TIDMAUY
RNS Number : 3483U
Yamana Gold Inc.
02 December 2021
YAMANA GOLD ANNOUNCES THE DISCOVERY OF NEW MINERALIZED ZONES AT
WASAMAC AND PROVIDES AN UPDATE ON ITS GROWTH PROJECTS
Download a PDF of detailed drill hole results for Wasamac
TORONTO, December 1, 2021 -- YAMANA GOLD INC. (TSX:YRI;
NYSE:AUY; LSE:AUY) ("Yamana" or "the Company") is pleased to
announce the following updates.
-- At Wasamac, exploration has defined an entirely new shear
zone which demonstrates the excellent exploration potential and
opportunity to further grow the mineral inventory and support a
production platform of 200,000 ounces per year over a mine life of
at least 15 years, significantly improving the approved development
plan of an average of 169,000 ounces per year over a mine life of
10 years, thereby meaningfully increasing overall value.
-- At Odyssey, continuing exploration successes support the
longer term potential for higher annual production than the
currently contemplated average annual production of 545,000 ounces
(100% basis) from 2029 onward and for extending mine life beyond
2039.
-- At Jacobina, the Phase 2 expansion is progressing ahead of
schedule with permitting now expected by early 2022 which would
advance the Company's second phase expansion to a production level
of 230,000 ounces per year for multi-decades at low cost and high
cash flow.
-- At Minera Florida, the Environmental and Social Impact
Assessment ("ESIA") has been submitted and with expected permitting
timelines, the mine could begin operating at a planned 100,000
tonnes per month by 2025 and producing 120,000 ounces per year.
Wasamac: New Mineralized Zones Discovered, Initiating Permitting
for the Bulk Sample, Engineering Advancing
Wasamac is a development-stage underground gold project located
15 kilometres west of Rouyn-Noranda in the prolific
Abitibi-Témiscamingue region of the mining-friendly province of
Quebec. The project is well located, adjacent to the Trans-Canada
highway and 100 kilometres west of the Company's 50%-owned Canadian
Malartic mine.
Exploration
Exploration drilling at Wasamac continues to deliver promising
results. An exploration hole WS-21-524, drilled south of the
Wildcat zone testing targets from the 2021 magnetic susceptibility
survey, intersected two new mineralized zones, referred to as South
Wildcat. The first is a zone of shearing and quartz carbonate
stockwork in altered mafic volcanic rocks intercepted at a downhole
depth of 402.93 metres, which returned 7.31 grams per tonne ("g/t")
of gold over an estimated true width of 3.37 metres (please see
Figure 1 below). The drill hole ended in a wide zone of shearing
and strong alteration with anomalous gold grades including 2.3 g/t
of gold over a core length of 0.6 metres and 1.3 g/t of gold over a
core length of 0.3 metres. This drill hole demonstrates the
excellent potential of the area south of the Wasamac shear and
north of the Cadillac Tectonic zone and follow-up drilling is
planned for early 2022.
Figure 1: Wasamac Project, Map of Wildcat Target with Recent
Drill Highlights at South Wildcat.
For figures, please refer to the original press release on
Yamana Gold's website.
The Company believes that the discovery of the two new parallel
mineralized structures in between the Wasamac shear and the
Cadillac Tectonic zone is further evidence of the excellent
geological upside on the large Wasamac property, and it plans to
continue the drilling programs to grow the mineral inventories with
an accelerated program. These results are aligned with the
Company's strategic objective to achieve a production platform of
200,000 ounces per year over a mine life of at least 15 years.
Furthermore, the Wasamac project further solidifies the Company's
long-term growth profile with a top-tier gold project in Quebec's
Abitibi-Témiscamingue Region, where Yamana has deep operational and
technical expertise.
Yamana's average annual gold production in Quebec, including
production from Wasamac and the Odyssey underground at Canadian
Malartic, has the potential to increase to approximately 500,000
ounces by 2028, and continue at this level through at least
2041.
"The discovery of a new shear zone and further exploration
successes support our higher annual production plan of 200,000
ounces over a longer mine life now expected to be fifteen years"
said Yohann Bouchard, Senior Vice President and Chief Operating
Officer.
Initiating Permitting for the Bulk Sample
The Company has decided to advance the bulk sample permitting
process for Wasamac and expects to obtain the required permitting
in the first quarter of 2023. The bulk sample permit would allow
construction to commence on the ramp enabling earlier access to the
deposit in order to increase the level of confidence in
metallurgical and geotechnical assumptions and optimize the
processing flow sheet and mining sequence. Construction on surface
facilities to support the ramp development activity and associated
environmental requirements would also advance.
