Monday, July 7, 2008
Banro's pre-feasibility study of its Twangiza gold project indicates gold production of 2.3 million ounces at average operating cash costs of US$345/OZ during 12 years of operation
Highlights include:
- Average annual production of 345,125 ounces of gold per annum over the
first 3 years of operation;
- Average annual production of 236,144 ounces of gold per annum for the
first 7 years of operation;
- Total operating cash costs of US$212 per ounce for the initial 3 years
of mine life;
- Average total operating cash costs of US$345 per ounce for the first
phase Life of Mine;
- Project post tax net present value ("NPV") of US$352 million based on
a gold price of US$850 per ounce and 5% real discount rate;
- Full project capital expenditure payback, including the cost of the
hydro-electric scheme, of 2.78 years from the start of production,
based on a US$850 per ounce gold price;
- Project net cash flow after tax and capital spending of
US$583 million.
"The Twangiza production profile is skewed with significantly higher rates of gold output in the earlier years resulting from the near surface, wide oxide zone, and together with lower mining and processing costs of this material, results in strong cash-flows, supporting a quick pay-back of total capex. This is an ideal scenario for this region and should support the decision to apply a lower discount rate on these future cash-flows in securing financing for the project. In addition to this, the project brief was designed to take full advantage of Banro's mining convention, specifically over the first 10 years of the mine's life. It is likely that the Twangiza project, and its resultant free cash-flows, can assist financing the organic growth of the belt," said Simon Village, Chairman of Banro.
The Pre-Feasibility Study has been prepared with input from a number of
independent consultants including SRK Consulting,
Twangiza Project Overview
The Twangiza project is located in the South Kivu Province of the DRC, 45
kilometres to the south-southeast of Bukavu, the provincial capital. The
Twangiza property consists of six exploitation permits totaling 1,164 square
kilometres which are wholly-owned by Banro through a DRC subsidiary, Twangiza
Mining SARL. The current exploration commenced in
"In spite of excessive increases in the cost of steel, fuel, other
reagents and transportation which have been experienced since the publication
of the Scoping Study last year, this Pre-Feasibility Study demonstrates the
robust economics of the Twangiza project. Twangiza has the potential to
generate significant cash flow based on its projected low operating cash
costs. Our focus is now to further improve Twangiza's economics by expanding
the resource base as well as optimizing various aspects of the project,
specifically the processing route and the hydro electric plant. This will be
done as we finalize the Bankable Feasibility Study and move Twangiza further
along the development path and up the value curve," said Banro President and
CEO
Mineral Resources
SRK Consulting (UK) Ltd. ("SRK") has prepared an independent estimate of the Mineral Resources at Twangiza, which estimate is set out in Table I below.
SRK's estimate is based on drilling data available as at
Table I - Summary of Twangiza Mineral Resource Estimate (June 23, 2008)
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Mineral Resource Tonnes Grade Ounces
Category (Million) (g/t Au) (Million)
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Measured 16.7 2.59 1.39
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Indicated 42.5 1.72 2.35
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Measured & Indicated 59.2 1.96 3.74
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Inferred 10.0 1.80 0.60
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(Using a 0.5 g/t Au cut-off).
The above estimated Mineral Resources are found within three deposits: Twangiza Main, which contains 87% of the total Mineral Resources; Twangiza North, which contains 11% of the total Mineral Resources; and the transported Twangiza "Valley Fill" deposit, which contains 2% of the total Mineral Resources.
This Mineral Resource estimate differs from Banro's
The lower cut-off grade has resulted in a 10% increase in Measured and
Indicated tonnage at a 13% reduced grade for a 3.5% reduction in gold content.
