São Francisco is an open-pit, gravity heap leach gold mine. It involves three different streams of processing including crushing, gravity then heap leach; crushing then heap leach; and run-of-mine heap leach.
Commercial production was declared in August 2006.
There is significant upside from the coarse gold effect, conversion of resources to reserves potential and potential to add reserves at depth.
Overview
Location
São Francisco is located in the extreme western portion of Mato Grosso State in West Central Brazil, very close to the Brazilian border with Bolivia. It is approximately 560 kilometres west of the State capital of Cuiaba. São Francisco consists of four contiguous exploration permits totalling 35,446 hectares.
Type of Operation
Open pit, gravity concentration/heap leach project
Proven and Probable Reserves
(at December 31, 2007)
Main Ore: 25,980,000 tonnes at 1.27 grams/tonne gold = 1,061,000 ounces gold
ROM Ore: 17,285,000 tonnes at 0.28 grams/tonne gold = 154,000 ounces gold
Total: 43,266,000 tonnes at 0.87 grams/tonne gold = 1,215,000 ounces gold
Measured and Indicated Resources
(exclusive of Reserves)
Main Ore: 24,489,000 tonnes at 0.82 grams/tonne gold = 646,000 ounces gold
ROM Ore: 28,058,000 tonnes at 0.20 grams/tonne gold = 182,000 ounces gold
Total: 52,547,000 tonnes at 0.49 grams/tonne gold = 828,000 ounces gold
Inferred Resources
Main Ore: 23,904,000 tonnes at 0.82 grams/tonne gold = 630,000 ounces gold
ROM Ore: 39,847,000 tonnes at 0.24 grams/tonne gold = 307,000 ounces gold
Total: 63,737,000 tonnes at 0.46 grams/tonne gold = 937,000 ounces gold
Expected Mine Life
10+ years
Project History
Gold was first discovered at São Francisco in the 1700s and the district reportedly produced and shipped to Portugal some 60 to 70 tonnes of gold between 1720 and 1830. When Yamana acquired the project in July 2003 there was a significant amount of metallurgical work available for the project and an estimated gold resource base of approximately 1.8 million ounces. In November 2004, Yamana completed an updated feasibility study on São Francisco and made a construction decision. The mine was built by early 2006 and commercial production was declared in August 2006.
Operating Plan
Yamana declared commercial production at São Francisco effective August 1, 2006. Heap leaching of ore commenced in March 2006. A total of 80,117 ounces of gold were produced to the end of 2006 including pre-commercial production from the pilot plant. Grades and volumes are expected to increase as the operation ramps up.
Mining is currently taking place in saprolite material. The mining of higher grade material and the anticipated positive coarse gold effect is expected to materialize in mid to late 2007 when mining extends to higher concentrations of quartz veins in harder rock.
Production at São Francisco is estimated to be in the range of 130,000 to 140,000 ounces in 2008 and in the range of 145,000 to 155,000 ounces in 2009. Yamana expects that São Francisco will be mining at these rates or better for in excess of 10 years.
Value Enhancing Initiatives
The coarse gold effect at São Francisco continues to be evaluated and reconciliation date through the end of January 2007 suggests that there is at least a 30% positive grade reconciliation on average for ore processed through gravity and heap leaching. The reconciliation is much higher for the ore processed through the gravity circuit which suggest results will become even more attractive once mining reaches the higher grade, deeper areas of the pit.
There is a substantial inferred resource base of 1.5 million ounces at São Francisco and Yamana will continue working towards upgrading resources to reserves, particularly along strike of the pit.
In addition, Yamana will be studying the potential of mining the deeper sections of the deposit by underground mining methods.