Sihayo revises N. Sumatra gold project design to cut cost
Tuesday, August 1 2017 - 02:56 AM WIB
ASX-listed Sihayo Gold Limited said that its 75 percent-owned Sihayo gold project in Indonesia?s North Sumatra Province is undergoing a significant revision in the base process flowsheet and in operational concepts to bring it back in line with a more appropriate Indonesian costing and robust design.
The company said in a statement on Monday the changes are expected to have a significant impact on reducing the projects capital and operating costs.
Sihayo said experienced key personnel have been recruited directly by Sorikmas to cover critical technical areas in the feasibility study (FS), including geology, mining and processing. It is expected the in-house team will continue with the project through construction and into operations. A six month schedule has been planned to complete the Definitive Feasibility Study at a budget cost of US$800,000. A short drilling program is also planned to include geotech holes, confirmatory drilling and met sampling. The estimated additional cost for drilling is $150,000, the company said.
Sihayo explains differences with the 2014 FS design impacting the capital cost include reverting to a conventional TSF, a simplified process flowsheet and relocation of facilities to a centralized area. In addition a significant reduction in operating costs will be realized through the adoption of owner management of key operational areas, including mining, drilling and laboratory as saying. The inclusion of a RECYN cyanide recovery circuit with Detox will also reduce operating costs and have beneficial environmental implications.
Increasing the ore treatment up to 2 million tons per annum is considered an essential change to improve the project economics, even though it means shortening the project life. A minimum production rate of 80,000oz/annum of gold is the target level considered for a sustainable operation of this sort. It is still expected to achieve a reduced capital cost, even at the higher throughput. The metallurgical recoveries as previously determined by extensive testwork will be accepted without change. The refractory component of the ore will be addressed as a tailings treatment exercise, with any additional recovery seen as a bonus, but not included in the DFS economics.
?Major permits for the FS, AMDAL (Environmental) and IPPKA (Forestry) will all need revision, but will be treated as addendums to current permits,? Sihayo said.
The company said it has commenced a substantial revision of the 2014 Feasibility Study based on a larger production rate and incorporating concepts to reduce capital and operating costs. These changes will require addendums to both the previous FS and AMDAL approvals.
The Sihayo gold project is located within a Generation VII Contract of Work (CoW) located in Northern Sumatra Indonesia. The company holds an interest in the project through 100 pwercent ownership of Aberfoyle Pungkut Investments Pte Ltd (API). The CoW is held by PT Sorikmas Mining (Sorikmas) which is operated under a Joint Venture arrangement between API (75%) and PT Aneka Tambang (25%).
Editing by Reiner Simanjuntak