Tag Archives: Burkina Faso

West African picks Ausdrill’s AUMS for Sanbrado open-pit mining

Equipment maintenance, Mineral project development, Mining equipment, Mining services, Precious metals, , , , , , , ,

Ausdrill, through its wholly-owned subsidiary, African Mining Services (AMS), has been selected by West African Resources as the preferred open-pit mining contractor for the Sanbrado gold project, in Burkina Faso.

Sanbrado, a low-cost, high-grade operation only 90 km from the country’s capital, Ouagadougou, will be the 14th commercial gold mine in Burkina Faso in 14 years. It is forecast to have average annual production of 217,000 oz/y of gold at all-in sustaining costs of less than $600/oz in its first five years of mine life.

The AMS scope of work includes a full suite of open pit mining services – including site preparation, drill and blast, load and haul, and maintenance works – over a five-year term, generating approximately A$235 million ($160 million) in revenue under a schedule of rates contract, Ausdrill said.

AMS anticipates it will employ some 190 personnel at the project, with the workforce to be predominantly local, and use a mix of new and existing equipment to deliver on the project.

AMS and West African Resources are in the process of finalising the contract terms, which will include the provision of an optional deferred payment arrangement for up to $10 million at a commercial interest rate, with works expected to commence in early 2020. West African Resources said mobilisation activities were expected to commence in November, ahead of open-pit mining commencement in January 2020.

Ausdrill Group Managing Director, Mark Norwell, said: “A key focus for the new Ausdrill group has been to enhance our surface operations in Africa and target substantial growth opportunities across a range of commodities in select African countries.

“Being selected as preferred contractor at the Sanbrado gold project is a significant achievement and represents the excellent progress we are making in building on the suite of quality projects on which AMS operates in the region.”

West African Resources Managing Director, Richard Hyde, said: “Sanbrado is the highest margin gold project in construction in West Africa and we are on target for approximately 300,000 oz of gold in the first 12 months of production. We look forward to partnering with AMS to bring this fully funded project into production in mid-2020.”

West Africa investments about to pay off for Capital Drilling

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Capital Drilling’s push into West Africa will start paying off in the second half of the year, according to Executive Chairman, Jamie Boyton, with the contractor having sealed a number of drilling agreements in the region in the opening six months of 2019.

The company has progressively invested more resources in West Africa over the past few years, aiming to capture market share in a region where gold exploration is high.

The company recorded revenue of $54.7 million over the six-month period, a 0.4% year-on-year increase, while its average revenue per operating rig dropped to $183,000, compared with $200,000 in the first half of 2018, primarily due to new contract mobilisations. The group maintained guidance on anticipated revenues for the current financial year of $110-120 million, with revenue expected to increase in the second half of this year.

During the period, the company purchased an additional blasthole rig for the long-term contract at Centamin’s Sukari gold mine, in Egypt, as part of the group’s ongoing fleet management; made further progress in the establishment of its West Africa operations, with drilling commencing in Burkina Faso with Golden Rim Resources in May; and was awarded its first drilling contract in Nigeria with Thor Explorations Ltd, with drilling scheduled to commence in the December quarter.

The company also, in these six months, appointed Jodie North as Chief Operating Officer, increased business development resources, appointing Chris Hall to position of Business Development Manager, West Africa, maintained its ongoing rig improvement program and achieved a number of safety records at the likes of Sukari, North Mara (Tanzania), Geita (Tanzania), Tasiast (Mauritania) and Syama (Mali).

Boyton said: “The first half of the year was focused on further consolidating Capital Drilling’s presence in the highly active West African market, with a number of new contracts awarded, which will contribute to group revenues from the end of Q3 (September quarter). This strong push into this region has seen the commencement of our first drilling contract in Burkina Faso during Q2.

“Today we have also announced our expansion into Nigeria from Q4 (December quarter), a mineral rich, yet poorly explored country with significant potential, where we already operate a successful mineral analytics laboratory. Pleasingly, our major operations have also continued to achieve significant safety milestones throughout the first half.”

