Cluff Gold Share Discussion Threads

[taffer87] 26/6/2012 10:50

I have zero expectations of CLF releasing anything over and above they say.

Interesting note:

Kalsaka Update – Site Visit Notes
We recently visited the producing Kalsaka mine in Burkina Faso. Overall,
we were encouraged with process improvements to date that should
support increased production levels through the remainder of the year.
Development of Sega also continues unabated with Sega expected to come
into the mine plan in Q1 2013. Sega secures operating cash flows for
Kalsaka beyond 2013 that can be used to fund development efforts at
Baomahun and Yaoure. We maintain our BUY rating and $3.65 per share
price target.
1. Optimizing Plant Throughput at Kalsaka
Management is making strides in addressing operational challenges at
Kalsaka. To process the quartz oversize rejects and ore not treatable
through the MMD, a hard rock crusher has been installed. Further, an
additional crusher is also to be installed that will see crushing plant
capacity increase and allow for processing transition ore. With these
challenges being addressed, we expect plant performance to improve
during the year.
2. Cost Containment at Kalsaka
Mining has transitioned to higher grade material and grades are expected to
be closer to 1.6g/t Au in the coming quarters. The strip ratio is also
showing sequential improvement from the 5.6:1 ratio achieved in Q1 2012
to about 3.6:1:1 in April 2012. Cheaper reagents for use have been
procured as well as a 150T Silo to receive bulk cement deliveries. This
should provide additional processing cost savings.
3. Advancing Sega Towards a Production Start of Q1 2013
The key development milestones for Sega are 1) delivery of a PEA to the
government by July 2012 and 2) submission of an ESIA by year-end. An
exploitation license is then expected in Q1 2013 to facilitate
commencement of mining at the start of the year. It is worth noting that
Cluff will retain a greater proportion of cash flows at Sega (90%) whereas
at Kalsaka it retains 78% of cash flows.
4. Sample Prep Lab to Facilitate Quick Turnaround of Assays
The Sample Prep Lab processing capacity has been increased to 1800
samples per day from the previous 900 samples per day to accommodate
the increase in sample submission volumes from Kalsaka and Sega
exploration.

KALSAKA
Mine Operations
• The mine perimeter covers 9.8km2
• There are five main pits: K Zone 1, K Zone 2, West Pit 2 and East Pit 1 and East Pit 2.
• East Pit 2 has been mined out and mining is currently coming from the K-zone 1 and 2 pit with an average reserve
grade of 1.28g/t and 1.95g/t respectively.
• The mine has 81,500oz in reserves grading 1.6g/t. Majority of the remaining reserves are within the K-zone.
• Stockpiles total 251kt grading 1.31g/t. This grade stated could be higher as grab samples taken over the surface of
the piles reported grades above 4g/t.
• Recoveries are about 87% for heap leach, which is good for heap leach.
• There is a 4 month leach cycle for the heaps. 1 tonne of ore sees 4 tonnes of solution
• Processing of ore at Kalsaka ends in March 2013. Sega is expected to come into the mine plan in Q1 2013.
• A geotechnical study has been completed that indicates that the heaps can support a third lift to support
processing of Sega ore.
• Kalsaka employs 600 contract workers of which 370 are Cluff employees.
Challenges
• Minimizing ore dilution is a challenge particularly at the East pit due to the pinch and swell nature of
mineralization which contributed to some of the dilution.
• Highly mineralized quartz are rejected by MMD sizer and stockpiled. Transition ore is also stockpiled. Stockpiled
transition ore currently sits at ~120,000 tonnes with an average grade of less than 1.47g/t.
• K Zone 2 pit ore with high and hard quartz content is not treatable through the MMD.
Solutions
• To control ore dilution, ore mining is closely monitored with no ore mining in the night. A geologist is always
present during ore mining.
• To process the oversize rejects and the K zone 2 pit ores, a hard rock crusher has been installed with a capacity of
140t/hr. Total material treated in March 2012 from both K zone 2 and oversize material was 114,825 tonnes at
1.06 g/t.
• Additional crushers will also be installed to increase crushing plant capacity as well as allow for transition ore
processing so as to make up for reduce ore mining from the pit.
Processing Improvements
• Cheaper reagents for use have been procured which provides savings of $400/tonne.
• A 150T Silo to receive Bulk Cement deliveries has also been installed. This will bring cement savings of $67 per
ton use and caustic savings of $888/ton use.
• Lastly, a booster station has been installed on the dam. Raw water pumping to increase flow from 86m3/h to
136m3/h. Pond levels and spraying capacity is currently at optimum levels.

