Tietto Minerals – Golden Prospects
Given its highly satisfactory results over the last year, recent achievement of DFS and CAPEX funding solutions, the mining company Tietto Minerals is fast-tracking on transitioning from being a gold explorer to a gold producer.
Perth-based Tietto Minerals Ltd – established in 2010 – is focused on developing a multi-million-ounce gold resource at its flagship Abujar Gold Project in Côte D’Ivoire, West Africa. The company, ASX-listed in 2017, with an IPO in 2018, is pursuing a clear business strategy of transformation from gold explorer to gold producer.
“The Abujar Gold Project is positioned in a stable, significantly under-explored mining jurisdiction in one of Africa’s most well-developed nations with outstanding infrastructure, close to good regional and local infrastructure to facilitate exploration and development, being only 15 km from the nearest tarred road and grid power.
Abujar is comprised of three contiguous tenements with a total land area of 1,114 km2, of which less than 10% has been explored; this provides significant potential for the resource to be further developed.
The company is progressing fast, and its founder and managing director Dr Caigen Wang, an internationally recognised mining engineer with a wealth of experience in the sector, is pursuing the strategy with determination. Last year, we spoke to him about the project’s history and its prospects. This time, we focused on recent achievements and the planned transition as the company is working towards the construction stage.
Over the last year, the company has secured all the requisite mining and environmental approvals needed for the project. In April 2021, Tietto delivered a Pre-Feasibility Study (PFS) for its flagship project, targeting 200,000 ounces of gold in the first year of production and estimated production of more than 168,000 ounces of gold annually for the first six years of operations. Beyond the actual gold production forecasts, the fundamental signs for a gold mine with a long production life were sound.
Tietto completed a Definitive Feasibility Study (DFS) for Abujar in October 2021. Promisingly, the DFS has boosted forecast production in the first year by 30% from the PFS to 260,000 ounces of gold at an all-in sustaining cost of US$ 651 per ounce. Looking beyond that, Abujar can deliver 1.2 million ounces of gold over the first six years at 200,000 ounces per annum, an increase of 20%, and at an average all-in sustaining cost of US$ 804 per ounce.
In November 2021, Tietto secured USD130-140 million debt facility through Taurus Mining Finance and raised A$85 million through placement. This brought the Abujar Gold Project into fully funded status.
Tietto is planning to produce the first gold from the Abujar Project in the fourth quarter of 2022, estimating that the project will have a payback period post-tax of less than 1 year from the first production.
Dr Caigen Wang commented: “Our recent update to the Abujar resource model has allowed Tietto to deliver a DFS that confirms Abujar’s potential to be one of the largest gold-producing mines in Côte d’Ivoire. The DFS metrics are clearly compelling – all the PFS measures have materially improved, from production to finance. Gold production, in particular, is positioning Abujar as a Tier 1 gold mine.”
“We are confident the Abujar Gold Project will continue to enjoy growth in both resources and reserves and hence life-of-mine production increases into next year through our continued large-scale drilling programme. We are focused on advancing the Abujar Gold Project towards becoming West Africa’s next gold mine.”
He further acknowledged that the six batches of results from the infill drilling programme at Abujar are delivering up more high-grade gold intercepts that continue to de-risk open pit mining at Abujar. The infill programme is designed to convert indicated resources into measured resources scheduled to be mined within the first two years of production.
Mile-long steps forward
On the human resources front, in summer the company added key people to what it now regards as the best mine-building team in West Africa, says Dr Wang, noting that Tietto has also completed the layout for the project’s proposed processing plant, while its partner, Primero Group (NRW), is advancing the engineering design and procurement for the mine.
Other work progression includes the 22 km access road, which is nearing completion. Powerline and switchyard detailed designs have started and the land acquisition for the Abujar gold mine is in the final stage of public notice. Additionally, mining contractors have visited the site as part of the tender process.
Progress on the ground continues to move fast. With its fleet of drill rigs, Tietto is continuing to drill-test underground targets and 20 regional prospects within 10 kilometres’ trucking distance of the planned Abujar mill. The company will examine the potential for the Abujar mill throughput to increase above DFS levels once the plant is operational, as demonstrated by other West African gold projects.
During the September quarter, Tietto received further high-grade gold results from infill drilling at the Abujar-Gludehi (AG) Deposit at Abujar, and in the same period reached an agreement to acquire more than 1,200 hectares of land for mine construction areas and mine production areas in a staged manner.
With the high level of interest arising from these excellent results, Tietto is well-funded, with USD130-140 debt facility secured through Taurus and over A$100 million in cash (A$ 32 million plus the recent A$85 capital raise) to continue the fast-tracking development of the project, advancing its dual strategy in 2021 and 2022. The company is now negotiating the Abujar Mining Convention with the Ivorian Government, the final regulatory step for Tietto to achieve.
Dr Wang concludes: “Over the last year, we have made good progress in terms of transiting from a gold explorer to a gold producer. Drilling is continuing and the next resource update is expected in first quarter in 2022. Tietto is on track to deliver its first gold at Abujar in the final quarter of 2022.