Austral Gold Amended Q1 2018 Report
MEDIA RELEASE
Austral Gold Limited
09 May 2018
Austral Gold
Amended Q1 2018 Report
Sydney, Australia-Austral Gold Limited (‘the Company’) (ASX: AGD; TSX-V: AGLD) is providing an
amended Quarterly Activity Report for March 2018 originally lodged on 30 April 2018.
The Company advises of typographical errors on pages 1,3,4 and 14 of its March 2018 Quarterly
Activity Report in relation to the Cash Cost and All-in Sustaining Cost at its Guanaco/Amancaya and
Casposo mines. The disclosure of these costs has been corrected as follows:
Page 1-the average selling prices across all operations at US$1,324 per ounce of gold
Page 3 and 14-C1 Cash Cost (US$/AuEq oz)** at Casposo Mine (100% basis) 1,427
Page 4-Cash Cost (US$/AuEq oz)** at Guanaco/Amancaya Mines 990; Casposo Mine (100% basis)
1,427
Page 4-All-in Sustaining Cost (US$/AuEq oz)# at Guanaco/Amancaya Mines 1,120; Casposo Mi ne
(100% basis) 1,903
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
On behalf of Austral Gold Limited:
Andrew Bursill
Company Secretary
For additional information please contact:
Jose Bordogna
Chief Financial Officer
Austral Gold Limited
+54 (11) 4323 7558
Andrew Bursill
Company Secretary
Austral Gold Limited
+61 (2) 9299 9690
Austral Gold Limited ABN 30 075 860 472 ASX: AGD TSXV: AGLD
Suite 2, Level 10, 70 Phillip St, Sydney NSW 2000 | T +61 2 9180 7233 | F +61 2 9251 7455 | [email protected] | www.australgold.com.au
1 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
KEY HIGHLIGHTS
• Quarterly production (100% of the Casposo, Guanaco and Amancaya mines) was
14,258 gold ounces and 486,591 silver ounces ( 20,367 gold equivalent ounces) or
13,462 gold ounces and 370,583 silver ounces ( 18,122 gold equivalent ounces) net to
Austral*.
• The combined production target for calendar year 2018 remains on target at 92,000
AuEq oz net to Austral* or 105,000 AuEq oz (100% basis).
• Quarterly operating cash cost (C1) and all -in-sustaining cost (AISC) across all
operations were US$1, 151 and US$1,409 per gold equivalent ounce respectively with
average selling prices at US$1,324 per ounce of gold and US$16.8 per ounce of silver.
• Sales proceeds for the quarter were US$30.2m of which the Guanaco /Amancaya mine
contributed US$17.4m and the Casposo mine US$12.8m.
MARCH 2018
Quarterly Activity Report
2 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
Guanaco and Amancaya Mines Production
• Quarterly production was 11, 606 gold ounces and 99,865 silver ounces (12, 852 gold
equivalent ounces) compared to the December quarter where production was 11,370
gold ounces and 73,440 silver ounces (or 12,329 gold equivalent ounces).
• Underground operations at Amancaya started during the March quarter in parallel with
the exploitation of the open pit.
• Production at the Guanaco mine was affected by unexpected higher copper grades in
the ore, and the Amancaya mine faced some short term production issues with grade
dilution due to narrow vein mining. Both cases were solved and grades control
procedures have improved.
Casposo Mine Production
• Quarterly production was 2,652 gold ounces and 386,726 silver ounces (100% basis)
(7,515 gold equivalent ounces). Austral Gold’s share of production was 1,856 gold
ounces and 270,708 silver ounces (5,261 gold equivalent ounces (70% basis).
(December quarter production was 5,544 gold ounces and 517,125 silver ounces (100%
basis) (12,292 gold equivalent ounces).
• Production at the Casposo mine decreased from the prior quarter mainly due to lower
head grades due to blending ore from the underground mine with low-grade ore stocks
fed to the mill to compensat e for the deficit of ore extraction from the mine . To improve
production at the Casposo mine, the Company plans to use additional mining equipment
in the following quarter.
