South African mining firm Gold Fields Limited has announced a reinvestment plan for the Damang Gold mine in Ghana that would extend the operating life by eight years.
According to the plan, Gold Fields has decided to invest $1.4bn over the life of mine that would be extended from 2017 to 2024.
The investment would fortify the company’s presence in one of its key operating regions. It will also lead to creation of 1,850 direct jobs.
During the mine life, a total of 165 million tonnes (Mt) will be mined, with 32Mt processed at a grade of 1.65g/t, resulting in total gold production of 1.56 million ounces (Moz).
Mining and processing costs are estimated at $3.60/t and $16.25/t respectively. The all-in costs (AIC) is projected to be average $950/oz.
The company claimed that the development agreement it signed with the Government of Ghana in March has provided essential inputs to the plan and economics of the project.
The reinvestment plan is based on extensive reviews conducted by external and internal consultants, namely SRK, Optiro and Rowley Geological Services (RGS).
Mining operations at Damang Gold mine started in 1997 and has produced in excess of 4.0Moz from multiple open-pits.
Production from this mine was halted in 2013, with mining having them focused on the margins of the Damang pit (the Huni, Juno and Saddle areas), including the lower grade satellite deposits.
A strategic review of Damang was conducted in 2015 that stated Gold Fields should return to mining the higher grade core of the main Damang orebody.
Evaluation work in 2015 and 2016 considered a number of options that included care and maintenance (C&M), closure, continuing operations or expanding operations. Due to the importance of the region to the group and taking into account the benefits of the development agreement, Gold Fields has taken the decision to continue operations at Damang through the reinvestment plan.
The group also retains the option to expand the operation if the gold prices improve and settle above $1,400/oz.