Avesoro Reports a 29% Increase in Mineral Reserves at the Youga Gold Mine

 

TSX: ASO
AIM: ASO

TORONTO, June 19, 2018 /CNW/ - Avesoro Resources Inc. ("Avesoro" or the "Company"), the TSX and AIM listed West African gold producer, is pleased to announce the results of an updated Mineral Resource and Mineral Reserve Estimate for its Youga Gold Mine ("Youga") in Burkina Faso.

Mineral Reserve and Resource Estimate Highlights (as at December 31, 2017)

• Total Mineral Reserve increased by 29%, or 147.4koz to 660.1koz of gold;
• Total Measured and Indicated Mineral Resource increased by 15% to 924.2koz of gold grading 1.73g/t Au;
• Mine life extended by two years to 2027, with total forecast gold production of 614koz;
• Pre-tax NPV¹ increased by 42% to US$188.3 million and post-tax NPV¹ increased to US$151.6 million;
• Life of mine ("LOM") operating cash costs reduced to US$860/oz;
• LOM all-in-sustaining costs reduced to US$920/oz; and
• Further Mineral Resource and Mineral Reserve upgrades at Youga expected to be announced in Q1 2019 from ongoing infill drilling programmes with six diamond drill rigs currently active.

 

Commenting, Serhan Umurhan, Chief Executive Officer of Avesoro Resources, said: "This updated Mineral Resource and Mineral Reserve estimate for Youga consolidates the results of the successful 2017 drilling campaign undertaken in Burkina Faso, and increases the Mineral Resources and Reserves at the Youga mine itself as well as at the high grade Balogo deposit that provides ore to the Youga processing plant.

We see the announcement today, which adds two years to Youga's mine life, as an interim step. We have added substantially to the value of the Youga Gold Mine since the Company acquired it for US$70.2 million in December 2017 and with our ongoing drilling programme of 139,000 metres in Burkina Faso this year we fully expect to add further years to the Youga life of mine.

In anticipation of further growth in Mineral Reserves, we are evaluating options for optimising the Youga process plant to allow the 2018 annual production guidance of 110 - 120koz to be maintained in subsequent years by increasing mill throughput.

I also look forward to updating the market in Q3 2018 on the results of our Mineral Resource upgrade work at New Liberty in Liberia, following the successful conclusion of the in-pit infill drilling programme earlier this year."

Updated Mineral Resource and Reserve Estimate

Following the acquisition of the Youga Gold Mine by Avesoro on December 18, 2017, the updated Mineral Resource and Reserve estimates were produced by CSA Global (UK) Ltd with an effective date of December 31, 2017 and reflect mining depletion from March 1, 2017 to December 31, 2017, during which time 110,000 ounces of gold were produced. The mineralisation wireframes used within the updated estimate are based on the results of the 2017 drilling campaign received subsequent to the information cut-off date for the previous estimation undertaken on February 28, 2017.

The Company plans to release a further Mineral Resource and Mineral Reserve update for Youga and its satellite deposits upon the conclusion of the on-going 139,000 metre drilling programme focussed across its Burkina Faso licence portfolio during 2018. As a part of this, a 20,000 metre infill drilling campaign has recently commenced on the Ouaré deposit with the aim of upgrading a portion of the 406koz of gold in the Inferred Mineral Resource category into a higher level of confidence and subsequently into Mineral Reserves.

The Company also recently completed a 13,000 metre diamond drilling programme that targeted the prospects of Panga and Cobra Hill, located a short distance along strike from the Balogo deposit. Following a review of the first phase of drilling a decision has been taken to undertake a second phase of drilling in Q3 2018 exploring further along strike to follow up on prospects identified during the 2017 drilling campaign with the aim of further delineating the strike extent of the mineralisation.

Additional drilling underneath the main Balogo pit will also be undertaken in H2 2018 targeting the down dip extension of mineralisation at the main Balogo pit where mineralisation has already been defined to depths of 140 metres below the existing planned pit floor. This down dip drilling programme has the potential to further increase the mine life of the Balogo deposit and also aims to define an underground Mineral Resource at Balogo.

