By: OrePulse

Fortuna Mining has extended high-grade gold mineralization at depth at its Diamba Sud project in Senegal, as the company works toward a final investment decision this quarter while holding to a production start in 2028.

New drilling in the Southern Arc zone cut 40.8 meters grading 3.9 grams per tonne gold from 228 meters downhole in hole DSR1149, extending the deposit at depth, the company said. A separate hole, DSDD699, intersected 12 meters at 6.8 grams per tonne from 96 meters. Two further holes, DSR1132 and DSR1128, returned 20 meters at 4.5 grams per tonne from 65 meters and 12.8 meters at 7.8 grams per tonne from 103 meters, respectively.

Since a February update, Fortuna has drilled 196 holes totaling 36,592 meters at Southern Arc, identifying extensions to the northeast and southwest of the zone as well as at depth. The company plans to fold the new results into its year-end resource and reserve update, with further step-out drilling planned for 2027 to test the limits of the mineralized system.

National Bank Financial analyst Mohamed Sidibe said the results "support near-pit growth" at Diamba Sud, adding that parallel structures to the southeast of Southern Arc remain untested and could offer additional upside to the mine plan.

Diamba Sud currently holds probable reserves of 20.5 million tonnes grading 1.75 grams per tonne gold, containing 1.15 million ounces, according to an April 2026 estimate. The project has become a focal point for Fortuna as it seeks to grow output beyond its existing operations in Latin America and West Africa.

A feasibility study completed in June 2026, using a 5% discount rate and a gold price of $3,500 an ounce, projected an after-tax net present value of $1 billion for the project, along with a 60% internal rate of return and a payback period of one year. Sidibe estimated that Diamba Sud accounts for 18% of Fortuna's net asset value of C$23.47 per share, underscoring the project's weight in the company's overall valuation.

Fortuna is targeting a final investment decision this quarter, with gold production slated to begin in the second quarter of 2028. The company said it aims to raise annual output to 500,000 gold-equivalent ounces by 2028, up from a maximum forecast of 305,000 ounces this year across its existing mines. Fortuna currently operates mines in Peru, Argentina and Cote d'Ivoire, and Diamba Sud would mark its first production asset in Senegal.

Fortuna said in an October 7 update that it is finalizing talks with Senegal's government over a tax stability agreement, with the company describing negotiations as being in their final stages. Fortuna has not disclosed further terms of those discussions.

Elsewhere on the surrounding Bambadji properties, Fortuna has begun drilling at Kabewest, which the company has identified as the area's largest drill-defined target, with assays still pending. Six drill rigs are running as part of an $8 million exploration campaign for the remainder of 2026. Kabewest sits about 2.3 kilometers from the proposed Diamba Sud plant site, positioning it as a potential future feed source should drilling confirm a viable deposit there.

Fortuna shares fell 3.4% to C$15.04 in Toronto trading, valuing the company at roughly C$4.5 billion, or $3.2 billion. The stock has traded in a 52-week range of C$10.78 to C$18.99.

Taken together, the latest drill results, the pending tax stability agreement and the targeted investment decision mark the next set of milestones for Diamba Sud as Fortuna works toward becoming a gold producer in Senegal by the second quarter of 2028. The company is pursuing growth on two fronts at once: near-pit extensions at Southern Arc that could feed a year-end reserve update, and early-stage drilling at Kabewest aimed at identifying additional feed sources close to the planned plant site.