The bulk sample was not considered in the feasibility study base
case and initiating the process has the potential to further
enhance the economics and mitigate risks of the project. Additional
benefits of the bulk sample include:
-- Build production ready models for the grade, recovery, and
geotechnical aspects of the project, to support the first three
years of production.
-- Capture opportunities to optimize the processing performance,
as preliminary results of optimization studies indicate the
potential to improve average gold recovery by 3%, and up to 5.5%
for certain zones of the deposit.
-- Confirm stope stability parameters to optimize stope
dimensions, backfilling strategy and mining sequence while
contributing to ensuring a safe working environment.
-- Establish drilling platforms to perform delineation and
exploration drilling at Wasamac, Wildcat and new zones from
underground.
Project Engineering and Optimization
A program has been implemented to improve recovery, simplifying
the process and to better understand the metallurgy of the
different areas of the deposit. Preliminary testing indicates that
average gold recovery could potentially increase by approximately
3% as compared to the feasibility study.
Substantial work is also underway to select the leading
technologies available for the development and operation of
Wasamac. The key objectives remain to increase worker safety,
minimize impact on the environment and the community, reduce
consumption of non-renewable energy and improve energy efficiency.
Technologies under evaluation include electric production vehicles,
autonomous vehicles, bio-lubricants and ventilation on demand.
The Company relies on a collaborative approach to ensure the
success of Wasamac. In this regard, our environmental assessment
process is conducted in collaboration with our neighbors,
stakeholders and First Nations. A community relations office has
now been established to further facilitate ongoing engagement with
local residents and accessibility to the Company's team, as well as
providing up-to-date information on the project. A campaign of
environmental baseline monitoring and testing is currently underway
with the objective of completing the Environmental Impact
Assessment ("EIA") by the second quarter of 2022.
Odyssey: Development Advancing with Continued Exploration
Success
Yamana and Agnico Eagle Mines Ltd., who each hold a 50% interest
in the Canadian Malartic General Partnership ("the Partnership"),
owner and operator of the Canadian Malartic mine, announced a
positive construction decision for the Odyssey underground project
at Canadian Malartic on February 11, 2021.
The project has advanced significantly throughout 2021, with
several milestones achieved in the past several months. In October,
the concrete pour to construct the 93-metre-tall headframe was
completed on schedule, in preparation for shaft sinking to begin in
2022. The production shaft will be 6.5 metres in diameter and 1,800
metres deep, with the first of two loading stations at 1,135 metres
below surface.
In parallel, the ramp from surface to the upper zones is
advancing according to plan and, as of the end of November, the
ramp heading is approximately 250 metres below surface. By the end
of the year, the ramp is expected to be at the elevation of the
third production level and the base of the first stoping horizon.
Underground development is planned to increase in 2022 with the
opening of additional headings and the addition of Canadian
Malartic development crews to complement the existing contractor
crews. As an employer of choice in the Abitibi, the Odyssey project
is successfully building a highly skilled team. The first
underground ore from Odyssey South is on track to be processed
through the existing Canadian Malartic plant in early 2023.
The combination of shaft hoisting from the lower zones of East
Gouldie and Odyssey North with truck haulage from the upper zones
of Odyssey South and East Malartic supports an underground
production rate of 19,500 tonnes per day ("tpd") when operating at
full capacity. Additionally, the mineralization geometry and very
good rock quality are ideal for bulk mining. The East Gouldie zone
in particular is at least one kilometre in height, one kilometre in
strike length and typically 15 metres wide, with maximum widths of
up to 80 metres. Infill drilling confirms that grade continuity
throughout the deposit is excellent. As such, large stopes of 30 to
50 metres high by 20 metres wide are achievable.
One of the advantages of the Odyssey project is that it will
utilize the existing processing plant and infrastructure of the
open pit operation. The Canadian Malartic mill is currently planned
to be downsized from approximately 60,000 tpd to 20,000 tpd in 2026
as open pit feed declines, with one ball mill and two crushers
planned to be put in care-and-maintenance. However, if additional
ore sources are identified in future, this equipment could remain
in operation or be re-started at a later date for possible
throughput increases.
Regarding permitting, the process is advancing according to
expectations with the decree modification expected for Q1 2022 and
the mining lease expected for Q4 2022.
