TORONTO, Aug. 30, 2017 (GLOBE NEWSWIRE) -- Teranga Gold Corporation(TGCDF) ("Teranga" or the "Company") announces the filing of a technical report pursuant to National Instrument Standards of Disclosure for Mineral Projects 43-101 (“NI 43-101”) for its Sabodala gold mine in Senegal, West Africa (the “Sabodala Technical Report”). The Sabodala Technical Report, which was prepared by Teranga and Roscoe Postle Associates Inc., conforms to NI 43-101 and supports the updated mineral reserves estimate and life of mine plan released on July 19, 2017. A copy of the Sabodala Technical Report has been filed on SEDAR at www.sedar.com and posted on the Company’s website at www.terangagold.com.
As previously announced, the Company’s proven and probable reserves at Sabodala increased to 2.7 million ounces of gold representing an increase of more than 400,000 ounces over the previous mineral reserves estimate. The majority of the new reserves come from the Niakafiri deposit, which is located less than five kilometres from the Sabodala process plant. The Sabodala mine plan has accordingly been re-sequenced to bring forward the development of the Niakafiri open pit deposits and defer underground development, improving Teranga’s five-year production and cash flow profile.
“We’re pleased with the update to Sabodala’s life of mine plan,” stated Richard Young, President and Chief Executive Officer of Teranga. “We have extended our mine life to 14 years and improved our five-year profile. Between 2018 and 2022, Sabodala’s gold production is expected to increase by 20% to more than one million ounces1 and generate a total of $230 million in free cash flow2, approximately two times the amount anticipated in the previous plan filed eighteen months ago.”
Mr. Young continued, “We will continue with our multi-year drilling program intended to further define near surface resources and reserves on the prospective Niakafiri trend.”
Highlights of the Sabodala Technical Report
• Proven and probable mineral reserves 61.6 Mt @ 1.37 g/t containing 2.7Moz Au3
• Measured and indicated resources 86.6 Mt @ 1.59 g/t containing 4.4Moz Au3
• Inferred mineral resources 17.2 Mt @ 1.81 g/t containing 1.0Moz Au3
• First 5 years (2018 - 2022)
– Average annual production 213 Koz1
– Average mill grade 1.64 g/t1
– Average all-in sustaining costs* $885 per ounce4
– Free cash flow* $230 million 2,4
• 14-year mine life
– Average annual production 176 Koz1
– Average all-in sustaining costs* $893 per ounce4
*See Non-IFRS Performance Measures section of this release.
Non-IFRS Financial Performance Measures
The Company has included non-IFRS measures in this document, including “free cash flow”, “total cash cost per ounce of gold sold” and “all-in sustaining costs per ounce”. The Company believes that these measures, in addition to conventional measures prepared in accordance with IFRS, provide investors an improved ability to evaluate the underlying performance of the Company. The non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These measures do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to other issuers.
Total cash costs figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is considered the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measure of other companies. The World Gold Council (“WGC”) definition of all-in sustaining costs seeks to extend the definition of total cash costs by adding corporate general and administrative costs, reclamation and remediation costs (including accretion and amortization), exploration and study costs (capital and expensed), capitalized stripping costs and sustaining capital expenditures and represents the total costs of producing gold from current operations. All-in sustaining cost excludes income tax payments, interest costs, costs related to business acquisitions and items needed to normalize earnings. Consequently, this measure is not representative of all of the Company’s cash expenditures. In addition, the calculation of all-in sustaining costs does not include depreciation expense as it does not reflect the impact of expenditures incurred in prior periods. Therefore, it is not indicative of the Company’s overall profitability. Life of mine total cash costs and all-in sustaining costs figures used in this press release are before cash/non-cash inventory movements and amortized advanced royalty costs, and exclude any allocation of corporate overheads. Other companies may calculate this measure differently. The Company calculates free cash flow as net cash flow provided by operating activities less sustaining capital expenditures. The Company believes this to be a useful indicator of its ability to generate cash for growth initiatives. Other companies may calculate this measure differently.
For more information regarding these measures, please refer to the Company’s 2016 Management’s Discussion and Analysis accessible on the Company’s website at www.terangagold.com.
