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Azumah Resources commences final phase of feasibility study and notes upside from gold price move

With funding in place, the study on the multi-million ounce Wa Gold Project is expected early-2020.

Azumah Resources Ltd - Azumah Resources commences final phase of feasibility study
Taking into account the rising gold price, the value of a gold operation increases significantly

Azumah Resources Ltd (ASX:AZM) has commenced the final phase of works to complete the feasibility study for its flagship Wa Gold Project in Ghana.

Azumah owns the project in a joint venture with its funding partner Ibaera Capital, who can increase its interest in the project from 42.5% to 46.5% by sole funding the remaining feasibility study costs of US$2.25 million.

Notably, Azumah has pointed out that the feasibility study progress update in January 2019 used a US$1,300 per ounce gold price.

If a US$1,500 per ounce gold price were to be used for those preliminary project valuation estimates, the net present valuation (NPV) would rise over 70% to US$309 million.

Azumah’s managing director Stephen Stone said: “It’s a particularly exciting time right now for Azumah and the Wa Gold Project as we are on the home straight to deliver an economically robust, long-life gold mine development for Ghana’s Upper West region, fully supported by the local community and Ghanaian Government at all levels.

“Assuming a gold price of US$1,500 per ounce and with all other inputs being the same as were used in the 30 January 2019 Feasibility Study progress update, the estimated pre-tax post-Government Royalty NPV and IRR could increase to approximately US$309 million and 54% respectively, illustrating the considerable gold price leverage that is inherent in the Project.”

Government discussions continue

Discussions are progressing with the Ghana Government on a fiscal stability agreement, which is a regular requirement in Ghana when establishing a mining operation.

Regarding environmental licences, the Ghana Environmental Protection Agency (EPA) is presently evaluating final submissions for the issue of EPA licences for the Kunche-Bepkong and the Julie deposits.

Wa Project background

The 2.77-million-ounce Wa Gold Project hosts 12 deposits split into two areas, Wa-Lawra and Wa-East.

The three main deposits are Kunche, Bepkong, and Julie and most recently a scoping study was completed on the Bepkong deposit.

The feasibility study assessing the Wa Gold Project will allow the company to make a development decision.

Quick facts: Azumah Resources Ltd

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ASX:AZM
Market: ASX
Market Cap: $31.8 m
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Azumah Resources progresses towards developing Wa Gold Project in Ghana

Azumah Resources Ltd(ASX: AZM) managing director Stephen Stone updates Proactive Investors on the company’s progress towards developing its Wa project gold asset in the West African country of Ghana. The plans are advancing following the recent release of a scoping study that indicated...

on 13/8/19

2 min read