Projects & Royalties

Bonikro

Project: Bonikro
Commodity: Gold
Royalty: up to 4.50% NSR royalty
Subsidiary: Altus Royalties Holdings Ltd
Location: Ivory Coast
Deposit Style: Porphyry copper-molybdenum
Key Attributes: Push Back 5 (PB5) expansion
Asset Stage: In production with open pit expansion
Results: Indicated Resource of 26.5Mt at 1.04 g/t for 882,000 oz, Inferred Resource of 6.3Mt at 0.82 g/t for 166,000 oz, Reserve of 10.1Mt at 1.39 g/t for 449,000 oz
Next Phase of Work: Development of PB5
Deal Partner: Allied Gold Corp
Deal Terms: NSR royalty of up to 4.5% on PB5, capped at 560koz

Project Overview

The Bonikro open-pit gold mine is located in Côte d’Ivoire, 230km north-west of Abidjan. The mine has produced over 1 million oz of gold since production commenced in October 2008. In 2018, Newcrest sold Bonikro to AfriqueGold who in turn sold it in 2019 to the current owner and operator, Allied Gold Corp. Allied Gold subsequently appointed Capital Drilling as mining contractor for 5 years.

The Bonikro deposit is characterised by a felsic granodiorite intrusion into mafic volcanics and sedimentary rocks. The granodiorite strikes for ~1km, with a 300m width and has been drilled up to 500m below surface. Gold mineralisation occurs in two structurally controlled high-grade shear zones as well as stockwork veining. The ore body is mined using conventional drill & blast, load & haul. The process plant has a capacity of 2.3 – 2.6Mtpa (0-25% oxide) with most of the gold recovered via a CIL circuit and the balance via a gravity circuit to produce doré.

In 2017, Newcrest conducted a PFS on a fifth push back, known as PB5. At a gold price of US$1,200/oz, the PFS estimated a pre-tax NPV of US$50m, leveraging the existing skilled personnel, infrastructure and mining fleet to extend the mine life by at least 5.5 years. Capital development is limited, and includes TSF expansion as well as minor changes to the road, pipeline and power line on the edge of the PB5 West Wall.

PB5 is estimated to contain an Indicated Resource of 26.5Mt grading at 1.04 g/t for 882,000 oz of contained gold as well as an Inferred Resource of 6.3Mt grading at 0.82 g/t for 166,000 oz of gold contained. Of this, a Reserve of 10.1Mt has been estimated grading 1.39 g/t for 449,000 oz.

Allied Gold is understood to be in the process of commencing development of PB5 and is targeting a ramp up to nameplate production of 100,000 oz per annum in 2023.

Royalty Overview

The Company owns a 50% interest in a NSR royalty on the Bonikro mine’s PB5 at a rate of up to 4.50%, capped at 560,000 oz. The royalty cap equates to 53% of Resources with production from PB5 expected to exceed this. The NSR royalty is triggered by commencement of production from PB5 with the royalty rate dependent on the gold price. The royalty interest is projected to generate US$2.4 million in average annual after-tax cash-flows to Altus over 8 years.
 

USD Gold Price

Applicable NSR Royalty

US$1,250 or less

0.00%

US$1,251to US$1,299

2.50%

US$1,300 to US$1,349

3.00%

US$1,350 to US$1,399

3.50%

US$1,400 to US$1,449

4.00%

US$1,450 and above

4.50%


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