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TIETTO M
Entering the final sta West Africa’s n
MINERALS
ages in the development of next major gold mine
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At the start of April 2021, gold exploration and development firm Tietto Minerals published a highly anticipated pre-feasibility study (PFS) for its flagship Abujar Gold Project in Côte d’Ivoire, to the delight of its legion investors who have been following Tietto’s progress since its listing on the ASX in January 2018. “I think the general market is always quite cautious when your PFS results come out, but our shareholders were extremely happy with the outcomes of the PFS, particularly with the robust economics,” Tietto’s managing director Caigen Wang tells RGN. The study revealed a 3.5 million tonnes per annum (Mtpa) open pit operation, producing 200,000 ounces of gold in the first year and an average 168,000 ounces over the first six years of the project, based on a maiden probable reserve of 15.7 Mt at 1.7 g/t gold for 860,000 ounces within the life of mine inventory of 1.1Moz in the base case scenario. The economics, which were perceived so favourably by Tietto’s investors, included a post-tax NPV (5%) of US$266 million and an IRR of 42%, based on an average gold price of $1,506 per ounce – significantly lower than the current spot of around $1,900 per ounce. The PFS resembled one of the most significant pieces of news flow released by the company since it first applied for an exploration licence at Abujar back in 2014. The milestone study also begins a ~two-year countdown to first commercial production at what will be West Africa’s next major gold mine.
MANAGING DIRECTOR CAIGEN WANG (RIGHT) AND ABUJAR ON-SITE MANAGEMEN
A key outcome of the PFS
Abujar will be mined via open
was its ability to demonstrate
pit – with 100% of the total
a simple, low-cost mining
ore reserve amenable to open
operation at all-in sustaining
pit mining in the base case
costs (AISC) of $839 per ounce.
scenario.
Crucially, for the first six years of the current 10-year mine life,
MINING | TIETTO MINERALS
NT TEAM
The open pit scenario is one
a simple carbon in-leaching
it’s easy to crush and grind
contributing factor to the low
(CIL) method at a course
the ore and average energy
AISC at Abujar; another is
grind particle size of 180µm to
requirements of fresh ore are
the high gold recovery levels
106µm.
lower than the vast majority
on the ore processing side.
of gold projects operating in
Laboratory results have shown
“Our gold is very easy to
recovery rates of 96-98% via
recover. The test results show
West Africa. That shows that
the processing side is not only simple, it’s also cheap,” Wang asserts.
World-class gold jurisdiction The low-cost nature of the project ultimately stems from its location in the Ivorian segment of the Birimian greenstone belt snaking across West Africa, where gold operations regularly fall into the lowest global AISC quartile.
T IE T TO MIN E RALS
AT A G L A N C E
STOCK TICKER: ASX:TIE MARKET CAPITALISATION: US$157 million (as of May 26, 2021) aj
MINING | TIETTO MINERALS
Côte d’Ivoire encompasses the largest section of the Birimian (covering 34% of the total mineralised belt) and produced 32.6 tonnes of gold from five mines in 2019, with the latest addition being Perseus Mining’s 3.8 million ounce (Moz) Yaouré Gold Mine in central Côte d’Ivoire, which was commissioned at the end of 2020 and is similarly sized to the Abujar project.
“Our expectation is that all resources currently in the inferred category, including the expanded case, will be drilled and upgraded to indicated category. Following the DFS, we’re expecting to have a reserve of around 1.4 Moz just like what was indicated in the expanded case, if not more” Caigen Wang, Tietto Minerals managing director and founder
Aside from the strong
friendly hydroelectricity,
based generators to provide
geological potential
which is not only cheap but a
energy.”
available to Tietto and fellow
stable source of power for the
exploration miners, the
nation’s industrial operations.
country offers favourable fiscal
Wang is also quick to point out that Côte d’Ivoire is a nation
terms and strong government
“Every existing modern
of bitumen roads, including in
support, alongside a network
mining operation in-country
the Abujar region. The project
of infrastructure that is
operates on grid power. In
is well served by bitumen
unrivalled in the region.
