Shanta Gold Limited (LON:SHG) has reached another milestone - kicking off its underground project at the New Luika gold mine after receiving all necessary approvals.
Development to begin mining at the underground project has now started in Tanzania, the firm told investors.
Chief executive Toby Bradbury said: "The start of the underground development is a major milestone for New Luika as it provides on-going long term access to high grade resources in the Bauhinia Creek and Luika deposits for at least the next five years.
"We are particularly grateful for the constructive and timely assistance of the Tanzanian authorities in the processing of the company's permits."
Meanwhile current production at New Luika, operating and capital costs remain on target.
New Luika produced just under 81,900 ounces of gold in 2015 and all–in costs for the year were a very competitive US$845 per ounce.
But they are set to go lower still in the current year. Shanta is predicting output will rise up to a possible 87,000 ounces this year with costs to fall to between US$750-800.
Pit reserves in the last estimate in September totalled 177,000oz.
Shanta has instigated a five-year plan to boost these and extend the mine life through a combination of going underground below the existing open pits and exploration of the surrounding deposits.
Read more about Shanta Gold's plans in our Big Picture article here.