Environmental
• During 2011 average rainfall was 391.6mm, below historical levels. Historical rain patterns have been as follows:
2010 – 742mm; 2009- 792mm, 2008 – 546mm. Between Jan and May 2012, rainfall totalled 89mm.
• There is a 1MM cubic metre water dam that supplies water for mine operations.
• Annual water requirements for the mine average about 0.676MM m3
• Notably, as a heap leach operation, the plant has lower water requirements and is therefore insulated from typical
water constraints faced by mine operations in Burkina Faso.
Community Relations
• There is an appointed liason officer who liases with the community to bring the needs of the community to the
attention of mine management. The liason officer also oversees the realization of the projects envisioned.
• A village community consultative committee has also been installed that serves as a mouthpiece and contact for
the community.
• Construction of a 4 unit classroom block for a college has begun at a cost of $65,690.
• 20 tonnes of rice have been donated to the community.
• Vocational skills training is provided for youths in carpentry, masonry and motorbike repairs.
Exploration
• 3 drill rigs are turning
• $6MM of drilling is planned, 70% of which will be allocated to near-mine targets and 30% to Yako
• Two deposits, Rondo and Zoungwa have the potential to add 40koz to the mine plan.
• The sulphide potential below the K2 pit and the East pit has been tested results for which are expected in
June 2012.
• There are an additional set of targets 35km to the south (Yako permit) where RC drilling has been
completed and infill drilling is planned to follow up on the results.
Reclamation
• Reclamation is expected to be less costly as backfilling or walling of the pits will not be required as unfilled pits
can be used as catchment for water.
SEGA
Sega Operations
• Sega is expected to run from 2013 to 2015. 2.175MM tonnes of ore is initially to be mined at a strip ratio
of 6.2 and an average grade of 2.27g/t.
• 57% of the ore to be treated is oxide and transition ore and the remaining 43% of ore is sulphide ore.
Total oxide to be treated is 1.896MMt @ 2.22g/t. Total transition material to be treated in 2013 is
0.03MMt @ 3.56g/t with additional transition ore of 0.3MMt @ 2.597g/t to be treated in H2 2014.
• The daily haulage rate is about 5,000t for a haulage distance of 25km.
• Grade control will need to be completed before mining begins.

Mineralized waste of between 0.4g/t – 0.73g/t could be stockpiled separately at Sega
• Overall oxide recoveries are expected to be about 80% whereas recovery of transition ore should be
about 65%.
• Cyanide consumption will be marginally higher due to higher grades of ore for processing to be
introduced.
• Ore blending of oxides and transition ore is to be introduced.
Sega Development Activities
• A certificate of exemption from VAT and withholding tax of 5% will be required from the Burkina
government
• A co-manager will need to be appointed to oversee Sega operations.
• Application and requisite paperwork for transfer of exploration license to Cluff has been completed.
Application for renewal of exploration license was completed by Orezone.
• Public hearings for development of Sega were held late last week.
• Management is working to de-couple the haulage road from the permitting process so as to start building
a road in August 2012 and anticipates having the infrastructure in place ahead of receiving the mining
license.
Relocation Program
• There is a well-organized and mechanical artisanal mining in and around Gambo that will need to be
relocated.
• Mining will start at the pits that have no surrounding communities to relocate.
• An ESIA is underway to address relocation of communities close to the operational area. The ESIA is
expected to be obtained by December 2012.
Sample Prep-Lab
• The sample prep lab has doubled capacity to 1800 samples/day to accommodate the increase in sample
submission volumes from Kalsaka and Seguenega exploration.
Processing at Sega
• A new primary jaw crusher is required. It is expected that the planned installation of a 250tph mobile
crusher at Kalsaka to process the transition stockpile toward the end of 2012 will be useful for treating
Sega ores.
• A third stage crusher is also to be installed to enable crushing to P80 passing 12mm with the plan to
maximize recoveries and to satisfy Sega test work parameters

Met testing on the various pits at Sega will be required for both oxide and transition ores. This will help
determine the metallurgical variability of the deposits as well as the reagent requirements. The test work
on oxides has already started.
Exploration
• 10,000m of drilling by Orezone which suggests the potential for further resource growth on some
advanced targets.
• There are two other targets to the East of Burkina Faso namely the Tyabo and Kankadi targets that have
the potential to drive resource growth. Soil geochem has been completed.
MILESTONES/CATALYSTS
1. Baomahun Resource Update – June 2012
2. Sega Scoping Study – July 2012
3. Baomahun Feasibility Study – Q3 2012
4. Completion of ESIA (Resettlement Action Plan) – Q4 2012
5. Yaoure Resource Update – Q4 2012
6. Sega Exploitation License – Q1 2013

[amargosa] 26/6/2012 10:21

Well, probably, but they do have the results of the 10,000m drilling already carried out at Sega; will they release them before the PEA I wonder.

