RGN | African Gold Group

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MINING | African Gold Group


The next platform for g


growth in West Africa

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MINING | African Gold Group

African Gold Group (AGG) is a West Africa-focused Canadian exploration and development company listed on the TSX Venture Exchange, with a primary focus on the Kobada Gold Project in Mali – a low cost operation with 122 km² of prospective exploration concessions in the prolific Birimian Greenstone Belt. The company recently appointed a new corporate leadership pairing in Stan Bharti and Danny Callow, two seasoned mining engineers with a range of complementary skillsets. Throughout his career, COO Callow has taken through to construction several greenfields and brownfields operations across Africa for large corporates, while CEO Bharti has garnered a reputation for developing undervalued assets over the last 30 years. “Stan had a couple of very good hits in the West African gold space,” says Callow. “He’s highly entrepreneurial, a great mentor and likes to let the operational guys get on with their work. Coupled with myself on the operational side, I think we make a very good CEO/COO team.” After coming on board in August, Callow recommended initiating an update to the 2016 feasibility study for the Kobada project to include additional data from drilling, geological trenching and regional geology work, ahead of a bankable feasibility.

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MINING | African Gold Group

The original feasibility indicates a total

metallurgical test work, and encompasses

resource of over 2 million ounces (Moz)

an infill drilling campaign that resembles

at Kobada, however this estimation only

a significant opportunity to upgrade the

accounts for drilling from a 4 km portion of

reserve at Kobada.

the main shear zone of the property, which is about 12 km in length.

“One of the things I’ve been pushing for is to undertake this final phase of drilling before

“That tells me that we have enough to start,

moving to construction so we can upgrade

but we also believe there is a lot more in the

the resource where we can and make sure

ground, which can give us a phased approach to have incorporated all of the geological to growing this project from a 50,000 oz per

information available to us. This will give us a

annum operation to 100,000 oz and beyond,” much better understanding of the structural Callow declares.

The phased approach

geology, which is important when we go into the design of the open pit and the type of crushers and mills that we need.”

Phase 1 of the pathway to production is designed to enhance confidence in resource

The processing method also needs to be

modelling, mining engineering and advanced confirmed by AGG, which was seen in the

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2016 study to be gravity concentration only.

listed company out of Toronto I think it’s an

The company is currently undertaking test

important baseline to have.”

work to ensure all stratigraphic boundaries across the orebody are incorporated and

The current ESIA has already been approved

amenable to low cost gravity concentration.

by the Malian government and the Kobada mine is fully permitted, so the Phase 2 drive

Moving into Phase 2, AGG will deliver a

is all about optimising the existing metrics. In

bankable feasibility by April 2020, which

fact, once the bankable feasibility is delivered

will identify an accurate capital costing

in April, AGG can theoretically push the

for the project along with all key long lead

button on construction of the mine.

items and other crucial aspects of the plant design. Phase 2 will also usher in an updated

“I have always worked on the philosophy

environmental social impact assessment

that when you have enough resource to start


construction of a mine, you should look at a phased approach. We are looking at a 50,000

“I am pushing for the ESIA to be upgraded

oz Phase 1 and then an additional 50,000 oz

to IFC and World Bank guidelines. Even

Phase 2.

though that’s not a requisite for Mali, as a

MINING | African Gold Group

“The advantage of that is the whole plant

“My opinion on exploration is you should

is designed in a modular fashion so you

never stop drilling while you have good

can easily add to it. At the same time, you

prospects. If you can drill enough to replace

can often fund Phase 2 with cash flow from

every single oz that you take out the ground

Phase 1, and that’s what we’ve done very

with another oz, you extend the life of mine

successfully in the past.”

and also give yourself the opportunity to grow the size of the production.”

This approach makes perfect sense at the Kobada mine, where there is significant

Local procurement

opportunity for resource growth through

Callow and Bharti believe in utilising

additional exploration. Looking to the longer

local partners as much as possible when

term, Callow sees a third phase taking place

developing projects, particularly in

that will poke holes in some of the other

Africa where there is an onus on mining

shear zones within the licences that are

companies to ‘do good’ by supporting local

prospective for mineralisation.

ResourceGlobal GlobalNetwork Network Resource responsibility (CSR) in the Kobada region, and these actions have been a key focus for Callow during the last 12 years of his career. “CSR is part of our social licence to operate and very often can determine the success or failure of a project. If you think that you can just come into a country, set up base, take all of the resources out the ground and 15 years later leave without leaving a footprint behind, then you will fail. “In its simplest form, CSR is looking to identify and employ skills from the local community, because what that does is bring money into the local community. The community then begins to improve and develop, and it becomes a self-sustaining model.” The COO describes the snowball effect precipitated by mining companies employing locally and supporting local enterprises; These small-scale ventures start bringing in more materials and grow into larger supply chains, which in turn supports key

enterprises providing additional goods and

stakeholders in the project vicinity.

services, which leads to the community becoming less dependent on the mine.

At Kobada, AGG has used a local Malian driller and a local construction company for

Another vital part of AGG’s CSR strategy

the camp, among other in-country suppliers

centres on maintaining full transparency

and contractors. The company’s EPCM

with stakeholders in the local communities

partner has been a rare exception to the rule,

through regular communication. This

coming out of South Africa but boasting a

consultation is as much about keeping

strong reputation for delivering gold projects

locals updated of the latest project updates,

in West Africa.

as it is about discovering what the local communities need from AGG in its role as a

Local procurement and community uplift form key tenets of AGG’s corporate social


MINING | African Gold Group “Rather than just assuming what is needed by the community, we sit down with them, explain how much is in the CSR budget and ask what they would like us to get involved in. “That way we can deliver sustainable projects, because at some stage the mine is not going to be there anymore, but if we’ve got thriving agriculture and other little businesses, when we leave those guys can carry on.”

Sitting down with the chief Grounding this point in the context of the Kobada project, Callow refers to a recent meeting with the Kobada Chief Dantoume Diawara and his village elders to discuss the progress of the project and AGG’s plan moving forward. “Clearly this was the first time this chief has experienced someone sitting down with him and explaining what we’re going to do and when. I outlined our commitments to local employment and local procurement and pledged to visit him on a quarterly basis to provide key updates.” a boardroom table with a PowerPoint In turn, the chief thanked Callow for

presentation, is so important. Instead we sat

employing 12 semi-skilled labourers from the

on plastic chairs with the chief on his veranda

village to help with clean up and preparation

and began a two-way relationship, instead of

for the upcoming drilling campaign, and

just telling him what we will do.”

underlined his commitment to managing the relocation of artisanal miners around the

In conclusion, AGG is running full steam

Kobada concessions.

towards a bankable feasibility for the Kobada project in April next year, at which point it

“I think that meeting with the local people

will be ready to commence construction of

in a very informal way, not sitting around

the mine. But, the development doesn’t end

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there, as the company’s phased approach

world’s most prospective regions for gold

will see it add increased capacity through

exploration right now. The company would

subsequent resource growth.

certainly look to consolidate into other West African jurisdictions should any opportunity

AGG is also interested in additional

fall in the right investment bracket.

opportunities across West Africa – one of the


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Published by Anderson Murray Media Ltd

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