How Does Pasofino Gold's Dugbe Gold Project Shape Up Against Competitors?

Gold mining has long been a significant industry in West Africa, with more than 324 metric tons of gold produced in the region in 2021. The last decade has seen additional focus on West Africa's gold production as efforts from South Africa have been redirected; Ghana, Burkina Faso and Mali have been the top three producing countries, accounting for 33% of Africa's gold production. 

However, a few companies have set their targets on less explored West African countries with the potential to expand gold production and supply in the region. Pasofino Gold EFRGF, and Tietto Minerals Abijar Project TIE are two companies that are in West Africa. Osino Twin Hills Project OSI is in southern Africa, but is similar in many aspects. 

West Africa's Gold Frontier 

Pasofino Gold believes Liberia is West Africa’s last untapped gold exploration frontier. The Dugbe Gold Project is located in the southeast county of Sinoe in Liberia, approximately 90 kilometers (66 miles) from the port of Greenville, and is situated within the Birimian geological province. The Birimian province is recognized for hosting the majority of West African gold deposits, but the Dugbe Gold Project remains largely underexplored. Pasofino is at the forefront of this exploration with its land spanning 2,302 square kilometers (889 square miles).

Osino Resources Corp.'s Twin Hills Project is located in Namibia in southern Africa. The Twin Hills Project is part of the country's growing gold exploration efforts to cement Namibia in the gold market. Meanwhile, Tietto Minerals' Abijar Project is located in Ivory Coast, another West African country that has attracted numerous explorers and miners due to its significant mineral endowment and relatively supportive regulatory framework. Compared to Osino and Tietto, Pasofino has a higher grade with 3.31Moz at an average of 1.37/gt Au versus 1.08.gt Au and 1.0gt Au for Osino and Tietto, respectively.

Mining Potential And The Future Landscape Of Gold 

Less than 20% of Pasofino Gold's project has been thoroughly explored, and within this Pasofino has had considerable success, the company says. The well-explored areas include the Dugbe F and Tuzon areas, which hold a combined Measured and Indicated Resource of approximately 3.3 million ounces of gold. The company believes the remaining 80% of the project area also holds significant potential for further discoveries. 

Osino's Twin Hills Project in Namibia has also shown promising gold discoveries, with continuous drilling campaigns aimed at increasing their understanding and estimates of the mineral resources. Tietto Minerals claims the Abijar Project to be one of the largest undeveloped gold resources in West Africa, highlighting substantial gold deposits with aggressive exploration and drilling results. The Abijar Project is rapidly moving towards production, with construction and development activities initiated. That being said, in January 2024, Pasofino closed a non-brokered private placement of $2.3 million to insiders to fund the Dugbe Gold project. That has allowed the company to progress the development of the project and the maximization of its value.

At Dugbe F and Tuzon, the 2022 DFS defined a large mineral reserve that supports an average annual gold production of approximately 173,000 ounces from open-pit mining. These reserves are projected to sustain a 14-year Life of Mine (LOM) with an expected recovery rate of 83% based on test work conducted during the Feasibility Study, the company says. 

Additionally, the average annual production for the first five years is anticipated to be 200,000 ounces. In comparison, Tietto's advanced stage could signal a short remaining lifespan – indicating lower potential for growth given the late stage – whereas Pasofino and Osino might attract those interested in long-term exploration potential. Pasofino in particular might present investors with an opportunity to invest at an earlier stage than Tietto and Osino.

Africa's Promise In The Gold Market

Companies like Pasofino, Tietto, and Osino each offer unique opportunities; Pasofino with a large untapped resource, Osino with a stable jurisdiction and expanding resources, and Tietto with a fast track to production and potentially early revenue generation. Despite very comparable evaluations and production capability, Osino had a market cap of $237 million and Tietto had a market cap of $605 million compared to Pasofino's market cap of $44 million. 

The gold market is currently experiencing massive growth, with many anticipating that by the end of 2024, the gold rate could exceed $2,300/oz, which would break the all-time high that was hit in March 2024. As of today, the gold price has already topped $2,400/oz, which is a potential sign of cautious optimism.  

West Africa seems likely to continue to be a major player in the global gold market. This landscape provides a variety of opportunities for all manner of investors, depending on their goals and risk profile. With some companies exhibiting more stability, and with players like Pasofino having a lower market capitalization than their other two competitors, different investors may find different opportunities in this developing landscape.

Featured photo by Artyom Korshunov on Unsplash

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