Condor Gold (LON: CNR) (TSX: COG) has decided to put its flagship La India open pit gold project in Nicaragua up for sale, preferably to a gold producer with mine building expertise.
The miner said the board reviewed the company’s options, including going through a financing and construction phase as a single-asset, single-jurisdiction company with no existing gold production.
Condor concluded, however, that it is in the best interests of the company and all stakeholders to offload its assets, and it has hired Hannam and Partners to assist with the sale.
The company completed in October a definitive feasibility study for La India, which confirmed the plan to build a mine in two stages, with two additional permitted high-grade feeder pits that can be added during the early years of production.
The study also demonstrates La India has the capacity to produce an average of 81,524 ounces gold per annum for the initial 6 years of its 8.4 year mine life at a relatively low total upfront capital cost of $106 million, chief executive Mark Child said.
The two additional feeder pits can boost early production to over 100,000 ounces gold a year, with a stage 2 expansion to 150,000 ounces of gold per annum, he said.
Condor Gold staked concessions in Nicaragua in 2006. Since then, the country’s mining sector has taken off due to the arrival of foreign companies with the cash and expertise to tap into existing reserves.
The La India project covers a 588 square kilometre land package, that holds 12 contiguous and adjacent concessions.
The asset hosts a high grade mineral resource estimate of 9,672 kt at 3.5g/t gold for 1,088,000 ounces of gold in the indicated mineral resource category. It also has 8,642 kt at 4.3 g/t gold for 1,190,000 ounces of gold in the inferred mineral resource category.
Condor Gold’s other assets in the country include nearly 1,000 hectares of land purchased for the mine site infrastructure for $4.2 million and a new $6.5 million SAG Mill package.
