February 6, 2020 / 3:56 PM / 4 months ago

Semafo to restart mining at Burkina Faso's Boungou in fourth quarter

Feb 6 (Reuters) - Semafo Inc on Thursday said it expects to restart mining at its Boungou operation in Burkina Faso in the fourth quarter after a deadly attack on a convoy of buses carrying its employees forced it to suspend operations in November.

Shares of the company jumped 8.3% to C$3.01 in early trade.

The company said it had already restarted the plant at Boungou and was implementing a three-month-long phased plan, which includes processing the stockpile and utilizing the on-site supplies inventory along with limiting deliveries of new supplies.

During the three-month period, Semafo expects production to reach between 42,000 and 46,000 ounces.

The Semafo convoy attack was the deadliest in recent years in Burkina Faso, which has been battling a rising insurgency that has killed 1,000 people since 2016 and driven nearly 500,000 from their homes. In this time, there have been dozens of attacks on industrial and small-scale mining operations.

Semafo said on Thursday that as part of its phased plan, employees and contractors who were previously traveling on the public road are being transported by air between Fada and Boungou and lodged at the mine site.

Although some aspects of the plan are within the company’s control, others require support from the government and from its existing contractors and suppliers, Semafo said.

The company also set an initial exploration budget of $7 million for the year on its three priority properties – Bantou, Boungou and Mana - in Burkina Faso.

The company expects consolidated 2020 gold production of 315,000 to 355,000 ounces, with total production from Boungou at 130,000 to 150,000 ounces. (Reporting by Shanti S Nair in Bengaluru; Editing by Maju Samuel)

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