The pit restriction has resulted in a significant reduction in Inferred
Mineral Resource given that deeper areas of fresh mineralisation are now
considered unlikely to be mined economically assuming a
SRK Consulting (
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Gold price US$ 700 (downside), US$850 (base case),
US$1,000 (upside) - per ounce
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Diesel fuel price US$ 1.60/litre
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Mining dilution 5% at zero grade
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Mining recovery 95%
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Pit slopes Minus 28 to 55 degrees
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Metallurgical recovery Oxide ore 90%
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Transitional porphyry: Twangiza Main 85%
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Transitional porphyry: Twangiza North 90%
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Fresh porphyry: Twangiza Main 83%
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Fresh porphyry: Twangiza North 75%
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Transitional sedimentary 38%
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Fresh sedimentary 54%
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The following Mineral Reserves are estimated by SRK Consulting to be contained in a practical pit design:
Table II - Summary of Twangiza Mineral Reserve Estimate (June 23, 2008)
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Tonnes Grade Ounces
Reserve Category Deposit (Million) (g/t Au) (Million)
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Proven Twangiza Main 15.22 2.60 1.273
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Twangiza North 0.07 1.19 0.003
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Total : Proven 15.29 2.60 1.276
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Probable Twangiza Main 27.47 1.81 1.594
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Twangiza North 6.13 2.23 0.440
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Total : Probable 33.60 1.88 2.034
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Total : Proven
and Probable Twangiza Project 48.89 2.11 3.310
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SRK Consulting's independent estimate of the Twangiza Mineral Reserves is
based on the Mineral Resource estimate set out above (see Table I). The
Mineral Reserves were estimated by
The two deposits at Twangiza are planned to be mined simultaneously to provide 5.0 million tonnes of oxide ore to the processing plant in the initial years. The transition and fresh ore types are planned to be stockpiled during this period and processed once the oxide ore production decreases.
The estimated total open pit mine operating cost of
"Twangiza has a favourable stripping ratio of only 1.72, which is an important contributing factor to Twangiza's low operating costs," said Prinsloo.
The Pre-Feasibility Study has been done at Banro's request with specific focus on the non-refractory portion of the ore body. SRK has included some of the transitional and fresh sedimentary ore types in the Measured and Indicated categories, but due to their refractory nature, this results in lower processing plant recoveries; recoveries of 38% for the sedimentary transition and 54% for the sedimentary fresh were used. (These same recoveries were used in the Scoping Study for this material). The Pre-Feasibility Study excludes an estimated 22.5 million tonnes of mineralized material categorized as reject material (transitional and fresh sedimentary), at an average estimated grade of 0.8g/t Au, (equivalent to approximately 570,000 ounces of gold) which are in the Inferred category and are to be stockpiled separately for processing at a later stage or blending when capacities in the plant allow for it. The metallurgy around those ore types will be reworked and optimized in the next six months as the Company moves through to completion of the Bankable Feasibility Study.
The Scoping Study (or Preliminary Assessment) that was released on
"This has further upside for Twangiza, and essentially provides the option of processing a further half million ounces that have not been incorporated in the current production profile. Also not included in the Pre-Feasibility Study as the first phase Life of Mine are the additional targets of Luhwindja (neighbouring Twangiza North), Mufwa and the Tshondo. Initial soil results and adit samples at Mufwa show promise, and should be confirmed by the current drilling program we have initiated at Mufwa," said Prinsloo.
Processing
Metallurgical test work, including recovery and comminution studies on
representative, composite drill core samples, have been undertaken for the
oxide, transitional and fresh rock ore categories by SGS Lakefield in
Oxide Twangiza Main: 89.8%
Oxide Twangiza North: 89.8%
Transition Non-Refractory Twangiza Main: 85.2%
Transition Non-Refractory Twangiza North: 90.2%
Fresh Non-Refractory Twangiza Main: 82.7%
Fresh Non-Refractory Twangiza North: 74.5%
Transitional Sedimentary: 38%
Fresh Sedimentary: 54%
Based on this test work, SENET of
Power
Studies have been undertaken using hydroelectric and diesel power sources
for the Twangiza project. Although capital costs are higher for the
hydroelectric alternative, operating costs, especially processing power costs,
are significantly lower and subsequent project economics are better than a
diesel powered generation alternative. Back up diesel power for essential
processing plant equipment has been included in the project's capital cost.
