15th Jul 2019 12:52
(Alliance News) - Shanta Gold Ltd could extend the life of the New Luika gold mine in Tanzania, it said Monday, after further drilling work.
Shanta, following drilling at Bauhinia Creek, has converted 126,787 ounces of inferred gold resource at a grade of 3.2 grams of gold per tonne of ore into 83,543 ounces of indicated resource, at a grade of 7.9 grams of gold per tonne.
This is a "suitable" level of confidence for those resources to now be included in a mine plan.
As a result, and with the fact more could be added, Shanta expects to extend the current life-of-mine of New Luika to "at least" 2025.
Shanta is to now look at converting further resources, of at least 220,300, into indicated resources at Bauhinia Creek as well as at surrounding deposits.
In the second half of 2019, Shanta is also planning on over 5,000 metres of exploration drilling at the Lupa goldfield nearby.
Chief Executive Eric Zurrin said: "Following the drilling of six holes costing the company USD164,000, we have replaced all of the depletion expected from 2019 gold production. This highlights the exceptional nature of the Bauhinia Creek orebody and the long-life potential of the high margin, New Luika gold mine."
"It is worth remembering that in 2012, New Luika gold mine's overall reserve based mine life was just 2.5 years and has grown incrementally since then despite production of approximately 80,000 ounces per year and limited exploration."
In the first quarter of 2019, Shanta produced 22,374 ounces of gold, 27% higher than the year prior. It has guided for 80,000 ounces to 84,000 ounces in 2019.
Shanta shares were 3.6% lower in London on Monday at 8.00 pence each.
Related Shares:
SHG.L