"Senegal has seen less exploration compared to Mali however the geological model has evolved, and the area is now getting significant exploration focus."

Andrew Grove

MANAGING DIRECTOR, CHESSER RESOURCES

May 10, 2022

Could you share the latest highlights at your flagship Diamba Sud project in eastern Senegal?

We are preparing to undertake our maiden resource estimate over our two targets at Area A and Area D, having already completed the resource definition drilling. In mid-2020 we discovered multiple high-grade, shallow oxide mineralization at Area D, 20-40 m thick grading between 5-7 g/t from 10 m below surface. Over the past 12 months, we conducted about 30,000 m of drilling with two main drilling programs: one 20,000 m program scoping out the near-surface mineralization within 100 m from the surface, focusing on the oxide at Area D and some of the high-grade Area A previously defined. After putting together this geological picture, we then started the resource definition drilling program.

The drillings are relatively shallow, averaging at 130 m depth penetration. We also conducted initial metallurgical test work on samples that showed a high average recovery averaging 96%. Beyond that, we will put together a scoping study to demonstrate the economics of the project, and finally, we will be going back to drilling at high priority exploration targets such as the Northern Arc, Western Splay and Southern Arc which have already shown strong anomalies and interesting geophysics that we need to test further.

Diamba Sud is located in the vicinity of mines such as Loulo-Gounkoto complex. Can you tell us more about the “nearology” of the property and what this means for the project?

Diamba Sud is located in eastern Senegal, about 7 km away from the Mali border, and in a straight line with Barrick’s Guonkoto mine, which is only 7 km east of Diamba. The Luolo mine is 12 km away. Barrick is taking great interest in the area through their Bambadji joint venture and has identified strong mineralisation at Kabewest just a few km northeast of our Area A in Senegal, immediately next to our tenement.

The rock sequences across the Senegal-Mali Shear Zone are very similar but, historically, Senegal has seen less exploration compared to Mali however the geological model has evolved, and the area is now getting significant exploration focus. Diamba Sud sits on the Kédougou-Kéniéba Inlier (KKI), home to about 45 million oz of gold discovered in the last two decades. Between Chesser, Barrick and IAMGOLD, industrial logic says there could be some corporate activity and clearly a great opportunity to increase the value for our shareholders.

How do you think Senegal is perceived as a mining jurisdiction?

Senegal is one of the best mining investment jurisdictions in West Africa, with one of the longest-running and stable democracies in the region and a fast-growing economy. The country has managed to defend its borders from the terrorist threat seen in neighbouring countries. There have been two mines developed in the country recently, both funded by external debt which has since been repaid and both have been traded on the market without any political interference. Australian O&G company Woodside Energy is also developing an offshore deepwater oil project, an investment amounting to about US$4.5 billion. Other big oil majors are also looking to invest in the country. Moreover, Dakar is a very good place to live in, most nations being represented through local embassies in the city.

How do you sense investor sentiment in the gold commodity markets?

US$1,700-1,800 oz remains a very good gold price. Gold gathered a lot of strength over the pandemic as a hedge to expansionary inflation fears and high government spending. Investor sentiment has weakened since last year also because investors follow the trends on decarbonization and electrification, which has meant that gold has lost some of its investors to other commodities like battery metals.

Nevertheless, gold producers are seeing very high cash flows and I would say African gold producers make particularly strong cash flows thanks to stronger margins, whereas in countries like Australia or Canada, they are experiencing cost inflation pressures. Many African gold producers are now generating higher margins than their Australian peers.

What are your main priorities in the near term?

Our near-term goal is to put the resource estimate out and showcase the value and economics of our asset. We think Diamba Sud is a stand-alone development project and we are progressing rapidly to de-risk and prove its upside potential. Through more drilling, we will be testing the extensions of the mineralization in Area A and Area D and elsewhere on the Diamba Sud tenement, and also start environmental surveys to have everything ready for the mining permits when the time comes. We have one of the highest value resources on the Senegal Mail Shear Zone belt in Senegal and I am confident we will see more discoveries in this part of the world.

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