AIM listed mining exploration company Kefi Minerals (LON:KEFI) has moved a step closer to gold and silver production after agreeing the terms of a possible joint venture at a mine in the Eastern Anti-Atlas Mountains of Morocco. KEFI has reached an agreement with local company Roche Invest Sarl, which gives it a period of exclusivity over the Tiouit gold-copper mine and associated tailings retreatment project. The company is carrying out due diligence investigations in order to assess whether to enter into the joint venture to develop the projects at the Tiouit Mine.

A non-JORC compliant report, dated February 2011, estimates the three tailings dams at Tiouit contain a total of 285,000 cubic metres (or approximately 460,000 tonnes) at 3 to 4 grams per ton of gold and 20 to 30 gramps per ton of silver. Significant potential also remains in the remnant ore in the underground mine.

KEFI Minerals is paying Roche Invest $250,000 for the five month exclusivity period at Tiouit. During that time it will conduct a definitive feasibility study to evaluate the retreatment of gold and silver contained in previous mine tailings. I will also initiate a pre-feasibility study on re-starting the underground mining operations at Tiouit. The agreement also sets the framework for a strategic alliance between the two companies to evaluate additional mining opportunities in Morocco and the African region.

Gold mineralisation was first discovered at Tiouit in 1946 and mining operations were carried out intermittently from 1950 to 1964. Approximately 1 million tonnes of ore have been mined historically at Tiouit with an average recovered grade of 7.9g/t gold, 67g/t silver and 0.45% copper. Approximately 720,000 tonnes of tailings were generated by previous mining operations and stored in a number of discrete "dry stacked" tailings dams at surface. The remainder of the tailings are buried beneath shallow waste cover or under the dilapidated processing plant infrastructure. A significant portion of the buried tailings may also be accessed for retreatment.

Meanwhile, significant potential also remains in the remnant ore and in un-mined veins in the underground mine. Narrow-vein mining techniques employed in the past resulted in excessive dilution of mined grades. The veins range from 0.5m to 6m in thickness, with the average mined thickness about 1.5m to 2.0m. This dilution, coupled with poor metallurgical recoveries for gold from flotation…

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