The Centamin PLC (LON: CEY) share price rose 4.8% after releasing the results of its pre-feasibility study (PFS) of its Doropo Gold Project located in north-eastern Côte d'Ivoire. The PFS revealed a Maiden Mineral Reserve Estimate of 1.87 million ounces of gold.
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The probable mineral reserves had an average grade of 1.44 grams per tonne of gold (g/t Au), supporting a 10-year life of mine (LOM). The Doropo mine is expected to produce an average of 173koz of gold annually over the LOM, with an average of 210koz in the first five years.
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The company expects to incur all-in-sustaining costs (AISC) of US$1,017 per ounce sold over the life of mine, with the first five years witnessing an AISC of US$963/oz. The firm intends to use conventional open-pit mining over shallow pits as its primary mine plan.
Investors cheered today’s announcement, which showed that the Doropo project in Côte d'Ivoire is economically viable and can help Centamin divest its reliance on the Sukari mine in Egypt, its sole revenue generator.
Centamin expects to spend US$349 million building out the mining plant, including a 10% contingency and expects to recoup its investment in 2.3 years once the mine is operational at an average gold price of US$1,600/oz.
The company intends to complete the definitive feasibility study (DFS) and environmental and social impact assessment (ESIA) in H1 2024, after which it could proceed to the construction stage.
Martin Horgan, Centamin’s CEO, commented: “The results from the Doropo PFS demonstrate an economically robust project that meets Centamin's hurdle rates to proceed with a definitive feasibility study. A life of mine average production rate of approximately 175kozpa at US$1,000/oz AISC over 10 years, delivering an IRR of 26% at a gold price of US$1,600/oz in a well-established mining jurisdiction, represents an excellent outcome. We have identified opportunities to further optimise the project, which will be assessed as part of the DFS, which is scheduled for completion in mid-2024.”
*This is not investment advice.
Centamin share price.
The Centamin share price rose 4.80% to trade at 95.760p, from Monday’s closing price of 91.375p.
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