Endeavour Mining Corp (TSE:EDV), the West Africa-focused gold miner, has notched up a big milestone as it poured first gold from its Ity CIL project in the Ivory Coast, four months ahead of schedule and under budget.
The event took place on March 18 this year and yielded around 1,800 ounces of gold, the Cayman Islands-headquartered company said.
Now, commercial production at the site is expected to be declared in the early second quarter of 2019, while the processing plant has already reached a stable nameplate capacity of 4 million tonnes per annum (Mtpa).
READ: Endeavour Mining eyeing pivotal year after beating production guidance and reducing costs in 2018
Endeavour noted that around 135,160 tonnes of ore has been processed since ore was introduced into the CIL processing plant on February 20 this year.
As has been previously guided, Ity is expected to produce between 160,000 and 200,000 ounces in 2019, at an AISC (all-in-sustaining-cost) of between $525 and 590 per ounce.
That bottom-end of production guidance corresponds to the 4Mtpa nameplate capacity while the top-end factors in upsides such as an earlier start date, an expedited ramp-up and the plant producing above the nameplate capacity.
"This first gold pour and the remarkably quick ramp-up period is a transformational event for Endeavour as the Ity CIL project will quickly contribute to Group's cash generation potential," said Sébastien de Montessus, president and CEO at the miner.
Work is now underway to increase the plant capacity by 1Mtpa to 5Mtpa, at a minimal cost of between $10 million to $15 million.
The Ity CIL project capex is tracking under-budget compared to the initial budget of $412 million, so Endeavour has completed additional works such as constructing a fuel farm, building exploration facilities, and an additional $7 million of crop compensation and resettlement related to prospective exploration grounds.
Total project capex spend is expected to amount to around $420 million.
Compelling investment
"Given its current 15-year mine life and strong exploration potential, our ability to increase the plant size by 1Mtpa to 5Mpta for minimal additional capex represents a very compelling investment and is in line with our focus on capital allocation efficiency and return on capital employed criteria. With this upgrade, Ity has the potential to produce circa 300koz of gold per annum at a low AISC," added de Montessus.
Meanwhile, at the project, an $11 million exploration program totaling around 71,000 meters of drilling has been planned for this year, with the aim of delineating additional resources at the Le Plaque target, and testing other targets such as Floleu, Daapleu SW and Samuel.
Endeavour Mining shares ticked up 0.89% in Toronto to $19.18
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