Location and Description of the Project
Gross is an important development project in Yakutia, adjacent to the well-established Neryungri (the Tabornoe gold deposit) open pit heap leach operation. The project is located in the southwestern Yakutia, some 125 km northeast of the Ikabya station on the BAM railway and some 4 km to the east of Neryungri.
Nordgold has conducted an extensive exploration programme to identify the Gross deposit and its reserves. Proven and probable gold reserves at Gross, as at December 31, 2016, were 4.4 moz, while measured and indicated resources were 7.6 moz and inferred resources were estimated at 0.9 moz.
A Feasibility Study confirmed the economic viability of an all-season open-pit heap leach project giving an IRR of almost 40% at a long-term gold price of US$1,250/oz. Gross is expected to mine approximately 12 million tonnes of ore and to produce approximately 230 koz of gold per year at full production for 17 years.
The construction of the new mine began in June 2016. The large-scale Gross project was fully permitted in 2015 and de-risked by a successful two-year mining and processing trial, which delivered gold recovery of over 80% with low production costs.
Nordgold invested US$42 million in the project in 2016, of a total of estimated capital investment of approximately US$250 million to complete construction. It is expected that gold production will begin in the first half of 2018.
The proximity of Neryungri is enabling Nordgold to benefit from economies of scale, an expert knowledge of the local geology and shared expertise from Neryungri’s management team.
The construction of Gross will be Nordgold’s third greenfield project developed from exploration to production and follows the successful launch of the Bissa mine in January 2013 and the Bouly mine in September 2016 in Burkina Faso.