The company plans a definitive feasibility study (DFS) for the project in the third quarter. Cora will seek to raise debt and equity financing, with the amount sought to be decided after the DFS, Monro says. The mine will take an estimated 18 to 24 months to build, he adds.
Mali is one of Africa’s biggest gold producers, hosting companies such as Barrick Gold and B2Gold. The industry has welcomed the decision by the Economic Community of West African States (ECOWAS) at the start of July to lift sanctions on the country following coups in August 2020 and May 2021.
Monro says Cora Gold has “good relationships with West African banks” which it will aim to draw on during its fundraising. He hopes the mining permit process will be straightforward given the country’s well-established mining code.
The company has already applied for an environmental permit. The government, he says, is responsive and easy to deal with and Mali is “a good country” for mining in both political and operating terms.
The July mineral resource estimate saw a 22% increase in oxide indicated mineral resources to 509,000 ounces. The high level of oxide ore near the surface means that underground mining is not needed and scooping diggers can be used for open-pit mining, Monro says. Power-intensive drilling, blasting and crushing will not be needed. Cora Gold will own and operate the mine, with contract mining the most likely option for production.
- The company has agreed to a $25m term sheet with Lionhead Capital to support Sanankoro’s development, with the amount split equally between equity and a convertible note.
- There’s “relatively low technological risk” and costs at the project will be lower than the industry average, Monro says.
- Monro adds that there is still potential to find new deposits in the Sanankoro permit area.
Road repairs
Cora Gold trades on London’s Alternative Investment Market (AIM). The debt-free company counts Brookstone Business (28.6%) and Michael Farmer, the British House of Lords peer and founding partner of the Red Kite group of hedge funds (14.1%) among its shareholders. Monro has a stake of under 1% which he bought on the market or in placements.
Moving gold out from the project will be relatively easy. The harder part, Monro says, will be getting heavy equipment to the site for mine construction. Sanankoro is about four and a half hours drive from Bamako. There is tarmac for most of the way, but the last 30km is a dirt road. Monro expects that the company will have to pay to upgrade it.
- The company plans to supply its own power, using a hybrid solar power solution with diesel generators as backup, Munro says.
- The company has further early-stage gold exploration projects at Yanfolila, 8km from a gold mine operated by Hummingbird Resources in southern Mali, and at Diangounté in western Mali and eastern Senegal.
Bottom line
The timing of international sanctions to date has not hurt early-stage exploration companies in Mali, but Cora will need the government to stay on the right side of the international community once mine construction starts.
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