Sabodala Gold Mine
Focused on Maximizing Free Cash Flow
The Sabodala Gold Mine that anchors Teranga's West African operations is located 650km east of the Senegalese capital, Dakar. Sabodala is situated within the West African Birimian geological gold belt in a region of Senegal that has only recently been opened for mining and exploration but already established itself as a significant gold camp with more than 10 million ounces discovered. The Sabodala gold project is the only large-scale, gold mine to come into operation in Senegal.
The first gold pour took place in March 2009. To date, over $700 million has been invested. The Company completed its plant expansion to double mill capacity in 2012. In early 2014, Teranga acquired its neighboring property the Oromin Joint Venture Group (“OJVG”). With the expansion and acquisition now complete, as a base case Teranga expects to increase average annual gold production to about 250,000 ounces at an average all-in sustaining cost of approximately $1,000 per ounce for about 10 years with a total reserve life of 16 years. This base case does not include any potential exploration discoveries on the Company’s prolific and large land package. Gold production for 2013 totaled 207,204 ounces and Teranga expects to produce between 220,000 to 240,000 gold ounces in 2014.
Through leveraging off of the Company’s existing mill and land package, its phase one vision sees annual production increasing to 250,000 – 350,000 ounces per year. A second phase of development could increase annual production to 400,000 – 500,000 ounces. This phase would require a second mill expansion.
Geology and Mineralization
The Sabodala Mining Concession and the surrounding exploration permits are located within the highly prospective Kedougou-Kenieba Inlier which forms part of the Paleoproterozoic age Birimian Terrane of the West African Craton. The permits straddle the volcanic-dominated Mako Supergroup in the west and the sediment-dominated Diale-Dalema Supergroup to the east.
The Mako and Diale-Dalema supracrustal sequences are intruded by a series of variably deformed granitoid intrusions. Lithologies in the region are affected mainly by lower green schist grade metamorphism. Northeast trending intermediate to felsic and later, post-tectonic mafic dykes are present throughout the region, the latter forming prominent linear magnetic features. Felsic and intermediate composition dykes are often spatially associated with shear zones hosting gold mineralization, and locally are host to significant gold mineralization themselves.
The Sabodala deposit is situated in the Mako Volcanic Belt. Locally the volcanics are intruded by subvolcanic dolerite and gabbro sills and dykes and also quartz feldspar porphyry and rhyolite dykes. Interflow sediments parallel the layering in the sequence. The Sabodala Shear Zone is approximately 2km wide and is identified by a subtle magnetic trend that extends through the 7km long permit and transects volcanic stratigraphy. The shear zone plays an integral part in the localization of gold mineralization.
The largest and best understood deposit in the Company's portfolio of properties is Sabodala due to its production status and size, so this deposit and controls on mineralization are well understood. Gold deposits on the adjacent OJVG properties are of similar style, and include primarily high grade shear vein systems and bulk tonnage, lower grade mineralization in carbonate altered ultramafic rocks along shear zones.
Mining and Processing
Mining of the Sabodala open pit is carried out by owner-operated conventional truck and shovel open pit mining.
The mine plan uses two cut-off grades for production assumptions. The higher cut-off grade is used to define material that can be treated economically in the plant at the time of production, whereas the material above the incremental cut-off grade will be mined and stockpiled and, depending on the economics of production at the time, will be treated at the end of the mine life.
The mining schedule is driven by balancing the truck hours required to deliver ore to the Run of Mine (“ROM”) pad and waste to the dumps annually in concert with the loading capacity. Ore in excess of process plant requirements is selectively stockpiled throughout the life of the operation.
To date, the ore treated by the Sabodala processing plant has been sourced exclusively from the Sabodala open pit which has been designed in phases. The Sabodala ore is a medium to hard silicified breccia with fine-grained gold, mainly associated with pyrite but also with a small amount of liberated gold present.
The gold is recovered in the 89%-92% range with an average grind of 80% passing 75μm. There is potential for additional recovery and performance improvement with installation of a gravity circuit. The gold extraction process uses a conventional carbon-in-leach (“CIL”) flowsheet. The major equipment comprises of two stage crushing with a primary jaw and secondary cone crushing system. This is followed by one SAG mill transferred into a return pebble crusher, sizer by cyclone and two ball mills. During the leaching process, the gold leaches into solution in leach tanks when in contact with cyanide, then absorbs onto the carbon to liberate gold from the ore before being captured with the activated carbon. After elution and electrolysis, the gold is recovered by fusion and poured into doré bars.
Since the completion of the mill expansion, the nominal capacity of the process plant is approximately 3.5 Mtpa of purely fresh ore and is expected to exceed 4.0 Mtpa with a blend of 75% fresh and 25% oxidized ore.
The Sabodala mine generates its own power which is sourced from a 30 MW heavy fuel oil power station with an additional reserve of a 6 MW unit. The mine has ample water supply drawn from two dams with a combined capacity of approximately 11 million cubic metres, which can also be supplemented if required from water sourced via a pipeline from the Faleme River.