3 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
A summary of key operational parameters for the March 2018 and 2017 and December
2017 reporting periods is set out in the following table for comparative purposes:
Operations
Guanaco/ Casposo Mine Net to
Austral Gold* Amancaya Mines (100% basis)
Mar
Quarter
2018
Dec
Quarter
2017
Mar
Quarter
2017
Mar
Quarter
2018
Dec
Quarter
2017
Mar
Quarter
2017
Mar
Quarter
2018
Dec
Quarter
2017
Mar
Quarter
2017
Processed (t) 60,573 101,908 145,456 51,107 59,942 48,602 96,348 143,867 170,243
Gold produced
(oz)
11,606
11,370
10,299
2,652
5,544
3,487
13,462
15,251 12,308
Silver produced
(oz)
99,865
73,440
12,711
386,726
517,125
288,327
370,573
435,428
180,390
Gold-Equivalent
(oz) ***
12,852
12,329
10,482
7,515
12,292
7,652
18,113
20,933 14,914
C1 Cash Cost
(US$/AuEq
oz) **
990
1,160
924
1,427
918
1,058
1,151
1,039
990
All-in Sustaining
Cost (US$/Au
oz) #
1,120
1,384
1,066
1,903
1,145
1,353
1,409
1,264
1,187
Realised gold
price (US$/Au
oz)
1,322
1,277
1,254
1,329
1,282
1,214
1,324
1,280
1,329
Realised silver
price (US$/Ag
oz)
17
17
18
17
17
17
17
17
17
* Austral Gold owned 70% of Casposo since March 2017; 51% since March 2016
** The cash cost (C1) includes: Mine, Plant, On-Site G&A, Smelting, Refining, and Royalties (excludes Corporate G&A)
# The All-in Sustaining Cost (AISC) includes: C1, Sustaining Capex, Brownfield Exploration, and Mine Closure Amortisation
*** AuEq ratio is calculated at 80:1 Ag:Au for March Quarter 2018; 77:1 Ag:Au for December Quarter 2017; 70:1 Ag:Au for March Quarter 2017
4 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
Actual Q1 2018 and Forecasted Calendar 2018 Production:
Total combined production for Q1 2018 was 20,367 gold equivalent ounces (100% basis) or
18,113 (net to Austral Gold*) with an average C1 and AISC of US$ 1,151/oz and US$ 1,409/oz
per ounce of gold equivalent respectively.
The table below provides the forecast production figures for calendar year 2018 and Q1 2018
actual results for the 3 -month period ended 31 March 2018. Production costs were higher than
forecasted, however the Company expects to meet its forecast by year-end. We will keep
shareholders informed of any changes to the production plan for calendar year 2018.
Operations
Guanaco/
Amancaya Mines
Casposo Mine
(100% basis)
Net to Austral Gold*
Q1
2018
Actual
Calendar
2018
Forecasted
Q1
2018
Actual
Calendar
2018
Forecasted
Q1
2018
Actual
Calendar
2018
Forecasted
Gold produced (oz)
11,606
54,000
2,652
24,000
13,462
71,000
Silver produced (oz)
99,865
520,000
386,726
1,400,000
370,573
1,520,000
Gold-Equivalent (oz) ***
12,852
62,000
7,515
43,000
14,914
92,000
C1 Cash Cost
(US$/AuEq oz) **
990
600-700
1,427
800-900
1,151
700-800
All-in Sustaining Cost
(US$/Au oz) #
1,120
850-950
1,903
1,050-1,150
1,409
900-1,050
Sustaining Capital
($000’s)
1,462
13,500
2,657
13,500
4,119
26,500
Realised gold price
(US$/Au oz)
1,322
1,250
1,329
1,250
1,324
1,250
Realised silver price
(US$/Ag oz)
17
17
17
17
17
17
* Austral Gold owned 70% of Casposo since March 2017; 51% since March 2016
** The cash cost (C1) includes: Mine, Plant, On-Site G&A, Smelting, Refining, and Royalties (excludes Corporate G&A)
# The All-in Sustaining Cost (AISC) includes: C1, Sustaining Capex, Brownfield Exploration, and Mine Closure Amortisation
*** AuEq ratio is calculated at 80:1 Ag:Au for March Quarter 2018; 77:1 Ag:Au for December Quarter 2017; 70:1 Ag:Au for March Quarter 2017
5 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
Exploration
• Exploration in Chile is focused on drilling the extensions of the Dumbo open pit
mineralised structures at the Guanaco mine, and the upper parts of the Amancaya mine
to support those portions of the model evaluated mainly with R everse Circulation drill
holes. A complementary DDH drill program of twelve holes was completed on the Nueva
vein, approximately 5k m north of the Amancaya open pit operation, with four areas of
gold mineralisation encountered, confirming a structure 2.8km in strike length.