Table 1: Updated Mineral Resource Estimate, prepared in accordance with CIM Standards.

 

Table 2: Updated Mineral Reserve Estimate, prepared in accordance with CIM Standards.

 

Table 3: Summary of Forecast Project Physicals for each Full Year of Production

 

Following the increase in Mineral Reserves, the Company is now undertaking a technical study to optimise the Youga process plant and increase plant throughput with the goal of enabling yearly gold production of 110 – 120koz for the life of the Project.

Table 4: Key LOM Financial Parameters (Reported at US$1,300/oz Au)

 

Technical Report

Supporting Technical Reports, prepared in accordance with the requirements of National Instrument 43-101, for the Youga Gold Mine (including the Ouaré and Balogo deposits) will be filed within 45 days of this release on SEDAR at www.sedar.com and on the Company's corporate website www.avesoro.com.

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

About Avesoro Resources Inc.

Avesoro Resources is a West Africa focused gold producer and development company that operates three gold mines across West Africa and is listed on the Toronto Stock Exchange ("TSX") and the AIM market operated by the London Stock Exchange ("AIM"). The Company's assets include the New Liberty Gold Mine in Liberia ("New Liberty") and the Youga Gold Mine in Burkina Faso ("Youga").

New Liberty has an estimated Proven and Probable Mineral Reserve of 7.4Mt with 717,000 ounces of gold grading 3.03g/t and an estimated Measured and Indicated Mineral Resource of 9.6Mt with 985,000 ounces of gold grading 3.2g/t and an estimated Inferred Mineral Resource of 6.4Mt with 620,000 ounces of gold grading 3.0g/t. The foregoing Mineral Reserve and Mineral Resource estimates and additional information in connection therewith, prepared in accordance with CIM guidelines, is set out in an NI 43-101 compliant Technical Report dated November 1, 2017 and entitled "New Liberty Gold Mine, Bea Mountain Mining Licence Southern Block, Liberia, West Africa" and is available on SEDAR at www.sedar.com.

Youga has an estimated Proven and Probable Mineral Reserve of 11.2Mt with 660,100 ounces of gold grading 1.84g/t and a combined estimated Measured and Indicated Mineral Resource of 16.64Mt with 924,200 ounces of gold grading 1.73g/t and an Inferred Mineral Resource of 13Mt with 685,000 ounces of gold grading 1.70g/t.

The information in this announcement relating to the Mineral Resource Estimates for the Youga Gold mine (comprising A2NE Mid, Gassore and Balogo) has been prepared by Ms. Maria O'Connor, who is a Member of the Australian Institute of Geologists. Ms. O'Connor is a full-time employee of CSA Global (UK) Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which she has undertaken to qualify as a "Qualified Person" as defined in National Instrument 43-101 "Standards of Disclosure for Mineral Projects" of the Canadian Securities Administrators. Ms O'Connor has reviewed and approved this announcement and consents to the inclusion in the announcement of the matters based on her information, in the form and context in which this appears.

The information in this announcement relating to the Mineral Resource Estimates for the Youga Gold mine, and Ouaré deposit (comprising Main Pit, Zergoré, NTV, A2NE East, East Pit, West Pit 1-4, Le Duc and Ouaré) which remain unchanged from the current Mineral Resources disclosed in the Technical Reports, dated June 16, 2017 entitled "Mineral Resource and Mineral Reserve Update for the Balogo Project" and dated June 19, 2017 and entitled "Mineral Resource and Mineral Reserve Update for the Youga and Ouaré Projects" has been prepared by Malcolm Titley, who is a Member of the Australian Institute of Geologists. Mr Titley is an Associate Consultant to CSA Global (UK) Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he has undertaken to qualify as a "Qualified Person" as defined in National Instrument 43-101 "Standards of Disclosure for Mineral Projects" of the Canadian Securities Administrators. Mr Titley has reviewed and approved this announcement and consents to the inclusion in the announcement of the matters based on his information in the form and context in which this appears.

