Golden Star says study shows 75% increase in Wassa gold production for 11 years

GOLDEN Star Resources, a Toronto-listed firm, has forecast average annual gold production of 294,000 ounces for 11 years from Wassa, its Ghana gold mine after completing a preliminary study of the mine’s underground potential.

According to a preliminary economic assessment (PEA), the details of which were published today, the mine’s Southern Extension zone has an inferred mineral resource yielding gold production of 3.5 million oz over the life of the mine.

This represents a 75% increase in the current production rate. Golden Star last week reported production of 41,000 oz from Wassa in the fourth quarter, taking full year output to 167,600 oz, 7% higher than previously guided.

Based on the PEA, the average cash operating costs per ounce would be $551 and an average all-in sustaining cost before corporate expenses (AISC) of $778/oz over the life of mine.

Andrew Wray, CEO of Golden Star, said converting Wassa to an underground mine was more capital efficient as it could bring production forward at a lower upfront capital cost. Development of the ‘Upper Mine’ would deliver production from 2023, he said.

“Following this study and with a stronger balance sheet, we are in a position to further accelerate the investment in drilling, development, and exploration programs to deliver on the growth potential and value of Wassa,” he said.

Additional drilling of the larger Wassa orebody was also nderway.

Wray said last week Golden Star had undergone “a transformational year” in 2020 in which it moved its head office to London from Toronto, installed new management, refinanced its balance sheet, and sold Prestea, a loss-making mine.