Mano River Resources is developing gold and diamonds projects in West Africa and also has its eyes on a promising iron ore prospect in the same region.
The company is listed on the TSX-V and AIM exchanges (ticker symbols MON and MANA respectively. The stock is well distributed with 40% owned by institutions and 15% in the hands of management ”“ a policy that usually ensures prudent husbandry. This characteristic is particularly apposite to Mano River, which looks to be developing highly viable projects with well managed finances.
The company is concentrating on licence areas covering a total of 25,000 square kilometres in the Aechaean terrain of the West African Mano River Union countries of Liberia, Sierra Leone and Guinea and has entered into a number of joint ventures. The area is highly prospective and under”“explored and the company’s New Liberty Gold Mine, upon which a bankable feasibility study is underway and which is due for construction during 2007 and to come on stream during 2008, will be the first significant gold mine in Liberia. The ”Kpo” pipe is the first diamondiferous kimberlite pipe to be identified in Liberia.
Mano River Resources Inc. was formed in 1998 through a reverse takeover involving the sale of Mano River Resources Ltd into Zicor Mining Inc and the subsequent change of name to Mano River Resources Inc. The original Mano River had been founded in 1996 and acquired the pre-existing assets of mining companies in Guinea and Sierra Leone along with exploration permits and extensive research in Liberia. The company’s willingness to wait (for some years) for the local disruptions to fall away has earned the loyalty of the local governments with whom it enjoys excellent relationships.
The New Liberty gold mine is on a wholly-owned licence in Liberia although the government has a free carried interest of 10%. The existing resource estimate is not yet compliant with international codes, but this is under development at present; so far the three zones examined have shown an estimated indicated and inferred resource of 5.09 million tonnes grading 4.6 grammes/tonne of gold giving a contained gold resource of 609,000 ounces. The deposit will host a shallow open pit and the current indicative projects basics suggest annual output of between 60,000 and 70,000 ounces, with a life of mine of twelve years and ore treatment of 600,000 tonnes per annum. Early estimates of production costs suggest something in the region of $200/ounce, with project capital expenditure of roughly $40 million, suggesting that the payback period will be less than two years.
In Sierra Leone Mano River is in joint venture partner with Golden Star Resources, which will earn a 51% interest through the expenditure of US$6 million on Mano’s licences over a period of four years. The property offers a number of greenstone gold targets and Golden Star has further identified an attractive geochemical anomaly, which is due for testing in the near future. At Yirisen, which lies within the Pampana licence area, one section has shown nine metres at 16 grammes/tonne of gold. Yirisen is a 3.75 north-east trending gold system of 3.75 kilometres in length which is open along strike with the zone of mineralisation reaching up to 200 metres in width.
The gold prospects look enticing and the diamonds may prove to be even more so. The kimberlite structure that Mano has identified at KONO in Sierra Leone contains a number of dykes and Mano has entered into a joint venture with Petra Diamonds. The latter is earning 51% through the expenditure of $3 million; this expenditure was achieved in seven months, substantially quicker than had originally been planed and Petra is sufficiently confident of the presence of a viable resource that it is exploring via mining; diamonds have already been produced merely from shaft sinking, with 44 stones recovered totalling 5.6 carats and including one stone of 1.4 carats. The operation will effectively be self funding and so is debt free and expected to stay that way.
Shaft sinking is proceeding well with two shafts in progress, currently to depths of 13.5 metres and nine metres. They will be sunk to approximately 30 metres prior to stope preparation. Numerous ”rolling” exploration trenches and shafts continue to be sunk in order to identify the best dyke targets; there are plenty from which to choose.
The indicative economics of the project suggest an annual mining rate of 200,000 tonnes for production of 100,000 carats per annum at low cost and high margin. Full production will be achieved in 2007 and the life of mine production could exceed five million carats. Life of mine is very long and could easily exceed 50 years.
A second diamond joint venture in Sierra Leone is getting underway with BHP-Billiton, which has now overcome managements prior concerns about politician risk in the region. The joint venture has a licence area of 9,700 square kilometres an is about to ”cherry pick”, reducing the size of the area under investigation to 1,000 square kilometres. This was always the intention; the remaining ,land will go back to the government for re-leasing. BHP-Billiton is to spend $3.4 million for a 51% interest and four area with an0pmalous indicators have already been identified for follow-up. The areas look to be multi-commodity, with the emphasis on diamonds and gold.
In Liberia, meanwhile, Mano is in joint venture with Trans Hex and chemical assay suing the Gurney technique (Chromium trioxide and calcium oxide distribution) suggests that the deposits on site are very similar to, or possibly better than, those of the North West Territories. Trans Hex is to run a $2 million programme over three years in order to earn 50%. The licence area covers 200 square kilometres and bulk testing of a pipe of four hectares area will commence in the third quarter of this year. Seven pipes have been identified to date and there are a further seven targets for investigation.
The company has also entered into a joint venture with the government’s Ministry of Lands Mines and Energy, to cover a 15,000 square kilometre licence area over three years.
Further ahead there are prospects for diamond production in Guinea and the company is also a licence holder over a highly prospective iron ore project in the Putu mountain range in Liberia.
So Mano River has plenty on its hands, but is in joint venture with judiciously chosen partners and should be reaping the benefits within a matter of months.