RNS

RNS Number : 5611C
Ortac Resources Limited
29 June 2016
 

Ortac Resources Ltd / Epic: OTC / Market: AIM / Sector: Mining & Exploration

 

ORTAC RESOURCES LTD 

("ORTAC" OR THE "COMPANY")

 

Update on investment into Casa Mining Limited, DRC

 

Ortac Resources Ltd ("Ortac"), the AIM listed exploration and mine development company, is pleased to provide an update on Casa Mining Limited ("CASA"), a private company in which Ortac holds a 12% interest. CASA holds prospective gold mining and exploration licenses in the Democratic Republic of Congo ("DRC").

Operational Progress:

·     CASA has received an updated scoping level study on a Stage 1 gravity process plant for the Akyanga gold deposit and commenced a further study for a Stage 2 carbon-in-leach ("CIL") expansion phase.

·     Estimated initial CAPEX of $7.3 million with operating costs estimated at $12.14/t.

·     CASA is preparing plans to further increase and improve the confidence levels of the existing 1.2m oz JORC compliant inferred resource base.

Vassilios Carellas, Ortac's CEO, commented: "Since our initial investment earlier this year, CASA has achieved its aim to investigate the potential commencement of production at Akyanga at a reduced rate and significantly reduced cost, with a view to rapidly expanding operations thereafter.

The results of this initial investigation are extremely encouraging and provide further support for capitalising on the project's potential in this manner. Over the next few months, CASA intends to complete a further study on Stage 2, which I expect will demonstrate further the robustness of this approach."   

Scoping Level Study - Stage 1 & 2

Over the past year, and following the completion of the Scoping Feasibility Study in 2014 by MDM Engineering ("MDM") and SRK Consulting (UK) ("SRK"), CASA has focused its efforts on optimising the development of the Akyanga deposit in stages, with an initial smaller production rate and an associated lower capital cost.  Based on the results of a revised metallurgical testwork program in 2015, MDM and SRK were commissioned in early 2016 to update the 2014 MDM study with gravity-only processing to treat Akyanga ore.

CASA plans to start gravity-only production (250,000 t/yr) - referred to as Stage 1 - and rapidly expand gold production thereafter to 960,000 t/yr (Stage 2) once successful commissioning and technical parameters of Stage 1 have been established. The introduction of CIL is expected to increase gold recoveries to over 90% and will form an integral part of the Stage 2 expansion plan. Mining is proposed to be carried out by a contractor with experience in the DRC.

The estimated capital cost for the plant and assay laboratory is $3.51 million with expected operating costs of $12.14/t. Stage 1 recovery is estimated to be between 40% and 50% but could be higher depending on head grade and plant efficiencies.

The total capital cost for Stage 1 is currently expected to be circa $7.3 million with $15 million estimated for Stage 2, subject to confirmation of technical parameters during Stage 1 operations. Work required in advance of Stage 2 is estimated to cost an additional $4.0 million.

Exploratory and Infill Drill Program

CASA has spent approx. $30 million over the last six years on exploration, related studies and logistical development on its licenses in the DRC. As a result of the success achieved by these exploratory works, CASA was in 2015 awarded a 133km2 mining license over the Akyanga deposit and a 60km long mineralised corridor where CASA is exploring further gold bearing anomalies.

CASA has initiated preparatory plans to carry out an infill drill program over a portion of the Akyanga deposit where the first couple of years' production is proposed to be mined, along with targeting the known prospects where there is a higher possibility of adding additional resources to the current resource base.

About Casa Mining Limited

CASA is a private, Mauritian registered company that is the 71.25% owner and operator of the Misisi Gold Project located in South Kivu, eastern DRC and is approximately 350km south of Bukavu and 180km north of Kalemie.

The CASA licence holdings consist of three contiguous mining licenses (133km2), issued in March 2015 and valid for 30 years. These licenses, which encompass a 60km strike length of the Tanganyika graben within the Rusizian belt ("Misisi Corridor"), include the Akyanga deposit along with the Lubitchako, Tulongwe, Kilombwe and Mutshobwe prospects (targets).

In addition to the regional geophysical surveys completed over these license areas in 2011, CASA has carried out, 19,522m of diamond drilling, 2,720m of reverse circulation drilling and excavated 6,274 line metres of trenches on its license area.

At CASA's most advanced project, the Akyanga deposit, SRK has reported a Mineral Resource within a US$1,200/oz gold selling price and 0.5 g/t Au cut-off grade optimised pit shell, which comprises an Inferred oxide gold Mineral Resource of 5.5 Mt at a grade of 1.5 g/t Au for approximately 272 koz of contained metal. SRK has further reported an Inferred transition gold Mineral Resource of 16.2 Mt at a grade of 1.8 g/t Au for approximately 927 koz of contained metal.

