Africa’s Mining Elites 2022: Tier Two Exploration

When Canadian explorer Newcore Gold acquired the Enchi gold property in Ghana in 2014, it got off to a good start and managed to conclude a positive PEA on the project the following year.

However, with the gold price drifting thereafter, progress on the project in subsequent years proved slow, with exploration limited to just one small drilling program in 2017.

That all changed in 2020. A spike in the price of gold and the appointment of a new Chairman and CEO, Luke Alexander, saw Newcore attack the project with flying colors, with an updated PEA released in June 2021 and a 90,000 m drill program. – an impressive amount by any measure – currently underway.

The program includes both RC and diamond drilling, with the RC rigs focusing on gold oxide targets near surface and the diamond rigs on targets at depth.

The Enchi Project is in southwestern Ghana with a land package covering approximately 40 km of Ghana’s Bibiani Shear Zone, a gold belt that hosts several major gold deposits, including Chirano, just 50 km to the north of Enchi.

Owned by Kinross, Chirano produced approximately 165,000 ounces of gold in 2020.

“It’s a great piece of land in a great neighborhood,” comments Greg Smith, Newcore vice president: Exploration.

“A long history of active exploration and mining has defined a prolific regional structure that spans hundreds of miles and Enchi covers a significant portion of it with multi-million ounce potential district-wide. .”

The updated PEA includes a new mineral resource estimate which has increased the pit-limited inferred mineral resource to 70.4 Mt grading 0.62 g/t gold for 1.4 Moz of gold.

The PEA is considering a 6.6 Mtpa open pit heap leach operation – to be developed in three phases – with a low stripping rate. Heap leach feed materials would be trucked from four deposits to a central crushing and heap leach facility located near Sewum, the largest deposit currently defined at Enchi.

The operation would produce approximately 104,000 ozpa in years two through five and approximately 983,000 oz over the 11-year mine life at estimated all-in sustaining costs of US$1,066/oz.

The PEA estimates capital expenditure at US$97 million with a short after-tax payback of 2.3 years. While the PEA results are robust enough to support a positive investment decision, Newcore believes the project has room to grow significantly and points out that the PEA only includes 20,195m of the current drilling program and only the shallow open pit. oxide material defined to date.

Summarizing the state of play, Smith says drilling continues to highlight the potential for resource growth at Enchi, with large areas of gold mineralization near surface.

“We also continue to increase our knowledge of the geology, structure and mineralization of each of the deposits, targeting the deeper, high-grade feeder structures,” he says.

“We are delighted to be in a strong financial position to continue unlocking the district-scale opportunity at our Enchi gold project, with Newcore well funded to continue drilling the project through 2022.”