Knight Piesold Ltd. of
The hydro electric power scheme also has the potential of obtaining carbon credits, which not only compliment Banro's environmental friendly policies, but could also present a favourable cost saving or claw back for the project. These recoveries have not been quantified in the Pre-Feasibility Study, but will be included in the Bankable Feasibility Study.
"Project economics have not been included using a diesel power alternative at Twangiza owing to the hydro potential of both the Ulindi 1 and Ulindi 2 sites in the area which are quite capable of supporting a project size of Twangiza. In addition, the hydro offers a clean energy solution that will attract both environmental and revenue benefits, the latter resulting from carbon credits that are now available in the market. This also improves the logistics of the operation through not having to convey diesel to site which would otherwise create congestion along the N2 highway, which has recently been upgraded with funding from the World Bank," said Prinsloo.
Capital Costs and Infrastructure
Table III below summarizes estimated capital costs for the Twangiza
project, as estimated by the independent consultants, and includes preliminary
quotations from equipment providers, further substantiated by experience on
current projects in
It is important to note that recent metallurgical test results (post process plant design selection) reveal that the selected process plant is not the most cost effective design for the processing requirements of the existing ore body. It is therefore envisioned that, based on this recent information, a substantial capital cost saving may be achieved through a redesign of the processing plant and its footprint. The transition into the bankable phase of the study will reveal this in greater detail, but for the purposes of the Pre-Feasibility Study, a scoping level capital expenditure estimate has been indicated for this alternative option. (See Sensitivities - Scenario II).
Within the Pre-Feasibility Study, certain assumptions around key financial drivers have been made (eg. owner operated mining fleet vs. outsourced mining, capital purchase of standby diesel generators vs. leasing options, etc.). These drivers have the obvious impact of increasing capital costs and reducing operating costs and need to be considered when reviewing the financial figures. Conversely, the lower capital cost options will increase the operating costs.
Costs currently assume an owner-operated mining fleet, although contractor mining has been investigated and interested parties will conduct site visits in the near future in order to submit a price for the Bankable Feasibility Study. (See Sensitivities - Scenario III).
Additionally, the assumption is made that a dedicated hydro-electric facility would be developed by Banro utilizing one of the sites selected by the Company's consultant hydrologist, Knight Piesold. Hydro electric power plant builders/operators have been approached to do on-site visits in the near future in order to submit a price for the Bankable Feasibility Study.
All financial analysis for the Life of Mine includes the total design, construction and commissioning, production and closure.
A conservative approach to the cost of lime and cement has been taken in
the Pre-Feasibility Study and further investigations of sourcing locally
(within the DRC) or close country supply (within
Labour costs have also been brought into line with Banro's current market levels.
Table III - Twangiza Project Estimated Capital Costs
3 Stream 1 Stream/Contractor 30 July 2007
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PFS Provisional
Original Estimate Original
CAPEX SUMMARY Design (Scoping Level) Scoping
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HEP HEP HEP
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Mining US$ million US$ million US$ million
Plant & Equipment 57.789 0 57.588
Haul Roads 3.500 3.500 4.563
Prestrip Costs 6.646 6.646 15.132
Other 2.944 2.944 1.386
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Total Mining 70.879 13.090 78.670
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Process Plant
Earthworks & Civils 49.348 38.000 14.287
Mechanical Equipment,
Structural & Piping 87.699 70.000 57.307
Electrical &
Instrumentation 14.790 11.500 7.899
Tailings Dam 16.848 16.848 5.441
Other 22.699 16.000 14.537
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Total Process Plant 191.383 152.348 99.470
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Infrastructure
Power Plant & First
Fuel Fill (Standby
Genset&Fuel Farm) 92.555 86.500 54.840
Buildings &
Accomodation
Facilities 8.382 7.000 7.598
Access Roads 17.298 17.000 6.510
Light Vehicles
& Mobile Equipment 2.784 2.500 2.6188
Other 9.000 7.500 1.452
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Total Infrastructure 130.019 120.500 73.019
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Management Costs
EPCM 41.000 39.000 34.227
Owner's Preproduction
Costs 26.134 17.000 9.695
Administration Tax
& Insurances 14.737 11.500 9.966
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Total Management Costs 81.870 67.500 53.888
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Contingency 67.050 55.000 42.423
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TOTAL INITIAL
CAPITAL COSTS 541.202 408.438 347.469
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Ongoing Capital 39.380 39.380 32.823
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GRAND TOTAL PROJECT
CAPITAL COSTS 580.582 447.818 380.292
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The estimated capital costs include the full hydro electric power plant
capital, which has increased by some
Note: Scenario 1 under sensitivities below examines the Base Case.