The information in this announcement relating to the Mineral Reserve Estimates for the Youga Gold Mine and its Balogo and Ouaré deposits has been prepared by Dr Matthew Randall, who is a registered Fellow of the Institute of Materials, Minerals and Mining. Dr Randall is an Associate Consultant to CSA Global (UK) Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he has undertaken to qualify as a "Qualified Person" as defined in National Instrument 43-101 "Standards of Disclosure for Mineral Projects" of the Canadian Securities Administrators. Dr Randall has reviewed and approved this announcement and consents to the inclusion in the announcement of the matters based on his information in the form and context in which this appears.

An independent NI 43-101 technical report with respect to the Youga Gold Mine will be filed on SEDAR within 45 days of this news release.

For more information, please visit www.avesoro.com

Qualified Persons

The Company's Qualified Person is Mark J. Pryor, who holds a BSc (Hons) in Geology & Mineralogy from Aberdeen University, United Kingdom and is a Fellow of the Geological Society of London, a Fellow of the Society of Economic Geologists and a registered Professional Natural Scientist (Pr. Sci.Nat) of the South African Council for Natural Scientific Professions.  Mark Pryor is an independent technical consultant with over 25 years of global experience in exploration, mining and mine development and is a "Qualified Person" as defined in National Instrument 43 -101 "Standards of Disclosure for Mineral Projects" of the Canadian Securities Administrators and has reviewed and approved this press release. Mr. Pryor has verified the underlying technical data disclosed in this press release.

Forward Looking Statements

Certain information contained in this press release constitutes forward looking information or forward looking statements within the meaning of applicable securities laws. This information or statements may relate to future events, facts, or circumstances or the Company's future financial or operating performance or other future events or circumstances. All information other than historical fact is forward looking information and involves known and unknown risks, uncertainties and other factors which may cause the actual results or performance to be materially different from any future results, performance, events or circumstances expressed or implied by such forward-looking statements or information. Such statements can be identified by the use of words such as "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "would", "project", "should", "believe", "target", "predict" and "potential".  No assurance can be given that this information will prove to be correct and such forward looking information included in this press release should not be unduly relied upon.  Forward looking information and statements speak only as of the date of this press release. 

Forward looking statements or information in this press release include, among other things, statements relating to the issuance of further Mineral Resource and Mineral Reserve upgrades at Youga expected to be announced in Q1 2019, the evaluation of options for optimising the Youga process plant to allow the 2018 annual production guidance of 110-120koz to continue, drilling at the Balogo deposit scheduled to commence during early Q3 2018 with a 29,000 metre diamond drilling programme, that the drilling programme at Balogo will further increase the mine life of the Balogo deposit and will also aim to define an underground Mineral Resource at Balogo, that the Company is undertaking a technical study to optimise the Youga process plant and increase plant throughput to 150,000 tonnes per month with the goal of enabling yearly gold production 110 – 120koz for the life of the Youga Project, and statements regarding increases to its Mineral Resource and Reserve inventory and mine lives.

In making the forward looking information or statements contained in this press release, assumptions have been made regarding, among other things: general business, economic and mining industry conditions; interest rates and foreign exchange rates; the continuing accuracy of Mineral Resource and Reserve estimates; geological and metallurgical conditions (including with respect to the size, grade and recoverability of Mineral Resources and Reserves) and cost estimates on which the Mineral Resource and Reserve estimates are based; the supply and demand for commodities and precious and base metals and the level and volatility of the prices of gold; market competition; the ability of the Company to raise sufficient funds from capital markets and/or debt to meet its future obligations and planned activities and that unforeseen events do not impact the ability of the Company to use existing funds to fund future plans and projects as currently contemplated; the stability and predictability of the political environments and legal and regulatory frameworks including with respect to, among other things, the ability of the Company to obtain, maintain, renew and/or extend required permits, licences, authorizations and/or approvals from the appropriate regulatory authorities; that contractual counterparties perform as agreed; and the ability of the Company to continue to obtain qualified staff and equipment in a timely and cost-efficient manner to meet its demand.

