Antilles Gold Limited (ASX:AAU) has received a significantly updated Mineral Resource Estimate (MRE) for the La Demajagua gold-silver deposit in Cuba.
Undertaken by Western Australia mining consultants, Cube Consulting, the revised MRE features selected data from 50,000m of historic drilling, and assays received to date from approximately 90% of the 28,000m of cored drilling undertaken for the proposed open pit mine at La Demajagua.
· The additional estimated 2.6 million tonnes within the revised Indicated and Inferred Resources should allow the mine life of the proposed open pit operation to be extended from six to eight years. · The Scoping Study for the proposed open pit mine will be revised to determine the positive economic impact of the estimated additional 188,000oz of contained gold in the revised Resources.
· The MRE for the La Demajagua open pit will be finalised after all outstanding assays are received in July 2022.
· The Definitive Feasibility Study (DFS) for the proposed open pit mine is scheduled to be completed in November 2022, with mine infrastructure planned to be undertaken in the first half of 2023, and mine construction during the following 12 months. The first shipment of concentrate is planned for July 2024.
· The drilling programme for the proposed underground operation will probably be deferred until 2028, but will be completed in time for any development to ensure continuity of operations.
Brian Johnson, Brian Johnson, said any increased life of the La Demajagua open pit mine would assist the company’s joint venture with Cuban mining company, GeoMinera, to arrange project finance.
“Antilles Gold has commenced discussions on this matter with prospective financiers that are not impacted by US sanctions, and has allowed 12 months to have finance in place.
“Approximately US$15 million of the US$65 million of third-party funding that will be required for the La Demajagua mine may be provided as credit by the Chinese suppliers of the project concentrator, and the heavy mining equipment, backed by the China Exim Bank or insurance company, Sinosure.
“Antilles Gold may provide a short-term loan of up to US$15 million to the joint venture which could come from anticipated proceeds from US$30 million of Claims against the Dominican Republic Government which are currently being arbitrated by a unit of the World Bank, conversion of listed options in April 2023, or from an issue of shares or notes later in 2023.”
Mr Johnson said he was confident that a project loan of US$35 million will be able to be arranged for the joint venture, where the lender will be repaid from a proportion of the proceeds from concentrate sales under a life of mine off-take agreement.
“An important next step in the bankability of the proposed mine will be negotiation of the concentrate off-take agreement.”
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