CANADIAN mining company, Goldsource Mines Inc., earlier this week announced that it has commenced preparatory construction activities for mining at its Eagle Mountain Gold Project near Mahdia, Region 8 (Potaro/Siparuni) and was working towards initial staged production by the end of this year.The Eagle Mountain project has an existing resource of 188,000 ounces, indicated, and 792,000, inferred, gold ounces, with strong potential for expansion, the company disclosed.
The local community of Mahdia is to be its primary source for skilled workers.
The officials have said that with gold price as low as $1,100 per ounce, the project is expected to remain quite profitable with an internal rate of return (IRR) of 49%.
The project is also projected to remain quite profitable with an IRR of 30%, even with an increase in operating costs of more than 30%.
Yannis Tsitos, President and Director of Goldsource Mines Inc. stated: “The commencement of construction activities at Eagle Mountain is a huge milestone for the company and we are very excited at the prospect of Goldsource becoming a low cost gold producer in 2015.”
He disclosed that this stage of the project is regarded as Phase I and has been fully financed.
He said: “The mine area is fully permitted for operations and mine site preparation and processing plant construction has begun.”
The Phase I development consists of a 1,000 tonnes per day open pit gravity plant for an eight year mine life with estimated pre-production capital costs of US$5.9 million and expected cash operating costs of US$480 per ounce of gold.
N. Eric Fier, Chief Operating Officer stated, “Our development plan for Phase I has started. We are excited about getting boots on the ground for construction as we expect to execute this work on time and on budget. With success of Phase I, we will look at several opportunities to optimise the mine for the benefit of our shareholders. Future expansions are intended to be paid for through operating cash flow.”
The company disclosed that it had purchased a 100 tonnes per hour processing plant from Sepro Mineral Systems Corp., Langley, Vancouver, British Columbia and construction of the said processing plant is currently being done and will be completed by the third quarter of the year ending September 2015.
Procurement of longer lead mining equipment is currently ongoing.
Rehabilitation of the existing 10 kilometre road between Mahdia Town and Eagle Mountain Gold is currently underway.
So also are camp facility rehabilitation and upgrades and recruitment of key operations personnel.
Site preparation of the plant and initial mining area is scheduled for completion by the second quarter of this year, leading to production by the end of the fourth quarter.
(By Clifford Stanley)