john Meyer 15th March22 Mar 2018 11:28
Georgian Mining, has at long last, agreed terms to start development of the Kvemo Bolnisi project in Georgia.
Moreover, Georgian�s jv partner is extremely keen to accelerate cash flow generation from the gold oxides with mining expected to start relatively quickly.
Further detail is expected to be released on this in the short term as the Georgian team finalise details for the start of mining.
Management are still in Georgia after lengthy and exhaustive negotiations with the owners and management of the Madneuli gold mine. Their effort and persistence appears to have won through and we hope investors are appreciative of the time, effort and dedication beyond the normal call of duty which has been applied. The team are now focussed on pushing the program forward to start mining as soon as is practically possible.
The good news is that Georgian �GEO� and it�s jv partner Caucasian Mining Group �CMG� will now jointly fund development of the joint venture subsidiary Georgian Copper and Gold �GCG� on a 50:50 basis. Georgian has solely funded the joint venture to date, meeting its $6m commitment to earn its 50% interest in the joint venture and the Kvemo Bolnisi mining project.
New work program: the new work program starts with some further drilling and metallurgical test work before the joint venture starts stripping ore off Kvemo Bolnisi Gold Zone 2. The drilling and met test work is to help better schedule the heap leach processing of the gold ore to optimise recovery rates and cash flow generation.
Mining will involve the very simple stripping of gold oxide ore off the top of the Kvemo Bolnisi project for processing using the Madneuli mine heap leach infrastructure.
Low cost environment: Georgia is a low cost environment from a mining perspective with availability of contractors.
We reckon that mining of the gold oxides should incur minimal cost. The heap leach pads can be seen from the Kvemo Bolnisi mine and the use of local contractors will hopefully require no up-front cost. Some work may be required on the road from Kvemo Bolnisi to the heap leach pads but there should be little else in the way of expenses before mining and processing starts.
Mining will focus on the weathered layer of relatively soft oxide material appears to host economic gold grades which will be simply processed at one of the Madneuli heap leach sites.
Gold recoveries should run at >90% as seen in initial test work and the topography and layout of the mine should see a near zero strip ratio and low crushing costs as the rock is highly fractured, broken and weathered with
Our inspection of the gold heap leach operation at Madneuli confirm the functionality of the mine�s gold heap leach operations though the copper flotation plant could use some refurbishment.
Drilling costs in Georgia run at around US$100 per meter all in, excluding assays. This is very low by industry standards.
Cash: We reported
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