Gramalote shows strength in social aspects

The ridge itself, also called Gramalote Central, is in the middle of what could potentially be an open pit to produce some 281,000 ounces a year from a resource of more than 4 million ounces, providing a panoramic view of the 1.2km by 500m footprint the pit will have, in addition to the opportunities and challenges its development will provide near San Roque in Antioquia.Gramalote is a structurally-controlled, intrusive-hosted bulk mineable deposit with the mineralisation found in structurally controlled quartz and quartz-pyrite veining and stockwork associated with carbonite-sericite, quartz-sericite and potassic alteration hosted in an oxidised Cretaceous tonalithic batholith.On the ground, the rock with potential to contain grade has a reddish colour and one looks for black sulphide veinlets, the more fractured, the better. The main mineralised zones are up to 150m true width and a gold grade of about 1 gram per tonne (g/t). "The gold is with the pyrite in the veins and we are looking for facture intensity as this provides a concentration of the gold. No veining means no gold," Steve Jensen, B2Gold's exploration manager Americas told Mining Journal. The white rock is barren.Gramalote Ridge currently hosts a December 2020 indicated resource estimate of 173.4 million tonnes grading 0.73g/t for 4.06Moz and an inferred resource of 58.2Mt grading 0.59g/t for 1.1Moz on a 100% basis using a US$1,800/oz gold price. While it is low grade, the project has a low strip ratio of 1.93:1 and low processing costs because the sulphide-bearing veinlets are highly friable and easily cleave away from their host rock, enabling a relatively high recovery rate of about 95.4%, which drives project economics.The Gramalote Ridge deposit is defined by 154,739 metres of drilling in 443 core holes between 2006 and 2021. Since 2020 when B2Gold resumed as operator, exploration has focused on infill drilling to upgrade inferred resources to indicated status as well as expanding the resource and to better define high-grade areas within the Gramalote Ridge pit.Gramalote also has upside potential as the Trinidad deposit, located within 5 km of Gramalote Ridge, hosts some 340,000oz. "The optimised feasibility will focus on Gramalote Ridge. Trinidad, as well as the Monjas West zone, will not be included and so they represent future upside down the road," said Jensen.After becoming operator in January 2020, B2Gold quickly released a preliminary economic assessment (PEA) for an 1Mtpy operation at Gramalote to produce gold from the sulphides. The oxides, which represent less than 2% of the total ounces, will be stockpiled, for potential processing at the end of the mine's life. B2Gold subsequently followed up its PEA with the May 2021 release of some interim data from the ongoing feasibility work. This showed 347,000oz/y production for the first five years and an average of 281,000oz/y over a 10.6-year mine life at an all-in sustaining cost of $744/oz following a capex of $925 million, giving an IRR of 15%.When B2Gold resumed as project operator in January 2020 it saw opportunities to enhance the plan its 50:50 joint venture partner AngloGold had advanced and got permitted with the aim of reducing the capex and increasing the IRR. With arguably the one of the best and most experienced mine building teams in the industry, the company is perfectly placed to do so, drawing on experience developing mines in similar environments such as Nicaragua, Namibia the Philippines and Mali. B2Gold VP operations Dale Craig (right) on Gramalote Ridge in Antioquia, ColombiaTo do so, B2Gold shipped in VP operations Dale Craig in 2020 as country manager to guide Gramalote towards a construction decision. The two-hour drive to site from Gramalote's administrative office in Medellin is mainly on a recently opened four-lane highway, an example of the considerable infrastructure investment the government is making via public-private partnerships to improve connectivity and facilitate economic growth. Private investment is very welcome in Colombia.During the drive, I ask Craig about the challenges the company faces to develop the project and the opportunity he sees. His answers are peppered with references to similar things he and the company have dealt with during the development of its other operations. B2Gold has clearly been through most situations that mine development can throw up and found a solution to overcome them and progress, whether it be relocating people, co-existing with small miners or building strong government and community relations.Craig also seems to combine an accountant's eye for cutting costs with a mining engineers adaptive thinking to challenge the status quo and find alternative solutions. "When we reviewed the results of the feasibility work to date in 2021, we saw possibilities for optimisation to reduce the capex and operating costs, to upgrade the inferred mineral resources to indicated and to improve the overall economics," said Craig.The result will be a Gramalote feasibility in the third quarter with a reduced physical footprint. The project optimization opportunities include road optimization and layout, pit design and phasing, blast design optimization, river deviation changes, improved infrastructure layout, and further optimization of plant design. These optimisations include a new location for the project camp, reducing the amount of roads which needs to be built and evaluating the use of high-pressure grinding rolls (HPGR) rather than a SAG mill.The company is also looking at grade streaming, a selective mining method which has proven to be successful at B2Gold's Fekola mine in Mali, which aims to get the best ounces to the mill at the beginning of the mine life to accelerate investment payback. "This is a balance between the required strip rate, grade and the amount of ore we need to stockpile," said Craig.Some decisions have yet to be made. For example, the mining fleet is likely to be hydrocarbon-based rather than electric although the company is looking at a mixed fuel option to reduce its exposure to diesel. B2Gold has developed solar generation capacity at its operations in Africa and is reviewing the possibility of doing the same at Gramalote, potentially through the installation of a solar generation plant on the surface of the tailings pond a few years into the project, which in addition to providing for the mine's own power needs, could provide a lasting benefit to the area post mine closure.With the feasibility due by the third quarter and the completion of an amendment to its existing environmental permit, the