High grade gold found at Otjikoto
Canadian mid-tier gold producer B2Gold has announced the discovery of high grade gold at the Wolfshag zone located near its 90% owned Otjikoto gold project.
Following the completion of the US$7 million 2013 drilling programme, B2Gold said an initial inferred resource estimate for the recently discovered Wolfshag zone stood at 6.8 million tonnes at 3.2 grams per tonne gold containing 703,000 ounces gold.
The Wolfshag zone occurs directly adjacent to the east and northeast portion of the planned Otjikoto deposit open pit which has an average grade of 1.42 grams per tonne of gold.
The new discovery by B2Gold is expected to help increase the economics of the project by potentially decreasing operating costs as a result of the increased average head grade. The initial high grade inferred resource estimate for the Wolfshag zone indicates the potential for future expansion of gold production as well as an increase in the 12-year mine life of the Otjikoto gold project.
With the completion of the initial inferred resource from the Wolfshag zone, B2Gold engineers are now expected to develop conceptual mine plans to determine when Wolfshag material could be fed to the Otjikoto mills.
B2gold said it will continue with its exploration programme in 2014, and an amount of US$8 million has already been budgeted for. The exploration drilling program will focus primarily on infill drilling on the northern portion of the Wolfshag zone to increase the drilling density to 50 x 25 metres, and will further test the extension of the Wolfshag zone to the South.
The company anticipates being in a position to upgrade the mineral resource classification to the indicated category by the end of 2014. The 2014 program will also include metallurgical and geo-technical test work for the Wolfshag zone.
B2Gold also announced that construction of the Otjikoto mine continues on schedule and on budget. The Otjikoto mine is scheduled to commence production in the fourth quarter of 2014. The current mine plan is based on probable open pit mineral reserves of 29.4 million tonnes at a grade of 1.42 g/t gold containing 1.34 million ounces of gold. The life of the mine, based on the probable reserves, is estimated to be 12 years, with annual forecast gold production of approximately 141,000 ounces gold per year for the first five years at an average operating cash cost of $524 per ounce of gold and for the life of mine approximately 112,000 ounces of gold per year at an average operating cash cost of $689 per ounce. Based on the positive drill results from the Wolfshag zone to date, B2Gold plans to expand the Otjikoto Mine in 2015, increasing ore throughput from 2.5 million tonnes per year to 3 million tonnes. The increased throughput will be achieved through the installation of a pebble crusher, additional leach tanks and mining equipment at a total cost of approximately $15 million. Once the expansion is completed at the end of 2015, annual gold production from the main Otjikoto pit alone would increase to approximately 170,000 ounces.