Centamin aims to add new gold production from $275m Doporo project by 2024

UK-listed Centamin is to progress its Doporo project in Côte d’Ivoire after a preliminary assessment said its mineral prospects could support $275m in investment.

Martin Horgan, CEO of Centamin, said in March that the company had been “reset” following operational setbacks at its only operating asset, the 450,000 ounce a year Sukari operation in Egypt. Adding to the company’s options was part of the new strategy following his appointment a year ago.

Currently, Sukari has a 12-year life of mine with a proven and probable gold reserve content of five million ounces as of December 31. This compares to seven million ounces 18 months previously.

Centamin said today the project would progress to the prefeasibilty stage which would be completed by mid-2022 at a cost of $14m.

A $3m exploration programme at another Côte d’Ivoire, ABC, would also be undertaken. However, Centamin would not progress Batie West, a prospect in Burkina Faso which fell beneath the company’s investment hurdle.

Horgan has previously expressed reservations regarding investing in Burkina Faso where jihadist attacks have disrupted the mining of other companies.

A preliminary economic assessment of Doporo implied a 13 year life of mine producing average annual gold of 207,800 oz for the first five years, and 150,959 oz over the life of mine. The prospect contains a total of two million ounces at an average all-in sustaining cost of $904/oz.

“We view the improved visibility on the West African portfolio as being incrementally positive,” said Raj Ray, an analyst for BMO Capital Markets. “However, it is still early days.”

Centamin had “fairly high conviction” that Doporo would be in production by late 2024, said Peel Hunt analysts Tim Huff and Peter Malin-Jones in a report. Doporo “… should also provide a substantial production uplift to Centamin after Sukari operations have stabilised. Diversification and growth are now firmly part of the Centamin’s strategy,” they said.