Gramalote JV Project – Colombia
The Gramalote Project is located approximately 230 km northwest of the Colombian capital of Bogota and approximately 120 km northeast of Medellin, the regional capital of the Department of Antioquia.
B2Gold has a 50% interest in the Gramalote Project (Anglo Gold Ashanti -50%), and on January 1, 2020 became the operator of the Project.
Based on the feasibility study work completed by B2Gold as operator of the Gramalote Project to date, and assuming an effective date of January 1, 2021, and a gold price of $1,500 per ounce, the project economic highlights include (100% basis):
- Open-pit gold mine with an initial life of mine (“LoM”) of 10.6 years based on current Indicated Mineral Resources (for Gramalote Ridge only)
- LoM gold production of 2.97 million ounces and average annual gold production of 347,000 ounces per year for the first five full years of production
- Average annual gold production LoM of 281,000 ounces per year at cash operating costs of $514 per ounce of gold and AISC of $744 per ounce of gold
- Average LoM gold recovery of 95.4% from conventional milling, flotation and cyanide leach of the flotation concentrate
- Estimated pre-production capital cost of $925 million (includes approximately $160 million for mining equipment)
- LoM pre-tax net cash flow of $1,444 million, and after-tax net cash flow of $948 million
- Post-tax NPV at a 5% discount rate of $483 million
- After-tax internal rate of return (“IRR”) of 15% at the project construction decision date with a project payback (including construction capital) of 3.5 years
Based on a review of the feasibility study work to date, B2Gold believes that there is strong potential for a more robust project, which could be developed by revisiting the original Project design parameters included in the existing mining permit as applied in the Gramalote PEA and historical AngloGold studies and further optimizing project design. The Gramalote Project team has identified project optimization opportunities, including potential reductions in capital and operating costs, as well as improved operability and sustainability. In addition, development and review of the updated Mineral Resource estimate has indicated that further value is available through additional drilling of the Inferred portions of the Mineral Resource area, both within and adjacent to the designed pit. The Gramalote Project partners are currently reviewing a revised feasibility study budget totalling $86 million which would allow the final feasibility study to be completed by the end of the first quarter of 2022
Exploration and Development 2021
The initial 2021 budget for the Gramalote Project is $52 million (B2Gold’s 50% share is $26 million) for the continued development of the project, along with continued environmental and social activities supporting local communities. The Gramalote budget also includes $9 million for exploration in 2021. A total of 18,000 metres of diamond drilling is planned in 2021. This includes 8,000 metres for further drilling at Gramalote Ridge and 10,000 metres at two satellite deposits (Trinidad and Monjas West), which are proximal to the planned infrastructure.
Gramalote’s 2021 budget includes project development up to the feasibility completion (expected in April 2021) and construction decision point in the second quarter of 2021, and therefore does not include early works or construction costs, such as mobilization and pioneering. A separate construction budget is expected to be developed for the second half of 2021, based on a positive Gramalote Feasibility Study and construction decision.
For the latest details and news releases pertaining to the Gramalote Project:
- Click here for B2Gold’s Q1 2021 Earnings Results news release (dated May 4, 2021)
- Click here for B2Gold’s Q4 & FY 2020 Earnings Results news release (dated February 23, 2021)
For a more detailed overview of the Gramalote Project, please refer to the following most recent company documents:
- Click here for B2Gold's Q1 2021 Management Discussion & Analysis ("MD&A") (dated March 31, 2021)
- Click here for B2Gold's Q1 2021 Financial Statements (dated March 31, 2021)
- Click here for B2Gold's 2021 Annual Information Form ("AIF") (dated March 30, 2020)
- Click here for B2Gold's Q4 & FY 2020 MD&A (dated December 31, 2020)
- Click here for B2Gold's Q4 & FY 2020 Financial Statements (dated December 31, 2020)
