Delivering organic growth by developing our resources and reserves is one of the target of our strategy.

Nordgold’s strong balance sheet and focus on consistent free cash flow generation enables us to invest in our globally diversified asset base across four continents and six countries, as well as in our exciting pipeline of high-quality development projects. A strong exploration programme is key to giving us the platform to drive continued organic growth. In 2017, we successfully replaced mined out ore and also increased our Mineral Resources as we look to further extend our overall life of mine performance.

Nordgold invested US$35 million in exploration and evaluation in 2017, including US$17 million in sustaining exploration (near-mine Ore Reserves replacement) and US$18 million in greenfield exploration. Greenfield exploration was mainly concentrated on Russian exploration licenses near Irokinda, Berezitovy and Neryungri mines as well as the Uryakh project in Russia and the Pistol Bay project in Canada. We report Exploration and Mineral Resources and Ore Reserves update for the period ended 31 December 2017 in accordance with the 2012 JORC code. Our investments delivered significant successes:

  • Total Mineral Resources increased by 7% or 2.1 million ounces of gold (“Moz”) to 33.6 Moz mainly due to successful near-mine exploration. Measured and Indicated Resources increased by 3% or 815 thousand ounces (“koz”) to 25.6 Moz despite depletion of 1.2 Moz.
  • Ore Reserves increased by 2% or 348 koz to 15.2 Moz of gold in 2017, in addition to the 1.2 Moz replacement of mined out ore.
  • In 2017, Gross construction progressed on schedule and within budget. Commissioning is planned to commence mid-2018 reaching full production by the end of the year.
  • Environmental and Social Impact Assessment reports for the Montagne d’Or project in French Guiana have been provided by consultants in draft form in Q4 2017. The reports will be finalised following review by the company and input from the public debate in French Guiana, which will occur between March and June 2018.
  • Nordgold is progressing with the Uryakh development project. The 2017 options study of mining and processing options indicated the viability of combined open pit and underground mining operations and CIL processing. In 2018, a prefeasibility study will be completed by SRK, along with geotechnical drilling and infill drilling of Mineral Resources.

Mineral Resources
(‘000 ounces)

31 DECEMBER 2017 31 DECEMBER 2016 31 DECEMBER 2015 31 DECEMBER 2014
Burkina Faso 8,850 8,277 8,137 7,623
Guinea 4,339 3,678 4,794 5,528
Russia 15,196 14,135 13,804 14,057
Kazakhstan 1,844 2,014 1,782 1,786
French Guiana (attributable 55.01%) 2,646 2,646 - -
Canada 742 742 - -
Total 33,617 31,492 28,518 28,994

Proven and Probable Reserves
(‘000 ounces)

31 DECEMBER 2017 31 DECEMBER 2016 31 DECEMBER 2015 31 DECEMBER 2014
Burkina Faso 4,152 3,994 3,887 3,570
Guinea 2,198 2,336 3,003 2,600
Russia 6,661 6,334 6,355 6,098
Kazakhstan 685 684 763 700
French Guiana (attributable 55.01%) 1,510 1,510 - -
Total 15,206 14,858 14,007 12,968

2018 key exploration and development priorities

  • Nordgold will continue to focus on near-mine and satellite deposits exploration at operating mines, with the aim of at least replacing mined out Ore Reserves annually, while progressing its growth pipeline.
  • Gross project on track and under budget. It is expected that Gross will begin gold production in mid 2018 reaching commercial levels of production by the end of 2018.
  • A contract has been signed with SRK Denver to complete a pre-feasibility study for Uryakh that is expected to be delivered by the end of 2018.
  • After completion of the public debates for the Montagne d’Or project and adjustment of the Environmental and Social Impact Assessment reports Nordgold plans to apply for construction and mining authorisations in H2 2018.
  • Nordgold’s strategy of organic growth remains the primary focus, the strength of its cash flow generation and balance sheet means that Nordgold is also able to review new opportunities continuously with a view to acquiring premium-quality Mineral Resources and Ore Reserves at competitive valuations to grow gold production.
  • The Company also seeks growth through acquisitions and partnerships in high-value gold projects. Projects in mining-friendly jurisdictions with over 2 Moz of potential minable Mineral Resources, production of above 150 koz, modest development capital investment and short payback period fit the criteria for Nordgold’s growth strategy.
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