VANCOUVER, BC, Oct. 5, 2022
/PRNewswire/ - Trilogy Metals Inc. (TSX: TMQ) (NYSE:
TMQ) ("Trilogy Metals", "Trilogy" or "the Company") announces its
financial results for the third quarter ended August 31, 2022. Details of the Company's
financial results are contained in the interim unaudited
consolidated financial statements and Management's Discussion and
Analysis which will be available on the Company's website at
www.trilogymetals.com, on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov. All amounts are in United
States dollars unless otherwise stated.
Highlights
- Exploration field season completed for the Upper Kobuk Mineral
Projects ("UKMP") with over 10,700 meters drilled.
- Projects are well funded with Ambler Metals LLC, our 50/50
joint venture with South32 Limited, holding $93.5 million as at August
31, 2022.
- Trilogy cash position of $3.1
million and working capital of $2.9
million as at August 31, 2022
sufficient to fund head office operations for the next twelve
months.
Joint Venture Project
Activities
Field season activities at the Upper Kobuk Mineral Project
("UKMP") commenced in late May, with the camp opening on
May 20 and drilling was completed on
September 16. The Bornite camp is expected to be fully shut
down during the first week of October. The $26.2 million approved budget for Ambler Metals
LLC for this year was mainly spent on the summer field program,
which included 10,739 meters of diamond drilling that prioritized
advancing the Arctic Project with additional infill drilling to
further improve the confidence in the resource and the completion
of a geotechnical study to further de-risk the Arctic Project.
Exploration outside of the Arctic deposit focused on identifying
copper-rich satellite deposits near Arctic in the Volcanic Massive
Sulphide ("VMS") Belt and the Cosmos Hills. The forecasted
spend at Ambler Metals for the fiscal year is estimated to be
approximately $28.5 million which is
$2.3 million or 8.8% higher than
budget.
For the 2022 Arctic field program, Ambler Metals completed 8,376
meters in 47 holes as part of an 8,400-meter infill program to
increase confidence of the resource from the Indicated to Measured
category. This includes five holes totaling 815 meters completed
for the geotechnical assessment of Arctic that was initiated last
year and two infill holes instrumented for the ongoing
geohydrological assessment.
The 2022 exploration program for the Cosmos Hills and Ambler VMS
Belt includes drilling of 7 holes totaling 2,363 meters as well as
detailed mapping and soil sampling to build on the work performed
during the prior year. In addition, 1,350 meters of trenching was
completed around Pardner Hill.
The Company expects to begin announcing drill results during the
fourth quarter of 2022.
Ambler Mining District Industrial
Access Project ("AMDIAP" or "Ambler Access Project")
In a press release dated September 21,
2022, the Company provided an update on the AMDIAP. The
United States Bureau of Land Management ("USBLM") published in the
Federal Register a Notice of Intent ("NOI") that it will prepare a
Supplemental Environmental Impact Statement ("SEIS") for the
proposed AMDIAP. The NOI includes a 45-day comment period on the
SEIS, which will allow the USBLM to determine if any additional
impacts and resources related to previously identified deficiencies
should be more thoroughly assessed. The NOI also indicated that
input by Alaska Native Tribes and Corporations will continue to be
of critical importance and that the USBLM will continue to consult
with these entities under applicable guidance. The USBLM
anticipates publishing a Draft SEIS during the second quarter of
2023, after which it will accept public comments on the Draft
SEIS.
The Company anticipates intervenor defendants, including the
State of Alaska, NANA Regional
Corporation, Inc. and Ambler Metals LLC, to provide comments to the
Court in the road permit lawsuit against the United States
Department of Interior ("DOI") urging the DOI to expedite their
work with a goal to reinstating the Joint Record of Decision for
the Ambler Access Project.
Selected Results
The following selected financial information is prepared in
accordance with U.S. GAAP.
in thousands of dollars
|
Three months
ended
|
Nine months
ended
|
Selected
expenses
|
August
31,
2022
$
|
August
31,
2021
$
|
August
31,
2022
$
|
August
31,
2021
$
|
General and
administrative
|
279
|
425
|
1,014
|
1,188
|
Investor
relations
|
18
|
170
|
155
|
440
|
Professional
fees
|
131
|
123
|
568
|
627
|
Salaries
|
172
|
365
|
847
|
1,210
|
Share of loss on equity
investment
|
8,925
|
6,072
|
13,295
|
8,892
|
|
|
|
|
|
For the three-month and nine-month periods ended August 31, 2022, cash preservation strategies
resulted in overall cash savings of $0.5
million and $0.9 million,
respectively in general and administrative expenses, investor
relations, professional fees and salaries when compared to the same
periods last year. The increase in our share of losses of Ambler
Metals of $2.9 million and
$4.4 million, respectively was mainly
due to an increase in mineral property expenses over the
comparative quarter in the prior year from higher drilling and
project support costs as well as higher pre-development costs for
the Ambler Access Project.
