Keegan Resources reports that a prefeasibility study of its Esaase gold project near Kumasi in southwest Ghana demonstrates the potential produce 2.6 million oz of gold over a 10.2-year mine life. Plant capacity would be 7.5 million mt/y, with capacity to treat 9 million mt/y in early years of production when processing 100% oxide ore. Gold production during the first year of operation is projected at 330,000 oz, and life-of-mine average production is projected at 258,000 oz/y.

Capital cost to develop Esaase is estimated at $506 million, utilizing a leased mining fleet. Cash costs are estimated at $693/oz of gold produced, including leasing costs for mining equipment.

Keegan’s interest in the project is the maximum allowable under Ghanaian law, and Keegan holds the mining lease for the project.