TIDMSOLG
SolGold PLC
05 March 2020
5 March 2020
SolGold plc
("SolGold" or the "Company")
PDAC Conference Presentation
The Board of SolGold (LSE and TSX code: SOLG) is pleased to
advise all shareholders and interested investors of the release of
the presentation given to the PDAC Conference in Toronto, Canada by
CEO Nicholas Mather.
Please click here to view the presentation PDF
http://www.rns-pdf.londonstockexchange.com/rns/0703F_1-2020-3-5.pdf
The presentation is also available on the Company's website:
www.solgold.com.au
By order of the Board
Karl Schlobohm
Company Secretary
CONTACTS Tel: +61 (0) 7 3303 0665
Nicholas Mather +61 (0) 417 880 448
SolGold Plc (Chief Executive Officer)
nmather@solgold.com.au
Karl Schlobohm
SolGold Plc (Company Secretary) Tel: +61 (0) 7 3303 0661
kschlobohm@solgold.com.au
Ingo Hofmaier
SolGold Plc (GM - Project & Corporate Tel: +44 (0) 20 3823 2131
Finance) ihofmaier@solgold.com.au
Gordon Poole / Nick Hennis
Camarco (Financial PR / IR) Tel: +44 (0) 20 3757 4997
solgold@camarco.co.uk
Andrew Chubb Tel: +44 (0) 20 7907 8500
Hannam & Partners (Joint Broker and Financial
Advisor)
solgold@hannam.partners
Ross Allister / David McKeown Tel: +44 (0)20 7418 8900
Peel Hunt (Joint Broker and Financial
Advisor)
solgold@peelhunt.com
James Kofman / Darren Wallace Tel: +1 416 943 6411
Cormark Securities Inc. (Financial Advisor)
dwallace@cormark.com
Follow us on twitter @SolGold_plc
ABOUT SOLGOLD
SolGold is a leading exploration company focussed on the
discovery, definition and development of world-class copper and
gold deposits. In 2018 SolGold's management team was recognised by
the "Mines and Money" Forum as an example of excellence in the
industry, and continues to strive to deliver objectives efficiently
and in the interests of shareholders. SolGold is the largest and
most active concession holder in Ecuador and is aggressively
exploring the length and breadth of this highly prospective and
gold-rich section of the Andean Copper Belt.
The Company operates with transparency and in accordance with
international best practices. SolGold is committed to delivering
value to its shareholders, while simultaneously providing economic
and social benefits to impacted communities, fostering a healthy
and safe workplace and minimizing the environmental impact.
Dedicated stakeholders
SolGold employs a staff of 737 employees of whom 98% are
Ecuadorean. This is expected to grow as the operations expand at
Alpala, and in Ecuador generally. SolGold focusses its operations
to be safe, reliable and environmentally responsible and maintains
close relationships with its local communities. SolGold has engaged
an increasingly skilled, refined and experienced team of
geoscientists using state of the art geophysical and geochemical
modelling applied to an extensive data base to enable the delivery
of ore grade intersections from nearly every drill hole at Alpala.
SolGold has 85 geologists, of whom 12% are female, on the ground in
Ecuador exploring for economic copper and gold deposits.
About Cascabel and Alpala
The Alpala deposit is the main target in the Cascabel
concession, located on the northern section of the heavily endowed
Andean Copper Belt, the entirety of which is renowned as the base
for nearly half of the world's copper production. The project area
hosts mineralisation of Eocene age, the same age as numerous Tier 1
deposits along the Andean Copper Belt in Chile and Peru to the
south. The project base is located at Rocafuerte within the
Cascabel concession in northern Ecuador, an approximately
three-hour drive on sealed highway north of the capital Quito,
close to water, power supply and Pacific ports.
Having fulfilled its earn-in requirements, SolGold is a
registered shareholder with an unencumbered legal and beneficial
85% interest in ENSA (Exploraciones Novomining S.A.) which holds
100% of the Cascabel concession covering approximately 50km(2) .
