Centamin Egypt Limited ("Centamin" or "the Company") (TSX:
CEE)(LSE: CEY) is providing the following report on its activities
in the quarter ended December 31, 2009:
Highlights
Construction and Development
- Completion of Stage 1 commissioning activities with remaining Stage 2
construction activities well advanced
- Process Plant performing in accordance with design specifications
Operations
- Mill throughput commenced following completion of Stage 1 construction
activities
- Continued increase in open pit mine production in both material and ore
movement
- Underground decline development underway
- Sukari Resource upgraded to a Measured and Indicated Resource of 210.2Mt
@ 1.52g/t Au for 10.29Moz Au with an Inferred Resource of 66.3Mt @
1.6g/t Au for 3.4 Moz Au
- 15,337m of resource diamond drilling completed
- Eight drill rigs on site continuing resource definition drilling to
target Hapi, Amun Deeps and Pharaoh Zone
- Regional Exploration continues - drilling commenced at Quartz Ridge Main
Quartz Vein structure during the quarter with 16 holes holes for 1,436m
completed to date. Drilling confirms mineralised quartz vein shear zone
structure
- Significant intersections received for the quarter include:
D1470 - 20m @ 3.61g/t from 310m
D1471 - 19m @ 13.7g/t from 804m
D1479 - 16m @ 8.16g/t from 547m
D1482 - 21m @ 4.19g/t from 593m
D1490 - 45m @ 2.11g/t from 325m
D1494 - 24m @ 3.19g/t from 311m
Corporate
- Successfully migrated to the main board of the London Stock Exchange in
November 2009
Subsequent Events
- Commencement of gold exports to a nominated overseas gold refinery
- ASX delisting completed
- Total reserves increased to 7.1 million ounces
Commenting on the quarterly report Josef El-Raghy, Managing
Director/CEO of Centamin, stated:
"The quarter saw the maiden feed through our mills at Sukari.
This follows the successful completion of Stage 1 construction
activities and the achievement of design throughput from the Sukari
processing facility. We have also seen the first gold being
exported and sold at spot prices from Sukari which represented one
of the last major milestones in project execution. From the rate of
production and the recovery rates reached so far, Centamin remains
on track to hit its production target of over 200,000 oz Au in the
current calendar year. Corporately, our move to the Main Market of
the London Stock Exchange during the quarter was another step in
the Company's growth as the Company continues to evolve from a
junior explorer to a significant gold producer".
SUKARI GOLD PROJECT - CONSTRUCTION
Stage 1 (oxide circuit) commissioning activities were completed
during the December 2009 quarter, with regular and sustained ore
throughput achieved late in the quarter. Stage 2 (sulphide circuit)
construction is well advanced with completion scheduled for
February / March. Workforce levels have reduced in line with the
completion of construction activities and transition into full
production from the Sukari Gold Project. Engineering works for
expansion of throughput to 8 - 10 mtpa will commence in quarter one
of 2010.
SUKARI GOLD PROJECT - OPERATIONS
----------------------------------------------------------------------------
% Change
Unit Measure Dec 2009 Sept 2009 Dec vs. Sept
Quarter Quarter Quarter
----------------------------------------------------------------------------
Ore Mined '000 tonnes 894 904 (1)%
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Total Material Movement '000 tonnes 3,914 3,458 13%
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Ore Processed '000 tonnes 140 - n/a
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Head Grade grams/tonne 1.11 - n/a
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Gold Recovery % 70.6 - n/a
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Gold Produced ounces 1,118 - n/a
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Mine Production
Centamin conducts its open pit mining operations on an 'owner
operator' basis. Primary mining fleet includes ten CAT785C rear
dump trucks and two O&K RH120E excavators with additional mine
support equipment in place. During the quarter, a third O&K
RH120E excavator was commissioned and commenced mining operations.
Additional trucking fleet is currently being shipped to Sukari and
will be commissioned during the June 2010 quarter.
During the quarter, ore was mined in Stage 1 from the 1136RL to
1112RL bench and in Stage 2 from 1178RL to 1170RL. 37,023 grade
control metres in Stage 1 and Stage 2 were completed to the 1088RL
and 1160RL respectively. For the December quarter, a total of
893,694 tonnes of ore @ 0.82g/t Au was mined. Total waste movement
for the December quarter was 3.9M tonnes, with a resulting
stripping ratio of 4.4:1. Ore grades achieved during the December
quarter are in line with oxide ore forecasts and in accordance with
mine development expectations. Access to transitional ore areas,
including the higher grade sulphide zones in Stage 2, commenced
during the December quarter. As the volume of higher grade zones
increases throughout 2010, the average mine grade is expected to
increase in accordance with current mine development plans.
