Asanko Gold Inc (TSE:AKG) reported the Definitive Feasibility Study report of a planned expansion at the Asanko Gold Mine, located in Ghana, which substantiates the AGM is a large scale, long-life quality asset with a robust and viable two stage organic development program and robust cash generation capability.
Asanko Gold reported that the Expansion DFS is constituted of two growth assignments, Project 10 Million and Project 5 Million. The Project 5 Million is designed on modular basis permitting plant upgrade and advancement of Esaase as discrete packages. It would be processing plant advancement to 5Mtpa at capital cost of US$22 million.
Development of Esaase deposit comprises construction of overland conveyor connecting Esaase to processing center capital cost of US$120 million capital uses the firm’s ability to further advance production in the future. Under Project 5 Million, strong business on standalone basis having a long life is expected.
Commenting on the update, Peter Breese, the CEO and President of Asanko, said that the growth plan has been intended to be entirely flexible so that it can be developed in modular components, as per the cash flow generation, financing opportunities, market conditions and balance sheet strength.
The preliminary expansion module of the plant upgrade is an interesting low cost capital efficient assignment which is fully funded, offering a 40% jump in throughput. They project to witness some volumetric increases in next quarter, ahead of full commissioning in the last quarter of 2017.
The Board is assessing the optimal timing for the advancement of Esaase and the conveyor, and Project 10 Million, and the particular investment decisions will be reliant on the firm’s financing opportunities and cash position. This assessment will enable them to wisely enhance their liquidity position to more than US$100 million by Q2 2018.
In the last trading session, the stock price of Asanko declined 0.95% to close the day at $2.08.
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