Endeavour Mining begins construction of new African gold mine

Canada’s Endeavour Mining (TSX:EDV) (OTCQX:EDVMF) has began construction at its Hounde project in Burkina Faso, which is forecast to produce about 1.9 million ounces of gold over a 10-year mine life.

Shares soared on the news and were trading 7.6% higher to $13.77 at 10:30 am ET. So far this year, Endeavour Mining’s value has climbed over 80%.

Endeavour owns five mines in Côte d’Ivoire, Ghana, Mali and Burkina Faso, and could produce between 575,000 and 600,000 ounces of gold this year.

Building the mine would cost an initial $328 million to build, the Vancouver-based firm said. The project will be the second low-cost gold mine Endeavour has in West Africa, after it grabbed the close-by Karma mine last month through a friendly acquisition of fellow Canadian miner True Gold (TSX-V: TGM)

In total, Endeavour owns five mines in Côte d’Ivoire, Ghana, Mali and Burkina Faso, and could produce between 575,000 and 600,000 ounces of gold this year at all-in sustaining costs ranging from $870 to $920 per ounces.

Once Hounde is operational, Endeavour will add 190,000 ounces per year.

In a separate statement, True Gold announced that Karma mine, 90% owned by Endeavour once the merger finalizes, has poured its first gold today.

Last year, Endeavour Mining produced 517,000 ounces of gold at all-in sustaining costs of $922 per ounce.