Allied Gold (TSX: AAUC) has fed the first ore through the crushing circuit at its Kurmuk gold project in western Ethiopia, moving the mine a step closer to its first gold pour.
The milestone follows the energization of an 88-kilometre, 132-kV power line that ties the site into Ethiopia’s national grid. State utility Ethiopian Electric Power commissioned the line and will supply electricity at a fixed rate of roughly US$0.04 per kilowatt-hour under a 20-year power purchase agreement.
With the crusher running, Allied is handing the circuit over from its commissioning team to operations. The company expects to start feeding ore to the grinding circuit in the coming weeks, with first gold “soon thereafter.”
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Mining is already well underway. Allied has stockpiled about 1 million tonnes of ore from the Dish Mountain and Ashashire open pits and plans to raise that to nearly 1.5 million tonnes before the full circuit is commissioned. That equals about 3 months of plant feed, which points to throughput of roughly 6 million tonnes per year.
The two pits hold all of Kurmuk’s current proven and probable reserves of 2.7 million ounces. The operation is a conventional truck-and-shovel open-pit mine that feeds a carbon-in-leach processing plant.
Production is expected to ramp up quickly. Allied is guiding for 240,000 to 270,000 ounces in the first full year of operation, rising to about 300,000 ounces in year 2. Output over the first 4 years is forecast to average around 290,000 ounces annually, and the mine is expected to average at least 240,000 ounces a year over an initial 15-year life.
The company also sees room to extend that life. It points to exploration potential across the 1,450-square-kilometre property around the initial pits.
Kurmuk will join Allied’s producing operations in Côte d’Ivoire and Mali.
Allied Gold last traded at $30.07 on the TSX.
