African Gold Group Inc (CVE:AGG) (OTCMKTS:AGGFF) (FRA:3A61) told investors it was on track to release an updated mineral resource for its flagship Kobada gold project in Mali early this year as the company released another round of positive drill assays and said it had extended drilling.
So far, the company has sunk 6,258 metres of combined diamond drilling and reverse circulation drilling, with results continuing to show deeper than anticipated extensions of the orebody as well as additional mineralized zones outside the known ore zones.
READ: African Gold Group announces more high-grade gold results from its Kobada Gold Project in Mali
Latest highlight assays from the main shear zone at the project include 3.5 g/t of the yellow metal over 14m from a depth of 113m to 127m.
Notably, African Gold added that the program has extended the depth of the oxide-sulphide boundary from an anticipated 110m to a more realistic 180m at the northern extensions of the main shear zone, representing an around 60% increase.
"We are very pleased with the continued positive results at our flagship Kobada Gold Project in Southern Mali," said Danny Callow, the CEO of African Gold in a statement.
"The drilling campaign to date has consistently intercepted deeper oxides and new mineralized oxide zones that were not anticipated in the original plan. Based on these results we believe that it is necessary to continue to extend the drilling in the Phase 4 infill drilling campaign, as well as look to start to drill the extension of the main shear zone as a Phase 5 programme.
"We have worked hard to design an extended drilling strategy which we believe will continue to show the true potential of the Kobada deposit."
Phase 4A drilling has now been completed, aimed at upgrading the inferred resource in oxides at the northern extension of the current pit design. After evaluating the results, the firm aims to continue with Phase 4B and C drilling, aiming to convert most of the inferred oxide resources across the known ore bodies.
A fifth phase will see drilling for the northern strike extension of the highly prolific Kobada Shear and at its neighbor, the Gosso shear zone.
In summary, the group's 2021 drilling plans are as follows:
- Increase resource from newly identified shear zones at Kobada, Faraba and Kobada Est concessions (Phase 3);
- Conversion of the inferred resources to measured and indicated category, with the goal of expanding the Reserve base to over 1 Moz (Phase 4); and
- Strike extension of the main shear zone at Kobada concession (Phase 5)
Kobada lies 126 km south-west of Mali's capital Bamako and sits in the Birimian Greenstone Belt, with excellent transportation to that city and excellent logistics routes via other West African ports.
In July last year, the company released a definitive feasibility study (DFS) that showed Kobada`s potential as a highly profitable standalone mine, delivering an internal rate of return (IRR) of 45.5% and net present value (NPV) of US$284 million, with all-in-sustaining costs (AISC) of US$788 per ounce of gold.
Advanced discussions on securing finance to construct the project are underway with a number of institutional investors.
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