Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Xtract Resources signs deal for alluvial gold production at Manica

Xtract has signed a joint venture to produce an additional 32,000 ounces of gold per year
Xtract Resources signs deal for alluvial gold production at Manica
First gold is expected in six months

Xtract Resources (LON:XTR) has signed a joint venture with a company called Mineral Technologies International to mine alluvial gold at the Manica project in Mozambique.

Xtract is currently preparing a bankable feasibility study for a larger open pit mine at Manica, and the new project will have the added benefit of removing significant overburden.

Nevertheless, Xtract will treat the alluvial project as a separate undertaking.

The plan is to mine 32,000 ounces per year of which 16,000 will be attributable to Xtract under the terms of the joint venture.

Start-up costs, estimated at US$1.2mln for the plant plus transport costs, will be wholly borne by MTI, while Xtract will assume operating costs once the plant is on site.

Internal estimates set the net present value of the alluvial operation at US$97mln and show that it will deliver an internal rate of return of 68%.

Operating costs are estimated to be US$203 per ounce, so there ought to be plenty of margin on offer, given that the current gold price is pushing on towards US$1,200 at the moment.

The plan is to get the project into production within six months.

 

View full XTR profile View Profile

Xtract Resources PLC Timeline

Related Articles

St George drills up nickel
October 08 2018
The company is addressing UK investors this week and Australian nickel market players later this month.
Workers underground at Prieska
October 25 2018
The company hopes to drill and define satellite deposits near the old mine.
map of australia with project locations marked
October 09 2018
The East Pilbara projects are prospective for conglomerate-hosted gold.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use