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Orvana Minerals Corp
Symbol ORV
Shares Issued 136,623,171
Close 2022-02-11 C$ 0.46
Recent Sedar Documents

Orvana Minerals earns $405,000 (U.S.) in fiscal Q1

2022-02-11 18:07 ET - News Release

Mr. Juan Gavidia reports

ORVANA REPORTS Q1 FY2022 RESULTS AND ANNOUNCES FILING OF PEA NI 43-101 REPORT FOR TAGUAS

Orvana Minerals Corp. has released its consolidated financial and operational results for the quarter ended Dec. 31, 2021, and the company will file on SEDAR the updated independent preliminary economic assessment report (the 2021 Taguas PEA) for the Taguas project located in San Juan province, Argentina. The 2021 Taguas PEA was prepared in accordance with National Instrument 43-101 -- Standards of Disclosure for Mineral Projects and the key 2021 Taguas PEA inputs and highlights were previously disclosed in the company's news release dated Dec. 29, 2021.

Q1 FY2022 consolidated highlights:

  • Revenue: $27-million;
  • EBITDA (earnings before interest, taxes, depreciation and amortization): $5-million;
  • Capex: $4-million;
  • Unrestricted cash EoP: $19-million.

Q1 FY2022 Orovalle highlights:

  • 15,921 gold equivalent ounces produced (11,731 gold (Au) ounces, 1.5 million copper (Cu) pounds and 48,752 silver (Ag) oz);
  • COC at $1,140 and AISC (all-in sustaining costs) at $1,446.

This news release should be read in conjunction with the company's management's discussion and analysis, unaudited financial statements and notes to unaudited financial statements for the corresponding period, which have been posted on the Orvana Minerals SEDAR profile, and which are also available on the company's website. All figures are in U.S. dollars unless otherwise noted.

"The company continues delivering solid quarters with increasing gold equivalent production and EBITDA, which, coupled with our recent syndicated financing, resulted in a strong Q1 balance sheet," said Orvana chief executive officer Juan Gavidia. "Looking ahead, we expect to continue delivering steady production and continue developing Orvana's three units according to our now well established organic growth strategy," he added.

First quarter of fiscal 2022 consolidated financial results and operating highlights:

  • EBITDA of $5.1-million;
  • Free cash flow of $800,000;
  • Capital expenditures of $4.3-million;
  • 15-million-euro syndicated loan with two Spain-based banks closed in December, 2021.
  • Orovalle:
    • Gold production of 11,731 ounces and copper production of 1.5 million pounds. Gold and copper production increased by 36 per cent and 16 per cent respectively, compared with the fourth quarter of fiscal 2021. The production increase was driven primarily by a 31-per-cent-higher throughput;
    • 7,022 metres of infill and brownfield drilling were drilled;
    • 1,415 metres of greenfield exploration were drilled;
    • 20.66 grams per tonne Au over 2.9 metres intercepted in Ortosa-Godan (investigation permit in Asturias, Spain);
    • Starting December, 2021, Orovalle has experienced the effects of the latest wave of COVID-19 cases in Spain despite the company's continuing efforts to safeguard the health of the work force. During this period, the company continued to operate safely and responsibly maintained employment and economic activity. This latest wave in the country is declining after reaching the peak in January, 2022, and the company expects to recover standard work force levels at the operation.
  • EMIPA:
    • Don Mario operation continues in care and maintenance (C&M), transitioning to the Oxides Stockpile project (plant overhaul to treat a two-million-ton stockpile accumulated from previous years of mining activity).
    • On Dec. 29, 2020, the company filed a technical report on the Don Mario oxide stockpile project (OSP). During 2021, the OSP quality assurance (metallurgical) testing advanced; studies were completed in November, 2021. Results to date are validating the company's preliminary assumptions in terms of its positive economics. Engineering and cost analysis to establish the capex are in progress.
    • On Dec. 29, 2021, the company filed a technical report effective Sept. 30, 2021, on the tailings reprocessing project (TRP). An infill drilling campaign is planned for the second quarter of fiscal 2022 to improve the tailings mineral resource category.
    • As there can be only one current technical report in respect of a property, the company is in the process of preparing a new technical report that will effectively merge the disclosure contained in the OSP technical report and the TRP technical report, as both projects are located on the same property. Once filed, the amended Don Mario report will replace the previous OSP and TRP reports.
    • During the first quarter of fiscal 2022, exploration was carried out in two previously unexplored areas of Las Tojas and Oscar sectors. Mapping, geochemical and geophysical sampling were carried out. Data obtained will be processed and analyzed in order to continue with fiscal 2022 program.
  • Orvana Argentina:
    • On Dec. 29, 2021, the company announced the results of its 2021 Taguas PEA. The report will be filed on SEDAR on Feb. 11, 2022.
    • The company started in late December, 2021, the infill drilling program at Taguas to improve confidence in the continuity of oxide mineralization, and to upgrade mineral resource classification categories. An update on the Taguas infill drilling program will be provided in March, 2022.

