Fortuna Silver Mines (TSX: FVI; NYSE: FSM) has updated reserves and resources for the Yaramoko mine complex in Burkina Faso following its July 2021 purchase of the project through the acquisition of Roxgold Resources. Based on an evaluation of previously completed work, recent brownfield exploration results, as well as mine depletion, proven and probable reserves have dropped by 43%.
Yaramoko’s proven and probable reserves now amount to 263,000 oz. of gold in 1.4 million tonnes averaging 5.8 grams gold per tonne. That compares with a previous December 2021 estimate of 464,000 gold oz. in 2.1 million tonnes averaging 6.78 grams gold.
The measured and indicated resources excluding reserves remain relatively unchanged at 500,000 tonnes averaging 6.1 grams gold per tonne containing 95,000 oz. of gold, while inferred resources decreased slightly to 140,000 tonnes averaging 5.39 grams gold for 25,000 ounces.
Following the acquisition of Yaramoko in 2021, the company updated the technical report to describe the proposed open-pit gold mining operation at the project’s 55 Zone.
During the first half of 2022, Fortuna carried out additional exploration drilling and a re-evaluation of the modelling and estimation techniques to improve the definition of the mineralization.
Underground drilling of the 55 Zone concentrated on grade control drilling within the mineral resource boundaries to provide increased confidence in the mine plans. The step-out drilling associated with the 2022 drill program returned encouraging results, says Fortuna, incrementally extending the western limit of the drill-defined mineralization by another 20 to 50 metres, where it remains open. Additional step-out drilling is planned for the first half of 2023.
Open-pit drilling at the 55 Zone was also successful in identifying the mineralized structures and veins, although continuity of economic intervals and strike lengths resulted in downgrading of the potential, Fortuna adds.
Reverse-circulation and diamond drilling was also completed at the 109 Zone, designed to infill and upgrade the geological confidence to support the estimation of mineral resources and reserves.
Roxgold’s previous proposal to build an open pit at the 55 Zone was based on extracting high-grade, near-surface material that formed the crown pillar by mining both remnant mineralization identified as being adjacent to existing mine workings and additional sub-parallel structures related to the main 55 Zone structure.
Based on recommendations in its updated 2022 technical report, Fortuna completed an evaluation of the mineralization that was identified as potentially recoverable from surface, which was to include an underground transition study and the preparation of a void management plan.
During this evaluation process, the company identified a spatial discrepancy attributed to a surveying error which occurred prior to August 2020. This resulted in horizontal differences averaging from 2 to 3 metres between the drill holes used to define the 55 Zone main mineralized structure and the underground face channel samples collected during underground development.
The updated estimate, having corrected for this inconsistency, resulted in a reduction of 120,000 ounces of gold previously identified as modelled remnant mineralized material.
Subsequently, an economic evaluation of the open pit resulted in a reduction of a further 46,000 ounces of mineralized material, which the company determined cannot be economically extracted from surface or underground due to its isolated location and low-grade nature.
The updated estimate of the 55 Zone crown pillar also decreases the life of mine from five years to three years and results in a reduction in pit size that reduces risk associated with the plan by lowering the strip ratio.
Shares of Fortuna Silver Mines were down 4.7% by 12:30 p.m. ET following the reserve and resource update. The Canadian-based precious metals miner has a market capitalization of $1.5 billion.