New contracts awarded during the first six months include:

  • Compass Gold Corp (Sikasso, Mali, pictured). Awarded a 10,000m exploration drilling contract, using one reverse circulation (RC) and one diamond rig from the existing fleet. Drilling commenced in June;
  • Golden Rim Resources (Kouri, Burkina Faso) (previously announced). Awarded a 20,000m exploration drilling contract using one multi-purpose rig from the existing fleet. Drilling commenced in May;
  • Allied Gold Corp (Bonikro, Côte d’Ivoire). Awarded a five-year exploration drilling contract, using one diamond rig and one RC rig from the existing fleet. Drilling is scheduled to commence in December quarter;
  • Thor Explorations Ltd (Segilola, Nigeria). Awarded a five-year exploration and grade control contract, using one RC rig from the existing fleet. This will transition to grade control in 2020, with exploration drilling scheduled to commence in the December quarter and grade control in H1 2020;
  • Kinross Gold Corp: (Tasiast, Mauritania): MSALABs was awarded a three-year onsite laboratory services contract with Kinross at the Tasiast gold mine. Operations commenced in July 2019, and;
  • Resolute Mining Ltd (Syama, Mali). Awarded one-year extension of the long-term underground grade control drilling contract using two underground rigs from the existing fleet. Contract extended to June 2020.

Avesoro and Orkun Group enter open-pit mining contract at Youga

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Avesoro Resources has made further headway on turning around operations at its Youga gold mine, in Burkina Faso, having entered into an open-pit mining contract with Orkun Group Sarl.

The mining program under the contract, secured by Avesoro’s Burkina Faso subsidaries, Burkina Mining Company SA (BMC) and Netiana Mining Company SA (NMC), is based on the excavation of between 800,000 to 900,000 bank cubic metres (bcm) of material per month, including a minimum of 120,000 t/mth of ore delivered to the run of mine (ROM) pad.

Youga, in the June quarter, saw production fall 19% quarter-on-quarter as falling grades and a stoppage in mining activities during June, which followed a transition to contractor mining, hit the operation.

Over the life of the Youga mine, the contract is based on the excavation of a minimum of 42 million bcm of material (Minimum TMM), which can be increased, at the company’s option, to 60 million bcm on the same terms. The contract price of excavation during this TMM period is $4.26/bcm (around $1.60/t) reducing to $3.75 per bcm thereafter (approximately $1.41 per tonne) for the remainder of the contract.

As part of the deal, Orkun will pay an earn-in fee of $0.51/bcm to acquire BMC’s existing heavy mining equipment fleet. The earn-in fee will be offset against the amounts invoiced by Orkun.

Upon completion of the Minimum TMM, ownership of BMC’s HME fleet will transfer to Orkun. However, Orkun assumes full responsibility for the ongoing upkeep and maintenance of the fleet from commencement of the contract, Avesoro confirmed.

“Orkun has also committed to supplement the existing HME fleet with $5 million of additional equipment at its own cost,” Avesoro said. This includes five excavators, 15 haul trucks and auxiliary equipment to ensure the contracted material movement is achieved. The first batch of this additional HME is due to arrive at Youga early in the September quarter.

BMC and NMC retain responsibility for mining geology, planning and certain other costs, Avesoro said.

Serhan Umurhan, Chief Executive Officer of Avesoro, said: “This contract will enable Avesoro to significantly reduce its future mining costs at Youga. Outsourcing the mining activity will also enable us to reduce our direct employee headcount and overall business complexity thereby reducing G&A costs.

“The responsibility for future fleet maintenance costs has also been transferred to Orkun, thereby significantly reducing the company’s 2019 funding shortfall that was announced on June 10, 2019.

