ASX-listed Indonesia-based gold explorer Sihayo Gold has increased its initial expected gold recovery rate from 35 per cent to a solid 80 per cent in fresh rock samples after trialling high pH leaching metallurgical test work on ore from its advanced Sihayo gold project in North Sumatra.
Transitional ore samples also received a healthy boost to the recovery rate, rising from 52.3 to 74.5 per cent.
The metallurgical test work forms part of the optimisation studies currently being undertaken on the project’s development by Sihayo.
In total, six fresh samples and 21 transitional samples have been tested. Further metallurgical test work is now underway on a further 80 samples to gain a better understanding of the optimal pH levels, leach time and reagent consumption to achieve better recovery rates.
The test work has been assessing methods of improving plant recoveries above levels currently adopted in feasibility studies for the Sihayo starter project.
A definitive feasibility study was completed at the project in 2020 that outlined an average life of mine gold recovery rate of 71 per cent. The company believes the improved metallurgical recovery rates create an opportunity to significantly improve its project economics.
Ore sourced from the Sihayo gold project is classified into three broad categories based on its oxidation state - oxide, transitional or fresh ore. Test work to date on oxide ore has tabled relatively uniform recovery rates from 80 per cent up to over 90 per cent. However, within the transitional and fresh zones the recovery rates become a lot more variable ranging from less than 10 per cent and up to 90 per cent.
The lower recoveries are due to the gold deposition being very fine – less than 5 microns – and a portion of it being locked in refractory sulphides.
Current and future metallurgical test work aims to focus primarily on boosting the transitional and fresh rock gold recovery rates.
Sihayo Gold is currently investigating ways to lift metallurgical recoveries in both transitional and fresh ores and plans to carry out further test work and processing design analysis including further assessment of the cost and benefits of implementing high pH leaching into the processing plant design.
Sihayo Gold Executive Chairman, Colin Moorhead said:
“High pH pre-leaching aims to recover gold otherwise locked up in fine grained arsenopyrite at Sihayo. Latest test work builds on earlier positive results and continues to indicate the potential for significant improvements in recoveries for more transitional and fresh ore types. This has the potential to not only increase life-of-mine gold production but also may unlock known higher grade fresh ore resources that currently remain unmined below our designed pits.”
The company’s definitive feasibility study released in mid-2020 shows the starter project development generating total EBITDA of US$744 million over an initial forecast life of mine of eight years or an annual average of US$93 million a year based on a gold price of US$1,890 an ounce.
The study also estimates an EBITDA of US$630 million or an average of US$78.7 million a year assuming a base case gold price scenario of US$1,700 an ounce.
Whilst metallurgy is often considered boring for the average mug punter it can in fact make or break a project. All important recovery rates can tip a project over into profitability or even uber-profitability if they are high enough.
Sihayo is right to focus on this area and its initial test work gives cause for pause and it will be interesting to see how it ultimately impacts the existing mining studies.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
