Perseus Mining (ASX,TSX:PRU) announced that that the ramp-up of operations at its Sissingu?(C) gold mine in northern Cote d'Ivoire has been completed ahead of schedule and the mine has now entered commercial production.
Sissingu?(C) is located southeast of the 7Moz Morila gold mine and northwest of the 4.3Moz Tongon deposit. It is estimated to produce 358,000 ounces over the 5-year life of mine, including 80,000 annually for the first three and a quarter years, and around 70,000 oz each year throughout its lifespan. The mine delivered its first crushed ore to the mill and processing plant in January.
In a press release issued today, Perseus said that mill throughput rates, gold recovery rates, grade reconciliation, and mining rates exceed the criteria that management had established to define 'commercial production.' This meant that Sissingu?(C) was cash flow positive by March 31, 2018.
According to the company, the capital cost of the development of the mine itself and its supporting infrastructure, excluding early works but including the cost of operations readiness initiatives, is forecast at $106.7 million, which is in line with its budget.
"We now have a second, high-quality cash flow stream that materially reduces our reliance on our Edikan Mine in Ghana for cash generation," said Jeff Quartermaine, the firm's CEO, in the media brief. "Cash flows from both operations will be deployed to partially fund the Yaour?(C) Gold Mine, our third planned operation, the development of which is scheduled to start later this year, now that Sissingu?(C) is successfully up and running," he added.
Yaour?(C) is located in the central region of the West African country and its estimated ore reserves sit at 26.8Mt at 1.76g/t containing 1.52 million ounces of gold. Perseus expects to produce 215,000oz per year during the first five years of operations.
The Australian company is also exploring three other prospects in C??te d'Ivoire, for now just mentioned as the Mbengu?(C), Mahal?(C) and Napi?(C) licences.
Analysts expect Cote d'Ivoire to become a power-hub in the next few years thanks to its revamped 2014 mining code and strong infrastructure development. A recent report by BMI Research forecasts a 15.6% growth for country's mining sector between 2017 and 2021.