For immediate release
14
April 2020
Serabi Gold plc(“Serabi”
or the “Company”)
Serabi reports first quarter gold
production for 2020, including record monthly gold production for
March.
Serabi Gold plc (AIM: SRB, TSX: SBI), the
Brazilian focused gold mining and development company, is pleased
to provide the results and a review of its first quarter
operational and development activities in the Tapajos region of
Para State, Northern Brazil.
OPERATIONAL and DEVELOPMENT
HIGHLIGHTS
- 3,674 ounces of gold produced in March 2020, the highest
monthly level since the operation opened.
- First quarter gold production of 9,020 ounces.
- 42,036 tonnes of ore mined during the quarter at 6.54 grams per
tonne (“g/t”) of gold.
- 40,465 tonnes of run of mine (“ROM”) ore were processed through
the plant from the combined Palito and Sao Chico orebodies, with an
average grade of 6.66 g/t of gold.
- 2,878 metres of horizontal development completed during the
quarter.
- Ore sorter in full scale operation in March following
completion of commissioning during the quarter.
- Public hearing for the Coringa project held on 6 February 2020
with positive feedback. The Company is now awaiting submission of
final recommendation to, and approval of, the State Environmental
Council (“COEMA”) for the award of the Licencia Previa (the
Preliminary License).
Mike Hodgson has provided interviews to
BRR Media and Crux Investors where he answers questions on the
Company’s recently announced 2019 financial results, recent
announcements on financing for Coringa and the first quarter
operational results. The following links can be used to
access these interviews.
BRR Media -
https://www.brrmedia.co.uk/event/164908
Crux Investors -
https://youtu.be/aUzyrvymZQU
Key Operational Information
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SUMMARY PRODUCTION STATISTICS FOR 2020 AND FOR 2019 |
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Qtr 1 |
Qtr 1 |
Qtr 2 |
Qtr 3 |
Qtr 4 |
Total |
2020 |
2019 |
2019 |
2019 |
2019 |
2019 |
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Gold production (1) (2) |
Ounces |
9,020 |
10,164 |
9,527 |
10,187 |
10,233 |
40,101 |
Mined ore – Total |
Tonnes |
42,036 |
42,609 |
44,784 |
44,757 |
44,092 |
176,243 |
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Gold grade (g/t) |
6.54 |
7.47 |
6.72 |
7.14 |
6.69 |
7.00 |
Milled ore |
Tonnes |
40,465 |
43,451 |
43,711 |
45,378 |
44,794 |
177,335 |
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Gold grade (g/t) |
6.66 |
7.69 |
6.72 |
6.84 |
6.81 |
7.02 |
Horizontal development
– Total |
Metres |
2,878 |
1,868 |
2,419 |
2,433 |
2,908 |
9,628 |
- Gold production figures are subject to amendment pending final
agreed assays of the gold content of the copper/gold concentrate
and gold doré that is delivered to the refineries.
- Gold production totals for 2020 include treatment of 9,146
tonnes of flotation tails at a grade of 4.35 g/t (Q1 2019:
3,136 tonnes at a grade of 4.00 g)
- The table may not sum due to rounding.
Mike Hodgson, CEO,
commented:
“The first quarter of 2020 has been very
eventful for us all. At Palito after a month of moderate production
in January, we suffered a completely unforeseen mill breakdown
during February losing over 18 milling days on our main ball
mill. This adversely effected gold production for that month,
so I am delighted to report that the response in March, producing
approximately 3,700 ounces of gold, a monthly production record
represented a truly exceptional effort which has continued into the
start of April. As a result we closed the quarter with a very
respectable total of 9,020 ounces of gold , which considering the
mill problems in February, when approximately 10% of our quarterly
throughput was lost, is a very pleasing
result.
“A lot of the improvement in March resulted from
improved average ore feed grades, most notably from Palito, which
can, in part, be attributed to the recently commissioned ore
sorter, which is working extremely well. During the first
part of the quarter, as we undertook commissioning, we made
multiple adjustments to optimise the set up, but by March we were
in the position to truly test its capability. During March,
the sorter processed approximately 2,500 tonnes of ROM with
an average grade of approximately 3 g/t , which the sorter screened
into 300 tonnes of product at over 20 g/t gold and 2,200 tonnes of
reject at 0.88 g/t Au, representing an improved feed grade of
600 to 700 per cent and eliminating virtually all the waste that
would otherwise have entered the plant. We estimate that during the
first quarter the ore sorter performance would have ‘liberated’ on
average approximately 80 tonnes per day of capacity (16 per cent)
in the plant, and we hope to be able to fill that capacity, and
replace the waste, with high grade ore going forward.