The junior equity owner in ENSA is required to repay 15% of costs
since SolGold's earn in was completed, from 90% of its share of
distribution of earnings or dividends from ENSA or the Cascabel
concession. It is also required to contribute to development or be
diluted, and if its interest falls below 10%, it shall reduce to a
0.5% NSR royalty which SolGold may acquire for US$3.5m.
Over 227,000m of diamond drilling has been completed on the
project. The Cascabel exploration program is currently focussed on
extending and upgrading the status of the Alpala resource, as well
as further drill testing of the evolving Aguinaga prospect. Drill
testing of the Trivinio target has commenced, whilst the numerous
other untested targets, namely at Moran, Cristal, Tandayama-America
and Chinambicito, are flagged for drill testing as overall program
demands allow.
The 15 November 2018 Alpala MRE#2 update was estimated from
68,173 assays. Drill core samples were obtained from a total of
133,576m drilled from 128 diamond drill holes, including 75 drill
holes with 34 daughter holes, 8 redrills, and 11 over-runs. Full
assay data was received from holes 1-67 while partial assay data
was received from holes 68 to 75. In contrast, the December 2017
maiden MRE#1 was estimated from 26,814 assays obtained from 53,616m
of drilling comprising 45 drill holes, including 10 daughter holes
and 5 redrills.
The November 2018 Alpala updated Mineral Resource Estimate
(MRE#2) totals a current:
o 2,050 Mt @ 0.60% CuEq (at 0.2% CuEq cut-off) in the Indicated
category, and
900 Mt @ 0.35% CuEq (at 0.2% CuEq cut-off) in the Inferred
category.
o Contained metal content of 8.4 Mt Cu and 19.4 Moz Au in
the Indicated category.
o Contained metal content of 2.5 Mt Cu and 3.8 Moz Au in
the Inferred category.
Investors should consult the technical report dated 3 January
2019 for a detailed account of the assumptions on which these
estimates were based as well as any known legal, political,
environmental and other risks that could materially affect the
development of the resources.
Advancing Alpala towards development
The resource at the Alpala deposit boasts a high grade core
which is targeted to facilitate early cashflows and an accelerated
payback of initial capital. SolGold is currently assessing
financing options available to the Company for the development of
the Alpala mine following completion of the Definitive Feasibility
Study.
The results of the Preliminary Economic Assessment (PEA) at
Alpala were published on 20 May 2019, highlighting the following
key aspects:
Ø Net Present Value ("NPV") estimates range from US$4.1bn
to US$4.5bn (Real, post-tax, @ 8% discount rate, US$3.3/lb
copper price, US$1,300/oz gold price and US$16/oz silver
price) depending on production rate scenario.
Ø Internal Rate of Return ("IRR") estimates range from 24.8%
to 26.5% (Real, post-tax, US$3.3/lb copper price, US$1,300/oz
gold price and US$16/oz silver price) depending on production
rate scenario.
Ø Pre-production Capex estimated at approx. US$2.4bn to
US$2.8bn, and total Capex including life of mine sustaining
Capex of US$10.1bn to US$10.5bn depending on production
rate scenario.
Ø Payback Period on initial start-up capital - Range from
3.5 years to 3.8 years after commencement of production
depending on production rate scenario.
Ø Preferred Mining Method - Underground low-cost mass mining
using Block Cave methods applied over several caves designed
on two vertically extensive Lifts.
Full results and all details of the PEA are available in the
Company's market release of 20 May 2019.
SolGold's regional exploration drive
SolGold is using its successful and cost-efficient blueprint
established at Alpala, and Cascabel generally, to explore for
additional world class copper and gold projects across Ecuador.
SolGold is the largest and most active concessionaire in
Ecuador.
The Company wholly owns four other subsidiaries active
throughout the country that are now focussed on thirteen high
priority gold and copper resource targets, several of which the
Company believes have the potential, subject to resource definition
and feasibility, to be developed in close succession or even on a
more accelerated basis compared to Alpala.
