Golden Star reports increase in proven reserve base at Wassa, but total gold reserves fall

Golden Star's Wassa underground mine

GOLDEN Star reported a significant increase in proven and probable mineral reserves at its Wassa gold mine in Ghana, but the group’s overall economically mineable reserve fell year-on-year by 4% or 77,000 ounces to 1.7 million oz.

Andrew Wray, CEO of Golden Star, said the company was encouraged by the “real scale and production growth” at the mine.

“Our exploration strategy for the mine in 2020 is transitioning away from further growth of the overall resource to infill drilling to assist us in better understanding the likely mine plans for the southern extension of the underground operation,” he said. “We understand that developing suitable drilling platforms from underground form a critical path item to realising this objective.”

Commenting on the potential for Golden Star’s other mine, Prestea which is also in Ghana, Wray said the focus would fall on revising the mine plan which would be done following a drilling programme first started in 2019.

During this period there had been “… some depletion of the reserve and no overall additions to the resource base, but this remains a high grade asset and our focus is on the disciplined mining of the identified reserve”.

In February, Golden Star extended its hedging programme adding 12,600 ounces to its existing forward sales plan in order to protect revenue for Prestea.

The company now has gold price protection in place for 45,933 oz at an average floor price of $1,427/oz and an average ceiling price of $1,816/oz. The initial period of the hedge was from August 2019 for a year, but it has now been extended to the end of 2020.