Mali Lithium Ltd (ASX:MLL) is moving quickly to progress the Morila transaction in Mali by developing a plan for production expansion and preparing to recommence drilling at the high-priority Koting Gold Project adjacent to Morila.
The agreement to acquire the producing Morila project was signed on August 31 and the company has been quick to act as it adopts a new gold focus, which will include a change of name to Firefinch Limited.
A US$1 million deposit has been paid to the Morila vendors and substantial progress has been made on the Morila production expansion plan.
This is occurring while Morila continues to operate as normal, producing gold from tailings with more than 3,000 ounces produced in September 2020.
Drilling at Koting
An initial resource estimate is nearing completion at Koting deposit within MLL's Massigui project and adjacent to Morila mine, being around 22 kilometres from the processing plant and 2 kilometres from the existing haul road.
The company is planning a reverse circulation (RC) drilling program of up to 4,400 metres for 38 holes to infill and extend the existing drilling and deliver a resource suitable for mine planning and design.
Drilling is set to begin as soon as possible after the wet season in Mali – around mid to late October.
Work has started on mining and environmental studies to support an application for a mining permit for the Finkola tenement, which hosts the Koting deposit.
The aim is to develop shallow open pit resources which can potentially feed the Morila mill in the short-term.
Three exploration targets
In addition to drilling at Koting, three exploration targets will be tested - K2, K3 and K4 - and an RC program of 28 holes for around 3,030 metres has been prepared.
These targets have been defined by gold in auger and aircore drilling.
The Morila sale and purchase agreement includes MLL raising a minimum of US$25 million prior to closing and receiving no objection to the transaction from the Government of Mali.
This transaction is scheduled to close on October 31.
On September 7, the company announced a placement of A$64 million in two tranches to institutional and sophisticated investors.
To date, no objections have been received from the government and both Mali Lithium and Barrick Gold Corp have been in contact with government providing information on arrangements with regard to worker entitlements and future employment at Morila, the continuity of community programs and plans to re-establish open pit mining.
Resource and mine plan update
Mali Lithium has begun work to upgrade the resource classification and increase the size of the 1.3-million-ounce inferred resource for the main Morila pit, using all available data along with prevailing gold prices and costs, to create a new mineral resource estimate.
The current mineral resource for the main Morila pit comprises 32 million tonnes at 1.26 g/t gold in the inferred category.
In addition, new mineral resource estimates will be created for the three satellite deposits (Domba, N’Tiola and Viper) as well as the Koting discovery.
These estimates will use all available data and prevailing gold prices and costs.
Resources will be subject to optimisation and mine design to provide an initial ore reserve estimate, mine plan, operating costs and schedules.
New waste dump and road infrastructure designs will also be completed with the schedule to provide a roadmap for bringing Morila back to full production based on mining of tailings and the satellites, ahead of the re-start of mining at the Morila Main Pit.
Planning is underway to determine the capital works necessary to re-establish large scale open pit mining and processing, including plant refurbishment, pit dewatering, power station upgrade and tailings storage dam reconfiguration.
The results of these studies are expected to be available progressively from early November.
A definitive feasibility study (DFS) for the Goulamina Lithium Project is nearing completion with the documentation of mining studies and financial modelling.
Mali Lithium hopes to release the results of the study before the end of October.