Note: Scenario 2 under sensitivities below examines the US$580.582 less
US$57.789 for the contractor mining fleet. (i.e US$522.793 capital
expenditure) - See Table III.
Note: Scenario 3 under sensitivities examines the US$447.818, which is
the contractor mining fleet /single stream plant.
Operating Costs
Table IV - Total Operating Costs for Initial 7 years
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PFS Scoping Study
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OPEX : First 7 Years : HEP US$/t US$/oz US$/t US$/0z
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Mining 5.39 109.67 6.62 104.25
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Processing 8.72 191.31 5.31 83.55
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G & A 2.09 44.89 1.58 24.92
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Refining 0.26 5.00 0.13 2.07
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Total 16.46 350.87 13.64 214.79
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Table V - Life of Mine Total Operating Costs
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PFS Scoping Study
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OPEX : LoM : HEP US$/t US$/oz US$/t US$/0z
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Mining 4.32 91.76 5.95 114.21
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Processing 9.48 201.29 5.73 110.01
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G & A 2.19 46.60 1.58 30.40
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Refining 0.24 5.00 0.11 2.07
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Total 16.23 344.65 13.37 256.69
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In preparing the Pre-Feasibility Study there have been a number of assumptions and material factors that have been employed. Some of these are shown in Table VI and VII below.
Table VI - Financial Assumptions - Twangiza
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UNIT BANRO ASSUMPTION
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Revenue
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Gold Price (US$/oz) 850
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Discount Rate (%) 5.0%
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Fuel Prices
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Diesel US$/l 1.60
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Power Costs
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HEP Costs US$/kWh 0.025
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Fiscal
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Tax Free Holiday Years 10
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Tax Rate Year 0 -10 (%) 0.0%
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Tax Rate greater than 10 years (%) 30%
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Royalty (Government) (%) 0.0%
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Administration Tax (%) 5.0%
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Depreciation (%) 0.0%
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Depreciation Period Years 10
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Conversions Factors
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Kilograms to Ounces (kg/troy oz) 32.1505
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Diesel Fuel Density (t/m(3)) 0.85
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Hydro Density (t/m(3)) 0.97
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Exchange Rate Rand:Dollar ZAR8:US$1
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Refining Charges, Dore
Transport and Insurance US$/oz 5.00
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Percent Capital
Expenditure (Year 1) % 30.0%
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Process Plant Residual Value % 5.0%
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Power Plant Residual Value % 30.0%
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Mining Equipment Residual Value % 5.0%
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Vehicles % 10.0%
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Table VII shows the percentage increases of the key components causing the difference between the Scoping Study and the Pre-Feasibility Study.
Table VII - Material Factors - Twangiza
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Approximate %
Price Increase
July 2007 vs. July 2008
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1. Diesel Costs 58.0%
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2. Transport (Logistics) 35%
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- Container Price for Freight 26.0%
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3. Civils and Infrastructure
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- Earthworks (Increased Process Plant
footprint, increase in earthwork rates) 784%
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- Civils (Increased Process Plant footprint) 70%
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- Access Roads (incl. Earthworks, Layers,
Drainage & Bridges): Distance Increase
(SS; 24km vs. PFS:34.2km) 126%
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4. Steel Costs 85%
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5. Reagents
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- Lime Costs 12.0%
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- Cyanide 22.0%
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- Cement 22.0%
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6. Power (Increase from 18MW to 30MW) 64.0%
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7. Process Plant Redesign (3 Stream (PFS) vs.
