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Aura Minerals Inc (4)
Symbol ORA
Shares Issued 72,627,529
Close 2022-07-11 C$ 7.69
Recent Sedar Documents

Aura Minerals produces 55,645 oz AuEq in Q2

2022-07-12 02:16 ET - News Release

Mr. Rodrigo Barbosa reports

AURA MINERALS ANNOUNCES SECOND QUARTER 2022 PRODUCTION RESULTS, EXPLORATION UPDATES AND STATUS ON THE ALMAS PROJECT CONSTRUCTION

Aura Minerals Inc. has released production results from the company's three producing operations for the second quarter of 2022 and an update on exploration activities across its portfolio. Total production reached 55,645 gold equivalent ounces (GEO) (1) during Q2 2022.

Highlights:

  • Total production decreased 7 per cent compared with the second quarter 2021 (59,834 GEO) primarily due to temporary lower recoveries at San Andres and increased processing of stockpiles at the EPP mine, consistent with management's strategy to optimize cash flows.
  • The Aranzazu mine continued to achieve strong processing rates, with a maximum processing capacity slightly above 100,000 tons per month.
  • Production is expected to improve in the coming quarters, particularly at San Andres and EPP, as higher-grade zones are reached.
  • Robust infill and expansion drilling continued across the company's portfolio, including at Matupa, where the company intersected 80 metres of 3.89 grams per tonne gold and 59 metres of 3.14 g/t Au in initial targets.

Geological activities continue to reinforce the company's exploration pipeline, with good intersections at EPP at the connection of the pits on the shale zone between Nosde and Lavrinhas, as well as confirmation of mineralization extension in Aranzazu and Matupa.

Finally, construction at the company's Almas project is on schedule, and the project is expected to be delivered on budget. The company expects Almas to start production by April, 2023. At the end of Q2 2022, about 47 per cent of the project was completed, and 90 per cent of services and equipment budget had been already negotiated, mitigating risks of potential cost overruns, despite a high-inflation scenario.

Rodrigo Barbosa, the company's president and chief executive officer, noted: "We are on track to meet the production guidance for the year. Despite some challenges in San Andres, Aura's other two producing operations performed above expectations. Due to mine sequencing, we knew this quarter would be weaker, and we expect better production in [third quarter and fourth quarter]. On geology, our exploration results during the quarter showed that we have important upsides on all our mines: Aranzazu Glory hole is expected to continue down deep, and near-mine exploration at EPP revealed a possible extension and connection between Nosde and Lavrinha with significant interceptions for 100 metres. At Matupa, drill holes at the Serrinhas target have shown over 200 metres of mineralization at MP2, where we announced the interception of 80 metres of 3.89 g/t Au and 59 metres of 3.14 g/t Au. Finally, construction at Almas is on schedule and on budget with 47 per cent of the work completed."

(1) Gold equivalent ounces, or GEO, is calculated by converting the production of silver and copper into gold using a ratio of the prices of these metals to that of gold. The prices used to determine the gold equivalent ounces are based on the weighted-average price of silver and copper realized from sales at the Aranzazu complex during the relevant period.

Production results

Preliminary GEO production volume for the three months ended June 30, 2022, when compared with the previous quarter and the same period of 2021 is shown in the attached production volume table.

The last-12-month production (LTM) has remained relatively stable at the end of Q2 2022 above 250,000 GEO, when production from Gold Road, which had its operation suspended during Q4 2021, is excluded.

(1) Includes ounces produced and capitalized while projects were at precommercial production stages.

(2) GEO calculated for Aranzazu using the realized weighted-average prices of copper, silver and gold from each of second quarter 2022, first quarter 2022 and second quarter 2021.

A summary of the performance by each operating mine during the second quarter of 2022 is set out as follows.

EPP mine: Total production was 2 per cent above Q1 2022 and slightly above management's expectations. The company expects stronger production volumes in Q3 and mainly Q4 2022, as a result of EPP achieving the high-grade Elephant zone at the Ernesto pit. Management also worked on reducing ore inventory from 2021, reducing working capital. As a consequence, ore and waste mined in Q2 2022 were, respectively, 62 per cent and 57 per cent below Q1 2022, and both were 67 per cent below Q2 2021, which should reduce total costs for the quarter.

San Andres: The plan for the quarter was focused on developing high-grade areas that will be producing in the coming months, and as a result, the plant was fed with lower grades than the previous quarter. Still, there was an impact from the reduction on recovery rates due to features of ore fed from a transition zone of oxide to sulphide.

Aranzazu: The operation has been processing at the maximum capacity, and in Q2 2022, the processing rate was slightly above 100,000 tons per month. Average copper price realized was $4.24 per pound, which is 7 per cent below Q1 2022 and 3 per cent below Q1 2021, and it negatively affects gold equivalent ounce calculation for the business unit. Total production in constant prices was in line with the company's expectations and was 22 per cent higher than in Q2 2021 but 9 per cent below Q1 2022, the consequence of mine plan with copper and gold grades feed, both around 10 per cent below previous quarter, and in line with company's expectation.

The attached production by type table shows production by each type of metal at Aranzazu. Production increased for all types of metals during Q2 2022 compared with Q2 2021.

Exploration highlights

Geological activities are continuing to establish the company's exploration pipeline, replenish the company's mineral reserves and measured, indicated and inferred mineral resources, and delineate geological targets on the company's business units and projects.

EPP

The connection between the Lavrinha and Nosde schist is being confirmed with good grades with intersections varying from two to 26 m and grade from 0.61 to 8.35 grams per tonne gold, including 12 metres of 3.13 g/t Au in Lavrinha, and 26 m of 1.98 g/t Au in Nosde, extending the current resources in approximately 100 metres in strike that is better than expected.

San Andres

In Esperanza Alto, infill drilling into the pit indicates a grade increase in 10 per cent compared with the long-term model in the zone. Holes intersected three mineralized sections of high grade, with an average of 0.40 g/t Au, including intervals up to three g/t Au.

Aranzazu

The infill program in GH and Cabrestante is in progress and confirming the expectation to convert inferred resources to indicated with significant intercepts. The drilling program will continue during 2022.

A deep hole intercepted a skarn mineralization, extending the current inferred zone at FW zone in approximately 200 m. This intercept is confirming that the results from magnetometry anomalies indicate that the body is still open down deep.

Matupa

At the Matupa project, Serrinhas and Target 47 exploration is under way with five drill hole assays received confirming 200 m of mineralized continuity on strike in Serrinha (MP2). This is the same target that intercepted 80 metres of 3.89 g/t Au and 59 metres of 3.14 g/t Au.

Qualified person

Farshid Ghazanfari, PGeo, geology and mineral resource manager for Aura Minerals, has reviewed and approved the scientific and technical information contained within this news release, and serves as the qualified person as defined in National Instrument 43-101 (Standards of Disclosure for Mineral Projects).

About Aura Minerals Inc.

Aura Minerals is focused on mining in complete terms -- thinking holistically about how its business impacts and benefits every one of its stakeholders: the company, its shareholders, its employees, and the countries and communities it serves. It calls this 360-degree mining.

Aura Minerals is a mid-tier gold and copper production company focused on the development and operation of gold and base metal projects in the Americas. The company's producing assets include the San Andres gold mine in Honduras, the Ernesto/Pau-a-Pique gold mine in Brazil and the Aranzazu copper-gold-silver mine in Mexico. In addition, the company has two additional gold projects in Brazil, Almas and Matupa, one gold project in Colombia, Tolda Fria, and the Gold Road mine in Arizona, United States, currently in care and maintenance.

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