end of the year could see a funding decision being made with B2Gold and its partner AngloGold Ashanti.EnvironmentThe environmental aspects are a key consideration for the company too, which is unsurprising given B2Gold's record around the world, but critical in Colombia which has some of the most exacting and proscriptive prescriptive environmental requirements in the Americas. Evidence that B2Gold takes its responsibilities seriously can be seen in its nursery to grow native and threatened tree species for the reforestation and rehabilitation of degraded areas, and in the human resource the company dedicates to environmental and social aspects of the development. Many of its 700 personnel work on these aspects under head of sustainability Juan David Ramirez.While some of the optimisations the company plans to make to the Gramalote development project are minor changes, some may require it to amend its existing environmental permit and the company is completing the environmental and social studies necessary to support any potential permit modifications and thus being able to provide answers backed by data for any question the National Environmental Licensing Authority (ANLA) or regional environmental authority Cornare can throw at it. Craig noted a positive feature is many of the potential changes actually reduce environmental impacts or provide better ways to manage environmental impacts.Building a mine is only part of the story B2Gold is advancing at Gramalote as more than anything, the project is shaping up as a regional development project with a mine at its centre. The area has been previously mined for decades, if not centuries, by hydraulic mining processes whereby local miners literally washed the gold-bearing saprolite from the hills leaving a highly eroded, and in places, highly unstable slopes behind. This process also stripped the original vegetation. The future mine, to a certain extent will remediate this past damage and ultimately provide a lake and, once the tailings area is revegetated, perhaps the only piece of flat land in the region, with several potential future uses including agriculture as it will have no reactive material and it will provide productive growth media. It could also be the site of a solar power array.B2Gold began working the Gramalote project some 16 years ago and during that time, the Gramalote subsidiary company has become part of the fabric of the San Roque region with deep relationships forged over time and countless local hires. It is the social element which has the power to make or break a project and the approach of B2Gold—and AngloGold before it—has the project set to achieve the former.SocialArtisanal miners have continued to work in around the Gramalote project area throughout its exploration. Development of the project will require the relocation of those working within the proposed pit area. To do so, the company has developed an artisanal miner relocation plan which already counts with successful examples such as the Mineria La Maria group.The artisanal miner formalisation programme has so far seen the creation of 17 productive units for whom B2Gold has found new areas to work which together have some 160 direct employees and have generated some 1 billion Colombian pesos ($260,000) in State royalties over the past two or three years. Each productive unit is a formal company which has an environmental license and approved work plan. Together, they have access to exploration geologists and mine engineers or an interdisciplinary shared-service group. The miners now work legally, safely, with social security, planning and administration, paying taxes and royalties, which have allowed for local investment in education and infrastructure, while the use of mercury has been eliminated, producing benefits to the environment. Removing the use of mercury has allowed the environment of the La Maria creek to recover 90% since 2018, with fish and vegetation returning, as the water quality improves."This has allowed the generation of trust with Gramalote, the people and the authorities. We have shown that the co-existence of small and large mining is possible and broken the myth that small miners cannot negotiate with big companies," Luis Villanueva, operations director of La Maria SAS told Mining Journal. "It was hard at first, adapting to a completely different way of doing things, and changing our thinking, but now we can plan and invest." The Gramalote model house for relocationThe other critical social aspect is the relocation of 327 households. As with the small miner resettlement, B2Gold can draw on its experiences elsewhere in the world to guide its actions and enhance the likelihood of success. Timing appears to be a key factor, with relocation to be undertaken within a certain time of the land being required to reduce the possibility of new people moving into the vacant land from other regions.The broad resettlement plan was designed and agreed in collaboration with the community, which included housing and habitat, productive areas and other aspects to ensure a successful transition. "The next phase is to make individual agreements with each household once the feasibility has been completed," said Ramirez.Community members provided input into the design of the houses they are to receive under the plan in terms of materials, layout, decoration and other aspects, with different sized families having access to houses of an appropriate size to their needs, from 54m2 to 150m2.Each house will be prefabricated from concreate and be free-standing with some 2,000m2 of land which can support a kitchen garden and livestock such as chickens. "Some 80% of people we have to relocate live in less than 50m2 in houses that are often made of corrugated steel and board, so these houses are quite a step up for some people. They will also get ownership rights to the land they will be on, which is something they don't currently enjoy," said Ramirez.Pivot pointIn addition to helping B2Gold to sustain an overall future production rate of around 1Moz/y, Gramalote is a pivotal project for many others. For the Colombian government and ANLA, it will communicate to investors that they can permit large projects and help overcome some of the stigma resulting from AngloGold's attempt to permit the Quebradona copper-gold project in Antioquia and Minesa's attempt to permit Soto Norte in Santander. It will also be a landmark for showing that relocation of small miners and resettlement can occur in mutually beneficial ways and are not necessarily processes to be feared.

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