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:: Banro Acquires Refurbished Process Plant to Fast Track Gold Production at its Twangiza Project
Banro Corporation has announced that it has entered into an agreement to purchase a refurbished gold processing plant capable of achieving a throughput capacity of 1.3million tonnes per annum. The closing of the purchase of the plant is expected to occur on or about September 21, 2009.
This acquisition supports the Company's strategy of advancing production through a staged approach which will focus initially on the processing of oxide material at the Company's wholly-owned Twangiza gold project in the Democratic Republic of the Congo (the "DRC").
It is planned that the plant will be transported by sea from Australia, via the Mombasa port in Kenya, and then by road to the Twangiza project site in the DRC, where it will be erected and commissioned over the next 24 months. The Company intends to further optimize this timeline as the project moves forward.
The refurbished plant comprises a crushing plant, two ball mills, carbon-in-pulp (CIP) section, gold room and a laboratory. The Company's consultants, SENET Engineering, estimate the total cost of purchasing and delivering the plant to Twangiza to be less than US$15 million, which represents significant savings in time and cost to Banro. SENET Engineering has been selected as the overall project manager and will also manage the erection and commissioning of the plant.
The Company intends to operate the plant as part of a low-cost "phase one" oxide mining operation, to be expanded in subsequent years.
It is estimated that annual production from this first phase plant will be between 80,000 and 110,000 ounces of gold per annum at a total operating cash cost of less than US$400 per ounce. The Company estimates the capital cost for phase one of the project (which phase is planned to use diesel power rather than hydroelectric power) to be approximately US$145 million, including contingencies. The Company has initiated discussions with a number of parties to arrange debt financing to supplement the equity financing which closed on June 25, 2009.
The Company believes that this decision will enable the Company to fast track the Twangiza project and commence gold production earlier along the extensive Twangiza - Namoya gold belt in the DRC where significant potential exists for expanding the Company's gold resources at its four wholly-owned gold projects. The updated feasibility study of the Twangiza project, announced on June 8, 2009, indicated full production at the Twangiza project to be in excess of 300,000 ounces of gold per annum based on current resources. Full details of the updated feasibility study of Twangiza, including the factors and assumptions used to develop the study's conclusions, are contained in the technical report of SENET dated July 17, 2009 and entitled "Updated Feasibility Study NI 43-101 Technical Report, Twangiza Gold Project, South Kivu Province, Democratic Republic of Congo." A copy of this report can be obtained from SEDAR at www.sedar.com and EDGAR at www.sec.gov.
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