B2Gold studies new underground mine to support higher production at Otjikoto

B2Gold (TSX: BTO, NYSE AMERICAN: BTG, NSX: B2G) has confirmed the potential for expanded production at its Otjikoto mine in Namibia following positive exploration drilling results from the Antelope deposit located 3 km south of the Phase 5 open pit.

The Antelope deposit, which comprises the Springbok zone, the Oryx zone, and a possible third structure, Impala, subject to further confirmatory drilling, was discovered in 2022 following deep drill testing on three-dimensional models of magnetic inversion data.

In 2023, B2Gold drilled a total of 20,715 metres in 37 holes at the Antelope deposit, making up a majority of the drilling completed under its $3.3 million exploration program that focused the licensed area surrounding Otjikoto.

Highlighted drill holes include GH22-048, which intersected 12.88 grams per tonne (g/t) gold over 7.6 metres from 485 metres at the Springbok zone; and GH23-056, intersecting 9.86 g/t gold over 7.48 metres from 517.55 metres at the Oryx zone.

According to B2Gold, the drill results at Springbok and Oryx indicate the potential for possible underground development of the Antelope deposit, which it believes could begin to contribute to gold production at Otjikoto as soon as 2026.

Otjikoto, located in the north-central part of Namibia, is the largest gold producer in the country. It consists of the namesake open pit and the new Wolfshag underground mine that together hold 620,000 oz. in probable mineral reserves.

The open pit operation at Otjikoto is anticipated to conclude in 2025, while underground mining operations at Wolfshag will continue through 2026, B2Gold confirmed in a news release Wednesday.

Current gold production estimates at Otjikoto are expected to be between 180,000 to 200,000 oz. in 2024 and 2025, just under 100,000 oz. in 2026, and stepping down to sub 50,000 oz. from 2026 through 2031 during the processing of low-grade stockpiles.

As such, the underground mining of the Antelope deposit could supplement the processing of stockpiles through 2031, with the goal of increasing gold production levels to over 100,000 oz. per year from 2026 through 2031, the company said.

B2Gold is targeting an initial mineral resource estimate for the Antelope deposit by the third quarter of 2024, followed by an internal scoping study on an underground mining operation, to be completed by the first quarter of 2025.

To achieve these milestones, the miner has nearly tripled its exploration budget for Namibia in 2024 to $9 million, which represents its largest drill program since the definition of the Wolfshag discovery in 2012. A 39,000-metre drill program has been planned to define and expand the Antelope deposit.

Otjikoto was acquired by B2Gold in late 2011 through a merger with Auryx Gold, becoming the company’s first African development project. It now has a 90% ownership in the operation, with local company EVI Mining holding the other 10%.

Shares of B2Gold edged 0.3% higher on the TSX as of noon ET, trading at C$3.79 apiece. The stock’s 52-week price range is C$3.56-C$5.87. The senior gold producer has a market capitalization of C$4.9 billion ($3.7bn).