In 2014, MDM Engineering Projects Ltd ("MDM"), in conjunction with SRK Consulting UK Limited ("SRK"), completed a scoping feasibility study for the Akyanga deposit resulting in an ungeared NPV (8% discount) and IRR of US$171m and 35% respectively at a US$1,300/oz gold price. This assumes a contract mining scenario with an initial capital cost estimate of US$87.4m and a total operating cost of US$628/oz of gold.

As a result of the fact that a large percentage of the gold is reported to be coarse and non-refractory, CASA has recently investigated the option of initially commencing operations at a reduced rate with a gravity-only circuit, which has a significantly lower capital requirement (approximately US$5m) with the view to expand operations thereafter.

 

**ENDS**

 

The information in this press release is based on information provided by Casa Mining Limited and compiled on behalf of Ortac by Mr Vassilios Carellas. The SRK JORC Mineral Resource estimate, the MDM-SRK Scoping Study and the MDM-SRK Stage 1 Update - Scoping Level Feasibility Study have not been independently verified by Ortac Resources Ltd.  Mr Vassilios Carellas (BSc (Hons), MAusIMM) is the Chief Executive Officer of Ortac Resources Limited and has sufficient experience 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 under the JORC Code.  Mr Carellas consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears. 

Contacts

 

Ortac Resources Ltd

Vassilios Carellas (CEO)

 

+44 (0) 20 7389 9050

SP Angel (Nominated Adviser & Broker)

Ewan Leggat / Tercel Moore

 

Beaufort Securities (Joint Broker)

Jon Belliss / Elliot Hance

+44 (0) 20 3470 0470 /

+44 (0) 20 7382 8300

 

 

Yellow Jersey (Media Relations)

Dominic Barretto

+44 (0) 7768 537 739

 

Glossary

 

Au

means gold.

 

carbon-in-column

carbon-in-column or CIC means a technological operation in which gold and silver are dissolved in clean leach solution and absorbed onto activated carbon which is layered horizontally in vertical columns.

 

Core drilling

means a drilling method that uses a rotating barrel and an annular-shaped, diamond impregnated rock-cutting bit to produce cylindrical rock cores and lift such cores to the surface, where they may be collected, examined and assayed.

 

cut-off grade

means the minimum grade at which mineralised material can be economically mined and processed (used in the calculation of ore reserves).

 

diamond core drilling

means a method of exploration in which rock samples from underground are retrieved as core (whole rock cylinders) for further examination and assaying.

 

Dip

The inclination of a geologic structure (bed, vein, fault, etc.) from the horizontal; dip is always measured downwards at right angles to the strike.

 

Exploration

means activity ultimately aimed at discovery of ore reserves for exploitation. Consists of sample collection and analysis, including reconnaissance, geophysical and geochemical surveys, trenching, drilling, etc.

 

Ga

means a billion years.

 

Graben

means an elongated block of the earth's crust lying between two faults and displaced downwards relative to the blocks on either side, as in a rift valley.

 

g/t

means gram per tonne.

 

heap leach

means a technological operation in which crushed material is laid on a sloping, impervious pad where it is leached by cyanide solution to dissolve gold and/or silver. Metals are subsequently recovered from pregnant leach solution by CIC or the Merrill Crowe process.

 

Inferred resource

means that part of a resource for which tonnage, grade and content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.

 

Km

means kilometres.

 

Koz

means thousand ounces.

 

m

means metres.

 

MDM

MDM Engineering Projects Ltd.

 

Mineral Resource

means a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.

 

Moz

means million ounces.

 

Mt

means million tonnes.

 

Oz

means troy ounce (31.1035 g).

 

Production

means the amount of pure precious metals, measured in thousands of ounces for gold, millions of ounces for silver and tonnes for copper, produced following processing.

 

Prospect

means a mining property, the value of which has not been determined by exploration.

 

Reverse circulation

means a drilling method that uses a rotating cutting bit within a double-walled drill pipe and produces rock chips rather than core. Air is circulated down to the bit between the inner and outer wall of the drill pipe. The chips are forced to the surface through the centre of the drill pipe and are collected, examined and assayed.

 

SRK

SRK Consulting (UK) Limited (SRK) is an associate company of the international group holding company, SRK Consulting (Global) Limited (the SRK Group).

 

Strike

means a horizontal extension of an ore body or mineralisation.

 

Tonne

means metric ton.

 

Trench

means a long, narrow excavation dug through overburden, or blasted out of rock, to expose a vein or ore structure.

 

 

For additional information please visit - www.ortacresources.com

 

 


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