Quality Assurance / Quality Control on Sample Collection,
Security and Assaying
SolGold operates according to its rigorous Quality Assurance and
Quality Control (QA/QC) protocol, which is consistent with industry
best practices.
Primary sample collection involves secure transport from
SolGold's concessions in Ecuador, to the ALS certified sample
preparation facility in Quito, Ecuador. Samples are then air
freighted from Quito to the ALS certified laboratory in Lima, Peru
where the assaying of drill core, channel samples, rock chips and
soil samples is undertaken. SolGold utilises ALS certified
laboratories in Canada and Australia for the analysis of
metallurgical samples.
Samples are prepared and analysed using 100g 4-Acid digest ICP
with MS finish for 48 elements on a 0.25g aliquot (ME-MS61).
Laboratory performance is routinely monitored using umpire assays,
check batches and inter-laboratory comparisons between ALS
certified laboratory in Lima and the ACME certified laboratory in
Cuenca, Ecuador.
In order to monitor the ongoing quality of its analytical
database, SolGold's QA/QC protocol encompasses standard sampling
methodologies, including the insertion of certified powder blanks,
coarse chip blanks, standards, pulp duplicates and field
duplicates. The blanks and standards are Certified Reference
Materials supplied by Ore Research and Exploration, Australia.
SolGold's QA/QC protocol also monitors the ongoing quality of
its analytical database. The Company's protocol involves
Independent data validation of the digital analytical database
including search for sample overlaps, duplicate or absent samples
as well as anomalous assay and survey results. These are routinely
performed ahead of Mineral Resource Estimates and Feasibility
Studies. No material QA/QC issues have been identified with respect
to sample collection, security and assaying.
Reviews of the sample preparation, chain of custody, data
security procedures and assaying methods used by SolGold confirm
that they are consistent with industry best practices and all
results stated in this announcement have passed SolGold's QA/QC
protocol.
See www.solgold.com.au for more information. Follow us on
twitter @SolGold_plc
CAUTIONARY NOTICE
News releases, presentations and public commentary made by
SolGold plc (the "Company") and its Officers may contain certain
statements and expressions of belief, expectation or opinion which
are forward looking statements, and which relate, inter alia, to
interpretations of exploration results to date and the Company's
proposed strategy, plans and objectives or to the expectations or
intentions of the Company's Directors. Such forward-looking and
interpretative statements involve known and unknown risks,
uncertainties and other important factors beyond the control of the
Company that could cause the actual performance or achievements of
the Company to be materially different from such interpretations
and forward-looking statements.
Accordingly, the reader should not rely on any interpretations
or forward-looking statements; and save as required by the exchange
rules of the TSX and LSE or by applicable laws, the Company does
not accept any obligation to disseminate any updates or revisions
to such interpretations or forward-looking statements. The Company
may reinterpret results to date as the status of its assets and
projects changes with time expenditure, metals prices and other
affecting circumstances.
This release may contain "forward--looking information" within
the meaning of applicable Canadian securities legislation.
Forward--looking information includes, but is not limited to,
statements regarding the Company's plans for developing its
properties. Generally, forward--looking information can be
identified by the use of forward-looking terminology such as
"plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes", or variations of such words
and phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved".
Forward--looking information is subject to known and unknown
risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the
Company to be materially different from those expressed or implied
by such forward--looking information, including but not limited to:
transaction risks; general business, economic, competitive,
political and social uncertainties; future prices of mineral
prices; accidents, labour disputes and shortages and other risks of
the mining industry. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking information,
there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that
such information will prove to be accurate, as actual results and
future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward--looking information. The Company does not
undertake to update any forward-looking information, except in
accordance with applicable securities laws.
The Company and its officers do not endorse, or reject or
otherwise comment on the conclusions, interpretations or views
expressed in press articles or third-party analysis, and where
possible aims to circulate all available material on its
website.
