07:44:00 EDT Fri 29 Mar 2024
Enter Symbol
or Name
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CA



Galane Gold Ltd
Symbol GG
Shares Issued 200,804,760
Close 2019-04-29 C$ 0.045
Market Cap C$ 9,036,214
Recent Sedar Documents

Galane talks Tau production, omits 2018 P&L from NR

2019-04-29 18:44 ET - News Release

Mr. Nick Brodie reports

GALANE GOLD LTD. RELEASES FINANCIAL AND OPERATING RESULTS FOR 2018

Galane Gold Ltd. has released its financial results for the year ended Dec. 31, 2018. All amounts are in U.S. dollars unless otherwise indicated.

A copy of the audited consolidated financial statements for the year ended Dec. 31, 2018, prepared in accordance with international financial reporting standards, and the corresponding management's discussion and analysis will be available under the company's profile on SEDAR.

2018 highlights:

  • For the third consecutive year, the company has increased its production and cash balance, and reduced its operating cash cost (1) compared with the previous year.
  • The company produced 35,527 ounces of gold at the Mupane property at a head grade of 1.97 grams per tonne (2017: 29,354 ounces at a head grade of 1.75 g/t and 2016: 26,783 ounces at a head grade of 1.29 g/t).
  • Production at Tau in 2018 was 400,078 tonnes at a head grade of 3.03 grams per tonne (2017: 365,425 tonnes at a head grade of 2.71 g/t and 2016: 206,591 tonnes at a head grade of 3.05 g/t).
  • Operating cash cost (1) was $928 per ounce for the year (2017: $933 and 2016: $965).
  • Cash balance was $4.2-million (2017: $2.6-million and 2016: $800,000).

Galane Gold chief executive officer Nick Brodie commented: "As I stated in the 2017 year-end press release, I expected the results in 2018 to be an improvement on the previous two years, and they have been. We have once again seen an increase in ounces produced at Tau, an increase in the company's cash balance and a reduction in operating cash costs per ounce. Two thousand nineteen is expected to be a consolidation of the hard work done over the last three years with a modest contraction in production as we progress deeper into the Tau mineralized body. With production now started at Galaxy and operations ramping up, we expect to show year-over-year production increases for the next several years."

Outlook (2)

Mupane property

The company completed an updated three-year mine plan for the Mupane property in 2018, which provides the guide for the company's short-term goals and long-term strategy (3).

The company intends to utilize the following resources during 2019:

  • Tau: It is estimated that the company will process approximately 408,000 tonnes at an average grade of 2.27 g/t. The company intends to continue exploration to further expand the potential resource as reported in the press release of Oct. 5, 2017, and May 1, 2018 (4).
  • Low-grade stockpiles: It is estimated that the company will process approximately 231,000 tonnes of low-grade stockpile at an average grade of 0.77 g/t, which is located at the run-of-mine pad at the processing plant.
  • Monarch slimes dump: It is estimated that the company will process approximately 243,000 tonnes of tailings and slimes at an average grade of 0.86 g/t, which is located at the Monarch mine, approximately 53 kilometres from the Mupane processing plant.

The Mupane property mine plan is subject to change according to the prevailing gold price (3). The company will adopt the appropriate plan for the prevailing gold price environment (3).

Galaxy property

With the recommencement of the Galaxy project under way following the completion of the secured loan facility with Barak Fund SPC Ltd. in October, 2018, the first drawdown of funds from the Barak facility in February, 2019, and mining of its first ore and production of its first concentrate in April, 2019, the company is targeting to produce 12,500 tonnes of concentrate in 2019, containing approximately 9,000 ounces of payable gold. To achieve this outcome, the company will be processing approximately 170,000 tonnes of material from various sources, including the Princeton underground and historical tailings facilities.

The company is targeting an increase in capacity of the Galaxy processing plant to 30,000 tonnes per month (5) and annual production to over 25,000 ounces of gold at a cash cost per ounce of less than $800 (U.S.) (1) (6). During the implementation of the first phase, the company expects to complete a study on the second expansion phase with the objective of increasing the capacity at the Galaxy processing plant to 60,000 tonnes per month and decreasing the cash cost per ounce with increased economies of scale.

Information of a technical and scientific nature that forms the basis of the disclosure in the press release has been prepared and approved by Kevin Crossling, PrSciNat, MAusIMM, business development manager for Galane Gold, a qualified person as defined by National Instrument 43-101 (Standards of Disclosure for Mineral Projects). Mr. Crossling has verified the technical and scientific data disclosed herein and has conducted appropriate verification on the underlying data.

About Galane Gold Ltd.

Galane Gold is an unhedged gold producer and explorer with mining operations and exploration tenements in Botswana and South Africa. Galane Gold's management team is composed of senior mining professionals with extensive experience in managing mining and processing operations and large-scale exploration programs. Galane Gold is committed to operating at world-class standards, and is focused on the safety of its employees, respecting the environment and contributing to the communities in which it operates.

Notes

(1) Total operating cash cost is a non-generally accepted accounting principle measure. Refer to "Supplemental Information to Management's Discussion and Analysis" in the company's management's discussion and analysis for the year ended Dec. 31, 2018, for reconciliation to measures reported in the company's financial statements.

(2) This is forward-looking information and is based on a number of assumptions.

(3) The decisions to update the mine plan are based on internal reporting by the company and not based on an independent feasibility study or prefeasibility study of mineral reserves, demonstrating economic and technical viability. While there is increased uncertainty and economic and technical risks associated with the company's production decision to proceed without an independent feasibility study, the company has been mining underground at the Tau property for the past three years, it carried out its own internal study based on its historical mining to support the new mine plan and, as a result, it believes it has sufficient knowledge to manage the risks associated with that decision.

(4) Based on a technical report in respect of the Mupane property entitled "Independent Technical Report on the Mupane Gold Mine" dated May 10, 2011, a copy is available under the company's profile on SEDAR. The Mupane technical report was prepared by MSA Geoservices Pty. Ltd. on behalf of Carlaw Capital III Corp. The potential extension of Tau has not been incorporated into the existing resource model found in the Mupane technical report. There has yet to be sufficient exploration on the potential expansion to extrapolate that it extends beyond the current mined area.

(5) The company is not basing its decision to expand the throughput capacity of the Galaxy mine's processing plant to 30,000 tonnes per month on a feasibility study of mineral reserves, demonstrating economic and technical viability of production at such levels, and as a result, there is increased uncertainty, and there are multiple technical and economic risks of failure, which are associated with producing at such plant's throughput capacity. These risks, among others, include areas that are analyzed in more detail in a feasibility study, such as applying economic analysis to resources and reserves, more detailed metallurgy, and a number of specialized studies in areas, such as mining and recovery methods, market analysis, and environmental and community impacts.

(6) Based on a technical report entitled "A Technical Report on the Galaxy Gold Mine, Mpumalanga Province, South Africa," which was issued Jan. 4, 2016, with an effective date of Sept. 1, 2015, a copy of which is available under the company's profile on SEDAR. The Galaxy technical report was prepared by Minxcon Pty. Ltd. and approved by Daniel van Heerden, BEng (min.), MCom (bus. admin.), PrEng, FSAIMM, AMMSA, a qualified person as defined by National Instrument 43-101. The Galaxy technical report satisfies the requirements to be a prefeasibility study. Cash cost per ounce is a non-generally accepted accounting principle measure.

We seek Safe Harbor.

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