• Exploration in Argentina is focused on testing the extensions of the Inca and Aztec veins
at the Casposo mine, with underground drilling ( nine holes), and the extension of the
Mercado vein with two drill holes. Drilling operations moved to the Julieta brownfield
target to complete the program before winter. Three holes were completed in Q1 2018.
Financial
• Cash on hand at 31 March 2018 was US$3.3m.
• Total consolidated debt at 31 March 2018 was US$~25m (of which ~US$16m is short-
term debt by way of financial leases, revolving export facilities and a credit facility). Net
debt repayments during the quarter totalled US$0.2m.
6 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
Guanaco/Amancaya
Antofagasta, Chile
Casposo
San Juan Province, Argentina
Pingüino,
Santa Cruz Province, Argentina
Guanaco & Amancaya mines Casposo mine Pingüino project
Antofagasta, Chile San Juan, Argentina Santa Cruz, Argentina
Austral Gold Limited (‘the Company’ or ‘Austral’) and its subsidiaries (‘the Group’) is a growing precious
metals mining and exploration company building a portfolio of assets in South America.
The Group produces gold and silver from the Guanaco and Amancaya Mines in Chile (100% interest)
and the Casposo Mine in San Juan, Argentina (70% interest). The Group also holds an attractive
portfolio of exploration projects including the Pingüino project in Santa Cruz, Argentina (100% interest)
and the recently acquired San Guillermo and Reprado projects near Amancaya (100% interest). With an
experienced and highly regarded major shareholder, Austral Gold is strengthening its asset base by
investing in more precious metals projects in Chile and Argentina with near-term development potential.
100%
100%
7 AUSTRAL GOLD QUARTERLY REPORT — MARCH 2018
CHILE
Guanaco and Amancaya Mines
Background
The Guanaco and Amancaya mine s remain the Company’s flagship mine complex . Guanaco is
located approximately 220km south -east of Antofagasta in Northern Chile at an elevation of 2,700m
and 45km from the Pan American Highway. Guanaco is embedded in the Paleocene/Eocene belt, a
geological feature which runs north/south through the centre of the Antofagasta region, Chile.
Gold mineralisation at Guanaco is controlled by pervasively silicified, sub-vertical east/northeast -
west/southwest trending zones with related hydrothermal breccias. Silicification grades outward
into advanced argillic alteration and further into zones with argillic and propylitic alteration. The
alteration pattern and the min eralogical composition of the Guanaco mineralisation have led to the
classification as a high-sulphidation epithermal deposit.
In July 2014, the Company acquired the Amancaya Project (‘Amancaya’) from Yamana Gold Inc
which is located approximately 60km south-west of the Guanaco mine. Amancaya is a low
sulphidation epithermal gold -silver deposit consisting of eight mining exploration concessions
covering 1,755 hectares (and a further 1,390 hectares of second layer mining claims).
At Amancaya, open-pit mining operations began during the first half of 2017. The Amancaya ore is
being trucked to the new plant at Guanaco for processing. The development of the decline to access
underground reserves commenced in late 2017.
San Guillermo and Reprado Properties
On 14 November 2017, Austral Gold completed its purchase of a 100% interest in the San
Guillermo and Reprado gold -silver projects, located in the emerging Amancaya precious metals
district of northern Chile, from Revelo Resources Corp. (TSX- V:RVL) for consideration of ten million
Austral Gold ordinary shares. Revelo has retained Net Smelter Return (NSR) Royalties on future
metals production of 1% and 0.5% at Reprado and San Guillermo, respectively.
The San Guillermo property consists of concessions totalli ng 12,175 hectares that surround the
company’s high-grade gold and silver Amancaya operation, which Austral began mining via open
pit operations in 2017. The Reprado Project consists of concessions totalling 3,960 hectares
situated approximately 20km north of the Company’s Amancaya operation. Historical drilling
undertaken by Teck Resources Ltd intersected gold in low sul phidation quartz veins trending
essentially east-west.
New plant and technical report on combined resources
Construction of a new agitation leaching plant at Guanaco mine site was completed in August 2017
with commissioning phase completed by November 2017. The Company released the results of an
independent resource and reserve estimate in accordance with the CIM Definitions 2014 in National
Instrument (“NI”) 43 -101 and Joint Ore Reserves Committee Code, 2012 (JORC 2012) on 8 June
2017 (see company profile on www.sedar.com and www.asx.com.au release). Highlights from the
estimate confirms the high-grade nature of the Amancaya project are as follows: