SolGold PLC Announces Business Update

BISHOPSGATE, LONDON / ACCESSWIRE / March 11, 2020 / The Board of Directors of SolGold (LSE:SOLG) (TSX:SOLG) wishes to provide an update regarding a range of activities that the Company is currently progressing.

Alpala Pre-Feasibility and Proposed Feasibility Study Programs

The Company is pressing forward with work on the Pre-Feasibility Study (PFS) together with work streams to acquire further information for completion of the proposed Definitive Feasibility Study (DFS). Currently, subject to funding and land acquisition programs, these studies are scheduled for completion by Q3, 2020 for the PSF and by end Q1, 2021 for the DFS.

Work is currently focussing on eight main areas of investigation, being:

1. Completion and independent certification of MRE 3 expected within 4 weeks;

2. Geotechnical studies (ongoing and progressing towards DFS Standards);

3. Surface logistic facilities including identifying and securing suitable tailings dam disposal sites for the life of mine for the Alpala Project;

4. Port access and infrastructure for future copper concentrate production streams;

5. Power supply and hydro co-generation options;

6. Revised metallurgy studies and gold and copper concentrate marketing studies with a focus on development funding advances;

7. Alpala financial model evaluation settings, including selection of future Ecuadorean sovereign royalty rates, and taxation rates to account for Ecuadorean policies including rebates for in-country capital reinvestment programs and selection of various mine development funding strategies;

8. Social and Economic Impact Study finalisation to provide a basis for Ecuadorean assessment of the project impact nationally.

Financial Evaluation and Funding Discussions

SolGold is currently conducting discussions in respect of developing and securing a funding package (circa USD $2.85 billion) for the development of the Alpala Project. This involves up to USD $150 million in the shorter-term for two years funding for completion of the DFS at Alpala, and SolGold's 85% share of both pre-development costs and the longer-term development capital expenditure (circa $2.7 billion per the PEA estimate).

Funding discussions for finalising the DFS and SolGold's share of pre-development costs are progressing encouragingly. If an agreement is reached, finalisation and settlement could take six to eight weeks.

For guidance, the longer-term development funding package (circa $2.7 billion) is being negotiated and targeted to be agreed with a range of financiers and third-parties on a conditional basis subject to (i) finalisation of the DFS including adoption of prescribed hurdles on measured inputs and outcomes from the DFS, (ii) permitting, and (iii) fiscal agreements (Exploitation Agreement and Investment Agreement) with the Ecuadorean Government.

The funding is targeted to involve debt packages backed by Sovereign Export and Import Credit facilities (supported by conditional concentrate off take agreements) plus equity raised from a corporate capital issue at development and targeted to be priced with reference to the NPV of the Alpala Project at DFS stage, and project related interests tied to copper and gold metal production.

Community and Social Programs

SolGold is continually developing its social and community programs around Alpala with a view to maximising employment for Ecuadoreans, creating, supporting and endorsing local Ecuadorean businesses and providing financial assistance and support for secondary and tertiary educational institutions (including universities and technical colleges). This strategy is also being applied to SolGold's regional exploration activity areas.

Regional Exploration Activities

SolGold is currently active in the field on its four regional exploration subsidiaries Carnegie Ridge Resources SA, Valle Rico Resources SA, Green Rock Resources SA and Cruz del Sol SA. Six drill targets (as outlined below) have been defined on major porphyry systems on the basis of mapping, soils, rock chip and channel sampling and geophysics.

Carnegie Ridge Resources Targets:

1. Rio Amarillo

2. Chical

Cruz del Sol Targets:

1. Timbara

2. La Hueca

GreenRock Resources Targets:

1. Porvenir

2. Santa Martha (Sharug)

Each of these project areas are 100% owned through SolGold's subsidiaries and are extensive, with the potential to hold greater metal endowment than Alpala.

Directors Intention to Acquire Further Shares

SolGold's Executive Board members Nicholas Mather and Jason Ward have both advised the Board of Directors that it is their intention to acquire further shares in SolGold in the next 30 days or in the next available capital raising subject to any applicable regulatory approvals or other restrictions.

By order of the Board

Karl Schlobohm

Company Secretary

Qualified Person:

Information in this report relating to the exploration results is based on data reviewed by Mr Jason Ward ((CP) B.Sc. Geol.), the Chief Geologist of the Company. Mr Ward is a Fellow of the Australasian Institute of Mining and Metallurgy, holds the designation FAusIMM (CP), and has in excess of 20 years' experience in mineral exploration and is a Qualified Person for the purposes of the relevant LSE and TSX Rules. Mr Ward consents to the inclusion of the information in the form and context in which it appears.

CONTACTS

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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.