Firefinch Ltd (ASX:FFX) (FRA:N9F) (OTCMKTS:EEYMF) has revealed a new Life of Mine plan (LOMP) for the Morila Gold Mine in Mali, West Africa, outlining annual average production of 160,000 ounces to 2030 through mining and processing of around 37.5 million tonnes at 1.33 g/t for 1.45 million recovered ounces.
The initial period of the LOMP (2021 to 2028) incorporates mining of probable ore reserves of 23.8 million tonnes at 1.40 g/t for 1.07 million contained ounces and returns an undiscounted pre-tax cashflow of US$604 million (A$805 million).
Shares higher
Shares have been up more than 5% to 40 cents this morning, a new high of almost three years with Firefinch's market cap sitting at approximately A$297.6 million.
Managing director Dr Michael Anderson said the company was delighted with the outcome of the new life of life plan, which affirms Morila as a ‘very profitable’ and long-life mining operation.
“Unique advantage”
He said: “The rapid ramp-up to annual production of 150,000-200,000 ounces highlights the unique advantage that Morila has in leveraging sunk capital.
“It is worth noting that the new plan is based upon existing drill data supplemented only by drilling at the satellite pits.
“Tellingly, we have yet to drill a hole at the Morila Super Pit – our main focus, and we are very excited to follow up the many obvious targets with the realistic aim of adding significantly to the current resources and reserves.
“As a company, we will continue to contribute significantly to Mali and its people and look forward to doing so.
“Approximately US$895 million is expected to be contributed in taxes, royalties, wages and salaries, and local procurement over the next 10 years, meaning our operation will substantially benefit shareholders and local stakeholders alike.”
The LOMP foresees the tailings production through hydraulic mining will progressively ramp down and cease by December 2021.
Increasing production
Production will increase through the mining of Morila Pit-5 adjacent to the Morila Super Pit and satellite pits Koting, N’Tiola and Viper at a rate of up to three million tonnes per annum.
Pre-strip and the delivery of ore from the Morila Super Pit will ultimately overlap satellite pit mining, and the predominant ore feed will be from Morila by Q1 of 2023 when production will ramp up to around four million tonnes per annum.
It is anticipated that feed from the satellite pits will continue to provide optionality.
The 10-year LOMP covers 2021 to 2030 (inclusive), with the period 2021 to 2028 based on the ore reserve for the Morila Project, along with inferred resources falling within the pit design.
This plan states that the proportion of inferred resources to be mined over the first five years of the LOMP is around 12% of the total tonnes mined.
The balance of the plan covers indicated and inferred resources from the Morila Stage-2 Pit, which is not currently classed as ore reserves.
With the inclusion of Stage-2, the proportion of inferred resources in the LOMP rises to around 30%.
The LOMP highlights a robust financial performance for Morila.