Perseus extends Edikan mining six years after incorporating $31m Esuajah South project

Edikan gold mine, Ghana

PERSEUS Mining said its Edikan mine in Ghana would produce an average of 212,000 ounces of gold a year from July for about 6.2 years in terms of its new mining plan which includes reserves from a $31m project, the Esuajah South underground mine.

The forecast weighted average all-in site costs, including all direct production costs, royalties, waste stripping costs and sustaining capital expenditure will be between US$870 and $890/oz, the Australian firm said.

This represents a 5% decrease in average all-in sustaining costs (AISC) of Edikan’s previous life of mine plan. The AISC assumes forecast sustaining capital costs, including site rehabilitation, of $37m, equal to $28/oz.

Edikan’s revised life of mine forecast indicates strong after-tax cash flow totalling some $356m or A$0.51 per share assuming an exchange rate of 0.60 Australian dollars to the US dolla and a flat spot gold price of $1,300/oz for the remaining mine life.

Gold production over the next four years will average about 231,000 oz.

Perseus reported strong interim results on February 20 in which it took net profit after tax up by $20m to $30.4m, equal to 2.6 cents per share.

The year-on-year improvement was built on impressive cost performances as its Sissingué operation in Côte d’Ivoire and a decline in costs at Edikan.

Production for the period came in at 134,980 oz, a 4% decline year-on-year as a result of the new mine plan at Edikan. Weighted average AISC fell 6% at some $942/oz compared to the six months ended December 2018.