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REGIONAL NEWS - AFRICA 14 E&MJ; • APRIL 2016 www.e-mj.com Endeavour Acquiring True Gold Endeavour Mining has agreed to acquire True Gold Mining in a friendly, all-share transaction that values True Gold at about C$226 million. Endeavour is listed on the Toronto Stock Exchange and operates four gold mines in West Africa, one each in Cote d'Ivoire, Mali, Burkina Faso and Ghana. True Gold has a 90% interest in the Karma gold mine in Burkina Faso, which was nearing production startup as of late March. Endeavour forecasts its 2016 gold pro- duction at between 535,000 and 560,000 ounces (oz) at an all-in sustaining cost of $870 to $920/oz, not counting produc- tion from Karma. Acquisition of Karma will add 110,000 to 120,000 oz per year (oz/y) to Endeavour production over a pro- jected mine life of 8.5 years based on cur- rent reserves. Karma's all-in sustaining cost of production is forecast at about $700/oz of gold during its frst fve years of operation. Endeavour Mining CEO Neil Woody- er said, "The production profle and low cost of True Gold's Karma mine is a very attractive ft with our West African oper- ating portfolio. Karma is nearing produc- tion, and Endeavour Mining has both the fnancial strength and an experienced op- erations team to ensure Karma's value is maximized during this important stage. "True Gold shareholders are receiving an attractive premium and an opportun- ity to participate in a larger diversifed West African producer, while Endeavour Mining shareholders are gaining a new, low-cost mine that boosts group pro- duction and reduces group all-in sustain- ing cost/oz. "In the long term, the Karma mine has extensive exploration potential. Endeav- our Mining's enhanced ability to fnance an expanded exploration strategy at Kar- ma and at our own mines is expected to generate signifcant value." The Karma acquisition will increase Endeavour's attributable proven and probable gold reserves by 19% to 5.4 million oz; its measured and indicated gold resources by 39% to 10.2 million oz; and its inferred gold resources by 123% to 3.9 million oz. In other news, from Endeavour, the company is nearing a construction start at its Houndé open-pit gold project in Burkina Faso. Production is forecast at 190,000 oz/y of gold over a 10-year mine life, including 248,000 oz/y during the frst two years. Reserves currently stand at 29.7 million mt grading 2.15 g/mt gold. Initial startup capital is forecast at $325 million. Life-of-mine all-in sus- taining cost of production is forecast at $717/oz, including royalties, rehabilita- tion and closure costs. Ivanhoe Reports Positive PFS for Kamoa Copper Ivanhoe Mines has reported positive fnd- ings from an independent prefeasibility study (PFS) for the frst phase of devel- opment of the Kamoa copper project in the Democratic Republic of Congo (DRC). The project is a joint venture between Ivanhoe and Zijin Mining Group. The Kamoa PFS focused on the initial phase of project development, describing construction and operation of a 3-million- metric-ton-per-year (mt/y) underground mine, concentrator, and associated infra- structure. The frst phase of mining would target high-grade copper mineralization in shallow underground resources to yield a high-value concentrate. A planned sec- ond phase would entail a major expansion of the mine and mill and construction of a smelter to produce blister copper. The PFS calls for feed to the concen- trator to average 3.86% copper over a 24-year mine life, resulting in production of approximately 100,000 mt/y of copper in concentrate. Concentrate grade would average 39.2% copper, with very low ar- senic levels. Initial capital costs to build the proj- ect, including contingency, are estimated at $1.2 billion. The Kamoa project is based on a very large, stratiform copper deposit with adja- cent prospective exploration areas within the Central African Copperbelt, approx- imately 25 km west of the established mining center of Kolwezi. The PFS has identifed several areas for further evalua- tion to optimize the project's economics, including the use of controlled-conver- gence room-and-pillar mining, which has been successfully used by Polish mining company KGHM at its copper-mining op- erations in Poland for the past 20 years. Ivanhoe's mining licenses for the Ka- moa copper project cover a total of 400 km 2 . The licenses are valid for 30 years and can be renewed at 15-year intervals. Mine development work at the project began in July 2014 with construction of a box cut for the decline ramps that will provide underground access to the initial high-grade mining area. True Gold has a 90% interest in the Karma gold mine in Burkina Faso, which was nearing production start-up as of late March 2016. (Photo: True Gold)