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Etruscan's Agbaou Gold Project covers 469 km2, giving Etruscan control of the 40 kilometer strike length of the Agbaou Gold Belt in Côte d'Ivoire. Agbaou is an advanced stage gold deposit and one of the largest undeveloped gold resources in Côte d'Ivoire.
Location
Drilling at Agbaou August 2005 |
The Agbaou Gold Project is situated approximately 200 kilometers northwest of the port city of Abidjan in Côte d'Ivoire. The Project is readily accessible by paved highway and is within 10 kilometers of the national power grid.
Ownership
The Agbaou permit was granted to Etruscan in November 2003. Etruscan will have an 85% interest in any mining company established to mine at Agbaou with the remaining 15% being held by the State of Côte d'Ivoire.
Agbaou Resource
An independent National Instrument 43-101 resource estimate titled "Agbaou Gold Deposit Resource Estimation" was prepared by Coffey Mining Pty Ltd. in February 2008 and is summarized as follows:
| Agbaou Mineral Resource |
Cutoff
Grade |
Indicated Resources |
Inferred Resource |
| Tonnes |
Grade |
Ounces |
Tonnes |
Grade |
Ounces |
| 0.5 gpt |
16,600,00 |
1.90 |
1,015,000 |
5,100,000 |
1.67 |
272,000 |
| 1.0 gpt |
10,500,000 |
2.58 |
871,000 |
2,800,000 |
2.46 |
218,000 |
Feasibility Study
Following delivery of the National Instrument 43-101 compliant resource, a feasibility study titled "Feasibility Study Report on the Agbaou Gold Project, Côte d'Ivoire, West Africa" dated November, 2008 was prepared by MDM Engineering International Ltd. and Coffey Mining Pty Ltd. Using a gold price of $850 per ounce, the base case scenario in the feasibility study concluded that Agbaou will produce an average of 82,000 ounces of gold per year at a cash operating cost of US$507 per ounce over a 6.3 year mine life. The feasibility study was based on probable reserves of 7.4 million tonnes of ore with an average grade of 2.4 grams per tonne containing 566,000 ounces. Pit optimizations were carried out using a US$750 per ounce gold price. The reserve estimation was completed in accordance with National Instrument 43-101. The study proposes open pit mining of three pits using an owner operated mining fleet with the ore to be processed through a
conventional gravity-CIL (carbon-in-leach) plant with a design capacity of 1.2 million tonnes per annum. The average gold recovery is 91% and the strip ratio is 8:1. Initial capital costs for the Agbaou Project are estimated to be US$106 million (excluding working capital) and were based on the purchase of all new equipment at prices prevailing earlier in 2008.
Other principal consultants on the feasibility study included Knight Piesold of South Africa (tailings dam design and hydrology), African Mining Consultants of Botswana (environmental study) and Golder and Associates of the United States (mine geo-technical).
The internal rate of return ("IRR") on the project for the base case scenario has been determined to be 9%. Both the Company and MDM Engineering believe that there is considerable room for improvement to the IRR given the substantial changes that have occurred in the mining sector with regards to pricing and availability of equipment since costing was determined over five months ago. MDM Engineering have indicated that they believe that reductions of 20% in capital costs and 10% in operating costs are achievable which would boost the project IRR to 21%. MDM Engineering have been mandated to revisit the economic parameters of the feasibility study to determine if that target is achievable.
Additional Exploration on the Agbaou Permit
Reconnaissance diamond drilling in proximity to the Agbaou gold deposit has identified three satellite discoveries within 600 meters of the Agbaou deposit. Reconnaissance drilling to the north of the main deposit has also intersected significant gold intersections. These results provide the potential to expand the known resources in the immediate vicinity of the gold plant at Agbaou.
Other Permits in Côte d'Ivoire
Côte d'Ivoire remains the most under-explored country in West Africa in spite of the fact that over 300,000 km2 is underlain by prospective Birimian and Archaean terranes. Many of the proven gold belts in Mali, Burkina Faso and Ghana converge into Côte d'Ivoire. Etruscan believes that the exploration potential in Côte d'Ivoire is very high and in addition to the Agbaou permit, the Company has been granted three exploration permits in 2008 and has made application for seven new permits covering together over 9,000 km2 in a number of other gold belts outside of Agbaou. The exploration permits are at varying stages of the application process and some early stage reconnaissance work has been completed on three of the permits which has confirmed the gold potential on each.
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