syama gold mine, page-6

re: syama gold mine - news articles Resolute puts its boot on 5Moz Mali mine
22/04/03 By: MiningNews.Net

Resolute Mining is considering paying up to US$12.6 million for an 80% stake in the multi-million ounce, metallurgically complex Syama gold mine in Mali.

Resolute has an option costing US$75,000 per month to assess the merits of the project over the next year, and CEO Peter Sullivan said the company would consider a number of alternate metallurgical routes.

However, he was unwilling to go into details at this stage, saying more information would be released once results of initial testwork were received, probably in the next couple of months.

Syama has measured and indicated resources of more than 5Moz - 50.59 million tonnes grading 3.17 grams per tonne - and has produced over 1.5Moz of gold since being commissioned by BHP in 1990.

London-listed Randgold Resources reportedly paid more than US$100 million for the project in 1997, and then spent tens of millions trying to make it a viable producer.

However, after initial success, the project suffered all manner of problems, the bulk of which derived from the difficult metallurgy.

The mine was put on care and maintenance in early 2001.

Syama's ore is in part carbonaceous, graphitic and refractory, with a roaster and other metallurgical routes thus far failing to overcome the difficulties for any length of time.

Sullivan said Resolute was approached by representatives of Randgold to buy the project.

All going to plan, Sullivan believes production could start in 2005.

Analysts contacted by MiningNews.net were positive on the deal based on the option arrangement allowing Resolute the opportunity for a full assessment.

Paterson Ord Minnett's Andrew Driscoll also said the deal addressed the issue of Resolute being a one-mine company following the closure of Obotan in Ghana.