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REGIONAL NEWS - AFRICA 18 E&MJ; • MARCH 2017 www.e-mj.com B2Gold Targeting October Production Start at Fekola B2Gold reported that construction of its Fekola gold mine in southwest Mali is ahead of schedule and now on target for an October production start. The company completed a revised geological resource model for Fekola in the third quarter of 2016, followed by updates to open-pit mine designs and production plans that reflect an increase in planned mill capaci- ty to 5 million metric tons per year (mt/y). Based on these production plans, B2Gold now expects Fekola to produce an average of 375,000 to 400,000 ounces per year (oz/y) during its first five years of produc- tion from 2018 through 2022. As of year-end 2016, overall construc- tion at Fekola was approximately 60% complete. A total of 4 million m 3 of mate- rial had been moved, and construction of the tailings storage facility and water em- bankments was 100% complete. Lining of the tailings facility began in December. Installation of mechanical components was ongoing, including the gyratory crusher, pebble crusher, conveyors, reclaim tunnel, and leach and carbon-in-pulp tanks. Com- mencement of mill installation began in January. Construction of the gold room and reagent storage area was well under way. Total preproduction capital costs to develop the Fekola project are estimated at $395 million, plus $67 million of an- ticipated mine fleet and power generator costs, which are expected to be leased. B2Gold has signed a €71.4 million equipment facility with Caterpillar Finan- cial SARL for the Fekola project (funding subject to satisfaction of conditions prec- edent) that it expected to draw on begin- ning in February 2017. At year-end 2015, the Fekola project had mineral reserves totaling 44.3 mil - lion mt, grading 2.35 g/mt gold and con - taining 3.3 million oz of gold. Glencore Purchases Stakes in Mutanda and Katanga Glencore has purchased the Fleurette group's remaining 31% stake in Mutan- da Mining Sarl for $922 million and a 10.25% stake in Katanga Mining Ltd. for $38 million. Fleurette and its affiliates owe outstanding loans to the Glencore group over the Mutanda shares, amounting to $556 million, of which $120 million comprises accrued interest. In addition, Glencore has acquired shareholder loans owed to the Fleurette group by Mutanda Mining Sarl of $130 million. Accordingly, the aggregate cash consideration payable by the Glencore group is $534 million. Glencore now owns 100% of Mutanda and approximately 86.33% of Katanga. Asanko Gold Receives Key Permits for Expansion Asanko Gold has received both the environ- mental permit and the mine operating per- mit required for an expansion of production at its Asanko gold operations in southwest Ghana. Current open-pit mining and pro- cessing operations reached commercial production in April 2016. Plant through- put capacity is 3.6 million mt/y, and gold production capacity is 190,000 oz/y. The planned expansion of Asanko op- erations consists of two discrete phases: 1) development of the Esaase open pit 27 kilometers (km) north of current op- erations, a 27-km overland conveyor to the existing carbon-in-leach processing plant, and expansion of the processing plant to 5 million mt/y of throughput capacity, and 2) construction of an ad- ditional carbon-in-leach plant to double throughput capacity from 5 million to 10 million mt/y. Construction of both phases is sched- uled for completion in 2020, following which Asanko is targeting production of more than of 450,000 oz/y of gold. A definitive feasibility study for the ex- pansions is on track for completion in the first quarter of 2017. Front end engineer- ing and design activities for the overland conveyor and for the plant upgrade to 5 million mt/y are in progress and on track for completion in the second quarter of 2017. The Esaase deposit contains 60.3 mil- lion mt of proven and probable mineral reserves at a grade of 1.41 g/mt gold, con- taining 2.73 million oz of gold. Approxi- mately 23 million mt of these reserves are in oxide and transition ores, which will be targeted during initial mining of the de- posit. Proven and probable reserves across all of Asanko's deposits stand at 97 mil- lion mt at a grade of 1.68 g/mt, containing 5.25 million oz of gold. The Asanko gold projects are held 90% by Asanko. The government of Gha- na has a 10% free carried interest. Anglo Sells Union Mine to Siyanda Resources American Platinum has agreed to sell its 85% interest in the Union mine in South Africa and 50.1% interest in MASA Chrome Co. to a subsidiary of Siyanda Resources. Anglo American Platinum will retain the Mortimer smelter operation. The transaction includes an intial pur- chase price of R400 million (approximately $30 million) in cash, as well as a deferred consideration based on 35% of cumulative distributable free cash flow paid annually as an earn-out, for a period of 10 years from the completion date of the transaction. Siyanda will sell concentrate produced by the Union mine to Anglo American Plati- num for seven years, thereafter Anglo Amer- ican Platinum will toll treat concentrate for the remaining life of the Union mine. The transaction is expected to be com- pleted during 2017. Glencore now owns 100% of Mutanda and approximately 86% of Katanga.