Centamin (LSE:CEY) rose 2.9pc to 122.4p on Friday after announcing a considerable resource increase at its gold assets in the Côte d'Ivoire. The firm completed 120,000m of drilling in the country last year to produce a maiden resource at its ABC project and an updated resource at its Doropo site. A further 90,000m of drilling is budgeted and underway for 2019 to build on these results.
The work revealed a 2.13Moz indicated and 0.8Moz inferred mineral resource within Doropo at a gold cut-off of 0.5g/t. Within this, 50MMts at 1.31g/t has been identified in the indicated category, representing a 55pc increase in resource tonnes year-on-year.
Centamin added that total Doropo licence holdings of 2,721km2 remain mostly unexplored, with numerous targets identified. It believes this could present significant resource upside potential.
Meanwhile, the company has budgeted a 55,000m drill programme at the site for 2019. It expects to develop immediate resource extensions and evaluate the resource significance of several regional Doropo targets. Finally, a preliminary economic assessment remains on track at the site and is on schedule for completion by H2 2019. Alongside this, a maiden mineral estimation is targeted by Q2 2019 to support the next stage of feasibility work ahead of a board investment decision on development.
Moving on from Doropo, last year’s drilling also revealed a maiden resource estimate of 19.6MM ore tonnes at 1.03g/t gold in the indicated category at the ABC project. This translates to around 650Koz of gold. The work also identified 16.1MM ore tonnes at 0.87g/t in the inferred category for around 450Koz of gold.
According to Centamin, the mineral resource area is defined from the surface, along a 2.3 km strike, and remains open in all directions. Detailed 3D grade modelling indicates there are high-grade plunging shoots within the 50m x 50m broad-spaced drilling.
A 34,000m drill programme is now scheduled for 2019 with a focus on resource development at two prospects called Kona Central and Kona South. The work will test the resource extension potential between the two candidates, drill testing high priority targets along the LGC in addition to airborne magnetic/radiometric surveying and geochemical sampling.
Centamin’s chief executive Andrew Pardey said: ‘2018 saw a further increase in our investment and level of activity in CDI across our 3,472km² land holding. We have only scratched the surface of the potential of these assets, and we are maintaining an intensive campaign in 2019 to define further quality gold ounces.
‘Doropo continues to demonstrate the potential to be our next organic development project. Ongoing exploration and concurrent viability studies will further unlock the potential future scale of this project as we assess the economics against our internal project value creation criteria. The PEA is progressing well and we look forward to reporting the results to the market at the end of H2 2019. Delivery of a maiden reserve and further feasibility work are critical milestones for 2019, ahead of a Board decision on capital allocated for development.
‘The success and scale of the 2018 ABC discovery results and the reporting of the maiden Kona South resource in less than two years of active exploration, highlights the scale and quality of the Lolosso Gold Corridor and the regional generative potential of the ABC land package.
‘Centamin's core strategy remains on delivering returns using its highly cash generative business which not only delivers a high yield for its shareholders as per our sustainable dividend policy, but also delivering fully funded growth from our exciting exploration portfolio.’
Author: Daniel Flynn
The Author does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the piece.
Catalyst Information Services Ltd, the owner of MiningMaven.com, does not own a position in the stock(s) and/or financial instrument(s) mentioned in the piece.
Catalyst Information Services Ltd, the owner of MiningMaven.com, has not been paid for the production of this piece by the company or companies mentioned above.
MiningMaven.com and Catalyst Information Services Ltd are not responsible for its content or accuracy and do not share the views of the author. News and research are not recommendations to deal, and investments may fall in value so that you could lose some or all of your investment. Past performance is not an indicator of future performance.