Asanko Gold Inc. (TSX:AKG) (NYSE MKT:AKG) is pleased to announce that the main construction work has commenced on Phase 1 of the Asanko Gold Mine in Ghana. Phase 1 is expected to produce 200,000 ounces of gold per annum at steady state starting in Q2 2016.
Earlier this year, the Company undertook preparatory early works at the Project site, including upgrading the access road, refurbishing the 225 person operations camp which already existed at site, installing temporary construction camp accommodation and upgrading the site utilities to support the additional construction population.
Following Board approval of the Project last month, main construction activities on site have now commenced. The bulk earthworks contract has been awarded and the contractor has mobilised to site. Initial work has begun on clearing ground for the 3 million tonne per annum gravity/carbon-in-leach processing plant, which is located near the main Nkran pit. Civil works and concrete pouring is expected to begin in the coming months to take advantage of the dry season in Ghana.
The tender process for the mining contractor is underway and the pre-stripping contractor for the Nkran pit will mobilise to site during Q4 2014.
Peter Breese, President and CEO, said “This marks an important milestone for the Company and our stakeholders as we begin the main construction activity at the Asanko Gold Mine. We are expecting the construction activity at site to be complete over the next 18 months, with steady state production anticipated in Q2 2016.”
In parallel with the site construction activity, engineering and procurement activities are continuing. The Company is in the final stages of updating the Mineral Resource Estimate for the Phase 1 deposits, including a maiden resource for Dynamite Hill. The revised MRE will be published in September, followed shortly by the associated NI 43-101 technical report. The overall MRE is not expected to be materially different than the previous estimate (announced in 2012 and the basis for the Company’s current disclosure). However, the revised estimate incorporates a more detailed geological model and utilises a combination of Indicator Kriging and Ordinary Kriging to bring a higher level of confidence and detail to the MRE which makes it more suitable for detailed mine planning.
The Definitive Project Plan for Phase 1 is also on track for publication in Q4 2014 and will include an update to the September 2012 Definitive Feasibility Study(1) mine plan and operating cost estimate. The capital cost of the project was confirmed to be in-line with the DFS at US$295 million (see news release dated July 14, 2014). The Definitive Project Plan is not expected to be materially different to the DFS mining plan of 2.25 million ounces of gold produced over an 11.5 year life-of-mine.
The Company has been monitoring the outbreak of the Ebola virus in other West African countries. Ebola has not been detected in Ghana to date and Asanko continues to operate normally, however the Company has taken proactive steps to prevent occurrences of the virus through its staff, contractors and local village populations. These preventative measures include education programs and the implementation of strict health measures at both the Project site and the Company’s Accra offices. In addition, the Company has implemented a travel screening program and pre-employment medical examinations in order to prevent the virus from being brought to the Project site by mobile workers. Crisis plans have been developed should the virus be detected in Ghana and/or the local community and the Company will continue to monitor the situation and continue with precautions until the virus is deemed by health authorities to have been brought under control.
Project Schedule and Key Milestones
The Company’s key Project timelines remain on schedule:
Commence Project Construction Q3 2014 Commenced
Definitive Project Plan including updated
MRE Q4 2014 On track
Underway, Report in
Evaluate trade off studies for Phase 2 Q4 2014 Q1 2015
Commissioning and Ramp-up Q1 2016 Q1 2016
Steady State Production of greater than
200,000 oz/year Q2 2016 Q2 2016
About Asanko Gold Inc.
Asanko’s vision is to become a mid-tier gold mining company that maximizes value for all its stakeholders. Asanko’s flagship project is the fully financed and permitted, multi-million ounce Asanko Gold Mine Project, located in Ghana, West Africa, which will be developed in phases.
Phase 1 has 2.43Moz(2) of Proven and Probable Mineral Reserves contained in the Nkran, Adubiaso, Abore and Asuadia deposits and is targeting steady state production of 200,000oz/pa of gold during Q2 2016. Construction is underway and first gold is targeted in Q1 2016.
Phase 2 has an additional 2.37Moz(3) of Proven and Probable Mineral Reserves which are located at the Esaase deposit, approximately 25km north of the processing plant site. A scoping study is underway to investigate a Phase 2 expansion and is expected to be published in Q1 2015.
Asanko is managed by highly skilled and successful technical, operational and financial professionals. The Company is strongly committed to the highest standards for environmental management, social responsibility, and health and safety for its employees and neighbouring communities.
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