Roxgold rallies on new West Africa estimate

The Séguéla Gold Project is located in Côte d’Ivoire and was acquired by Roxgold in April 2019 as part of a portfolio comprised of 11 regional exploration permits. The total land package is approximately 3,298km2 including the advanced exploration Séguéla gold project that hosts the near surface Antenna gold deposit, which was discovered in 2016. Source: Roxgold Inc.

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Roxgold Inc. [ROXG-TSX; ROGFF-OTCQX] on Wednesday January 28 released an updated mineral resource estimate for its Seguela gold project in Côte D’Ivoire, West Africa.

The company said total Indicated Mineral Resources are up 7% to 529,000 ounces, while Inferred Resources have jumped 1,286% to 471,000 ounces in comparison to the maiden resource, which was announced on July, 2019.

Wednesday’s update compares to a maiden estimate of 496,000 ounces of Indicated material, at a grade of 2.4 g/t gold. On top of that was an estimated Inferred Resource of 34,000 ounces, also at 2.4 g/t, material that is contained in the Antenna deposit.

The new NI 43-101-compliant estimate is based on 18,693 metres of reverse circulation and diamond core drilling completed since the Seguela Project was acquired in April, 2019, the company said. The project was part of a portfolio consisting of 11 regional exploration permits and covers 3,298 km2.

Seguela is located approximately 480 km northwest of Abidjan, the commercial capital of Côte d’Ivoire.

The drill program prioritized the delineation and definition of maiden resource estimates at the Ancien, Agouti, and Boulder satellite deposits, and infilling of the Antenna deposit.

The company said it is working towards the completion of a preliminary economic assessment study for Seguela. Mine planning, metallurgical testwork, plant design and infrastructure pricing activities are underway.

The company anticipates being in a position to release the preliminary economic assessment on this basis by the second quarter of 2020.

Roxgold shares advanced on the news, rising 10.6% or $0.09 to 94 cents on volume of 500,087. The shares are currently trading in a 52-week range of 80 cents and $1.42.

Roxgold’s key asset is the high-grade Yaramoko gold mine located in the province of Bale in southwestern Burkina Faso, about 200 km southwest of Ouagadougou. Yaramoko lies directly south of, and is contiguous to, the SEMAFO Inc. property hosting the flagship Mana gold mine, and lies within the Houndé greenstone belt. The company declared commercial production in October 1, 2016.

After completing a feasibility study in 2014, Roxgold has developed a significant high-grade gold discovery at Yaramoko’s 55 Zone, which is expected to produce 652,000 ounces over the next seven years, at a life-of-mine average of 11.5 g/t gold.

Roxgold has also outlined an Inferred Resource of 220,000 ounces gold in the Bagassi South Zone, a satellite discovery, located 1.8 km south of Zone 55.

Roxgold produced 142,204 ounces of gold in 2019, enabling the company to generate over US$47 million in free cash flow during the second half of the year.

While continuing to advance the Seguela Project, Roxgold has said Yaramoko is expected to produce between 120,000 and 130,000 ounces of gold in 2020 at an all-in-sustaining cost of US$930 to US$990 per ounce.

Gold production at Yaramoko for 2021 and 2022 is anticipated at between 120,000 and 130,000 ounces with the all-in-sustaining cost falling to US$750 to US$850 an ounce. The estimated decrease in costs is attributable to lower spending on underground development.

At Bagassi South, 42,807 tonnes of ore was mined at 5.5 g/t in 2019.

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