Single Stream (SS)) 62.0%
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8. Tailings Dam 210.0%
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9. Resettlement Costs 183.0%
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(xx)Notes: PFS - Pre-Feasibility Study; SS - Scoping Study
The 3 stream plant has a bigger footprint requiring more earthworks
because of topography.
The increase in the tailings dam is due to a change in location
necessitated by environmental considerations.
The contractors have also increased their margins, particularly for more
remote locations.
Project Economics and Financial Analysis
SENET has produced a cash flow valuation model for the Twangiza project
based on the geological and engineering work completed to date and
incorporating the hydroelectric power source. The base case was developed
using a long-term gold price of
Calculated sensitivities show the significant upside leverage to gold prices and robust nature of the projected economics to operating assumptions. These sensitivities could also be indicative of a more economical process plant design that will be reviewed within the bankable phase of the study.
Sensitivities
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Scenario 1 - Base Case
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Table VIII - Gold Price
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Gold Price IRR NPV US$ million at different discount rates
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US$/oz % 0% 5% 10%
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700 9.6% 237 92 7
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850 20.5% 583 352 196
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1000 29.8% 928 611 398
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Table IX - Capex
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CAPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 24.6% 641 407 249
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+10% 17.1% 525 296 143
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Table X - Operating Costs
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OPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 22.4% 662 408 238
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+10% 18.5% 503 295 153
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Table XI - Fuel Price
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Fuel Price IRR NPV US$ million at different discount rates
Change ------------------------------------------------------
% % 0% 5% 10%
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-10% 20.8% 592 359 201
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+10% 20.2% 573 344 190
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Scenario 2 - Contract Mining Option
-----------------------------------
(Contractor option where mining fleet is purchased by the contractor.
This will impact on costs by an estimated US$30/oz, increasing the total
operating cash cost to US$375/oz).
Table VIII (2) - Gold Price
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Gold Price IRR NPV US$ million at different discount rates
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US$/oz % 0% 5% 10%
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700 13.1% 293 147 47
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850 24.7% 639 406 249
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1000 34.7% 984 666 451
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Table IX (2) - Capex
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CAPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 29.1% 691 456 297
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+10% 21.0% 586 357 202
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Table X (2) - Operating Costs
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OPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 26.7% 718 463 291
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+10% 22.7% 559 350 207
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Table XI (2) - Fuel Price
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Fuel Price IRR NPV US$ million at different discount rates
Change ------------------------------------------------------
% % 0% 5% 10%
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-10% 25.0% 648 414 255
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+10% 24.4% 629 399 243
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Scenario 3 - Contractor Mining/Single Stream Plant
--------------------------------------------------
(Capital expenditure further reduced by footprint and single stream
plant).
Table VIII (3) - Gold Price
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Gold Price IRR NPV US$ million at different discount rates
US$/oz ------------------------------------------------------
% 0% 5% 10%
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700 19.0% 366 218 117
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850 31.8% 711 478 319
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1000 42.8% 1,057 737 521
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Table IX (3) - Capex
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CAPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 36.7% 756 520 359
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+10% 27.6% 666 436 279
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Table X(3) - Operating Costs
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OPEX Change IRR NPV US$ million at different discount rates
% ------------------------------------------------------
% 0% 5% 10%
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-10% 33.8% 791 535 361
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+10% 29.6% 632 421 277
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Table XI (3) - Fuel Price
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Fuel Price IRR NPV US$ million at different discount rates
Change ------------------------------------------------------
% % 0% 5% 10%
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-10% 32.1% 721 485 325
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+10% 31.4% 702 470 313
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The above financial analysis does not take into account ongoing exploration, financing, interest or working capital costs, but does estimate ongoing capital requirements.