“Development and production from the Palito
orebody in the quarter was focussed on the Chico da Santa sector,
where we have the Jatoba, Mogno and Ipe veins. The latter two are
being developed on several levels and we have been mining
exceptionally high grades of up to 20g/t. The other area of
development is the G3 vein, which when the current operations
started in 2014 was a backbone of production. We have more recently
been developing a number of other areas of the deposit but have
returned to advancing development of G3 vein on the 130m level, to
access an area successfully drilled from surface during 2019.
At the Sao Chico orebody, the ramp is deepening to level -60m,
whilst development continues west on upper levels at 186mRL and
156mRL.
“On the exploration front, the exciting news to
come out of Sao Chico during the quarter was the drilling success
in both the underground and surface drilling programmes which was
reported in a news release on 3 March 2020. To the west,
drilling has been undertaken 300 metres beyond the current western
limit of the mine, and the intersections are indicative of now
being able to extend the current mine limit. To the east we have
extended the mineralisation some 220 metres beyond the mine limits
with a drill intersection of 11.7 g/t Au over 1.2 metres.
However, for me, the most encouraging result was an
intersection located approximately 200 metres below the current
lowest development level of the mine, where the assayed gold grade
was 25.37g/t over a width of 4.08 metres.
“As well as exploration success in the immediate
mine area, we also continued to drill the near-minesite geophysical
anomalies of Abelha, Besouro, and Cicada all of which lie within a
5 kilometre radius of Sao Chico. The drilling started in
December and continued through the quarter. We have now
drilled 5 holes, three of which have intersected gold bearing
sulphides. With the step out drilling to the west of Sao
Chico advancing towards these anomalies and now just 1km away, I am
very excited by the potential that this mineralisation may all join
up.
“With respect to Coringa, significant progress
was been made with the permitting during the quarter, most notably
with the successful public hearing that took place on 6 February
2020. We are now awaiting formal recommendation to, and
approval of, the State Environmental Council (“COEMA”) for the
award of the Licencia Previa (the Preliminary License).
“Finally, and very significantly I must discuss
the impact of the Coronavirus on Serabi and our activities.
As was mentioned in our news release of 26 March 2020, the
operation is continuing to perform very well. The site
remains totally virus free and the workforce at site have requested
that in the immediate term there should be no rotation of workers,
at least not until testing of oncoming workers is possible, to keep
the site virus free. For those at site, more rest days have
been agreed. We have stockpiled as many critical mining and
processing consumables and supplies as we can to keep the site
operational. With this strategy, whilst we may not be able to
quite reach our budgeted levels of production, I think we can come
close. Gold price and exchange rates are hugely in our
favour, so we are at least in these troubled times finding success
as a gold producer.
“I would like to end by taking the opportunity
to thank the flexibility and professionalism of our Serabi
workforce, and the superb results they are, and I anticipate will
continue to achieve in the coming
months.
Production Results
Total production for the first quarter of 2020
was 9,020 ounces of gold, generated from the processing of 40,465
tonnes of ore at overall average grades of 6.66 g/t of gold. This
processed ore was sourced from hard rock mined ore from the Palito
and Sao Chico orebodies, supplemented by the processing of 9,146
tonnes of surface stockpiled flotation tailings grading
approximately 4.35 g/t gold. Mined tonnage for the quarter
totalled 42,036 tonnes with a grade of 6.54 g/t of
gold.
On 31 March 2020, there were coarse ore stocks
of approximately 9,601 tonnes of ore with an average grade of 2.6
g/t of gold, and a significant stockpile of flotation tails with an
estimated average grade of 3.00 g/t of gold. These stockpiles are
being slowly consumed, used as a ‘top-up’ to mined ROM to keep the
plant full. The stockpile of flotation tailings is sufficient
to continue to process this material at current rates for the rest
of the year.