Highlights of the 2021 Taguas PEA to be filed include:

  • Pretax NPV (net present value) of $104-million (U.S.) at 8.0-per-cent discount rate;
  • Pretax internal rate of return (IRR): 27.4 per cent;
  • After-tax NPV of $57-million (U.S.) at 8.0-per-cent discount rate;
  • After-tax IRR (internal rate of return): 20.2 per cent;
  • Payback period (from start of operations): 2.9 years (years based on after tax);
  • Initial capital: $141-million (U.S.);
  • LOM (life of mine) capital: $148-million (U.S.).

Estimated average LOM all-in sustaining costs (AISC): $915 (U.S.)/Au oz payable

Cautionary statement -- Mineral resources that are not mineral reserves do not have demonstrated economic viability. The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty that the results of the PEA will be realized. The PEA study is conceptual in nature and the PEA mine plan is based on 100-per-cent inferred resources. The projections, forecasts and estimates presented in the PEA constitute forward-looking statements and readers are urged not to place undue reliance on such forward-looking statements. Additional cautionary and forward-looking statement information is detailed at the end of this news release.

There are no material differences in the 2021 Taguas PEA from those results disclosed in the company's press release dated Dec. 29, 2021.

The 2021 Taguas PEA will be filed on Feb. 11, 2022, with an effective date of Dec. 29, 2021, and is entitled "Preliminary Economic Assessment NI 43-101 Technical Report on the Taguas Heap Leach Project San Juan, Argentina." The 2021 Taguas PEA, prepared in accordance with National Instrument 43-101 -- Standards of Disclosure for Mineral projects, replaces the previous independent technical report preliminary economic assessment dated June 30, 2021, and filed on SEDAR on July 28, 2021. The 2021 Taguas PEA refers only to the oxidized gold-silver mineralization occurring near surface in Cerro Taguas. The 2021 Taguas PEA is available for review on SEDAR and on the company's website.

The 2021 Taguas PEA was prepared for Orvana Argentina SA by Kappes, Cassiday and Associates (KCA), NCL Ingenieria & Construccion SpA (NCL), Dr. Joseph J. Kowalik and Geosim Services Inc. (Geosim) with support from SAXUM Engineered Solutions.

Qualified persons:

The following were the qualified persons (QPs) for the 2021 Taguas PEA, as defined by National Instrument 43-101:

  • Caleb Cook, PE, Kappes, Cassiday & Associates;
  • Carlos Guzman, FAusIMM and RM CMC, NCL Ingenieria & Construccion SpA;
  • Joseph J. Kowalik, PhD, QP MMSA, senior consulting geologist;
  • Ronald G. Simpson, PGeo, mineral resource consultant, Geosim Services Inc.

Quality control

All technical data contained in this news release in relation to the 2021 Taguas PEA have been reviewed and approved by Caleb Cook, PE, a qualified person under National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

About Orvana Minerals Corp.

Orvana is a multimine gold-copper-silver company. Orvana's assets consist of the producing El Valle and Carles gold-copper-silver mines in northern Spain, the Don Mario gold-silver property in Bolivia, currently in care and maintenance, and the Taguas property located in Argentina.

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