Accessibility and Transport/Logistics
SENET and FH Bertling Logistics have undertaken preliminary surveying with detailed analysis of access routes to the Twangiza project for plant and equipment as well as ongoing production materials and consumables. As part of the Pre-Feasibility Study the following routes were investigated:
1. Mombasa (Kenya)-Nairobi-Kampala (Uganda) - Kigali (Rwanda) - Bukavu
(DRC) and then en-route to Site via the N2 road in South Kivu
Province.
2. Dar es Salaam (Tanzania) to Kigomo by road or rail - travel north
through Tanzania crossover into the Burundi border and again into
Rwanda en-route to Bukavu - N2 through to Site.
3. Road from Johannesburg (RSA) on the Great North road through Zambia to
Mpulungu (southern most point of Lake Tanganyika) - barge to Bujumbura
(Burundi) and truck over the Rwandan border - Bukavu (DRC) N2 through
to Site.
The national road (N2) running from Bukavu to Kasongo passes within approximately 24 kilometres of the project. This road is currently being upgraded through a World Bank initiative and the upgraded section has passed the Twangiza turnoff and the Ulindi 1 and/or Ulindi 2 hydro sites on route to Kamituga, Lugushwa and Namoya, three of Banro's other projects.
The study findings propose option 1 as the preferred choice.
Environmental and Social Aspects
SRK Consulting has commissioned and is implementing a Bankable Feasibility, Environmental base-line study at Twangiza which will include ecological, hydrological and socio-economic assessments. During the Pre-Feasibility phase specialist inputs were commissioned on:
- Environmental studies
- Social studies
- Water studies
- Geochemistry studies
The Pre-Feasibility socio-economic assessment included a village-level socio-economic survey, which generated valuable data on demography, lifestyles and household livelihoods. It provided a firm basis for the formulation of a Resettlement Policy Framework, which will form the basis for taking the resettlement planning process to the level of a resettlement action plan (RAP) during the Bankable Feasibility phase. The social assessment also generated a conceptual Social Development Plan and a Stakeholder Engagement Plan which will be further detailed and refined during the Bankable Feasibility Study phase.
Project Opportunities
Banro is actively pursuing a number of alternatives for enhancing and increasing the economics and financial returns relating to the Twangiza project. These include delineating additional resources at Twangiza, such as the Luhwindja, Mufuwa and Tshondo deposits, which are within economic hauling distances, optimizing the mine plan schedule, optimizing process recoveries for the various ore types and targeting new near surface prospects within the Twangiza project area.
The regional exploration potential is encouraging. The Twangiza and surrounding properties have recently been covered by geographical survey involving helicopter borne magnetic and radiometric surveys. The data has been processed and analyzed and resultant anomalies and targets will be tested as part of future growth opportunities. The Company has also completed the LiDAR surveys for the whole of the Twangiza property and the surrounding areas.
Site Selection
All sites have been selected from the different site positions that were investigated for each category (e.g. the plant, waste rock dumps, tailings (slimes) dam, man camps, etc.) However, further site opportunities and optimization to minimize the associated earth works are under consideration and will be evaluated in line with the perceived process plant design changes to be undertaken in the Bankable Feasibility Study.
Development Timetable
Despite the recent abnormally high price increases in fuel, steel and
other consumables, the project economics have remained positive and have
endorsed Banro's decision to work seamlessly towards completion of a formal
Bankable Feasibility Study by the end of 2008. This will largely involve the
inclusion of more infill drilling and a further resource update, further pit
optimization and optimizing the engineering studies and design, including the
incorporation of further metallurgical and geotechnical investigations. Banro
and SRK Consulting are targeting to complete the baseline environmental
studies by the end of
All the Pre-Feasibility work will now progress directly to a definitive, Bankable Feasibility Study with completion targeted for the end of the fourth quarter of 2008. During this period, Banro intends to initiate discussions with potential project finance lenders, including both multilateral agencies and commercial banks.
