The construction of the Otjikoto Mine owned by B2Gold is way ahead of schedule and will meet the construction completion deadline of fourth quarter this year the company has revealed in their latest quarterly update.
The Otjikoto Gold project is located approximately 300km north of Windhoek between Otjiwarongo and Otavi and is owned 90% by B2Gold and 10% by EVI Mining (proprietary) Ltd, local company steered by business mogul Dr. Leake Hangala.
According to the first quarter update by the company, excavation at the mill area is complete and concrete batch plant is in continuous use to assist with the pouring of foundations.
B2Gold also revealed that a total of about 15000 cubic metres of concrete is to be poured during construction with 13 000 cubic metres of those already catered for as at March this year.
The first quarter report also noted that, the mill and mining offices have already been completed and the construction of all other administration buildings is progressing well.
The current average annual production for the five years is estimated to be approximately 141 000 ounces of gold per year at an average cash operating cost of $524 ( approx N$ 5240) per ounce for the life of mine scheduled for a 12 year period.
The 2014 Otjikoto exploration program is budgeted at N$80m.
The company announced plans to expand the Otjikoto mine in 2015, increasing ore throughout from 2.5m per year to 3m tonnes. The increased ore throughout will be achieved through the installation of pebble crusher, additional leach tanks and mining equipment at a total cost of approximately N$1.5b.
Once the expansion is completed at the end of 2015, the company expects that the annual gold production from the main Otjikoto would increase to approximately 170 000 ounces per year.
B2Gold president and chief executive officer Clive Johnson noted that the company anticipates being in a position to upgrade the mineral resource classification to the indicated category by the end of 2014 include metallurgical and geotechnical test work for the Wolfshag zone.
Regarding the overall financial result, Johnson noted that B2Gold’s recorded gold production of 96, 303 ounces in the first quarter of 2014 which was an increase of 21% over the first quarter of 2013 and a decrease from fourth quarter 2013 of 106 185 ounces.
The company also recorded revenue of $129m (N$1.29b) on sales of 98 995 ounce compared to $ 138m (N$1.38b) recorded in the fourth quarter in 2013 and down from $ 154.9m on sales of 95. 042 ounces in the first quarter 2013.
“The decrease in gold revenue was mainly attributable to a 20% decline in the average realised gold prices. Gold sales volume only increased by 4% in the first quarter of 2014 (compared to 21% increase in gold production in the quarter) as gold revenue in the first quarter of 2013 benefitted from the sale of 20 811 ounces, relating to the Masbate Mine’s gold bullion inventory acquired,” he said.