Permitting process commenced for two High Grade Satellite Feeder Pits with potential, as per management studies, to increase open pit production by 50% to 120,000 oz gold per annum
LONDON, UK / March 5, 2019, JMN Wire / Condor Gold (AIM: CNR; TSX: COG) is pleased to announce that following the announcement on 28 January 2019 of an updated Mineral Resource Estimate on its 100% owned La India Project, which included a new, high grade open pit on the Mestiza Vein Set, Condor has commenced the permitting process for the America and Mestiza open pits, which are located approximately 2km and 4km, respectively, from the location of the processing plant for the permitted La India open pit.
Mark Child, Chairman and Chief Executive Officer of Condor Gold, commented:
“Permitting the high grade Mestiza and America satellite feeder pits has the potential to increase annual production from open pit material by 50% to 120,000 oz gold p.a. for a seven year life of mine. The feeder pits have in aggregate 206 thousand tonnes (“Kt”) at a grade of 9.9 g/t (66,000 oz contained metal) in the Indicated category and 1,018Kt at 4.6 g/t (152,000 oz contained gold in the Inferred category).
“The feeder pits complement the main, fully permitted La India open pit, which has a robust, economically viable Pre-Feasibility Study (“PFS”) with Mineral Reserves of 6.9 million tonnes (“M tonnes” or “Mt”) at 3.0 g/t for 675,000 oz gold, which demonstrates annual production of 79,300 oz gold and lower quartile all-in-sustaining cash costs (“AISC”) of US$690 per oz gold. The higher grade feeder pits have the potential to materially enhance the Project economics”.
Background
As at 25 January 2019, Condor’s La India Project has a Mineral Resource Estimate of 9.85M tonnes at 3.6 g/t gold for 1,140,000 oz gold in the Indicated category and 8.48M tonnes at 4.3 g/t gold for 1,179,000 oz gold in the Inferred category (See RNS dated 28 January 2019).
The updated Mineral Resource Estimate included total open pit Mineral Resources of 8.58Mt at a grade of 3.3 g/t gold, for 902,000 oz gold in the Indicated category and 3.01Mt at a grade of 3.0 g/t gold, for 290,000 oz gold in the Inferred category and total underground Mineral Resources of 1.27Mt at a grade of 5.8 g/t gold, for 238,000 oz gold in the Indicated category and 5.47Mt at a grade of 5.1 g/t gold, for 889,000 oz gold in the Inferred category.
The updated open pit Mineral Resource Estimate includes two high grade satellite feeder pits. The Mestiza open pit of 92Kt at a grade of 12.1 g/t (36,000 oz contained gold) in the Indicated category and 341Kt at a grade of 7.7 g/t gold (85,000 oz contained gold) in the Inferred category. The America open pit of 114Kt at a grade of 8.1 g/t (30,000 oz contained gold) in the Indicated category and 677Kt at a grade of 3.1 g/t (67,000 oz contained gold) in the Inferred category.
In January 2019, Condor applied to the Ministry of Environment and Natural Resources (“MARENA”) for a Terms of Reference to produce an Environmental Impact Assessment (“EIA”) for an Environmental Permit for the development and extraction of contained gold at the Mestiza and America open pits, with a view to processing the material through the permitted processing plant. MARENA together with the Ministry of Energy and Mines and Ministry of Forestry has conducted a site visit inspection of the proposed lay out of the pits, waste dumps and associated mine site infrastructure. On 1st March 2019, the Company received the Terms of Reference from MARENA. The Terms of Reference is an integral part of the permitting process in Nicaragua and lists the technical, environmental and social studies required by MARENA in an EIA.
Reason For Permitting Two Satellite Feeder Pits
The main La India open pit is permitted for the construction and operation of a processing plant with capacity of up to 2,800 tonnes per day. The La India open pit has a robust, economically viable PFS with Mineral Reserves of 6.9Mt at 3.0g/t for 675,000 oz gold.
Permitting additional high grade open pit material within the Mestiza and America open pits has the potential to enhance the project economics, increase the annual production and/or increase the life of mine. The Mestiza and America open pits have, in aggregate, 206Kt at a grade of 9.9 g/t (66,000 oz contained gold) in the Indicated category and 1,018Kt at 4.6 g/t (152,000 oz contained gold in the Inferred category).
Condor’s internal studies indicate that the addition to the mine plan of the contained gold in the Mestiza and America open pits would result in average annual production of 120,000 oz gold for a seven year period. This compares with the PFS, which demonstrates annual production of 79,300 oz gold over seven years with lower quartile AISC of US$690 per oz gold.
