(Sharecast News) - Gold producer Centamin said on Tuesday that underground operations at its Sukari Gold Mine in Egypt will transition from contractor-mining to owner-operator mining, with immediate effect.
Centamin said the change will deliver "significant cost savings" and improve operational control and mining flexibility at the site, whilst also enabling it to upskill the local workforce.
The FTSE 250-listed firm stated the decision was primarily driven by a 200% increase in Sukari underground proven and probable reserves, which underpinned an eight-year underground life of mine, with identified near-term growth targets to extend beyond a ten-year life of mine.
It added a detailed transition plan to owner-operator mining was in place, with implementation underway, including utilising a third-party underground mining specialist to assist with workforce training.
Centamin also said ut had executed its contractual right to purchase the current underground mining fleet from the incumbent contractor for a total capital cost of $10.5m, to be paid this quarter.
Chief executive Martin Horgan said: "The decision to transition the underground to owner mining reflects extensive planning and evaluation to determine the most effective operating model as we continue to grow and maximise the value of the Sukari orebody.
"We believe this move best places us to extract the maximum value safely, efficiently and cost-effectively from the expanding underground operations"
As of 0835 GMT, Centamin shares were down 0.41% at 92.94p.
Centamin PLC (CEY)23 May 2024 15:36