Aim-listed Alecto Minerals on Monday said 2015 had proved to be a turning point for the group as it transitioned from an explorer to developer after acquiring the Matala and Dunrobin gold mines, in Zambia. A “clear path” to production was being established in Zambia, with the Africa-focused gold and base metal exploration and development company now boasting a Joint Ore Reserve Committee- (Jorc-) compliant total estimated resource exceeding one-million ounces of gold, up from 247 000 oz in the prior year, a further 240 000 oz of non-Jorc-compliant gold resources and a 25-year renewable mining licence covering some 32km2.
“We made great strides towards becoming an African gold producer in 2015,” Alecto CEO Mark Jones commented, pointing to the demonstrated strong economics and low costs associated with delivering production at the historical Matala. With an environmental permit in place, the feasibility study completed and nearly $20-million in historic investment, the acquisition brought an additional 760 000 oz of gold resources into the group at an acquisition cost of less than $3/oz.
“Our focus going forward is very much on achieving gold production at this project location at the earliest opportunity,” said Jones. To this end, vendor financing was progressing, with a letter of intent signed for up to $14.4-million between private design, build and operate contractor Yantai Xinhai Machinery, PenMin, which produced the feasibility study, and Alecto, for the proposed 400 000 t/y mine. The mine was expected to produce about 33 000 oz/y of gold, with a net present value for the project of $28.6-million and an estimated internal rate of return of 52%. “Our development plan for Matala is designed to be rapid and robust,” Jones added.
Alecto posted profit for the year ended December 31, 2015, of £3.3-million, a rebound on the restated loss of £767 804 the year before. “The profit this year is owing to a fair value adjustment to the exploration and evaluation assets acquired by the group in November 2015, net of the loss realised on the disposal of the group’s Ethiopian assets,” Jones said. The group’s revenue for the year to December was £14 291. Alecto’s cash position as at December 31, 2015, was £530 003, compared with the £114 258 reported in 2014.