“To achieve the material movement targets set out in the contract, Orkun will also supplement the existing Youga mining fleet…This should ensure a minimum of 120,000 t of ore is delivered to the ROM pad each month and that the Youga processing plant is maintained at full operating capacity.”

Avesoro enlists CSA Global for Youga gold mine turnaround

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Avesoro Resources says it is expecting a “material improvement” in grade and production at its Youga gold mine, in Burkina Faso, after implementing mining and grade control recommendations from consultant CSA Global to stem an output drop that saw production fall 19% quarter-on-quarter in the three months ending June 30.

The mine’s output was affected not only by falling grades in the June quarter, but also a stoppage in mining activities during June, which followed a transition to contractor mining.

In the three-month period, total material movement was 4.44 Mt, 7% lower than the previous quarter. Waste mined also dropped 6% in this period to 4.23 Mt, while ore mined decreased 27% to 214,000 t, resulting in a waste to ore stripping ratio of 19.8:1.

Avesoro said: “During the period, mining focused predominantly on the Gassore pit adjacent to the Youga process plant, where mined grades continued to be below forecast. Following a review of both grade control and mining practices, undertaken by CSA Global, the company made the decision to bolster its on-site technical team by hiring of additional technical staff to manage mining production and grade control.”

Serhan Umurhan, CEO of Avesoro, said he was confident the company would see a “material improvement in the situation as a result”.

Due to the temporary stoppage in mining activities in June, some emergency low-grade ore stockpiles were blended into the plant feed during June, reducing overall June quarter run of mill grade to 1.59 g/t Au, a quarter-on-quarter reduction of 23%. An increase in plant throughput of 4% to 332,000 t during the period helped to offset the grade impact, however gold production fell 19% to 15,516 oz.

Avesoro’s New Liberty gold mine, in Liberia, meanwhile saw production drop 27% to 18,822 oz in the quarter.

The company put this down to a number of staff in the mining and heavy mining equipment maintenance teams resigning during April, which led to a drop in mining productivity during this month and early May. Total material movement dropped, which had a knock-on effect to mine ore grade and mill feed grade.

Despite the company only recording 34,338 oz of gold production from the two mines in the quarter – bringing first half output to 79,435 oz – Avesoro reiterated its revised production guidance of 180,000-200,000 oz of gold for 2019.

Umurhan said: “With the operational aspects of the transition to contractor mining at both Youga and New Liberty now in place, I am confident that the challenges experienced during Q2 (June quarter) have been overcome and that total material movement and gold production will increase in the second half of the year.”

Transense iTrack II mining tyre monitoring system coming to Nordgold’s Bissa

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Transense Technologies’ Translogik division has won a contract, through its Ghana partner WATS (West African Tyre Services), to supply 41 iTrack II mining tyre monitoring systems for haul trucks at Nordgold’s Bissa mine in Burkina Faso.

These systems are to be supplied on a rental and service basis via WATS, a wholly-owned subsidiary of Rana Motors & Metal Works Engineering Co. Transense said: “This method allows mining companies to benefit from the productivity gains and overhead savings provided by using the system without any of the associated capital cost while providing Translogik with a recurring revenue stream.”

The iTrack II system provides fast, accurate, reliable real-time data on the condition of the tyres, combined with live tracking of vehicle location and status, according to Transense. “The company’s 24/7 control room monitors the pressures and temperatures live, and this information can, for example, be used to ensure tyres do not exceed critical heat thresholds, detect incorrect load distributions, predict suspension failures, eliminate manual tyre pressure checks and much more.”

All of these benefits increase health and safety as well as reducing maintenance and downtime, which maximises the hours a truck is working (on-road truck working hours), which directly correlates to an increase in production, according to Transense. Existing iTrack users have reported increases in tyre life of up to 30% and fuel savings of up to 3%, the company said.

Vibi Chandra, Director, Sales & Services Director, OTR Tyres, WATS, said: “The considerable advantages that Nordgold have seen at their sister mine, SOMITA (Taparko), where we installed iTrack in May 2018, have persuaded Nordgold to adopt the system at Bissa.