[taffer87] 26/6/2012 10:15

SEGA will probably be in August.. from the conference call. The PEA will be received the Board end of June.. they will take a month to update/revise... public release with any results in Aug.

[amargosa] 25/6/2012 21:32

Sega drilling results too?

[taffer87] 21/6/2012 12:00

Baomahun resource update: next then?

[boadicea] 21/6/2012 08:02

The 'bid' price on my monitor is changing regularly every 10 seconds between 67.25p and 67.5p!
Is this some sort of automated ruse to keep the share on the top line of a change notifying system somewhere?

[fitton] 20/6/2012 17:30

Drilling results indicate that yaoure could be a large resource.Financing the projects is obviously causing concern in the market.The question is how long before a bid comes in for the company.The share price must be under severe presure not to respond to todays news with a few pence increase at least.Value has been added to the company but not to the market cap.I would guess if the share price recovers to closer to £1 in the next 6-8 weeks with good news flow then the company my have a fighting chance of avoiding a takeover.If the share price is still in the 60-70p ish range then it will be the end, I hope!

[taffer87] 20/6/2012 15:57

start 74p and back to 68 at close

[lucky_punter] 20/6/2012 13:28

Shares in West-African focused gold miner Cluff Gold (LON:CLF, TSE:CFG) were lifted today after it unveiled "significant" drilling results from its Yaoure project in the Ivory Coast.

[thetache] 20/6/2012 13:16

FWIW (which isn't much) I hold some Aureus as well as Cluff. But then I was also caught out by Shanta too, although at least I am back where I started with them, with Cluff I am 30% down

[taffer87] 20/6/2012 12:42

Any one with views on Aureus?

[danielmiller1] 20/6/2012 10:45

Been with CFL a while...you have no problems there. Also there may be a GDP/CLF deal somewhere in the wind.

Both excellent companies with highly credible management!

[boadicea] 20/6/2012 10:29

DM1 - Agree about SHG - management totally lost credibility (and I could say worse but possibly libellous!) Unfortunately the distrust engendered by some managements tends to rub off on the better ones too by tarnishing the whole sector. Result is some really good prospects at bargain prices imho, of which we hope CLF is one such.

[danielmiller1] 20/6/2012 10:11

Its doing what Algy said it would, nowt better. There are a few creamers out there amongst the junk juniors, CLUFF, GDP and a few other that I hold. These are the best I guess it left to the idiots( just read some BBs comments), to get into the rest.

Look at the SHG BB comments after suffering a wipe our from 40 to 20 due to a lack of due diligence (to be kind) by directors, they are still buying this and other with mountains of problems...beats me!

[taffer87] 20/6/2012 10:05

boadicea.. I totally agree. If Finance is available then this is looking very very good.

But with gold equities at such low levels.. hard to justify equity financing. And they will try to get as much debt as possible for Baomahun.

[boadicea] 20/6/2012 09:55

taffer - Intentions can change or develop based on results. They now seem keen to point out the economic potential, viz: "The location of the project, situated
close to existing infrastructure, means that the cost base for development is much lower than other projects located in West Africa."

On that basis and not forgetting the eggs and baskets principle, there is something to be said for parallel developments if finance is available. Yaoure may also be attractive as a relatively speedy development opportunity in mining terms.

[taffer87] 20/6/2012 08:00

Good results. Yeah, I can't see them developing Yaooure in the next 4-5 years internally if they focus on Baomahun. And it didn't look like they were planning to based on the conference call recently.

[pineapple1] 20/6/2012 07:29

Maybe they should sell Baomahun and concerntrate on this as its going to cost a lot less to get up and running.I doubt it however, but good to see the old donkey get up a canter for a change.
Seems like they have a lot to keep them busy ,perhaps a little to much really for such a small company.Nonetheless it is very encouraging.I,ve added here a few times on weakness,now i just need it to do a POG..imho

[amargosa] 20/6/2012 07:04

Starting to deliver; Yaoure's going to rival Baomahun.

[boadicea] 20/6/2012 07:04

Excellent news.
The description is rather technical. My understanding of it in layman's terms (someone more knowledgeable may correct me if I'm misinterpreting) is that there appears to be a likely combination of good bulk tonnage with some rich vein-work to put some icing on the cake. Ore is very tractable - non-refractory and capable of high recovery which is often not the case with sulphide-rich ores.

Sp responding accordingly!

[selkirk69] 20/6/2012 06:45

Yes about time really too, lets hope this is the start of some of the long awaited news flow.

[fitton] 20/6/2012 06:36

At last some news.It has to be said,some very,very good drilling results.