West African Resources holds a 100% interest in the Sanbrado Gold Project in Burkina Faso, which hosts Probable Reserves of 894,000oz (16.8Mt at 1.7g/t gold) and Indicated Resources of 1.3Moz gold (29.57Mt at 1.4g/t gold using a 0.5g/t cut-off).
A Definitive Feasibility Study for Sanbrado released in February 2017 confirmed:
- Forecast annual production of 150,000 ounces of gold over the first three years of the project and 93,000oz gold per year over the current nine-year mine life
- Low All-In Sustaining Costs of US$708/oz over the first 3 years and US$759/oz over Life of Mine
- Strong economics – pre-tax NPV5% of $143m, IRR 27% and post-tax NPV5% of $100m, IRR 21%
- Mining and environmental permits approved.
Following excellent drilling results since feasibility study completion, including 0.5m at 1,613.41 g/t Au and 0.5m at 530.38 g/t Au at M1 South, WAF will focus on targeted drilling aimed at maximising the project NPV.
A Mineral Resource Estimate (MRE) for the M1 South and M5 deposits released in October 2017 confirmed:
- 150% increase of Indicated Resource ounces and 100% increase in Indicated Resource grade at M1 South deposit
- 40% increase in Indicated Resources, 7% increase in grade at the M5 deposit
- Ramp up to six rigs and full exploration drilling during November
- Funding to complete all work programs with $26m cash at bank
A further resource update is expected in Q1 2018, ahead of the completion of an updated Feasibility Study in mid-2018.
Once complete, WAF will analyse development scenarios, leading to a revised open-pit and underground feasibility study and project finance proposals in H1 2018.
Tenure & Permitting
In December 2016, the Burkina Faso Ministry of the Environment, Green Economy and Climate Change approved the ESIA for the Project.
In January 2017, the government of Burkina Faso Council of Ministers approved the Sanbrado Mining Permit application, which covers an area of 26km². The Manesse Exploration Licence was also granted, which covers the residual area of the former Tanlouka Exploration Licence.
A Resettlement Action Plan (RAP) and the Environmental and Social Impact Assessment (ESIA) were approved in the September 2016 quarter by Burkina Faso’s Ministry of Environment, Green Economy and Climate Change.
Sanbrado is located within a northeast-trending volcano-sedimentary belt that is bounded to the east by the Tiébélé-Dori-Markoye Fault, one of the two major structures subdividing Burkina Faso into three litho-tectonic domains. The Sanbrado deposit is associated with the Lower Proterozoic system of the Birimian (2.17-2.18 billion years) comprising metavolcanic (arc) and metasedimentary (basin) rocks.
Gold mineralisation in the project area is associated with quartz vein and veinlet arrays, silica, sulphide and carbonate-albite, tourmaline-biotite alteration. Gold is free and is mainly associated with minor pyrite, chalcopyrite and arsenopyrite disseminations and stringers.
Known mineralisation at M1 extends along strike for approximately 1km, is up to 50m wide and 300m in depth. The M5 mineralisation extends along strike for approximately 3km, is up to 100m wide and 300m in depth. The M3 mineralisation extends along strike for 750m, is up to 50m wide and 75m in depth. Mineralisation at all deposits remains open at depth.
|Sanbrado Gold Project October 2017 Resource|
|Cutoff (Au g/t)||Indicated Resource||Inferred Resource|
|Tonnes||Grade (Au g/t)||Au Oz||Tonnes||Grade (Au g/t)||Au Oz|
*No change have been made to the M1 North and M3 Mineral Resources since the February 2017 estimates. Totals may not add up correctly due to rounding.
|Sanbrado Gold Project Probable Ore Reserves|
Information in this announcement that relates to exploration results, exploration targets or mineral resources is based on, and fairly represents, information and supporting documentation prepared by Mr Brian Wolfe, an independent consultant specialising in mineral resource estimation, evaluation and exploration. Mr Wolfe is a Member of the Australian Institute of Geoscientists. Mr Wolfe has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person (or “CP”) as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) and a Qualified Person under Canadian National Instrument 43-101. Mr Wolfe has reviewed the contents of this news release dated 20 February 2017 and consents to the inclusion in the announcement of all technical statements based on his information in the form and context in which they appear.