Drilling and mapping has shown high grade gold is associated
with strongly sheared and sericite-hematite altered porphyry; with
stock works of extensional quartz veins and sheared contacts with
the hangingwall rocks. Correlations between the resource model and
grade control continue to be satisfactory, with mineralised
controlling structures adequately appearing in the grade control
and mapping. To date, ore mined from Phase 1 and Phase 2 is 14%
higher in gold ounces compared to the reserve model. This is
encouraging as we mine the top of Sukari Hill where there is
minimal resource drilling data coverage due to the steepness of the
topography.
Processing
Mill throughput commenced during the quarter, with 140,101
tonnes milled through to the end of the quarter. Since the
commencement of ore treatment, average mill throughput rates and
recoveries have increased steadily and have been consistently
achieving design capacity since the end of the December quarter. A
further 85,000 tonnes of crushed material has been transferred to
dump leach pads during the quarter. A total of 809,000 tonnes at
0.7 g/t have been transferred to the dump leach pads since
inception of leaching operations.
UNDERGROUND MINE DEVELOPMENT
Underground development at Sukari continues to progress well.
The Amun decline recorded a total advance of 147 metres through to
the end of December.
The initial development has encountered variable ground
conditions which were expected in the footwall and close to
surface. These have been managed with simple ground support
regimes, and have not affected the advance rates anticipated. In
the coming quarter, development rates will be increasing as more
personnel are mobilised. Planned development is expected to provide
initial access to the orebody towards the end of 2010. Stoping
panels are scheduled to commence production in early 2011.
The Company believes it has the opportunity to increase
production by accessing higher grade ore from an underground mine.
The aim is to access this higher grade ore earlier than otherwise
would have been scheduled through surface mining. As well as
providing the haulage access for the planned underground operation,
the decline will also provide a platform from which to delineate
deeper targets which may form the basis of a larger underground
operation looking forward.
An initial underground mining rate of 500,000 tonnes per annum
at a grade between 5-10g/t Au is being targeted thus bringing
higher grade ore feed into production earlier than otherwise would
have been scheduled through surface mining averaging circa
2g/t.
RESOURCE DEFINITION
As previously reported in December 2009, the Sukari mineral
resource was upgraded to 10.29Moz Measured and Indicated, plus
3.4Moz Inferred. The total Global Resource increased by 374,000 oz
Au (4%) Measured and Indicated, and 175,000 oz Inferred (5%).
Measured and Indicated resources account for 75% of global
resources.
Table 1 - Total Resource (December 2009)
----------------------------------------------------------------------------
Total
--------------------
Measured Indicated Measured + Indicated Inferred
- --------------------------------------------------------------------------
Cut-off Tonnes Grade Tonnes Grade Tonnes Grade Gold Tonnes Grade Gold
----------------------------------------------------------------------------
g/t (Mt) (g/t (Mt) (g/t (Mt) (g/t (Moz) (Mt) (g/t (Moz)
Au Au) Au) Au) Au)
----------------------------------------------------------------------------
0.5 78.26 1.48 131.93 1.55 210.19 1.52 10.29 66.3 1.6 3.4
----------------------------------------------------------------------------
0.7 56.25 1.82 95.75 1.91 152.00 1.88 9.18 47.2 2.0 3.1
----------------------------------------------------------------------------
1 36.65 2.35 63.59 2.45 100.24 2.42 7.78 31.2 2.6 2.7
----------------------------------------------------------------------------
Note to Table: Figures in table may not add correctly due to rounding
----------------------------------------------------------------------------
To view Figure 1, please visit the following link:
http://media3.marketwire.com/docs/sukariFig1.pdf
South of 11312.5N (ie southern half of the Sukari hill outcrop),
the Measured and Indicated resource is estimated at 8.94Moz, equal
to approximately 87% of the total Measured and Indicated resource.
The resource increase is based on additional assay results from
approximately 23,274 metres of drilling.
On 01 February 2010, the Company announced that the total
reserves had increased to 7.1 million ounces from the previously
reported 6.4 million ounces. The new mineral reserves are based on
drilling up to 01 November 2009 and a gold price of US$700 per
ounce. Details of the new reserves calculated for Sukari are listed
in the table below. The reserves have been marginally depleted
using the 31 December 2009 topographic survey and exclude material
mined between April and December 2009.
