Mining firm says more exploration drilling and technical study work required to establish whether the project could be economically viable.
NAIROBI, Kenya, Feb 27 – Acacia Mining will invest Sh1.2 billion in Western Kenya gold exploration projects over the next 12 months following the discovery of an estimated 1.31 million ounces of gold resources on the Liranda Corridor, in Kakamega County, 48 km north-northwest of Kisumu City.
The firm says the move comes after the firm announced the discovery of an estimated 1.31 million ounces of gold resources on the Liranda Corridor – one of the highest grade projects in Africa.
“We are delighted to announce the maiden NI 43-101 compliant Inferred Mineral Resource Estimate (MRE) on the Liranda Corridor. This is one of the highest-grade projects in Africa today, and we believe that this initial resource is a first step in the delineation of a multi-million-ounce high-grade corridor, says Acacia’s Chief Executive Officer Brad Gordon.
Gordon says the discovery demonstrates the contrarian approach they have taken of investing in exploration over the past few years whilst others have been pulling back.
A large percentage of the investment will go towards a 45,000 metre drilling programme on the Liranda Corridor which is targeting an increase in the gold resource to over 2 million ounces in 2017.
The mining company also plans to commence a scoping study that looks at the potential for an underground mining operation towards the end of 2017.
Despite being a major discovery, significant further exploration and technical study work is required to establish whether this becomes an economically viable mine which will take several years.
“Kenya is undoubtedly a geologically rich country, and we are taking significant steps, such as the ratification of the 2016 Mining Act, to establish a robust legislative framework to support our developing mining industry. We are excited about the potential of Acacia’s West Kenya Project, as it could ultimately lead to the creation of a gold mining industry that would have a benefit to our country, economy and people,” says Mining Cabinet Secretary Dan Kazungu.
Acacia mining has so far invested about Sh2.9 billion over the last four years. In 2016 alone, the firm spent Sh1 billion in drilling 45, 038 metres.
According to the Kenya National Bureau of Statistics, gold production in 2015 rose 50 per cent to 0.3 tonnes though this was lower than its 2012 peak of 3.6 tonnes.
The firm, which has operations in Tanzania, Burkina Faso and Mali, bought out its joint venture partner in the Western Kenya mines in August last year at a cost of Sh503 million. Lonmin held a 49 percent stake in two mining licenses in the area.
The find by Acacia Mining comes after another find in its Goldplat’s operation in Narok, where the firm operates the Kilimapesa Gold Mine.
According to the company, Kilimapesa mine has a total resource of 8.72 million tonnes of gold.
Goldplat produced 2,000 ounces of gold in the financial year to June last year and expects to push up the production to 6,800 ounces this year.
Gold production accounted for less than 1 percent of total mineral output.
