Canadian mining company Roscan Gold has revealed an initial investment plan of $218.7 million to develop a new gold mine at its Kandiolé project in Mali. The announcement, made as part of a preliminary economic assessment (PEA) published on Monday 2 March, marks a key milestone in the project's progress, which could produce more than 834,858 ounces of gold over an estimated 13-year life.
According to Roscan's projections, the proposed mining complex would generate an average annual production of 92,786 ounces of gold during the first four years of operation. Based on a consensus gold price of $3,100 per ounce, the study estimates a net present value (NPV) after tax of $498 million and an internal rate of return (IRR) of 43%. The initial investment could be recouped in just 2.8 years after production begins, highlighting the project's potential profitability in a context of rising gold prices, which are expected to increase by more than 60% in 2025.
"Most of the ore destined to feed the processing plant comes from only three of the six deposits included in the resource estimate, suggesting significant growth potential through additional drilling," said Nana Sangmuah, President of Roscan Gold, in a statement. This prospect for expansion enhances the project's appeal, as the company, which currently has no producing assets, aims to complete the next stages of development by the end of 2026.
Among the milestones expected this year are obtaining a mining permit and initiating discussions to secure financing for the project. However, several conditions remain to be met before confirming the viability of commercial production. The PEA is based solely on mineral resources, and their conversion into proven reserves will be essential. A definitive feasibility study (DFS) will be a crucial step in consolidating the technical and economic credibility of the project.
For Mali, the Kandiolé project could be of strategic importance in the medium and long term. The country, one of Africa's leading gold producers, is seeking to maximise the economic benefits of its mining sector. According to the Extractive Industries Transparency Initiative (EITI), gold accounted for 76.5% of national exports and 9.2% of GDP in 2022. Recent reforms, including the adoption of a new Mining Code in 2023, aim to strengthen these benefits. Alongside Kandiolé, other advanced projects such as Kobada, led by Canadian company Toubani Resources, could help boost the industry, with an expected production of 162,000 ounces of gold per year over 9.2 years.
Roscan Gold, listed on the Toronto Stock Exchange, continues to explore opportunities to accelerate the development of Kandiolé, taking advantage of a favourable gold market. Investors and Malian authorities will be closely monitoring progress, as the mining sector remains a pillar of the West African economy.