Nyota Minerals (LON:NYO, ASX:NYO ) hailed the progress made at its flagship Tulu Kapi gold project in Ethiopia in the second half of 2011, which culminated in a resource upgrade announced in March.
The period saw extensive drilling at Tulu Kapi alongside step-out targets, which provided positive infill results and identified new areas of mineralisation within the project’s extension areas.
Post-period end, Nyota increased the Tulu Kapi indicated resource by 82 percent to 0.8 million ounces (Moz) at a grade of 3.01 grammes per tonne (g/t). The total Tulu Kapi resource currently amounts to 1.67 Moz at 2.9 g/t gold.
The substantial increase in the resource reflected an increased understanding of the geology and structure at the deposit following its latest drill programme, said Nyota.
The estimate incorporated assay results up to the end of January; data received after that will be included in another resource estimate, which Nyota expects to release this year.
Importantly, the company has made considerable progress with the Tulu Kapi definitive feasibility study (DFS), which remains on track to complete in the third quarter of 2012.
Mine and processing plant design will be based on a two million tonnes per annum gold mine, a format frequently built across Africa.
The company is currently in talks with the Ethiopian Ministry of Mines regarding a large scale mining license, which are expected to conclude in the second half of the year.
In the meantime, Nyota has identified three drill-ready targets within the Northern Block regional exploration licences, which it said supported its belief that these licences “contain significant value for future standalone projects”.
Drilling kicked off at the first of the targets in February, while exploration on the balance of 40 targets is now underway and is expected to continue until June, 2012, the approximate start of the next rainy season.
In the interim report, the company also highlighted the recent placing to raise £10 million. The fundraising effort was supported by FTSE 250 gold group Centamin (LON:CEY), which now owns 14.08 percent of Nyota.
The funds will be used to develop Tulu Kapi between completion of the definitive feasibility study and before project finance as well as the Northern Block exploration.
On the financial front, Nyota managed to reduce its pre-tax losses from US$6.7 million a year earlier to US$4.49 million and had US$14.4 million in the bank at the end of 2011.