West African Resources Forecasts 430,000–490,000oz Gold at Sub-US$1,900 AISC in 2026
West African Resources forecasts a record 430,000 to 490,000 ounces of gold production in 2026, driven by full-year output from Kiaka and sustained performance at Sanbrado. The company plans significant drilling and capital investment to extend mine life and enhance growth.
- 2026 gold production guidance of 430,000–490,000 ounces at AISC under US$1,900/oz
- Kiaka to contribute over half of production in its first full operational year
- More than 100,000 metres of drilling planned to extend mine life and increase resources
- US$15–20 million exploration budget and US$165–200 million growth capital expenditure
- Dividend payments and share buybacks under consideration for second half of 2026
Record Production Forecast for 2026
West African Resources Limited (ASX:WAF) has unveiled ambitious production guidance for 2026, targeting a record 430,000 to 490,000 ounces of gold at an all-in sustaining cost (AISC) below US$1,900 per ounce. This marks a significant step up from prior years, with the Kiaka gold mine contributing over half of the group’s output in its first full year of operation, complemented by steady production from the Sanbrado mine.
Strategic Drilling and Exploration Drive Growth
The company plans to invest heavily in exploration, allocating between US$15 million and US$20 million to drill more than 100,000 metres across its key assets and surrounding areas. This extensive drilling program aims to extend the mine life of both Sanbrado and Kiaka, with a focus on underground and open pit expansions, including the Toega deposit which is poised for its maiden underground ore reserve in 2027.
Sanbrado’s production plan benefits from recent drilling success, with increased throughput and ongoing infrastructure upgrades such as process plant refurbishments and tailings storage facility expansions. Meanwhile, Kiaka’s operational efficiency has improved notably with stable grid power, reducing costs and enabling higher throughput.
Capital Investment and Cost Management
West African Resources is budgeting US$165 million to US$200 million in growth capital expenditure for 2026. Key projects include power infrastructure enhancements at Kiaka, pre-production development at Toega and M5 South underground mines, and ventilation upgrades at Sanbrado’s M1 South underground operation. These investments are critical to supporting the company’s goal of becoming a sustainable 500,000+ ounce gold producer.
Cost assumptions underpinning the guidance include an average gold price of US$4,000 per ounce and royalty costs of US$440 per ounce, reflecting Burkina Faso’s sliding scale royalty regime. The company cautions that fuel price volatility and geopolitical tensions, particularly in the Middle East, could impact operating costs and may necessitate future guidance revisions.
Capital Management and Shareholder Returns
With expected strong free cash flow generation in 2026 and 2027, West African Resources is considering early debt repayments and the potential for dividend payments or share buybacks in the second half of 2026. This signals confidence in the company’s financial position and commitment to delivering shareholder value as production scales up.
Executive Chairman and CEO Richard Hyde highlighted the company’s growth trajectory, emphasising the value creation from exploration and operational improvements. The upcoming half-year report will be a key milestone for investors to assess progress and potential returns.
Bottom Line?
West African Resources is poised for a transformative year in 2026, but investors should watch closely for cost pressures and drilling outcomes that will shape its path to half a million ounces annually.
Questions in the middle?
- How will fuel price fluctuations and geopolitical risks affect West African’s cost structure and AISC?
- What results will the extensive 100,000m drilling program yield in terms of resource upgrades and mine life extensions?
- When and how will the company formalise dividend payments or share buybacks amid its growth investments?
