After two testing initial quarters, Tietto Minerals’ Abujar gold mine in Côte d’Ivoire is starting to hit its straps with significant improvements revealed in both production and grade during the past month.
The company says unavoidable mining equipment delays are now in the rear-view mirror and it milled 1 gram per tonne gold giving 11,643 ounces in July alone. Management is adamant it is just the first of many good months to come and has forecast producing between 105,000 and 120,000 ounces of gold at an all-in sustaining cost of between US$875 (AU$1337) and US$975 (AU$1490) per ounce for the second half of the year.
Those numbers would suggest a tasty return given today’s gold price of about US$1937 (AU$2965). Of particular note is the fact that the company’s 2021 definitive feasibility study (DFS) for Abujar was based on a gold price of US$1700 (AU$2602) per ounce and produced an EBITDA of US$1522 million (AU$2330 million) over an 11-year mine life.
Tietto says its significant boost in ore grade of nearly 50 per cent, compared to the March quarter, is a result of the mining operation moving from pre-strip of the low-grade shallow oxide ore into the main gold pay zone. That zone was quoted in the DFS to contain a probable ore reserve of 34.4 million tonnes at 1.3g/t gold for 1.45 million ounces.
Management says delays in pre-strip and the removal of lower-grade overburden resulted in a slow start to the year’s production at Abujar, with the mill running on the low-grade shallow material up until last month. A major factor in the pre-strip delay was because 10 of the company’s 90-tonne dump trucks that were to play a critical role in removing the overburden, were held in African customs for three and half months.
Now that issue has been resolved and with mining in full swing and outperforming the plant, the company will stockpile any lower-grade material and feed the plant with high-grade paydirt as a priority.
We are pleased to report a strong increase in monthly production to 11,643 oz gold and stabilised milling rates of more than 370,000 tonnes per month. Mill feed is mainly comprised of fresh rock, and grade has increased by more than 50% from the June quarter average of 0.68g/t Au to 1.0g/t Au in July, as we have largely moved through oxide and transitional ore depleted by artisanal miners. We anticipate delivering strong net cash flow over the second half of 2023 as we optimise mining and milling after a solid start in July. Tietto Minerals managing director and chief executive officer Matt Wilcox
The company says its processing plant is outperforming its DFS rate of 4 million tonnes per annum, reaching an annualised rate of 4.4 million tonnes for the past month. It says the plant reached peak daily rates of 16,000 tonnes and is confident it will exceed nameplate capacity during the second half of the year.
Tietto completed grade control drilling during the June quarter, demonstrating that contained aggregate gold reconciled well, within 10 per cent of its resource block models. Further grade control drilling last month has enabled it to more accurately predict grade and likely production numbers for the second half of this year, boosting the company’s confidence in its production guidance.
Management celebrated its first Abujar gold pour on January 14 this year and recorded its first gold sales the following month. Its life of mine is estimated to be 11 years, but with its ongoing resource growth and significant unexplored strike extensions, the company is planning to reveal an extension to the operational period when it updates its production plan during this quarter.
It has also announced the appointment of Clinton Bennett as its new chief operating officer and says he brings a “world-class” West African gold mining background, including recent experience in Cote d’Ivoire, to the boardroom table.
So after the slow start to the year, Tietto is now through the pre-strip and feeding the mill with near DFS-grade pay. With the gold price and production rates outperforming the DFS, the year ahead could see the company winning over a new wave of believers and making headlines with its African gold story.
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