TIDMSOLG
RNS Number : 7534U
SolGold PLC
08 April 2021
08 April 2021
SolGold plc
("SolGold" or the "Company")
Alpala Pre-Feasibility Study Update
The Board of Directors of SolGold (LSE & TSX code: SOLG)
wishes to provide an update regarding progress of the
Pre-Feasibility Study ("PFS") with respect to the Alpala
copper-gold porphyry project ("Project") on the Cascabel concession
in northern Ecuador .
The Alpala Project Team and the Project Committee, chaired by
Interim CEO Keith Marshall, are making good progress studying
potential Alpala mine plans while addressing a number of mine
development and metallurgical enhancements as well as potential
upsides, and are continuing to target the release of the PFS in
late 2021 .
The Alpala deposit comprises 2,663 Mt at 0.53% CuEq in the
Measured plus Indicated categories and contained metal content of
9.9 Mt Cu, 21.7 Moz Au and 92.2 Moz Ag ([1]) . The core of the
deposit measures approximately 900m in height and 500m in diameter.
Given the size and geometry of the deposit, the Company is quite
optimistic that the PFS will demonstrate that it is amenable to
underground caving mining methods.
The Company is confident that this revised approach being
studied from that which was previously considered is much more
beneficial for SolGold and will deliver significant shareholder
value. The Company is currently expanding its team of experienced
technical staff, with Ms Lisa Park, Head of Metallurgy having
officially joined in recent days.
Key considerations that suggest the superiority of the revised
approach currently being studied for the development of the Project
include:
-- much earlier access to the resource with shortest time to potential first production;
-- a more selective mining approach, without sterilising the
remaining resource, reducing dilution without compromising metal
extraction;
-- optimal size and orientation of an underground footprint with
the potential for two extraction levels to minimise dilution and
upfront development Capex; and
-- mining of higher head grades in the earlier years of potential production.
The company is optimistic that the revised mine plan currently
being studied as part of the PFS process could deliver similar
metal production while mining significantly less material. This
could result in potentially significant cost savings. The crushing,
processing and waste storage requirements are also expected to be
reduced accordingly as would, in this potential scenario, the
upfront capex associated with these installations.
Anticipated benefits of the revised approach being studied
include lower expected execution risks, lower expected
pre-production capital and significantly reduced time to first
potential production.
SolGold is also investigating options that could provide further
upside to the value of the Project including:
-- near-surface, open pittable mining options at and near the Alpala deposit;
-- hydroelectric power options to reduce power costs;
-- further metallurgical testing to increase copper, gold and silver recoveries; and
-- electrification of underground production mobile plant,
thereby reducing requirements for fuel, emission control and
ventilation with additional likely reductions in capital
expenditure and operating costs
A number of proof-of-concept level studies on these options have
been initiated beginning with geotechnical and mining options.
These are being followed with more detailed studies and are
expected to be included in the designs for downstream processes and
infrastructure. These studies are on track for the delivery of the
PFS in late 2021.
The Company is of the view that the Alpala resource is one of
the most significant copper-gold porphyry discoveries of the last
decade. It has the potential to become a key source of future
copper supply amid an expected growing medium-term market deficit,
reflecting limited new project development, a declining base
production and growing demand supported by the shift towards
electrification and decarbonisation.
SolGold plans to provide further progress updates as the revised
PFS advances during the remainder of the year.
Commenting on today's PFS update, SolGold Interim CEO, Keith
Marshall said:
"The revised mine plan being studied underpins the whole of the
Alpala Project. The plan being studied is smaller in scale
initially, but a much more selective and simpler approach to mining
the deposit. In my view, the big advantages of underground mining
over open pit mining are sequencing and selectivity. With
underground mining you can target which areas of the orebody you
want to mine and when. The previously studied plan was the
equivalent of an inverted open pit, with limited selectivity, that
would likely have resulted in the mining of larger volumes of waste
material.
We are now studying a plan that would introduce an upper
extraction level that may offer earlier access to high grade
material. We are also considering dual access, through shafts and a
decline which might be developed from both ends concurrently.
Through the study of the revised approach, we are hopeful of
arriving at a plan that will not sterilise any of the resource,
furthering SolGold's goal of developing the resource with a view to
the interests of all stakeholders, particularly Ecuador.
I am very encouraged with the progress of the study of this
revised approach and I am confident that it should offer a robust
but flexible solution to the development of a mine at Alpala."
By order of the Board
Karl Schlobohm
Company Secretary
([1]) See "Cascabel Property NI 43-101 Technical Report, Alpala
Porphyry Copper-Gold-Silver Deposit - Mineral Resource Estimation,
January 2021" with an Effective date: 18 March 2020 and Amended
Date: 15 January 2021 (the "Amended Technical Report"), filed at
www.Sedar.com on January 29, 2021.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of the
Regulation (EU) No 596/2014 until the release of this
announcement.
CONTACTS
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
Fawzi Hanano
SolGold Plc (Investors / Media) Tel: +44 (0) 20 3823 2131
fhanano@solgold.com.au
Follow us on twitter @SolGold_plc
ABOUT SOLGOLD
SolGold is a leading resources 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 over 800 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 database to enable the delivery
of ore grade intersections from nearly every drill hole at Alpala.
SolGold has over 80 geologists 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$3.5million.
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.
SolGold is listed on the London Stock Exchange and Toronto Stock
Exchange (LSE/TSX: SOLG). The Company has on issue a total of
2,084,113,494 fully paid ordinary shares and 114,775,000 share
options.
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, including the plan for
developing the Project currently being studied as well as the
expectations of the Company as to the forward price of copper. 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. Factors that could cause actual results to differ
materially from such forward-looking information include, but are
not limited to, risks relating to the ability of exploration
activities (including assay results) to accurately predict
mineralization; errors in management's geological modelling and/or
mine development plan; capital and operating costs varying
significantly from estimates; the preliminary nature of visual
assessments; delays in obtaining or failures to obtain required
governmental, environmental or other required approvals;
uncertainties relating to the availability and costs of financing
needed in the future; changes in equity markets; inflation; the
global economic climate; fluctuations in commodity prices; the
ability of the Company to complete further exploration activities,
including drilling; delays in the development of projects;
environmental risks; community and non-governmental actions; other
risks involved in the mineral exploration and development industry;
the ability of the Company to retain its key management employees
and skilled and experienced personnel; and those risks set out in
the Company's public documents filed on SEDAR at www.sedar.com .
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.
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