The Company recognises that the term "World Class" is subjective
and for the purpose of the Company's projects the Company considers
the drilling results at the growing Alpala Porphyry Copper Gold
Deposit at its Cascabel Project to represent intersections of a
"World Class" deposit. The Company considers that "World Class"
deposits are rare, very large, long life, low cost, and are
responsible for approximately half of total global metals
production.
"World Class" deposits are generally accepted as deposits of a
size and quality that create multiple expansion opportunities, and
have or are likely to demonstrate robust economics that ensure
development irrespective of position within the global commodity
cycles, or whether or not the deposit has been fully drilled out,
or a feasibility study completed.
Standards drawn from industry experts (1) Singer and Menzie,
2010; (2) Schodde, 2006; (3) Schodde and Hronsky, 2006; (4) Singer,
1995; (5) Laznicka, 2010) have characterised "World Class" deposits
at prevailing commodity prices. The relevant criteria for "World
Class" deposits, adjusted to current long run commodity prices, are
considered to be those holding or likely to hold more than 5
million tonnes of copper and/or more than 6 million ounces of gold
with a modelled net present value of greater than USD 1
Billion.
The Company and its external consultants prepared an initial
Mineral Resource Estimate at the Cascabel Project in December 2017.
Results of the updated Mineral Resource Estimate, released in
November 2018, are summarised in Table B attached.
The updated Mineral Resource Estimate was completed from
133,576m of drilling, comprising 128 diamond drill holes, including
75 drill holes, 34 daughter holes, 8 re-drills, and 11 over-runs,
and represents full assay data from holes 1-67 and partial assay
data received from holes 68-75. There remains strong potential for
further growth from more recent drilling results, and continue
rapid growth of the deposit.
Any development or mining potential for the project remains
speculative.
Drill hole intercepts have been updated to reflect current
commodity prices, using a data aggregation method, defined by
copper equivalent cut-off grades and reported with up to 10m
internal dilution, excluding bridging to a single sample. Copper
equivalent grades are calculated using a gold conversion factor of
0.63, determined using an updated copper price of USD3.00/pound and
an updated gold price of USD1300/ounce. True widths of down hole
intersections are estimated to be approximately 25-70%.
On the basis of the drilling results to date and the results of
the Alpala Maiden Mineral Resource Estimate, the reference to the
Cascabel Project as "World Class" (or "Tier 1") is considered to be
appropriate. Examples of global copper and gold discoveries since
2006 that are generally considered to be "World Class" are
summarised in Table A.
References cited in the text:
1. Singer, D.A. and Menzie, W.D., 2010. Quantitative Mineral
Resource Assessments: An Integrated Approach. Oxford University
Press Inc.
2. Schodde, R., 2006. What do we mean by a world class deposit?
And why are they special. Presentation. AMEC Conference,
Perth.
3. Schodde, R and Hronsky, J.M.A, 2006. The Role of World-Class
Mines in Wealth Creation. Special Publications of the Society
of Economic Geologists Volume 12.
4. Singer, D.A., 1995, World-class base and precious metal
deposits-a quantitative analysis: Economic Geology, v.
90, no.1, p. 88-104.
5. Laznicka, P., 2010. Giant Metallic Deposits: Future Sources
of Industrial Metal, Second Edition. Springer-Verlag Heidelberg.
