True Gold wins mining permit for Karma project in Burkina Faso

29 January 2014 (Last Updated January 29th, 2014 18:30)

True Gold Mining has been granted an exploitation permit for the development of the Karma Gold project in Burkina Faso, West Africa.

True Gold Mining has been granted an exploitation permit for the development of the Karma Gold project in Burkina Faso, West Africa.

The permit was issued to the company's Burkina Faso operating subsidiary, Riverstone Karma, by Burkina Faso's president.

The company will mine the pits with the highest-grade mineral reserves for a quick payback and strong cashflow from the outset.

"The Karma project [is] firmly on track to becoming Burkina Faso's next gold mine."

True Gold president and CEO Dwayne Melrose said the company is well-positioned with a permitted, feasible gold project that shows excellent economics at $1,250 gold and resilience at considerably lower prices.

"This, coupled with a proven in-house mine-building and operations team, keeps the Karma project firmly on track to becoming Burkina Faso's next gold mine," Melrose said.

The first gold pour is expected at the end of 2015, with pre-stripping commencing 12 months prior.

True Gold continues to advance the Karma project towards mine financing and is preparing for construction.

Earlier this month, True Gold Mining was granted an environmental permit by the Burkina Faso Ministry of Environment and Sustainable Development, for the development of the Kao deposit at its Karma Gold project.

With a capacity to process four million tonnes per annum, the mine is expected to produce an average of 97,000oz of gold per year over eight and a half years, with direct cash operating costs of about $591 per ounce.

True Gold has appointed Barclays Bank and Société Genérale as lead arrangers for the Karma project bank debt financing in December.

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