G Mining to acquire Brazilian gold project from BHP
G Mining Ventures Corp. [GMIN-TSXV, GMINF-OTCQB] said it has agreed to acquire the CentroGold project in Brazil’s prospective Gurupi Gold Belt from BHP Group Ltd. [BHP-NYSE, ASX, LSE, BHG-JSE].
In consideration for the assets, G Mining will grant BHP a 1.0% NSR royalty on the first one million ounces of gold produced at tenements that contain the asset and a 1.5% NSR royalty on gold production thereafter.
CentroGold is located in the state of Maranhao, in northern Brazil, and consists of 47 tenements covering 1,900 square kilometres. The project contains multiple identified gold targets along the over 80-kilometre mineralized trend, including the Blanket, Contact and Chega Tudo open pit deposits, which currently host 2.3 million ounces of JORC-compliant gold resources and remain open for expansion.
In July 2019, Oz Minerals Ltd., which was later acquired by BHP in 2023, released a pre-feasibility study on the Blanket and Contact deposits. The pre-feasibility study, envisioned a 10-year mine life with an average annual gold production of 100,000 to 120,000 ounces per year, with 190,000 to 120,000 ounces of gold annually in the first two years of production.
G Mining said it views the project as an advanced-stage exploration asset with extensive exploration and engineering work completed to date, including over 135,000 metres of exploration core drilling.
The company intends to build on CentroGold’s existing geological model and redesign the project from first principles to better fit today’s new permitting requirements and economic environment. Shortly after the transaction closes, G Mining plans to update the JORC-compliant gold resource to meet NI 43-101 standards of disclosure.
On Monday. G Mining shares rose 2.28% or 18 cents to $8.08. The shares are trading in a 52-week range of $10.83 and $4.36.
Meanwhile, the company remains focused on ramping up the 100%-owned its Tocantinzinho gold project in Para State, Brazil to nameplate capacity and advancing the Oko West Gold project in Guyana towards a construction decision in the second half of 2025.
G Mining recently received the operational licenses for Tocantinzinho. The licenses are the last remaining permitting milestone for commercial production.
The company also said the project remains on time and budget for commercial production in the second half of 2024.
Tocantinzinho is expected to be a low-cost, conventional open pit mining and milling operation.
A feasibility study announced in February, 2022, outlines total gold production of 1.8 million ounces of gold over 10.5 years, resulting in average annual production of 174,700 ounces with an all-in-sustaining cost per ounce of US$681 and an initial capital cost of US$458 million.
The mine plan is based on proven and probable reserves of 48.7 million tonnes at an average grade of 1.31 g/t gold or 2.04 million contained gold ounces as of December 10, 2021.