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Study pegs US$671M value for B2Gold's Colombian JV with AngloGold


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Study pegs US$671M value for B2Gold's Colombian JV with AngloGold

An updated preliminary economic assessment on AngloGold Ashanti Ltd. and B2Gold Corp.'s Gramalote Ridge deposit, part of the Gramalote gold project in Colombia, generated a posttax net present value of US$671 million at a 5% discount rate, with an 18.1% internal rate of return and a 3.6-year payback period.

The study assumed a gold price of US$1,350 per ounce and gold production of 3.85 million ounces over an initial mine life of 13.6 years.

AngloGold and B2Gold each own a 50% stake in the proposed open pit mine, and B2Gold is the manager of the joint venture.

Average annual gold production is estimated at 416,600 ounces for the first five years of production. Average annual production over the mine's life is targeted at 283,990 ounces at cash operating costs of US$544/oz.

Average all-in sustaining costs are seen at US$648/oz, and average all-in costs, including preproduction capital costs, are expected at US$882/oz over the life of the mine.

Preproduction capital is expected at US$901 million, including about US$160 million for mining equipment.

The study also included a resource estimate. The overall project hosts 2.1 million ounces of gold contained within 78.2 million tonnes of indicated resources grading 0.85 g/t and 2.8 Moz of gold contained within 129.2 Mt of inferred resources grading 0.68 g/t. The resource update for Gramalote and Trinidad were reported with gold cutoff grades of 0.15 g/t for oxide and 0.20 g/t for sulfide.

Work is ongoing to optimize the PEA results, and a final feasibility study is expected by the end of the year, B2Gold said Jan. 21.

The company said it is also completing 42,500 meters of infill drilling at Gramalote Ridge to convert the inferred resources to the indicated category as well as 7,645 meters of geotechnical drilling for site infrastructure.