Liquidity and Capital
Resources
We expended $3.4 million on
operating activities during the nine-month period ending
August 31, 2022 with the majority of
cash spent on corporate salaries, professional fees related to our
annual regulatory filings, annual insurance renewal, annual fees
paid to the Toronto Stock Exchange and the NYSE American Exchange
and with the American and Canadian securities commissions.
At August 31, 2022, we had
$3.1 million in cash and cash
equivalents and working capital of $2.9
million. The Company continues to manage its cash
expenditures through its working capital. Management continues to
review the fiscal 2022 budget for cash preservation opportunities
and has reduced cash expenditures where feasible, including but not
limited to, reductions in marketing and investor conferences and
office expenses. In addition, the Company's Board of Directors have
agreed to take all of their fees in equity of the Company in an
effort to preserve cash and increase share ownership. The Company's
senior management team are also taking a portion of their base
salaries in equity of the Company to preserve cash. Management
believes that the combination of these cost reduction efforts
results in sufficient cash to fund the Company's operations for the
next twelve months.
Qualified Persons
Richard Gosse, P.Geo, Vice
President Exploration for Trilogy Metals Inc., is a Qualified
Person as defined by National Instrument 43-101. Mr. Gosse
has reviewed the scientific and technical information in this news
release and approves the disclosure contained herein.
About Trilogy Metals
Trilogy Metals Inc. is a metal exploration and development
company that holds a 50 percent interest in Ambler Metals LLC which
has a 100 percent interest in the UKMP in Northwestern Alaska. On December 19, 2019, South32, a globally
diversified mining and metals company, exercised its option to form
a 50/50 joint venture with Trilogy. The UKMP is located within the
Ambler Mining District, one of the richest and most-prospective
known copper-dominant districts in the world. It hosts world-class
polymetallic VMS deposits that contain copper, zinc, lead, gold and
silver, and carbonate replacement deposits that have been found to
host high-grade copper and cobalt mineralization. Exploration
efforts have been focused on two deposits in the Ambler Mining
District – the Arctic VMS deposit and the Bornite carbonate
replacement deposit. Both deposits are located within a land
package that spans approximately 181,387 hectares. Ambler Metals
LLC has an agreement with NANA Regional Corporation, Inc., an
Alaska Native Corporation that provides a framework for the
exploration and potential development of the Ambler Mining District
in cooperation with local communities. Trilogy's vision is to
develop the Ambler Mining District into a premier North American
copper producer while protecting and respecting subsistence
livelihoods.
Cautionary Note Regarding
Forward-Looking Statements
This press release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation including the United States Private
Securities Litigation Reform Act of 1995. All statements, other
than statements of historical fact, included herein, including,
without limitation, statements relating to the anticipated timing
of drill results, the expected timing of the shutdown of the
Bornite Camp, the Company's forecasted expenditures for the fiscal
year, the Company's ability to fund its operations, our
expectations relating to and continued work with the DOJ and other
intervenor defendants in the lawsuits concerning the Ambler Access
Project, the requirement for additional funding at Ambler Metals
and the perceived merit of the Company's properties are
forward-looking statements. Forward-looking statements are
frequently, but not always, identified by words such as "expects",
"anticipates", "believes", "intends", "estimates", "potential",
"possible", and similar expressions, or statements that events,
conditions, or results "will", "may", "could", or "should" occur or
be achieved. Forward-looking statements involve various risks and
uncertainties. There can be no assurance that such statements will
prove to be accurate, and actual results and future events could
differ materially from those anticipated in such statements.
Important factors that could cause actual results to differ
materially from the Company's expectations include the
uncertainties involving success of exploration activities,
permitting timelines, requirements for additional capital, risks
pertaining to the outbreak of the coronavirus (COVID-19),
government regulation of mining operations, environmental risks,
prices for energy inputs, labour, materials, supplies and services,
uncertainties involved in the interpretation of drilling results
and geological tests, unexpected cost increases and other risks and
uncertainties disclosed in the Company's Annual Report on Form 10-K
for the year ended November 30, 2021
filed with Canadian securities regulatory authorities and with the
United States Securities and Exchange Commission and in other
Company reports and documents filed with applicable securities
regulatory authorities from time to time. The Company's
forward-looking statements reflect the beliefs, opinions and
projections on the date the statements are made. The Company
assumes no obligation to update the forward-looking statements or
beliefs, opinions, projections, or other factors, should they
change, except as required by law.
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SOURCE Trilogy Metals Inc.