Hod Maden Project in Turkey Targets 200,000 oz/y of Gold

Sandstorm Gold has reported summary results of a prefeasibility study (PFS) of the Hod Maden project in northeast Turkey that forecasts production of an average of 200,000 ounces per year (oz/y) of gold and 12,600 metric tons per year (mt/y) of copper in concentrate over a mine life of 11 years. The project is owned 30% by Sandstorm and 70% by Lidya Madencilik, which is the operator.

All-in sustaining costs at Hod Maden are estimated at $374/oz of gold produced on a co-product basis. Upfront capital costs are estimated at $272 million. The payback period from the start of production is estimated at 1.5 years.

Hod Maden’s proven and probable mineral reserves stand at 2.61 million oz of gold and 129,000 mt of copper. Mill throughput is planned at 900,000 mt/y at head grades of 8.9 g/mt gold and 1.4% copper.

Sandstorm President and CEO Nolan Watson commented, “Hod Maden was discovered only three years ago and has since made remarkable progress toward production at a pace that few projects in the mining industry could match, and Sandstorm is pleased to be partnered with one of the best Turkish mining operators. “The current financing plan is 65% debt financing, leaving Sandstorm’s capital contribution at less than $30 million.

The Hod Maden PFS is based on underground mining using mechanized methods, including transverse and longitudinal longhole open stoping with paste backfill. The main area will be mined from the bottom up in primary and secondary stopes, with a total of 9.1 million mt of ore produced during the 11-year mine life. Ore processing contemplates a single- stage crush, various stages of milling, bulk flotation roughing, various stages of copper cleaning, and regrind to produce a single copper concentrate containing gold. Concentrate will be transported to Hopa port on the Black Sea in Turkey for shipment to smelters.

The mill will be built in the nearby Saliçor Valley to avoid contact with existing roads and housing. A tailings storage facility and waste dumps will be located on surface, as will a main office, a 120-person camp, laboratory, storage, and water treatment facilities. Grid power is available on-site, and some workforce can be based out of the nearby city of Artvin.

With the release of the PFS, the Hod Maden project moves into the next stage of development. Lidya Madencilik has initiated the permitting process and is concurrently working on a gap analysis and trade-off studies. A feasibility study will begin by the end of 2018. Construction is tentatively slated to start in fourth-quarter 2020, with first production by early 2022.

As featured in Womp 2018 Vol 08 - www.womp-int.com