Imperial Metals (TSE) is teaming up with Japan-based Sumitomo on a new project in Niger, Africa.
The companies are forming a joint venture on the 748-sq.-km M’Banga gold concession, west of the capital city of Niger. Imperial will be the operator and hold a 60% interest, while Sumitomo will hold 40%. The partners must spend US$2.5 million on exploration during the first three years and complete a feasibility study within one year.
The government of Niger can acquire up to a 20% interest, half of which is carried, by providing 10% of the capital funding following completion of a feasibility study. At such time, Imperial will be reduced to a 48% interest and Sumitomo will hold 32%.
Imperial will hold the right to purchase an additional 3% interest from Sumitomo for fair market value.
The M’Banga concession lies within the Birimian formation and is immediately adjacent to ground recently granted to Barrick Gold and to Ashanti Gold Mines.
Exploration activity in recent years was carried out by the Japanese government through the Metal Mining Association of Japan. Trenching on stockwork vein systems has returned values of up to 16.38 grams gold per tonne over 10 metres.
An exploration program, budgeted at US$1.2 million, is already under way. Work will include geophysical surveys, soil sampling, trenching, auger drilling and follow-up diamond drilling.
Sumitomo holds the right to acquire a 35% interest in Imperial’s Mount Polley project in central British Columbia. Imperial recently revised the economics for the gold-copper project using its updated reserve estimate.
The proposed open pit is estimated to contain 81.5 million tonnes grading 0.41 gram gold and 0.3% copper, at a stripping ratio of 1.12-to-1. With a plant capacity of 6.5 million tonnes per year, Mount Polley is expected to produce a total of 894,000 oz. gold and 367 million lb. copper over a mine life of 14 years.
Cash costs are projected at US$277 per oz. gold, using copper as a credit (or US53 cents per lb. copper, with gold as a credit). Capital costs, including contingency and working capital, are estimated at $117 million.
Talks are ongoing with the British Columbia government regarding infrastructure support and electricity pricing.