B2Gold ups resource estimate for West Africa mine

B2Gold Corp. [BTO-TSX, BTG-NYSE] on Thursday announced a better-than-expected resource estimate  for its Fekola mine in Mali, West Africa. The Vancouver company also released positive results from a mill expansion study at the Fekola mine.

The increased mineral resource and the positive results, to date, from the Fekola mill expansion study indicate the potential for an increase in mill throughput tonnage and an increase in the annual gold production at the site with moderate capital expenditure, the company said in a press release.

Based in Vancouver, B2 Gold is a senior gold producer with five operating mines and numerous exploration and development projects in various countries, including Nicaragua, the Philippines, Namibia, Mali, Burkina Faso, Colombia and Finland.

Its roster of producing mines includes the Fekola mine in Mali, West Africa, the Masbate mine in the Philippines, the Otjikoto mine in Namibia. The company also has two mines in Nicaragua. They are the La Libertad and El Limon mines.

The Fekola Mine is located in southwest Mali, on the border between Mali and Senegal, approximately 500 kilometres west of the capital city of Barnako. The first gold pour at the mine occurred in October, 2017. Commercial production was achieved a month later.

B2Gold said the measured and indicated resource at Fekola now stands at 5.73 million ounces gold at 1.92 g/t gold, up from a previous estimate of 3.94 million ounces at 2.08 g/t, marking an increase of 1.8 million ounces.

Scotiabank said in a note to investors that it anticipated an increase of one million ounces.

The new estimate is based on 192,000 metres of exploration drilling in 928 holes (including 70,877 metres in 294 holes drilled by B2Gold since June, 2014.

B2Gold continues to work on an updated mine plan that will consider a mill expansion to 7.5 million tonnes per annum, up from 5.5 million tonnes now to boost production.  The results of the study are expected to be released in the fourth quarter of 2018, likely before the company’s Investor Day on November 29, 2018.

With the first full year of production from the large new Fekola Mine, B2Gold said it is achieving transformational growth in 2018. Consolidated gold production is forecast to be between 920,000 and 960,000 ounces, representing an increase in annual consolidated gold production of approximately 300,000 ounces in 2018 versus 2017.

Based on current assumptions, in 2018, consolidated cash operating costs are projected at between US$505 and US$550 an ounce. Consolidated all-in sustaining costs are projected at between US$780 and US$830 an ounce. Gold was trading Thursday at US$1,229.40.

On Thursday, B2Gold shares eased 4.79% or 17 cents to $2.38 on volume of 2.6 million. The 52-week range is $4.06 and $2.77.