Exploration Update
Infill drilling at East Gouldie continues to return significant
values, confirming the continuity, grade and widths of the
mineralization. The Company expects to report first indicated
mineral resources at East Gouldie at year-end. Additionally,
drilling continues to expand the East Gouldie mineral resource
envelope on all sides, which is expected to add inferred mineral
resources at year-end, confirming our view that mine life is
expected to continue far beyond the 2039 mine plan included in the
technical study.
Shallow drilling in the Odyssey and Jupiter zones is helping
define new resources as internal zones proximal to the Odyssey
North and South deposits with most verified drill results
pending.
Exploration drilling continues to test the east extension of the
East Gouldie shear zone where previously reported results (Please
see the press release issued September 7, 2021, titled 'Yamana Gold
Reports Positive Exploration Results at Its Producing Mines',
available at www.yamana.com), included 6.29 g/t of gold over an
estimated true width of 4.81 metres (RD21-4678) that extended the
mineralized zone 1,260 metres beyond the reported East Gouldie
mineral resource and RD20-4674 with 3.50 g/t of gold over an
estimated true width of 9.26 metres in a new subparallel zone,
located 400 metres in the footwall for the East Gouldie zone.
Drilling is ongoing and further results from four new deep pierce
points are expected to be reported with year-end results.
In October 2021, the Canadian Malartic exploration team was
presented with the "Discovery of the Year" Award at the Quebec
Mineral Exploration Association virtual 2021 Xplor Convention in
recognition for the discovery of the East Gouldie deposit of the
Odyssey mine in September 2018. The discovery of East Gouldie at
depth has significantly changed the Odyssey project by ensuring its
economic viability and providing a long term production profile
beyond the life of the open pit.
Opportunities Providing Upside to the Technical Study
Gold production from the Odyssey mine is planned to ramp up from
2023 to 2028 as the Canadian Malartic open pit operation winds
down. The underground operation will be in full production from
2029, producing an expected 500,000 to 600,000 ounces per year on a
100% basis (Please see the press release issued February 11, 2021,
titled 'Yamana Gold Reports Strong Fourth Quarter and Full Year
2020 Results', and NI 43-101 Technical Report 'Canadian Malartic
Mine, Quebec, Canada' effective December 31, 2020 available at
www.yamana.com or on SEDAR at www.sedar.com).
The technical study completed in December 2020, demonstrates
robust project economics with significant leverage to higher gold
prices and thus supporting the approval for project construction.
The intention of the Partnership was always to build upon this base
case scenario by realizing value enhancement opportunities
improving the production profile and extending mine life.
Throughout 2021, these opportunities have increased in confidence
and definition as a result of the ongoing exploration success and
the rapid advancement of the project.
In the near-term, Canadian Malartic has the opportunity to
improve the gold production profile during the transition from open
pit to underground mining, especially from 2026 to 2028. As a first
step, the Barnat pit design was optimized, adding 290,000 ounces
(100% basis) to year-end 2020 open pit mineral reserves. Processing
of the marginal grade stockpile also remains an opportunity,
especially if the gold price remains at current levels.
Furthermore, infill drilling of the Odyssey Internal zones from the
underground ramp in 2021 has defined potentially mineable zones
that are currently not included in the technical study mine plan
and could potentially be mined from the Odyssey South ramp within
the next five years.
In the technical study, gold production during the 2021 to 2028
construction period is expected at 932,000 ounces (100% basis),
with net proceeds from the sale of these ounces significantly
reducing the capital requirements for the construction of the
project. Assuming a gold price of $1,550 per ounce, the projected
initial expansionary capital of $1.14 billion over this eight-year
period would be reduced in half. Proceeds from additional
underground production, from Odyssey Internal zones or other, would
further reduce capital requirements.
Further opportunities are being evaluated to extend mine life at
a sustainable production rate of 500,000 to 600,000 ounces per year
(100% basis). The technical study mine plan includes 7.3 million
ounces, or approximately 50% of the project's 14.3 million ounces
of mineral resources. Increased conversion of mineral resources and
ongoing extension of the mineral resource envelopes, especially at
the higher grade East Gouldie zone, confirms the Partnership's view
that mine life will continue for more than 20 years.
Opportunities also exist for supplemental production sources to
increase throughput beyond 20,000 tpd and utilize the excess
process capacity of the 60,000 tpd Canadian Malartic plant.
Exploration drilling of the East Gouldie Extension and parallel
structures, while widely spaced, indicate that a corridor of
mineralization extends at least 1.3 kilometres to the east of East
Gouldie. Although at the very early stages, these results suggest
the potential for a second production shaft that could increase
throughput over the longer term. Open pit and underground
exploration targets within the Canadian Malartic land package
present additional potential ore sources.
