AMN - MALI: Moving towards Kobada construction

African Gold Group (AGG) is making significant progress as it rapidly moves on the Kobada Gold Project in southern Mali towards construction. A new definite feasibility study (DFS) will incorporate results of an additional expected 15,000 metres of diamond drilling and 3,000 metres of RC in-fill drilling.

This is being done to gain a better geological understanding of the main shear zone and additional highly prospective exploratory targets.

The project's 2016 feasibility study has a stated NI 43-101 compliant resource of 2.2 million ounces.

AGG has embarked on a process to upgrade the geological model and understanding of the ore body in order to double the annual production rate to 100,000 ounces.

In addition, AGG is carrying out extensive detailed metallurgical test work on representative samples to optimise the processing plant in terms of gold recoveries, capital expenditure and operating costs.

AGG's VP Exploration Dr Andreas Rompel said, "By carrying out the in-fill drilling program, which we expect to complete in early-December, we will have a comprehensive understanding of the geological structures and the mineralogy, the knowledge of which is paramount for the design of the process plant in order to treat every type of ore present at Kobada.

"The 30km of shear zones already identified at Kobada are largely untested and we see significant upside to the resource as we progress on the drilling program. In addition, all historical drilling indicates deeper resources below the current level of drilling.

"Our objective is to increase the resource through this and ongoing drilling campaigns to be able to develop a 100,000-ounce production operation."

The DFS will also deliver a processing plant and mine infrastructure design and detailed equipment lists, as well as an updated Environmental Impact Statement.

AGG's chief operating officer Danny Callow said, "This is an exciting time for Kobada as we move towards the construction phase. We have assembled a number of world-class experts to partner with us in engineering design, drilling, geological interpretation, assaying and construction.

"All of our partners have extensive experience in West Africa and in particular Mali and this will ensure that we have a solid foundation to build a world-class operation when construction begins.

"There is no doubt that there is huge upside potential in the gold resource yet to be drilled and this solid foundation will enable us to develop a modular approach to construction that will see an initial 50,000-ounce plant be constructed followed by an expansion to 100,000 ounces as the resource increases.

"With 30km of shear zones yet to be drilled there is no doubt we are sitting on a significant resource and I am looking forward to taking this project through the DFS and construction phase into full production."

Since the beginning of August, geological consultants Minxcon have mobilised to site to incorporate recent drilling and regional geological data into the model and review close to 30,000 metres of existing diamond drill core.

In addition, AMCO drilling contractors are mobilising to site to begin the next phase of drilling, and SGS, a world-class international assay laboratory, has been awarded the contract to fast-track the assays.

Overseeing this phase of the project is SENET, part of the international DRA Group. SENET is one of the most experienced EPCM companies operating in West Africa and has been involved in dozens of projects over the past 15 years in Mali and neighbouring countries.

Finally, as part of this initial phase, construction has restarted on the new camp at the Kobada site by EGTF, one of the largest Malian construction and mining companies. The expectation is that the new camp will be finished by December as AGG starts to build a permanent team on site to take the project through to the construction stage.

www.africangoldgroup.com