"Roxgold is a very different company to the one we were 12-18 months ago, having branched out from a single asset miner into multiple jurisdictions. We are well on the path to becoming a multi-asset producer, as we expect to more than double our production and cash flow within the next two years without the need to issue any shares."
Could you share the latest developments at Roxgold’s Yaramoko mine in Burkina Faso?
Notwithstanding the logistical challenges we had to work through due to the pandemic, our team has maintained an excellent performance and we are on track to produce up to 130,000 oz of gold this year. Last year, we brought our satellite deposit, Bagassi South, online and completed the expansion of our processing plant. This expansion has allowed us to further reduce our operating costs and maximize our margins, allowing for Yaramoko to be an even stronger cash flow engine for our company and positioned us well to take advantage of the recent run-up in the gold price.
What is the progress made at the Séguéla asset in Ivory Coast?
After a six-week pause during the pandemic, we were able to go back on the ground in July and resume drilling. We completed the Séguéla Preliminary Economic Assessment in April, which outlined a very robust project with exceptional economics, defining a project capable of producing over 100,000 oz/y over a life of mine of 8 years and generating an NPV of nearly US$500 million at today’s gold price. The next step for us was to complete the infill drilling campaign in support for the Feasibility Report and to continue to test the extensions of the deposits at Séguéla. The Feasibility Report is on track for early next year and we expect to see the complete conversion of inferred resources into measured and indicated. Furthermore, we have had success increasing the mineralized footprint of our main deposits, in particular Ancien, which is one of the highest grade open-pit deposits in Africa with an average grade of 6.1 g/mt. We believe that the culmination of all our drilling this year since the cut-off of the PEA will translate to a Feasibility Study that will compare very well to the PEA – outlining a project that will more than double Roxgold’s production profile while keeping capital spending in line to finance the project ourselves through cash on hand and available debt capacity. Looking forward, we continue to have success delineating additional prospects on our Séguéla land package and believe that the project has the real potential to become a multi-million ounce household name in the African mining industry.
Reflecting on the current exploration undertaken at both Yaramoko and Séguéla, but also the Boussoura gold project on the Houndé belt, how important is exploration at Roxgold?
Roxgold’s key skills reside in exploration and the proven ability to advance a project through development and construction. In the last two years we have significantly bolstered the depth and skillset of our exploration team and we are now starting to enjoy the fruits of this investment in our people. Just like Yaramoko, Boussoura is a home-grown discovery, and is demonstrating similar characteristics of the large systems typically found on the Houndé belt. Meanwhile our exploration team at Séguéla has done an incredible job prioritizing and defining a portfolio of targets that we believe will ultimately be incorporated into the life of mine of the project. At Yaramoko, we will be completing our first comprehensive underground drill program later this year.
What are the underpinning operational measures that allow Roxgold to keep costs low?
Naturally, being one of the highest-grade producers gives us a great head start, but it is true that we have also had a strong focus on costs, and our cost base has relentlessly fallen over the last few years. We can do that by mining more tonnes, but also through a positive working relationship with our contractors while focusing on nationalizing our workforce. Over 90% of our employees at Yaramoko are local Burkinabe, which is an important milestone not only from a cost perspective but also from a legacy perspective as part of our broader social license.
Roxgold’s second Annual Sustainability Report released this June is titled “Strengthening Communities”. What can you tell us about community relations in Roxgold’s countries of operation?
Roxgold has created very positive relationships with our host communities, from local people through to regional authorities and national governments. We see our role as an important part of the formal economy, a big contributor to GDP and a significant source of FDI in Burkina Faso, and soon, in Côte d’Ivoire. Mining is essential for building resilience in these economies, by paying taxes and empowering employees. Mining is becoming part of the fabric of the economy and, while we are aware that our activity has an impact, I strongly believe that through employing industry best practices and being invested and partnered with our communities the benefits far outweigh the negatives.
What are your impressions about operating in Burkina Faso and Côte d’Ivoire?
Roxgold operates in two of the most mining-friendly jurisdictions, but we acknowledge investors hesitance due to country and political risks. However, there are not many countries in the world where one can go from the first drilled hole to the first bar of gold in only five years, and this is what we did with the Yaramoko discovery. This quick turnover is not due to any shortcuts – the same standards apply – but the difference is made by both politicians and communities who are very keen on investment and participation. When you combine the willingness of governments and communities to attract mining, coupled with the significant mineral wealth of the region, we believe that West Africa is one of the best regions to operate globally.
Do you have a final message?
Roxgold is a very different company to the one we were 12-18 months ago, having branched out from a single asset miner into multiple jurisdictions. We are well on the path to becoming a multi-asset producer, as we expect to more than double our production and cash flow within the next two years without the need to issue any shares. This is a company that can fund its growth from our balance sheet, ensuring that our current shareholders are the beneficiaries of this growth. It is an exciting time to be a Roxgold shareholder and we look forward to the steady advancement of our projects through this year and into next.