----------------------------------------------------------------------------
Sukari Open Pit Mineral Reserve Estimate as at 31 December 2009
(reported at a cut-off grade of 0.4 g/t Au for oxide and sulphide
material and 0.5 g/t for transitional)
----------------------------------------------------------------------------
Proven Probable Mineral Reserve
----------------------------------------------------------------------------
Tonnes Au Tonnes Au Tonnes Au Cont Au
(Mt) (g/t) (Mt) (g/t) (Mt) (g/t) (Moz)
----------------------------------------------------------------------------
New Reserve 69.1 1.37 90.1 1.41 159.3 1.39 7.1
----------------------------------------------------------------------------
Previous Reserve 64 1.38 78 1.43 142 1.4 6.4
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Note to Table: new reserve figure includes 1,167,798t @ 0.74g/t
for 27,762ozs in the proven category
The current reserve has been calculated from a Measured and
Indicated resource of 210Mt at 1.5g/t Au for 10.2 million ounces. A
total Measured and Indicated resource increase of 0.80 Million
ounces has resulted in a 0.60 Million ounce increase in total
reserves.
The Sukari pit is being developed in a number of stages and the
mining and processing schedule developed for Sukari uses an
elevated cutoff grade through the early years to increase the head
grade to the processing plant. It is currently assumed that the
material between this elevated cutoff grade and the cutoff grade
used for the Mineral Reserve estimate is stockpiled and treated at
the end of the project life.
EXPLORATION
During the quarter, resource definition drilling continued to be
mainly concentrated in the Pharaoh zone north of 11300N, following
the high grade Hapi Zone at depth, deeper Hapi zones at the basal
porphyry contacts, the west dipping high grade shear zone basal
porphyry contact at the eastern margins and other mineralised
structures within the porphyry (Figure 2). Drilling also occurred
in the south of the Sukari porphyry from Wadi Fault testing the
along strike continuity of the Amun Deeps porphyry blocks and
mineralisation, Hapi Zone and Downthrust Zone from 10800N
northwards.
Several encouraging high grade assay intersections have been
returned from the Pharaoh Zone in the targeted Hapi Zone, deeper
Hapi and eastern basal porphyry contact zones (Figure 2), and deep
drilling in the Ra Zone between 10800N and 11000N intersected high
grade porphyry blocks in the Amun Deeps and Downthrust zones.
Results have significantly increased the resource base and advanced
understanding of the complex controls on gold mineralisation along
strike and at depth.
The drilling continues to show the high grade Hapi and related
zones extend from the far south Amun Zone north to the area of
current drilling in the Ra and Pharaoh zones. These zones, along
the entire strike length of the Sukari Hill (2.5km), are the target
of current infill and extension drilling with eight diamond coring
rigs.
To view Figure 2, please visit the following link:
http://media3.marketwire.com/docs/sukariFig2.pdf
REGIONAL EXPLORATION
Work continued on the Quartz Ridge prospect, with RC drilling
having completed 16 holes for 1,436m. A further 10 holes for
approximately 1400m remain.
Significant mineralisation has been intersected in north-south
orientated drilling intersecting the quartz reef at 10m to 60m
below wadi level. As predicted from the surface results, gold is
focused in the quartz reef with minor mineralisation occurring as a
weak alteration geochemical halo in the wallrock adjacent to the
vein. Drilling is continuing.
CORPORATE
Following completion of due diligence during the quarter, the
Company was admitted to the Official List of the UK Listing
Authority and commenced trading on the London Stock Exchange's Main
Market for listed securities on 06 November 2009.
The Company had earlier announced its intention to be removed
from the Australian Securities Exchange ("ASX") official list. The
application for removal from the ASX official list was announced in
October 2009 in an effort to streamline listing and compliance
costs. Removal from the ASX official list occurred on 29 January
2010.
At the Annual General Meeting on 27 November 2009, Mr Sami
El-Raghy announced he would be stepping down as the Chairman of
Centamin and as a member of the Board on 31 December 2009 to pursue
new personal endeavours and challenges. Sami has overseen a
successful transformation of the Company from a mining exploration
company into a significant gold producer. Mr Gordon Brian Speechly
also stepped down from the Board on 31 December 2009 due to other
work commitments. Mr Speechly has been a director of the Company
since 15 August 2000. Further appointments to the Board are
currently being considered.
The Company remains debt free, unhedged and able to aggressively
pursue further exploration and development activities, including
the underground development of the high grade Amun Deeps Zone.
On behalf of Centamin Egypt Limited
Josef El-Raghy, Managing Director/CEO
Quality Assurance and Control and Qualified Person
The information in this report that relates to ore reserves has
been compiled by Mr Andrew Pardey. Mr Pardey is a Member of the
Australasian Institute of Mining and Metallurgy and is a full time
employee of the Company. He has sufficient experience which is
relevant to the style of mineralisation and type of deposit under
consideration and to the activity he is undertaking, to qualify as
a "Competent Person" as defined in the 2004 Edition of the
"Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves" and is a "Qualified Person" as defined
in the "National Instrument 43-101 of the Canadian Securities
Administrators" and "CIM Definition Standards For Mineral Resources
and Mineral Reserves" of December 2005 as prepared by the CIM
Standing Committee on Reserve Definitions of the Canadian Institute
of Mining. Mr Pardey's written consent has been received by the
Company for this information to be included in this report in the
form and context which it appears.