Daniel Racine, President and Chief Executive Officer commented:
"Exploration is continuing to deliver exciting results at Odyssey
and we believe that exploration successes will in time allow the
Partnership to take advantage of the excess plant capacity in order
to maximize underground production above currently planned levels.
The possible addition of a second shaft and further production from
upper ore bodies accessed by ramp are additional opportunities that
merit continuing investigation and assessment."
Jacobina: Phase 2 Ahead of Schedule
Phase 2 Expansion
At Jacobina, the Phase 2 expansion is progressing ahead of
schedule. The Company's second phase expansion is expected to bring
a production level of 230,000 ounces per year for multi-decades at
low cost and high cash flow.
Permitting for throughput of up to 10,000 tpd is advancing
according to plan, with the timeline for completion now expected by
early 2022. Based on this accelerated permitting progress, the
company expects to start producing at the throughput rate of 8,500
tpd in 2022, significantly ahead of the original 2024 timeline.
The Company expects to achieve the Phase 2 throughput rate of
8,500 tpd by implementing a simplified approach of debottlenecking
and incremental operational improvements, without requiring the
installation of an additional ball mill. This approach is expected
to significantly reduce capital expenditures, increase energy
efficiency, and derisk the project. As such, capital costs for the
plant expansion are expected to be in the range of $15 million to
$20 million as compared to the original $57 million capital cost
originally planned.
Throughput during the quarter has remained stable at the
currently permitted level of 7,500 tpd and preparations are being
made to expedite the ramp up to 8,500 tpd as soon as the new
permitting is received. Optimization of the crushing circuit which
did not require the installation of new equipment has now been
completed. Further initiatives which are expected to be completed
during the first half of 2022 include optimizing the grinding
process with the installation of ultrasonic density meters to
optimize ore feed control to the mills and increasing the capacity
of the electro-winning circuit.
The Phase 3 expansion is being evaluated to increase throughput
to 10,000 tpd. Engineering will advance in parallel with Phase 2,
with a feasibility study for Phase 3 scheduled for completion in
2023.
Minera Florida: ESIA Submitted
At Minera Florida, the plant de-bottlenecking study is advancing
on schedule with the objective of increasing mine and plant
throughput from 74,500 to 100,000 tonnes per month and thereby
increasing gold production to 120,000 ounces per year. The Company
has now submitted the ESIA with the timeline expected to be
approximately 18 months for approval, with another 12 months to
receive sectorial permits. With the expected permitting timelines,
the mine could begin operating at a planned 100,000 tonnes per
month level in 2025.
Qualified Persons
Scientific and technical information contained in this news
release has been reviewed and approved by Sébastien Bernier (P. Geo
and Senior Director, Geology and Mineral Resources). Sébastien
Bernier is an employee of Yamana Gold Inc. and a "Qualified Person"
as defined by Canadian Securities Administrators' National
Instrument 43-101 - Standards of Disclosure for Mineral
Projects.
Quality Assurance and Quality Control
Yamana incorporates a Quality Assurance and Quality Control
("QA/QC") program for all of its mines and exploration projects
which conforms to industry best practices.
Samples are transported in security sealed bags for preparation
at ALS Geochemistry. ALS and SGS are both ISO 9001:2008 and 17025
certified laboratories. Gold is analyzed by gold fire assay with 30
grams aliquot and AAS finish (lab code: Au-AA25). Au-AA25 is
certified from 0.01 to 100 g/t gold. Samples over 100 g/t gold are
re-analyzed by gravimetric finish methods. Silver is determined
using a four acid digestion and ICP-MS finish (ultra trace). The
ME-MS61 method we use for silver is certified 0.01 to 100 ppm. Five
percent of all pulps are further checked by a secondary certified
laboratory (SGS) using the same ore grade fire assay analytical
method.
All exploration diamond drill cores are split in half by core
sawing and sampled at appropriate intervals for assay. The
remaining core, and pulps are stored on-site in a secure location.
We disposed of the rejects at the lab after the QA/QC was
complete.
Certified reference standards, blanks and duplicates
(preparation and analytical) are routinely inserted into the sample
stream as a control for assay accuracy, bias, precision and
contamination. The results of these checks are tracked and failures
are re-analyzed. This information also includes pulp checks carried
out in the secondary lab.
