Sanu Gold Corp is on the trail of gold in Guinea
By James Brewer
In international trade, the Republic of Guinea in West Africa is prominent in the top three bauxite producers. The country, bordering on the North Atlantic, also has large deposits of iron ore planned for development which could propel it into the top five producers of that commodity. It is in the top 15 diamond producers. Now the country, with its enticing mineral resources, is being described as “gold’s new frontier.” It is already a top 20 producer of gold, and is poised to increase its global ranking with new mines coming into production.
Companies active in gold exploration and discovery in the republic include Vancouver-based Sanu Gold Corp, which listed on the Canadian Securities Exchange in mid-2022 after 18 months of fieldwork.
Sanu Gold’s president and chief executive Martin Pawlitschek, and vice-president for corporate development and communications Fiona Childe, are having a busy summer travelling to give progress reports to investors in London, Paris, Monaco and other financial centres and at conferences, and in online presentations.
Mr Pawlitschek detailed an encouraging business environment for his company, with West Africa being the world’s premier gold mining region, responsible for 15% of global supplies, ahead of major gold producing countries such as China, Russia and Australia. The country produces over 500,000 ounces of gold annually from open-pit mines, with estimated reserves of 25m ounces. It has a modern mining code, put together in 2013 with the assistance of the United Nations and World Bank.
Sanu Gold is working in the western and northern margins of the prolific Siguiri Basin, a long-standing gold district that hosts several large operating mines and major discoveries – but which compared to neighbouring countries is relatively unexplored. It has what it says is a highly prospective 280,00 sq km land package in a hitherto unexplored area. The company has three projects there and has already discovered high-grade gold mineralisation in its inaugural drill programmes at its Bantabaye and Daina permits. At Bantabaye anomalies cumulatively extend for over 10 km in strike and are up to 300 m wide. Mr Pawlitschek said there were similarities between gold mineralisation at Bantabaye and other recent discoveries in the Basin. The Bantabaye permit, is some 50km south of the Lefa Gold Mine and 80 km north of the multi-million-ounce Bankan Gold Project.
During the first half of 2023 a programme of reverse circulation drilling is under way, with a total of over 25,000 m of 200 holes required to test all the targets. The process uses compressed air to bring a continuous flow of samples to surface.
Intriguingly, the company relies on what it calls “systematic termite mound geochemistry,” a cost-effective and environmentally friendly type of exploration. Termite mound sampling is common in West Africa: the insects stockpile particles of weathered bedrock at surface, including gold if it is present in the subsoil, as they build their nests underground, highlighting areas that have potential for gold, as the prospective bedrock geology is mostly obscured by a veneer of laterite at surface. The termites burrow through the red laterite surface soil typical of tropical areas down to a creamy coloured underlying weathered bedrock.
Sanu’s team has collected more than 16,000 termite mound and rock samples with peak values of up to 10 grams per tonne of gold. Termites generally reach down to the lowest water levels, which can be up to 5-15 m below surface. Large anomalies defined by termite mound sampling are followed up with systematic shallow auger drilling, a fast, low cost, low footprint drilling tool, that allows more detailed sampling of the subsurface in areas highlighted by gold content in the termite mound samples.
The strongest anomalies from the auger drilling are eventually drill tested by reverse circulation drillings. Reverse circulation drilling provides a deeper and more accurate test of subsurface gold mineralisation, with first testing up to 200 m below surface.
In early June 2023, the company announced additional gold intercepts from multiple target areas on the Bantabaye permit.
Sanu Gold has commenced a 25,000 m reverse circulation drill programme, building on its 2022 high-grade gold discovery, when drilling intersected near-surface, oxide-hosted mineralisation with grades of up to 5.48 grams of gold per tonne over 15 metres at the Daina 2 Main Zone. Drilling began on this and other high-priority targets on the Daina permit, and then moved to the flagship Bantabaye permit.
Mining is integral to Guinea’s economy, representing 18% of gross domestic product and 75% of its exports. Large, high quality iron ore deposits have remained undeveloped largely because of lack of infrastructure – but in early 2023 Rio Tinto with partners committed $15bn to develop the 2bn tonnes Simandu iron ore deposit in the southeast of the country, with first production targeted for early 2025. It is projected that the deposit could produce 100m tonnes of high-quality iron ore per year.
Guinea is meanwhile global number one in proven bauxite reserves, which are estimated at 7.4bn tonnes, and number two in global bauxite production. Around a quarter of all bauxite production comes from Guinea, and continuing production growth is expected in the years ahead. Bauxite is used to produce aluminium for industries including motor and electronics. China is a major importer, taking some 90m tonnes in 2022.
Licences within 40 kms of Sanu include Anglo Gold’s Siguiri mine (6.2m ounces of gold), the Nordgold Lefa mine (7.9m ounces) and Predictive Discovery’s Bankan Project (4.2m ounces). There is a bitumen road from the capital, Conakry, to the gold mining region. A transitional government that came to power following a coup replacing an autocratic regime is intent on developing the country’s infrastructure. There has recently been major investment in transport, including rail and port facilities.
In March 2023, Sanu Gold closed an over-subscribed non-brokered private placement, raising $3m. Mr Pawlitschek said at the time: “We are very pleased with the overwhelming interest and investor support in this financing, which had strong demand in excess of the initial placement size. We had significant interest from both institutional and retail investors who understand the potential for large-scale gold discoveries in Guinea.” The shareholder structure includes 25% institutional investors and 25% high net worth individuals. In late June 2023, the company’s market capitalisation stood at C$6.26m.
Sanu Gold stresses its ESG (environmental, social and governance) commitment, building dialogue with all community stakeholders, purchasing supplies and materials from local communities, and hiring local tradespeople for camp construction and non-technical community Improvements such as local road infrastructure. A tree planting programme began in 2022.
Sanu is operated by a highly experienced team. Mr Pawlitschek has held management positions with junior explorers, private equity investment funds, majors (BHP) and development companies. He has been co-founder of several exploration companies in West Africa, South America, Europe, and Australia. Company executive chairman Vince Sorace has founded and led resource and technology companies with assets and operations in the US, Canada, Europe and Asia and raised over $300m in equity and debt financings.
“These are exciting days for the company, and we look forward to updating the market on our progress,” said the Sanu Gold chief.
Further information on Sanu Gold is at the company website www.sanugoldcorp.com
