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REGIONAL NEWS - AFRICA 22 E&MJ; • OCTOBER 2017 www.e-mj.com ity tailings, elution, electrowinning, and smelting to produce gold doré. Feasibility Study Supports Teranga's Bandore Project Teranga Gold has reported positive results from a feasibility study of its open-pit Banfora gold project in southwest Burkina Faso. Base case highlights from the study include average mill feed grade of 1.88 grams per metric ton (mt) of gold and av- erage production of 119,000 ounces per year (oz/y) over a mine life of nine years. Preproduction capital expenditures are estimated at $232 million. The Banfora study was based on initial gold reserves of approximately 1.2 million oz in four deposits — Nogbele, Fourkou- ra, Stinger and Samavogo — within the Banfora mine license. The process plant will be located adjacent to the Nogbele deposit, which contains approximately 50% of the initial reserves. The Fourk- oura, Stinger, and Samavogo deposits are located 6 km, 15 km, and 25 km, respec- tively, from the process plant. Teranga expects Banfora's project eco- nomics to improve following completion of an infill drill program aimed at convert- ing inferred resources to reserves to be completed later this year. Major construc- tion is currently scheduled to begin in the second quarter of 2018. Beyond the initial four deposits in- cluded in the feasibility study, Teranga has initiated a multiyear exploration pro- gram on more than a dozen other priority targets on its regional exploration land package, all within trucking distance of the proposed mill site. Banfora will be Teranga's second gold mine in West Africa. Its Sabodala open- pit mine in Senegal is forecast to produce between 205,000 oz and 225,000 oz of gold in 2017. Teranga anticipates that its Banfora project will benefit from the com- pany's experience at Sabodala. Banfora will be mined by conventional open-pit methods. The project scale suits 110- to 140-mt-class backhoe excavators matched to 50-mt-class haul trucks operat- ing at 5-m bench heights. An extensive re- verse circulation drill program is planned to supplement the production blast hole sam- pling as part of the grade control strategy. The haul trucks selected can haul ore directly from the pits to the process plant, which is expected to reduce re-handling costs and minimize waste movement through optimized pit designs for the near-surface orebodies. Teranga will oper- ate its own fleet. The Banfora process plant design is based on a conventional carbon-in-leach (CIL) flowsheet, including primary crush- ing, SAG and ball milling, a pebble crusher, CIL tanks, elution, electrowinning, and gold smelting to produce doré on-site. Through- put is expected to range between 2.2 mil- lion mt/y and 2.5 million mt/y, depending on the blend of soft and hard ore. The aver- age predicted plant recovery is 92%. Reinventing the Gemstone Market The takeover of London-listed precious stone producer Gemfields by majority shareholder Pallinghurst in late June is the coming to- gether of a plan to create a de Beers-type marketing platform for gemstones. Gem- fields produces emeralds and amethysts in Zambia and rubies in Mozambique. Brian Gilbertson, chairman and founder of South African-based Pallinghurst, said he wants to create the same value chain for gems that De Beers created for diamonds. "The old way of selling gems was slow — row upon row of stones were put on display for buyers. So, we now hold regular auctions where buyers can bid on lots," Gilbertson said. "Buyers are typically a father and son — they spend days or even weeks poring over each stone in a lot, then put in a bid." Before each auction Gemfields prod- ucts are washed, sorted and graded. The rough is graded not only into size and quality, but also into the different cate- gories for specific cutting requirements. For example, faceted stones, cabochons, beads and calibrated goods all require dif- ferent grades of rough. Buyers can select stones specific for their requirements. Gemfields said it has the world's most comprehensive grading system, and holds auctions up to four times a year. The sys- tem allows jewelers to plan ahead and overall leads to an increase in demand. All production so far is in Southern Africa. The Kagem mine in Zambia is the world's single largest producer of emer- alds and accounts for approximately 20% of global emerald production. Gemfields also owns a 50% stake in the Kariba mine in southern Zambia, the world's largest amethyst mine. In addition, Gemfields produces around 70% of the world ruby supply, from the Monepuez deposit in northeast of Mozambique. More than half of the world's gem- stones are now found within Southern and Eastern Africa, servicing a global market worth $310 billion each year, according to Euromonitor. The majority of mining operations are in a geological region known as the Neoproterozoic Mo- zambique Belt that stretches from Kenya all the way down to Malawi and sweeps eastward to the island of Madagascar. Central to Gilbertson's marketing strat- egy was the acquisition of the Fabergé brand, renowned as the jeweler to the Tsars, crafting fine artwork out of gold, diamonds and more. After the Russian revolution in 1917 the Fabergé clan fled into exile. What followed was a schizophrenic emergence of several Fabergé workshops — in Par- is, Leningrad and New York. In a kind of "pass the parcel," the name changed ownership over the decades before land- ing ignominiously in the hands of Unile- ver, a global consumer goods company. "They used the name on roll-on de- odorants," said Gilbertson. Pallinghurst bought the brand from Unilever for $38 million in 2007. The name Fabergé is now housed in Gemfields, and will market the products from its mines. "The idea was to recreate for colored gemstones what de Beers did for dia- monds," said Gilbertson. The diamond producer today owns production mines as well as a high street retail stores bearing its name. "The great thing about de Beers is they took up the whole pro- duction chain," Gilberston added. To this end, there are now four stand- alone Faberge stores, and about a dozen representatives around the world. Like de Beers, the company employs its own craftsmen and jewelery makers to pro- duce bespoke items. If this wanders a little too far into the left field for most miners, it should be recalled that Gilbertson was the cre- ator of BHP Billiton. During the early 2000s through a series of corporate maneuverings, Gilbertson took South Africa gold producer Gencore into a re- verse listing in London, and then merged the new entity Billiton with Australia's Broken Hill Proprietary. He was ousted from the board in 2003. Since then, he has pursued mining related projects and now hopes to put his business and mining acumen to reinvent- ing the gemstone market.