Dar es Salaam — Shanta gold miner revealed recently it has started construction work together with updated project economics for the Singida Gold Mining Project in central Tanzania.
Total capital investment of about $26 million has been committed on the project over a 24-month construction period, excluding pre-stripping. The company says the project is being funded from internally generated cash flow.
Contacted, the Commissioner for Minerals in the Ministry for Minerals, Mr Zephania Maduhu, told The Citizen that the project was still in the early stages.
"A team of experts is going to visit the project next week," he said. However, he noted that he could not say anything further since the project was still in the early stages. Earlier, Mr Eric Zurrin, the chief executive officer, was quoted as saying that the project would increase group production to over 110,000 oz per year while maintaining attractive cost base.
Singida is hosted in a green- stone deposit lending itself well to upside exploration potential. Future exploration will target the extension of reserves and will be funded by cash flow from produc- tion at Singida.
"The Singida project has very attractive economics for Shanta with considerable upside through potential conversion of mineral resources currently outside of the reserve-based mine plan," he said.
According to him, successful future exploration could justify an increase in the size of the plant to increase both throughout and production. He said Singida will have a major positive impact on the Ikungi area.
Shanta intends to roll out its well- regarded CSR program into the surrounding villages, which will lead to improvements in livelihoods, water, health and education."
The gold mine comprises three prospecting licences covering approximately 52km² and three mining licences covering 30km². Shanta Gold said that the mine is said to give the company a post- tax net present value (NPV) at 8 percent of $73 million.
According to the company, the internal rate of return (IRR) will be 59 percent at approximately $1,900 per ounce at the current gold spot price.
The Singida Project currently employees 60 people, whereby the number is expected to rise to 300 at steady state production.
"Shanta's corporate social responsibility programme will focus on improving economic livelihoods and education among others," he said.