“As we have previously stated, West Africa is a region with dozens of mines and hundreds of haul trucks and it is our intention to introduce our new enhanced service, including iTrack, to our existing portfolio of mines as well as other mines across the region.”

Graham Storey, CEO of Transense, said: “We are very pleased to have added another Nordgold-owned mine in West Africa to our growing list of iTrack users. WATS are a well-established and highly regarded tyre service provider in West Africa and with their depth of contacts we are hopeful of an accelerated rate of adoption moving forward.”

Bissa, which was launched in January 2013, produced 195,700 oz of gold in 2017.

Teranga and Endeavour Mining on board with the World Gold Council

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The World Gold Council has welcomed Teranga Gold Corp and Endeavour Mining Corporation as its newest board members.

David Harquail (pictured), Chair of the market development organisation for the gold industry, said: “Both companies play an important role in the production and exploration of gold across West Africa and bring with them a wealth of experience that will be of significant value.”

Teranga is a Canada-based gold company focused on production and development as well as the exploration of approximately 6,000 km2 of land located on prospective gold belts across West Africa, according to the WGC.

Since its initial public offering in 2010, Teranga has produced more than 1.6 Moz of gold at its flagship operation in Senegal. Focused on diversification and growth, the company is advancing construction of its second producing gold mine, located in Burkina Faso, as well as carrying out exploration programmes in Côte d’Ivoire, Burkina Faso and Senegal.

Endeavour is an intermediate gold producer with a track record of operational excellence, project development and exploration in the Birimian greenstone belt in West Africa, WGC said.

Endeavour operates four mines across Côte d’Ivoire (Agbaou and Ity) and Burkina Faso (Houndé, Karma) which are expected to produce 615-695,000 oz in 2019 at an all-in sustaining cost of $760-810/oz.

Sébastien De Montessus, CEO and President of Endeavour, said: “We are very pleased to be joining the World Gold Council. We share the organisation’s belief in the importance of setting global standards to reinforce trust and transparency in the sector and across the whole value chain. We look forward to working with the council and its members to improve understanding of the gold industry.”

Richard Young, President and CEO, Teranga Gold, said: “For more than 30 years, the World Gold Council has supported greater understanding of gold’s enduring value and global influence. Today, at a time of both uncertainty and unprecedented opportunity, the work of organisations such as the World Gold Council is of paramount importance.”

Byrnecut wins underground mining contract at WAF’s Sanbrado gold project

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West African Resources has awarded the underground mining contract for the M1 South deposit at the Sanbrado gold project in Burkina Faso to Byrnecut.

The contract, worth $110 million over five years, is Byrnecut’s second in the West African country.

Mobilisation activities are expected to commence in December with portal establishment planned for March.

Works under the contract include underground portal establishment for M1 South, decline and level development of 7 km, ore driving of 2 km and 200,000 t, stope production of 1.3 Mt, and raise drilling and cemented rock backfill.

West African Managing Director Richard Hyde said: “The underground mining contract is a key operational contract for Sanbrado and its award follows the completion of a competitive tender process and extensive due diligence process examining safety, experience and capabilities.

“We are very pleased to award the underground mining contract to Byrnecut who have a long history providing underground mining services globally and have current operating experience in West Africa.”

Byrnecut Group Executive Chairman Steve Coughlan said: “We are looking forward to partnering with West African on the exciting Sanbrado gold project. This project will be our second site in Burkina Faso and fifth project we have operated in the West African region.”

The M1 South underground will kick-off WAF’s mining development at Sanbrado, with the underground development accessing high-grade, free-milling gold mineralisation located directly beneath the proposed M1 South open pit at approximately 120m vertical.

Concurrent mining of the M1 South open pit ore from surface and underground will accelerate cash-flow over the early years of the Sanbrado mine life, the company says.