Centamin upbeat on update to Sukari resource

Centamin updated the market on its Sukari resource and reserve on Tuesday, delivering a 1.3 million ounce increase in measured and indicated mineral resources at the gold mine.

The FTSE 250 company said that took Sukari to 11.11 million ounces at 1.08 grams of gold per tonne, representing a 13% increase in ounces after 12 months of mining depletion, inclusive of mineral reserves.

It also delivered a 5% increase in Sukari’s proven and probable mineral reserves to six million ounces at 1.1 grams of gold per tonne after 12 months of mining depletion, including adding 0.8 million ounces of reserves before depletion.

Centamin said 0.4 million ounces was added within the open pit at an average grade of 1.0 grams of gold per tonne, replacing reserve depletion and extending the open pit life of mine to 14 years, while another 0.4 million ounces was added underground at an average grade of 3.9 grams of gold per tonne for an 11% improvement in ounces, further supporting its plan to increase the underground mining rate to 1.5 million tonnes per annum.

The company also said it had identified “multiple” mineral resource and reserve growth opportunities at Sukari, with 280,000 metres of drilling budgeted for 2023, focussing on open pit resource-to-reserve conversion at depth, underground exploration and delineation of known targets, and testing surface targets across the concession.

An updated Sukari life-of-mine plan would be announced in the first half of 2023, incorporating the fully-engineered Sukari underground expansion plan.

Centamin said its group measured and indicated mineral resource base had increased 13% to 13.6 million ounces in 2022, after Sukari mining depletion, the upgrade to Doropo mineral resources, and the removal of the non-core Batie West asset in Burkina Faso.

“Today's announcement marks the second consecutive year of resource and reserve growth at Sukari, further underpinning its status as a tier-one gold mine,” said chief executive officer Martin Horgan.

“Our improved geological understanding has resulted in meaningful growth of both resources and reserves at unchanged cut-off grades.

“The open-pit mineral reserve gain replaced annual depletion for the first time since 2015, while the underground mineral reserves of 1.2 million ounces represents a threefold increase since 2020, net of mining depletion, which further supports the planned underground expansion project.”

Horgan said that, aligned with its growth strategy, Centamin had an “aggressive” drilling campaign across known targets within the underground and elsewhere in the concession area.

“We have added nearly two million ounces of gross mineral reserves over the last two years, and we remain confident in delivering more growth both at Sukari and across the wider portfolio.”

At 0837 GMT, shares in Centamin were up 1.26% at 108.2p.

Reporting by Josh White for Sharecast.com.