Actual results could differ materially from those anticipated in the forward looking information or statements contained in this press release as a result of risks and uncertainties (both foreseen and unforeseen), and should not be read as guarantees of future performance or results, and will not necessarily be accurate indicators of whether or not such results will be achieved. These risks and uncertainties include the risks normally incidental to exploration and development of mineral projects and the conduct of mining operations (including exploration failure, cost overruns or increases, and operational difficulties resulting from plant or equipment failure, among others); the inability of the Company to obtain required financing when needed and/or on acceptable terms or at all; risks related to operating in West Africa, including potentially more limited infrastructure and/or less developed legal and regulatory regimes; health risks associated with the mining workforce in West Africa; risks related to the Company's title to its mineral properties; the risk of adverse changes in commodity prices; the risk that the Company's exploration for and development of mineral deposits may not be successful; the inability of the Company to obtain, maintain, renew and/or extend required licences, permits, authorizations and/or approvals from the appropriate regulatory authorities and other risks relating to the legal and regulatory frameworks in jurisdictions where the Company operates, including adverse or arbitrary changes in applicable laws or regulations or in their enforcement; competitive conditions in the mineral exploration and mining industry; risks related to obtaining insurance or adequate levels of insurance for the Company's operations; that Mineral Resource and Reserve estimates are only estimates and actual metal produced may be less than estimated in a Mineral Resource or Reserve estimate; the risk that the Company will be unable to delineate additional Mineral Resources; risks related to environmental regulations and cost of compliance, as well as costs associated with possible breaches of such regulations; uncertainties in the interpretation of results from drilling; risks related to the tax residency of the Company; the possibility that future exploration, development or mining results will not be consistent with expectations; the risk of delays in construction resulting from, among others, the failure to obtain materials in a timely manner or on a delayed schedule; inflation pressures which may increase the cost of production or of consumables beyond what is estimated in studies and forecasts; changes in exchange and interest rates; risks related to the activities of artisanal miners, whose activities could delay or hinder exploration or mining operations; the risk that third parties to contracts may not perform as contracted or may breach their agreements; the risk that plant, equipment or labour may not be available at a reasonable cost or at all, or cease to be available, or in the case of labour, may undertake strike or other labour actions; the inability to attract and retain key management and personnel; and the risk of political uncertainty, terrorism, civil strife, or war in the jurisdictions in which the Company operates, or in neighbouring jurisdictions which could impact on the Company's exploration, development and operating activities.

This press release also contains Mineral Resource and Mineral Reserve estimates. Information relating to Mineral Resource and Mineral Reserve contained in this press release is considered forward looking information in nature, as such estimates are estimates only, and that involve the implied assessment of the amount of minerals that may be economically extracted in a given area based on certain judgments and assumptions made by qualified persons, including the future economic viability of the deposit based on, among other things, future estimates of commodity prices.  Such estimates are expressions of judgment and opinion based on the knowledge, mining experience, analysis of drilling results and industry practices of the qualified persons making the estimate.  Valid estimates made at a given time may significantly change when new information becomes available, and may have to change as a result of numerous factors, including changes in the prevailing price of gold. By their nature, Mineral Resource and Mineral Reserve estimates are imprecise and depend, to a certain extent, upon statistical inferences which may ultimately prove unreliable. If such Mineral Resource and Mineral Reserve estimates are inaccurate or are reduced in the future (including through changes in grade or tonnage), this could have a material adverse impact on the Company and its operating and financial performance.  Mineral resources that are not mineral reserves do not have demonstrated economic viability.  Due to the uncertainty that may be attached to inferred mineral resources, it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result of continued exploration.

Although the forward-looking statements contained in this press release are based upon what management believes are reasonable assumptions, the Company cannot provide assurance that actual results or performance will be consistent with these forward-looking statements. The forward looking information and statements included in this press release are expressly qualified by this cautionary statement and are made only as of the date of this press release.  The Company does not undertake any obligation to publicly update or revise any forward looking information except as required by applicable securities laws.

SOURCE Avesoro Resources Inc.

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