Papillon Resources increases Fekola project gold Resource

/in /by

THE DRILL SERGEANT: Papillon Resources (ASX: PIR) has announced an update to the Mineral Resource Estimate (MRE) for the company’s Fekola project, located in south western Mali, adjacent to the border with Senegal.

The updated MRE has been estimated at 68.29 million tonnes averaging 2.35 grams per tonne gold for a contained 5.15 million ounces of gold at a lower cut-off grade of 1g/t gold, representing an increase of 22 per cent from the previous MRE of 4.21 million ounces gold released in January 2013.

The MRE comprises 60.01 million tonnes averaging 2.4g/t gold for a contained 4.64 million ounces of gold classified into the Measured and Indicated Resource categories, which represents approximately 90 per cent of the MRE.

The Inferred Resource consists of 8.3 million tonnes averaging 1.9g/t gold for a contained 0.5 million ounces of gold.

 

Source: Company announcement

 

“The updated Mineral Resource Estimate is another significant milestone for the Fekola project,” Papillon Resources managing director Mark Connelly said in the company’s announcement to the Australian Securities Exchange.

“The rapid growth of this deposit to over 5.15 million ounces of contained gold in less than 30 months highlights the world class potential of the deposit.

“The recent results from the PFS demonstrate its ability to support a large scale, long life, low cost operation.

“We believe that these fundamentals provide an excellent platform for future company growth as well as greatly enhancing Papillon’s ability to fulfil its strategic objective of becoming a West African gold producer in the near term.”

In June Papillon Resources released the results of its Pre-Feasibility Study for the project, the results of which determined average annual production in excess of 300,000 ounces over the Life of Mine, and operating costs (C1 cash costs) less than US$600 per ounce.

Papillon said the study had re-confirmed the technical viability of the project, and its ability to produce robust cash flows.

The updated MRE has resulted in a 33 per cent increase in the contained gold in the M&I Resource categories from what had previously been released in January 2013, which formed the basis of the PFS.

Papillon indicated the updated MRE will now be incorporated into a Definitive Feasibility Study, which the company expects to complete during 2014.