About Condor Gold plc:
Condor Gold plc was admitted to AIM in May 2006 and dual listed on the TSX in January 2018. The Company is a gold exploration and development company with a focus on Nicaragua.
In August 2018, the Company announced that the Ministry of the Environment in Nicaragua had granted the Company the Environmental Permit (“EP”) for the development, construction and operation of a processing plant with capacity to process up to 2,800 tonnes per day at its wholly-owned La India gold project (“La India Project”). The EP is considered to be the master permit for mining operations in Nicaragua. Condor Gold published a PFS on La India Project in December 2014, as summarised in the Technical Report (as defined below). The PFS details an open pit gold Mineral Reserve in the Probable category of 6.9 Mt at 3.0 g/t gold for 675,000 oz gold, producing 80,000 oz gold per annum for seven years. La India Project contains a Mineral Resource of 9,850Kt at 3.6 g/t gold for 1,140Koz gold in the Indicated category and 8,479Kt at 4.3g/t gold for 1,179Koz gold in the Inferred category. The Indicated Mineral Resource is inclusive of the Mineral Reserve.
Disclaimer
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
Qualified Persons
The Mineral Resource Estimate has been completed by Ben Parsons, a Principal Consultant (Resource Geology) with SRK Consulting (U.S.), Inc, who is a Member of the Australian Institute of Mining and Metallurgy, MAusIMM(CP). Ben Parsons has some eighteen years’ experience in the exploration, definition and mining of precious and base metal Mineral Resources. Ben Parsons is a full-time employee of SRK Consulting (U.S.), Inc, an independent Consultancy, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration, and to the type of activity which he is undertaking to qualify as a “qualified person” as defined by NI 43-101 and as required by the June 2009 Edition of the AIM Note for Mining and Oil & Gas Companies. Ben Parsons consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
The technical and scientific information in this press release has been reviewed, verified and approved by Andrew Cheatle, P.Geo., who is a “qualified person” as defined by NI 43-101.
Technical Information
Certain disclosure contained in this news release of a scientific or technical nature has been summarised or extracted from the technical report entitled “Technical Report on the La India Gold Project, Nicaragua, December 2014”, dated November 13, 2017 with an effective date of December 21, 2014 (the “Technical Report”), prepared in accordance with NI 43-101. The Technical Report was prepared by or under the supervision of Tim Lucks, Principal Consultant (Geology & Project Management), Gabor Bacsfalusi, Principal Consultant (Mining), Benjamin Parsons, Principal Consultant (Resource Geology), each of SRK Consulting (UK) Limited, and Neil Lincoln of Lycopodium Minerals Canada Ltd., each of whom is an independent “qualified person” as defined by NI 43-101.
Forward Looking Statements
All statements in this press release, other than statements of historical fact, are ‘forward-looking information’ with respect to the Company within the meaning of applicable securities laws, including statements with respect to: the Mineral Resources, Mineral Reserves and future production rates and plans at the La India Project. Forward-looking information is often, but not always, identified by the use of words such as: "seek", "anticipate", "plan", "continue", “strategies”, “estimate”, "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", “could”, “might”, “will” and similar expressions. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions regarding: future commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; future currency exchange and interest rates; the impact of increasing competition; general conditions in economic and financial markets; availability of drilling and related equipment; effects of regulation by governmental agencies; the receipt of required permits; royalty rates; future tax rates; future operating costs; availability of future sources of funding; ability to obtain financing and assumptions underlying estimates related to adjusted funds from operations. Many assumptions are based on factors and events that are not within the control of the Company and there is no assurance they will prove to be correct.
Such forward-looking information involves known and unknown risks, which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information, including, risks related to: mineral exploration, development and operating risks; estimation of mineralisation, resources and reserves; environmental, health and safety regulations of the resource industry; competitive conditions; operational risks; liquidity and financing risks; funding risk; exploration costs; uninsurable risks; conflicts of interest; risks of operating in Nicaragua; government policy changes; ownership risks; permitting and licencing risks; artisanal miners and community relations; difficulty in enforcement of judgments; market conditions; stress in the global economy; current global financial condition; exchange rate and currency risks; commodity prices; reliance on key personnel; dilution risk; payment of dividends; as well as those factors discussed under the heading “Risk Factors” in the Company’s annual information form for the fiscal year ended December 31, 2017 dated March 29, 2018, available under the Company’s SEDAR profile at www.sedar.com.
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 information, there may be other factors that cause actions, events or 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. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.