A total of 2,878 metres of horizontal
development has been completed during the quarter, of which 1,256
metres was ore development. The balance is the ramp, cross
cuts and stope preparation development.
2020 Production Guidance
At this time, the impact of CV-19 has not
directly affected production, but, as stated above, the Company
cannot, in the immediate term, refresh the workforce at site and
these employees have undertaken to extend their work rosters as a
result. The Company will continue to make its best efforts to
maintain production levels as close as guidance is practical being
mindful of providing proper rest schedules for those staff at the
mine site. The Company will be constantly monitoring
this situation and providing further updates as
necessary.
This announcement is inside information for the
purposes of Article 7 of Regulation 596/2014.
The person who arranged for the release of this
announcement on behalf of the Company was Clive Line, Director.
Enquiries:
Serabi Gold plc |
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Michael Hodgson |
Tel: +44 (0)20 7246 6830 |
Chief Executive |
Mobile: +44 (0)7799 473621 |
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Clive Line |
Tel: +44 (0)20 7246 6830 |
Finance Director |
Mobile: +44 (0)7710 151692 |
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Email: contact@serabigold.com |
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Website: www.serabigold.com |
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Beaumont Cornish LimitedNominated Adviser and Financial
Adviser |
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Roland Cornish |
Tel: +44 (0)20 7628 3396 |
Michael Cornish |
Tel: +44 (0)20 7628 3396 |
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Peel Hunt LLPUK Broker |
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Ross Allister |
Tel: +44 (0)20 7418 8900 |
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Copies of this announcement are available from
the Company's website at www.serabigold.com.
Neither the Toronto Stock Exchange, nor any
other securities regulatory authority, has approved or disapproved
of the contents of this announcement.
GLOSSARY OF TERMS
The following is a glossary of technical
terms:
“Au” means gold.
“assay” in economic geology, means to
analyse the proportions of metal in a rock or overburden sample; to
test an ore or mineral for composition, purity, weight or other
properties of commercial interest.
“development” - excavations used to establish
access to the mineralised rock and other workings
“DNPM” is the Departamento Nacional de Produção
Mineral.
“grade” is the concentration of mineral within
the host rock typically quoted as grammes per tonne (g/t), parts
per million (ppm) or parts per billion (ppb).
“g/t” means grams per tonne.
“granodiorite” is an igneous intrusive rock
similar to granite.
“igneous” is a rock that has solidified from
molten material or magma.
“Intrusive” is a body of igneous rock that
invades older rocks.
“on-lode development” - Development that is
undertaken in and following the direction of the Vein
“mRL” – depth in metres measured relative
to a fixed point – in the case of Palito and Sao Chico this is
sea-level. The mine entrance at Palito is at 250mRL.
“saprolite” is a weathered or decomposed
clay‐rich rock.
“scrubber” – a machine for cleaning ore and
removing impurities such as clays, coatings or other deleterious
materials.
“stoping blocks” – a discrete area of
mineralised rock established for planning and scheduling purposes
that will be mined using one of the various stoping
methods.
“vein” is a generic term to describe an
occurrence of mineralised rock within an area of non-mineralised
rock.
Qualified Persons StatementThe
scientific and technical information contained within this
announcement has been reviewed and approved by Michael Hodgson, a
Director of the Company. Mr Hodgson is an Economic Geologist by
training with over 26 years' experience in the mining industry. He
holds a BSc (Hons) Geology, University of London, a MSc Mining
Geology, University of Leicester and is a Fellow of the Institute
of Materials, Minerals and Mining and a Chartered Engineer of the
Engineering Council of UK, recognising him as both a Qualified
Person for the purposes of Canadian National Instrument 43-101 and
by the AIM Guidance Note on Mining and Oil & Gas Companies
dated June 2009.
Forward Looking
StatementsCertain statements in this announcement are, or
may be deemed to be, forward looking statements. Forward looking
statements are identified by their use of terms and phrases such as
‘‘believe’’, ‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’,
‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘will’’ or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward looking statements are not based on
historical facts but rather on the Directors’ current expectations
and assumptions regarding the Company’s future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements reflect the Directors’ current beliefs
and assumptions and are based on information currently available to
the Directors. A number of factors could cause actual results to
differ materially from the results discussed in the forward looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward-looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements.
ENDS
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