About Yamana
Yamana Gold Inc. is a Canadian-based precious metals producer
with significant gold and silver production, development stage
properties, exploration properties, and land positions throughout
the Americas, including Canada, Brazil, Chile and Argentina. Yamana
plans to continue to build on this base through expansion and
optimization initiatives at existing operating mines, development
of new mines, the advancement of its exploration properties and, at
times, by targeting other consolidation opportunities with a
primary focus in the Americas.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Investor Relations
416-815-0220
1-888-809-0925
Email: investor@yamana.com
FTI Consulting (UK Public Relations)
Sara Powell / Ben Brewerton
+44 7931 765 223 / +44 203 727 1000
Peel Hunt LLP (Joint UK Corporate Broker)
Ross Allister / David McKeown / Alexander Allen
Telephone: +44 (0) 20 7418 8900
Berenberg (Joint UK Corporate Broker)
Matthew Armitt / Jennifer Wyllie / Detlir Elezi
Telephone: +44 (0) 20 3207 7800
Credit Suisse (Joint UK Corporate Broker)
Ben Lawrence / David Nangle
Telephone: +44 (0) 20 7888 8888
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: This news
release contains or incorporates by reference "forward-looking
statements" and "forward-looking information" under applicable
Canadian securities legislation and within the meaning of the
United States Private Securities Litigation Reform Act of 1995.
Forward-looking information includes, but is not limited to
information with respect to the Company's strategy, plans or future
financial or operating performance, including exploration drilling
plans and results from the Company's generative program and
potential to significantly extend mine lives at the Company's
projects; expected permitting and commencement of operations;
expected fourth quarter production and guidance . Forward-looking
statements are characterized by words such as "plan", "expect",
"budget", "target", "project", "intend", "believe", "anticipate",
"estimate" and other similar words, or statements that certain
events or conditions "may" or "will" occur. Forward-looking
statements are based on the opinions, assumptions and estimates of
management considered reasonable at the date the statements are
made, and are inherently subject to a variety of risks and
uncertainties and other known and unknown factors that could cause
actual events or results to differ materially from those projected
in the forward-looking statements. These factors include the
Company's expectations in connection with the production and
exploration, development and expansion plans at the Company's
projects discussed herein being met, the impact of proposed
optimizations at the Company's projects, changes in national and
local government legislation, taxation, controls or regulations
and/or change in the administration of laws, policies and
practices, and the impact of general business and economic
conditions, global liquidity and credit availability on the timing
of cash flows and the values of assets and liabilities based on
projected future conditions, fluctuating metal prices (such as
gold, silver, copper and zinc), currency exchange rates (such as
the Canadian Dollar, the Brazilian Real, the Chilean Peso and the
Argentine Peso versus the United States Dollar), the impact of
inflation, possible variations in ore grade or recovery rates,
changes in the Company's hedging program, changes in accounting
policies, changes in mineral resources and mineral reserves, risks
related to asset dispositions, risks related to metal purchase
agreements, risks related to acquisitions, changes in project
parameters as plans continue to be refined, changes in project
development, construction, production and commissioning time
frames, risks associated with infectious diseases, including
COVID-19, unanticipated costs and expenses, higher prices for fuel,
steel, power, labour and other consumables contributing to higher
costs and general risks of the mining industry, failure of plant,
equipment or processes to operate as anticipated, unexpected
changes in mine life, final pricing for concentrate sales,
unanticipated results of future studies, seasonality and
unanticipated weather changes, costs and timing of the development
of new deposits, success of exploration activities, permitting
timelines, government regulation and the risk of government
expropriation or nationalization of mining operations, risks
related to relying on local advisors and consultants in foreign
jurisdictions, environmental risks, unanticipated reclamation
expenses, risks relating to joint venture operations, title
disputes or claims, limitations on insurance coverage, timing and
possible outcome of pending and outstanding litigation and labour
disputes, risks related to enforcing legal rights in foreign
jurisdictions, as well as those risk factors discussed or referred
to herein and in the Company's Annual Information Form filed with
the securities regulatory authorities in all provinces of Canada
and available at www.sedar.com , and the Company's Annual Report on
Form 40-F filed with the United States Securities and Exchange
Commission. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
The Company undertakes no obligation to update forward-looking
statements if circumstances or management's estimates, assumptions
or opinions should change, except as required by applicable law.
The reader is cautioned not to place undue reliance on
forward-looking statements. The forward-looking information
contained herein is presented for the purpose of assisting
investors in understanding the Company's plans and objectives in
connection with its exploration programs and results of exploration
and its expected fourth quarter production and may not be
appropriate for other purposes.
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