Deposit Discovery Major Country Current Status Mining Inventory
Name Year Metals Style
LA COLOSA 2006 Au, Cu Colombia Feasibility Open Pit (1) 469Mt
- New Project @ 0.95g/t
Au; 14.3Moz
Au
============= =========== ============ ========================= =============== ===============
LOS SULFATOS 2007 Cu, Mo Chile Advanced Exploration Underground (2) 1.2Bt
@1.46% Cu
& 0.02% Mo;
17.5Mt Cu
============= =========== ============ ========================= =============== ===============
BRUCEJACK 2008 Au Canada Development/Construction Open Pit (3) 15.6Mt
@ 16.1 g/t
Au; 8.1Moz
Au
============= =========== ============ ========================= =============== ===============
KAMOA-KAKULA 2008 Cu, Co, Congo Feasibility Open Pit (4) 1.3Bt
Zn (DRC) - New Project & Underground @ 2.72% Cu;
36.5 Mt Cu
============= =========== ============ ========================= =============== ===============
GOLPU 2009 Cu, Au PNG Feasibility Underground (5) 820Mt
- New Project @ 1.0% Cu,
0.70g/t Au;
8.2Mt Cu,
18.5Moz Au
============= =========== ============ ========================= =============== ===============
COTE 2010 Au, Cu Canada Feasibility Open Pit (6) 289Mt
Study @ 0.90 g/t
Au; 8.4Moz
Au
============= =========== ============ ========================= =============== ===============
HAIYU 2011 Au China Development/Construction Underground (7) 15Moz
Au
============= =========== ============ ========================= =============== ===============
RED HILL-GOLD 2011 Au United Feasibility Open Pit (8) 47.6Mt
RUSH States Study & Underground @ 4.56 g/t
Au; 7.0Moz
Au
============= =========== ============ ========================= =============== ===============
XILING 2016 Au China Advanced Exploration Underground (9) 383Mt
@ 4.52g/t
Au; 55.7Moz
Au
============= =========== ============ ========================= =============== ===============
Source: after MinEx Consulting, May 2017
(1) Source: http://www.mining--technology.com/projects/la--colosa
(2) Source: http://www.angloamerican.com/media/press--releases/2009
(3) Source: http://www.pretivm.com/projects/brucejack/overview/
(4) Source: https://www.ivanhoemines.com/projects/kamoa--kakula--project/
(5) Source:
http://www.newcrest.com.au/media/resource_reserves/2016/December_2016_Resources_and_Reserves_Statement.pdf
(6) Source: http://www.canadianminingjournal.com/news/gold--iamgold--files--cote--project--pea/
(7) Source: http://www.zhaojin.com.cn/upload/2015--05--31/580601981.pdf
(8) Source: https://mrdata.usgs.gov/sedau/show--sedau.php?rec_id=103
(9) Source: http://www.chinadaily.com.cn/business/2017--03/29/content_28719822.htm
Table A : Tier 1 global copper and gold discoveries since 2006.
This table does not purport to be exhaustive exclusive or
definitive.
Grade Resource Tonnage Grade Contained Metal
Category Category (Mt)
======================
Cu (%) Au (g/t) CuEq Cu Au (Moz) CuEq
(%) (Mt) (Mt)
====== ======== ==== ===== ======== =====
Total >0.2%
CuEq Indicated 2,050 0.41 0.29 0.60 8.4 19.4 12.2
============ ========== ======= ====== ======== ==== ===== ======== =====
Inferred 900 0.27 0.13 0.35 2.5 3.8 3.2
======================= ======= ====== ======== ==== ===== ======== =====
Table B: Alpala Mineral Resource Estimate updated effective 16
November 2018.
Notes:
-- Mr. Martin Pittuck, MSc, CEng, MIMMM, is responsible for
this Mineral Resource estimate and is an "independent qualified
person" as such term is defined in NI 43-101.
-- The Mineral Resource is reported using a cut-off grade
of 0.3% copper equivalent calculated using [copper grade
(%)] + [gold grade (g/t) x 0.6] based on a copper price
of US$2.8/lb and gold price of US$1,160/oz.
-- The Mineral Resource is considered to have reasonable potential
for eventual economic extraction by underground mass mining
such as block caving.
-- Mineral Resources are not Mineral Reserves and do not have
demonstrated economic viability.
-- The statement uses the terminology, definitions and guidelines
given in the CIM Standards on Mineral Resources and Mineral
Reserves (May 2014).
-- The MRE is reported on 100 percent basis.
-- Values given in the table have been rounded, apparent calculation
errors resulting from this are not considered to be material.
-- The effective date for the Mineral Resource statement is
16 November 2018.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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