Otjikoto: Glowing by the numbers

The B2Gold Otjikoto Mine is expected to produce between 190 000 and 210 000 ounces of gold in 2023, at cash operating costs of between US$590 and US$650 per ounce and all-in sustaining costs of between US$1 080 and US$1 140 per ounce.

The Canadian listed international gold producer said, for 2023, Otjikoto is expected to process a total of 3.4 million tonnes of ore at an average grade of 1.87 g/t, and with a process gold recovery of 98%.

In the first half of 2023, processed ore was sourced from the Otjikoto pit and the Wolfshag underground mine, supplemented by existing medium- and high-grade ore stockpiles.

Otjikoto's gold production is expected to be weighted approximately 60% to the second half of 2023 due to the timing of high-grade ore mining from the Otjikoto pit and increased ore volumes from the Wolfshag underground mine, B2Gold said. The anticipated decrease in Otjikoto's all-in sustaining costs for 2023 reflects the benefits of processing higher grade ore from the Otjikoto pit and the Wolfshag underground mine in the second half of 2023, according to the company.



Capital expenditures

Capital expenditures in 2023 at Otjikoto are expected to total US$77 million, of which approximately US$74 million is classified as sustaining capital expenditures and US$3 million is classified as non-sustaining capital expenditures. Sustaining capital expenditures are anticipated to include US$71 million for capitalised stripping and capitalised development and US$3 million for mobile equipment rebuilds.

The mine had a strong finish to 2022 and produced 161 614 ounces of gold, slightly below the revised guidance range of 165 000 to 175 000 ounces (original guidance range was 175 000 to 185 000 ounces), mainly due to delays in bringing the Wolfshag underground mine into production.

Project delays were due to issues achieving development rates in prior periods, which were addressed through the appointment of a new underground development contractor in April 2022.

Development rates in the Wolfshag underground mine have improved and are in line with expectations, with access to initial development ore achieved in the third quarter of 2022 and stope ore production having commenced in the fourth quarter of 2022, the company elaborated.

Since the start of 2023, Wolfshag underground ore production rates are at expected levels, open-pit high-grade ore stockpile balances are above budgeted volumes and mined ore tonnage and grade continue to reconcile well with Otjikoto’s resource model, B2Gold said.

The initial underground mineral reserve estimate for the down-plunge extension of the Wolfshag deposit includes 210 000 ounces of gold in 1.2 million tonnes of ore at 5.57 g/t gold.

For the year ended 31 December 2022, mill feed grade was 1.5 g/t, mill throughput was 3.41 million tonnes, and gold recovery averaged 98.5%.

In the fourth quarter of 2022, the Otjikoto mine produced 60 068 ounces of gold. The fourth quarter of 2022 included a monthly production record of 30 493 ounces of gold in December 2022. For the fourth quarter of 2022, mill feed grade was 2.25 g/t, mill throughput was 0.84 million tonnes, and gold recovery averaged 98.8%.



All-in sustaining costs

The Otjikoto mine's all-in sustaining costs for 2022 were at the high end of its guidance range, as a result of lower-than-anticipated gold ounces sold and higher-than-expected lease expenditures, partially offset by lower-than-expected sustaining capital expenditures and higher-than-expected realised gains on fuel derivatives.

Capital expenditures totalled US$79 million in 2022, primarily consisting of US$35 million for Wolfshag underground development, US$27 million for pre-stripping for the Otjikoto pit, US$12 million in mobile equipment rebuilds and purchases and US$5 million for the national power grid connection line.

Capital expenditures for the fourth quarter of 2022 totalled US$20 million - primarily consisting of US$8 million for pre-stripping for the Otjikoto pit, US$7 million for Wolfshag underground development and US$3 million in mobile equipment rebuilds and purchases.

The Otjikoto mine is owned 90% by B2Gold and 10% by EVI Mining, a Namibian empowerment company. B2Gold acquired its first African gold development project, the Otjikoto Gold Project, through a merger with Auryx Gold Corporation in December 2011. The company received the Otjikoto mining licence in December 2012, and construction of the Otjikoto mine commenced in April 2013.

Within approximately 19 months, the first gold pour occurred on 11 December 2014, ahead of schedule.