our location in central-West
roads which run through the
Côte d’Ivoire, electricity costs
middle of Tietto’s 1,114 km2
In terms of energy, a
for domestic use are 12 cents
exploration licence and along
significant chunk of Côte
US per unit. That’s actually
of the edge of its 120.36 km2
d’Ivoire’s grid power is
very cheap compared with
mining licence. The only
supplied by environmentally-
other mines operating in West
infrastructural development
Africa, where they often use
required is the upgrade of an
expensive and polluting diesel-
18 km site access road, which
MINING | TIETTO MINERALS
ECG Engineering – Proudly partnering Tietto Minerals
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13/5/21 8:35 am
has already commenced and a
“The work in our PFS on the
optimisation of the production
90kV connector to Daloa.
processing plant side has been
profile at Abujar. The mill
done very much to definitive
is slightly larger than the
feasibility study (DFS) level
capacity used in the PFS,
and Mintrex has actually
which means Tietto won’t have
The PFS estimates that a
been working towards the
to do as much pre-production
$230 million capex will be
DFS from the beginning, so
mining.
required to build the mine
the contingency numbers are
– a conservative figure that
going to be reduced when we
“Now we will be able to
includes $35 million in pre-
reach the definitive stage very
maintain a bigger gold
production mining and
soon.”
production profile,” Wang says.
Lowering the capex
contingency which may not be
“The SAG mill is going to save
necessarily used in the Abujar
In addition, the recent
$3.5 million in capex alone
mine construction, according
procurement of a 4 Mtpa
compared to the PFS estimate.
to Tietto’s managing director.
SAG mill will further reduce
These [aforementioned] things
the capex bill through
are likely to deliver a sizeable reduction in the total capex requirement as well.”
Delivering the DFS The Abujar DFS is scheduled for Q3 of 2021 and will contain upgraded figures on the current 3.02 Moz resource which came out in October last year, based on more than 53,000 metres of mostly infill (and some extensional) drilling across the existing resource on the middle tenement at the project. The infill drilling has focused on adding confidence in the inferred resources that were identified in a scoping study for an expanded project at Abujar. The expansion plan has the potential to deliver increases in NPV, IRR and mine life, with gold production growing to 1.4 Moz of gold recovered over 12 years of operation in the expanded scenario.
MINING | TIETTO MINERALS
“Our expectation is that all resources currently in the inferred category, including the expanded case, will be drilled and upgraded to the indicated category, which means we have an opportunity to add this part of the resource to the reserve. Following the DFS, we’re expecting to have a reserve of around 1.4 Moz if not more,” says a confident Wang. After publication of the DFS, Tietto plans to complete a debt facility, mobilise contractors and begin major construction works in the final quarter of the year. While this timeline puts the company soaring towards first gold and commercial production in Q4 2022, the story doesn’t end there at Abujar. As Tietto always reminds its investors, the current Abujar resource comes from a very small portion of the overall 70 km mineralised strike length, with less than 10% of the project tenements explored
and multiple mineralised
“This puts us in a very
at Abujar: Building and
structures existing in parallel
strong position to continue
operating the gold mine, as
to the strike of the current
expanding our resource base
well as continuous drilling
resources.
while we focus on the mine
to expand the resource base.
development at the same time.
The transition from being
“Most of these targets are yet
With new resources to be
100% exploration-focused to
to be drill tested. That gives us
defined, there is clear upside
a gold producing company is
big potential to increase our
beyond the initial mine life of
evidenced by recent additions
resource base and with our
around 10 years.”
to the executive team, such as
own drilling capacity of six
COO Matt Wilcox in February
are able to drill around 11,000
Personnel for the transition
metres of diamond holes per
As alluded to by Wang,
Tietto’s new COO brings
month.
Tietto is now preparing
huge experience in building
itself to work on two fronts
modern gold mines, with
sets of diamond drill rigs; we
2021.
MINING | TIETTO MINERALS
the latest being the 2.6 Mtpa
mine construction manager,
Yao Nkanza and our geological
Sanbrado mine for West
commercial manager and
team, led by Yaya Ouattara
African Resources in Burkina
health and safety manager.
and Rock Seouvo. They
Faso, which was delivered
are so capable and reliable
under-budget and under-
“I believe that people are
people working at extreme
schedule. Gradually, more
the most critical asset of any
efficiencies. We are really
members of Wilcox’s team will
company. On that note, I would
proud of them and thank them
be joining Tietto, including
like to flag our appreciation
very much,” Wang concludes.
his earthmover manager,
of the in-country team, led by our country manager Fred
Published by Anderson Murray Media Ltd
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