Project Summary: Tulawaka
Owner
MDN holds a 30% participating interest in the Tulawaka property in Tanzania, which started commercial production in March 2005 as the Tulawaka Gold Mine.
Location
The Tulawaka mine is located about 160 km southwest of the city of Mwanza, in the western part of the Lake Victoria goldfield, United Republic of Tanzania. The property is a mining concession surrounded by prospecting licenses in the Biharamulo District (Kagera region) and Kahama District (Shinyanga region).
Area
The joint enterprise agreement covers an area of 317 km².
The main Tulawaka gold deposit is hosted in dominantly volcanogenic tuffaceous rock and bedded terrigenous sediment with thin layers of silicate iron formations, all metamorphosed into amphibolite facies. A generation of porphyric felsic veins as well as a generation of mafic and felsic veins intersect the metamorphic rocks.
The deposit is considered to have developed in an isolated shear zone along which porphyry dykes were intruded. The shear zone and the porphyry bodies developed in tectonic dislocations during deformation.
The shear zone appears to be parallel or subparallel to the rock strata, containing all the quartz veins over a strike length of at least 1,300 m, dipping to the northeast. These quartz veins pinch and swell both along strike and down dip, and contain most of the gold mineralization. Significant gold mineralization was found beneath current operations at a vertical depth of more than 200 meters.
Resources and Mineral Reserves
Tulawaka commenced open pit operations in 2005 with a declared reserve of 546,000ounces. It had produced 808,678 ounces up until the end of December 2010..
This corresponds to a 54% increase in production relative to the original 2003 feasibility study, which estimated reserves at 525,686 ounces of gold. Most of the ounces mined in 2009 were replaced by the reserves outlined in 2010, further extending the mine life. The goal of the 2011 drilling program is to extend the mine life yet again. Given the drill targets, depending on the success achieved, production could continue into 2014.
In fiscal 2010, the Tulawaka mine produced 60,132 ounces of gold. Average cash costs for the year totalled US $709 to produce one ounce of gold. The average grade mined was 4.14 g/t of gold, and the gold recovery rate at the mill was 93.2%. A total of 64,574 ounces were sold during the year, at a spot price of US $1,227 per ounce.
Tulawaka generated total revenues of US $79.2 million, and development and operating costs were US $67.3 million. The Tulawaka mine therefore continued to yield operating profits, which totalled US $11.9 million in 2010. Given the substantial investments required to accelerate underground mine development and exploration drilling at depth, all the net cash from MDN’s share of the profits for fiscal 2010 was reinvested in infrastructure and drilling activities.