The information in this report that relates to ore reserves has
also been independently verified by Mr Pieter Doelman, an employee
of Coffey Mining Pty Ltd Perth. Mr Doelman is a Member of the
Australasian Institute of Mining and Metallurgy and has sufficient
experience, relevant to the style of mineralisation and type of
deposit under consideration and to the activity he is undertaking,
to qualify as a "Competent Person" as defined in the 2004 Edition
of the "Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves" and is a "Qualified Person" as
defined in the "National Instrument 43-101 of the Canadian
Securities Administrators" and the "CIM Definition Standards For
Mineral Resources and Mineral Reserves" of December 2005 as
prepared by the CIM Standing Committee on Reserve Definitions of
the Canadian Institute of Mining. Mr Doelman consents to the
inclusion of this estimate in reports.
The information in this report that relates to mineral resources
is based on work completed independently by Mr Nicolas Johnson, who
is a Member of the Australian Institute of Geoscientists. Mr
Johnson is a full time employee of Hellman and Schofield Pty Ltd
and has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a "Competent Person"
as defined in the 2004 edition of the "Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves" and is a "Qualified Person" as defined in "National
Instrument 43-101 of the Canadian Securities Administrators". Mr
Johnson consents to the inclusion in the report of the matters
based on his information in the form and context in which it
appears.
Information in this report which relates to exploration,
geology, sampling and drilling is based on information compiled by
geologist Mr Richard Osman who is a full time employee of the
Company, and is a member of the Australasian Institute of Mining
and Metallurgy with more than five years experience in the fields
of activity being reported on, and is a 'Competent Person' for this
purpose and is a "Qualified Person" as defined in "National
Instrument 43-101 of the Canadian Securities Administrators". His
written consent has been received by the Company for this
information to be included in this report in the form and context
which it appears.
The assay samples were analysed by Ultra Trace Pty Ltd, Canning
Vale, Western Australia.
Refer to the updated Technical Report which was filed in May
2009 for further discussion of the extent to which the estimate of
mineral resources/reserves may be materially affected by any known
environmental, permitting, legal, title, taxation, socio-political,
marketing or other relevant issue.
Table 1 - Significant Intersections from the Sukari Gold Project
- December 2009 Quarter
---------------------------------------------------------------------------
HOLE NORTH EAST DIP AZI EOH FROM TO INTERVAL AUAR1
---------------------------------------------------------------------------
D1470 11300 10948 -85 270 584.8
---------------------------------------------------------------------------
incl. 326 327 1 16.1
---------------------------------------------------------------------------
incl. 530 531 1 19.0
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1471 10900 10945 -63 270 991.2 804 823 19 13.7
---------------------------------------------------------------------------
incl. 817 818 1.3 172.0
---------------------------------------------------------------------------
incl. 821 822 1 27.2
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1474 10850 10955 -67 270 899.2 359 361 2 11.8
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1475 11425 10890 -86 270 698.5
---------------------------------------------------------------------------
incl. 352 353 1 12.7
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1476 11750 10867 -84 270 623.8
---------------------------------------------------------------------------
incl. 578 579 1 18.0
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1479 10700 10827 -68 270 778.5
---------------------------------------------------------------------------
incl. 561 562 1 108.0
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---------------------------------------------------------------------------
D1482 11750 10866 -63 270 653.8
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incl. 40 41 1 10.3
---------------------------------------------------------------------------
incl. 612 614 2 26.9
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D1485 10825 10791 -66 270 611.4
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incl. 513 514 1 16.3
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---------------------------------------------------------------------------
D1492 11675 10813 -85 270 658.3
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incl. 647 648 1 51.5
---------------------------------------------------------------------------
---------------------------------------------------------------------------
D1494 11450 10913 -87 270 637.8
---------------------------------------------------------------------------
incl. 313 316 3 18.26
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Note: Intervals shown in the table are down hole intercepts, drilled at
high angles relative to the internal mineralized structures and the Sukari
Porphyry; true widths do not apply or are not used in drilling the
stockwork style mineralization at Sukari
ABN 86 007 700 352
Contacts: Centamin Egypt Limited Josef El-Raghy + 61 (8) 9316
2640 www.centamin.com Buchanan Communications Limited Ben Willey or
Bobby Morse + 44 (0) 207 7466 5000
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