TORONTO (miningweekly.com) – Mining has started at the Goulagou II (GGII) deposit at the Karma gold mine, in Burkina Faso, with Canadian project developer True Gold advising on Tuesday that it remained on track for first gold production at the end of the 2016 first quarter.

The GGII deposit was the first in line of six deposits that would be mined over the $131.5-million project’s 11.5-year life.

While openpit mining and grade control drilling had started at GGII, True Gold said the mine fleet had been deployed to GGII after completing significant excavation of bulk earthworks at the mine’s processing and storage ponds.

Equipment deliveries to site stood at 92% and procurement was complete.

The GGII deposit held reserves of 273 000 leachable ounces of gold, contained in 7.6-million tonnes, grading at 1.12 g/t of gold, and would be the primary source of ore during the first two years of production.

“As we transition into gold production over the next few months, our team is increasingly focused on operational readiness. Karma will produce about 120 000 oz/y of gold during our first five years at the lowest quartile of cash costs, laying the foundation for True Gold to become a midtier producer,” president and CEO Christian Milau said.

True Gold reported that the project was now about 73% complete, with rapid progress being made by the nearly 1 000 staff and contractors on site. With the project remaining completely funded through to production, as of September 30, the company had $19-million in cash and up to $48-million available under its finance facility.

During September, True Gold inaugurated a national 'stability forum' led by True Gold’s strategic adviser Mâitre Halidou Ouedraogo, a magistrate and human rights advocate in Burkina Faso. The company had organised the forum in an effort to foster dialogue and discussion, and promote national peace and stability with delegates from a range of business, community and political backgrounds, including the political parties participating in the upcoming elections.

Meanwhile, the Burkina Faso Council of Ministers had ratified the mining convention that set out the fiscal and legal terms regarding the operation of the Karma mine. The convention was valid for 20 years and could be renewed for ensuing periods of five years.