LONDON (Alliance News) - Ortac Resources Ltd Wednesday said the gold miner that it invested in earlier this year, Casa Mining Ltd, plans to expand the resource at the Akyanga gold deposit and believes it can construct an operation there for a very small amount of expenditure.
Ortac, which has its own flagship gold project in Slovakia, purchased a 12% stake in Casa Mining in late February by participating in a private placing as the London-listed miner aimed to gain exposure to licences in the South Kivu province in the Democratic Republic of Congo.
Ortac paid USD62,500 to purchase 625,000 shares in Casa Mining and also used rights that were held by Chairman Anthony Balme to obtain a further 124,558 shares in Casa Mining, which overall allowed the miner to acquire that 12% stake.
Casa is the 71.25% owner and operator of the Misisi Gold project in South Kivu, including the Akyanga deposit. It has spent USD30 million since 2009 identifying a 60 kilometre long corridor prospective for gold, with multiple prospects identified.
On Wednesday, Ortac said Casa has updated the scoping study for the stage one gravity process plant that will serve Aytanga, and has started an additional study for a stage two, carbon-in-leach expansion plan.
The estimated capital expenditure needed for the development stands at USD7.3 million and operating costs are anticipated to be about USD12.14 per tonne of ore handled.
The asset already has a JORC-compliant resource of 1.2 million ounces of inferred gold, but Casa Mining is preparing to increase this, according to Ortac.
"Since our initial investment earlier this year, Casa has achieved its aim to investigate the potential commencement of production at Akyanga at a reduced rate and significantly reduced cost, with a view to rapidly expanding operations thereafter," said Ortac Chief Executive Vassilios Carellas.
"The results of this initial investigation are extremely encouraging and provide further support for capitalising on the project's potential in this manner. Over the next few months, Casa intends to complete a further study on stage 2, which I expect will demonstrate further the robustness of this approach," he added.
Ortac shares were trading down 6.9% to 0.0256 pence per share on Wednesday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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