Full details of the Twangiza Pre-Feasibility Study in the form of a
National Instrument 43-101 technical report will be filed on SEDAR (at
www.sedar.com) within the next 45 days. Additional information with respect to
the Twangiza project is contained in the technical report of SENET dated
Qualified Person
The Pre-Feasibility Study of Twangiza was prepared under the supervision
of
Teleconference
Banro will be hosting a teleconference to discuss the results of the
Twangiza Pre-Feasibility Study on
Banro is a Canadian-based gold exploration and development company focused on the development of four major, wholly-owned gold projects, each with mining licenses, along the 210 kilometre-long Twangiza-Namoya gold belt in the South Kivu and Maniema provinces of the DRC. Led by a proven management team with extensive gold and African experience, Banro's strategy is to unlock shareholder value by increasing and developing its significant gold assets in a socially and environmentally responsible manner.
Cautionary Statement
The Pre-Feasibility Study of Twangiza does not include any Inferred Mineral Resources. There is no certainty that the conclusions reached in the Pre-Feasibility Study will be realized.
Cautionary Note to U.S. Investors
The United States Securities and Exchange Commission (the "SEC") permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. Certain terms are used by the Company, such as "measured", "indicated", and "inferred" "resources", that the SEC guidelines strictly prohibit U.S. registered companies from including in their filings with the SEC. U.S. Investors are urged to consider closely the disclosure in the Company's Form 40-F Registration Statement, File # 001-32399, which may be secured from the Company, or from the SEC's website at http://www.sec.gov/edgar.shtml.
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements,
other than statements of historical fact, that address activities, events or
developments that the Company believes, expects or anticipates will or may
occur in the future (including, without limitation, statements regarding
estimates and/or assumptions in respect of production, revenue, cash flow and
costs, estimated Twangiza project economics, mineral resource and mineral
reserve estimates, potential mineralization, potential mineral resources and
mineral reserves and the Company's exploration and development plans and
objectives with respect to its Twangiza project) are forward-looking
statements. These forward-looking statements reflect the current expectations
or beliefs of the Company based on information currently available to the
Company. Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of the Company to differ
materially from those discussed in the forward-looking statements, and even if
such actual results are realized or substantially realized, there can be no
assurance that they will have the expected consequences to, or effects on the
Company. Factors that could cause actual results or events to differ
materially from current expectations include, among other things: uncertainty
of estimates of capital and operating costs, production estimates and
estimated economic return; the possibility that actual circumstances will
differ from the estimates and assumptions used in the Twangiza Pre-Feasibility
Study and mine plan; failure to establish estimated mineral resources or
reserves; fluctuations in gold prices and currency exchange rates; inflation;
gold recoveries for Twangiza being less than those indicated by the
metallurgical test work carried out to date (there can be no assurance that
gold recoveries in small scale laboratory tests will be duplicated in large
tests under on-site conditions or during production); changes in equity
markets; political developments in the DRC; changes to regulations affecting
the Company's activities; uncertainties relating to the availability and costs
of financing needed in the future; the uncertainties involved in interpreting
drilling results and other geological data; and the other risks disclosed
under the heading "Risk Factors" and elsewhere in the Company's annual
information form dated
Cautionary Note Concerning Resource and Reserve Estimates
The mineral resource and mineral reserve figures referred to in this press release are estimates and no assurances can be given that the indicated levels of gold will be produced. Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices. Valid estimates made at a given time may significantly change when new information becomes available. While the Company believes that the resource and reserve estimates included in this press release are well established, by their nature resource and reserve estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such estimates are inaccurate or are reduced in the future, this could have a material adverse impact on the Company.
Due to the uncertainty that may be attached to inferred mineral resources, it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result of continued exploration. Confidence in the estimate is insufficient to allow meaningful application of the technical and economic parameters to enable an evaluation of economic viability worthy of public disclosure. Inferred mineral resources are excluded from estimates forming the basis of a feasibility study.
The Mineral Resource and Reserve estimates are reported according to the
definitions and guidelines given in the Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves.
The Mineral Resource and Reserve estimates are considered to have reasonable
prospects for economic extraction by open pit mining and have been restricted
to an optimum pit shell which uses a
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Banro will also be announcing the Pre-Feasibility Study Results for its
Namoya Project in due course.
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