The study recorded a production target of about an additional 154,000 ounces of contained gold, as well as adding around US$32 million cash flow at a gold price of US$1,300 per ounce.
The Bepkong deposit is a key component of the Wa project for which a feasibility study being managed by joint venture partner Ibaera Capital is nearing completion.
An underground operation will only need to cover capital and associated operating costs with all project establishment costs likely to be repaid by open-pit mining operations prior to the beginning of underground mining.
Azumah managing director Stephen Stone said: “On the back of the recently reported Bepkong ‘Underground’ mineral resource of 279,700 ounces grading 3.59 g/t gold, a scoping study has indicated an underground mining operation could provide a material boost to the Wa Gold Project.
“An estimated production target of about 154,000 ounces as well as pre-tax, post-royalty revenue of US$32 million is a tremendous development for the current 1-million-ounce ore reserve, open-pit based project.
“With the prevailing gold price well above the US$1,300 per ounce used in determining ore reserves and revenues for the feasibility study and revenues for the scoping study, the business case for development just gets stronger.”
The Bepkong underground mining opportunity would not be financed on a standalone basis but as part of the overall project establishment capital finance package and from subsequent cash flows.
This finance is not yet in place as the JV has not made a development decision and its strategic plan to develop a gold mining operation is subject to the results of the feasibility study.
Mining of the underground mineralisation is dependant upon a decision by the JV to proceed in order to develop the project, the availability of finance and several other commercial factors.
The JV will continue to advance the project feasibility study to completion and undertake further detailed assessment of mining the Bepkong underground mineralisation.