Austral Gold Reports Second Fiscal Quarter 2017 Results
Austral Gold Reports Second
Fiscal Quarter 2017 Results
VANCOUVER, BRITISH COLUMBIA--(Newsfile – February 3, 2017) Austral Gold Limited
(‘the Company’) (ASX: AGD; TSX-V: AGLD) is pleased to report results for quarterly
activities for its second fiscal quarter ended December 31, 2016.
Fiscal Second Quarter and January 2017 Highlights:
(All figures are in U.S. dollars unless otherwise noted)
• Record quarterly production of 17,102 Au oz and 236,011 Ag oz 1
• 25% increase in production of gold equivalent ounces 2 from previous quarter at
Guanaco.
• Respective average cash costs for the quarter at Guanaco and Casposo were
US$527/AuEq and US$969/AuEq oz and all-in sustaining cost (“AISC”) at
US$664AuEq oz and US$1,200 AuEq oz respectively.
• Recommissioning of Casposo Mine (51% owned) resulted in 2,289 oz of gold
(included in total quarterly production number above) and 221,650 oz of silver
production.1
• The assay results from the Amancaya infill drilling program completed in November
2016, reported in December and January, identified two new high grade gold
shoots and confirmed and extended the multiple high grade zones previously
modelled at the Central vein.
• Exercised 399,300 Fortuna Silver warrants and subsequently sold the related
Fortuna Silver shares for gross proceeds of US$2.7 million (C$3.7 million) with a
51.4% pre-tax realized return.
Stabro Kasaneva, CEO, said, “This quarter has seen us exceed expectations across a
number of fronts. At Guanaco there was a significant growth in production and decrease in
cash costs and all-in sustaining costs, due largely to higher gold grades. This continues the
improvements we saw in the previous quarter relative to the first half of 2016. At Amancaya
we completed a very successful infill drill program, identifying two new high grade gold
shoots. Amancaya is fully permitted and with the pre-feasibility study due by the end of
March we expect that we could be in a position to make a production decision on this gold
and silver project very shortly, with preparati ons at site well advanced. At Casposo we are
1 Excludes 49% of Casposo production owned by Troy Resources during the period.
2 Gold equivalent, or “AuEq” ratio is calculated at 71:1 Ag:Au
starting to see the turn-around in the mine as a result of the new mining methods being
adopted and are optimistic that these will impact operations positively going forward.”
Guanaco Mine
Production from underground operations using the heap leach process generated 14,813
Au oz and 14,361 Ag oz during the quarter. Production for the quarter concentrated in the
Dumbo and Cachinalito extensions. Production increased due to an increase in the grade
and continued improvements in underground operations and resultant increased loading of
the heap leach pads.
Casposo Mine
Guanaco Mine
December
Quarter 2016
December
Quarter 2015
Six months
ended
December
2016
Six months
ended
December
2015
Total Ore processed (t) 141,388 130,488 281,848 140,460
Average Plant grade (g/t Au) 3.78 2.90 4.62 5.47
Average Plant grade (g/t Ag) 9.4 8.3 8.8 8.2
Gold produced (oz) 14,813 9,244 26,575 11,762
Silver produced (oz) 14,361 11,157 30,470 16,109
C1 Cash Cost (US$/AuEq oz) 527 823 591 673
All-in Sustaining Cost* (US$/AuEq oz) 664 1,010 746 848
Realised gold price (US$/Au oz) 1,242 1,121 1281 1,330
Casposo Mine (51% owned by Austral Gold*)
Dec Quarter
2016
Sept Quarter
2016
Total Ore processed (t) (100% basis) 66,328 68,055
Gold recovery (%) 91% 90%
Silver recovery (%) 84% 78%
Average Plant Grade (g/t Au) 2.30 2.98
Average Plant Grade (g/t Ag) 241.4 180.9
Gold produced (oz): 100% basis 4,489 4,457
Share of Gold produced (oz): 51% basis 2,289 2,426
Silver produced (oz): 100% basis 434,607 313,765
Share of Silver produced (oz): 51% 221,650 160,020
Outlook
Guanaco
Production of gold equivalent ounces for the calendar year 2017 from the Guanaco mine is
projected to be in the range of 45,500-51,000 ounces.
Construction of the new agitation leach plant (Merrill-Crowe circuit) at Guanaco continues to
advance and a completion date prior to the end of March 2017 has been forecast. To date the
actual spend on the project is ~80% complete.
Amancaya
Site preparations at Amancaya have been advanced during the quarter, and onsite facilities and
road works to the site are well advanced. Roscoe Postle and Associates (RPA) have been
working on a prefeasibility study for the mining of Amancaya and treating of production at the
new Guanaco agitation leach plant. This study should be completed by the end of March 2017.
In anticipation of a favorable result, all the basic permits to start operations are in place and
personnel have been hired to commence when initial pre-operations activities start.
Casposo
The Company expects to pay $1 million to Tr oy Resources in March 2017 to acquire
additional 19% of Casposo Mine to increase ownership interest to 70%.
Expected production for the calendar year 2017 is 50,000 gold equivalent ounces with a goal of
reaching an AISC of US$957 per ounce, as per the Casposo Gold-Silver Mine Technical
Report, dated 7 September 2016, with an effective date of 30 of June 2016 and available on
SEDAR under the Company’s profile. The Company is working to further reduce costs at
Casposo.
Further details can be found in the Company ’s Quarterly Activity Report filed at
www.australgold.com, http://www.asx.com.au and on www.sedar.com.
* Non-IFRS Measures
The Company has included certain non-IFRS measures including "Cash cost per gold ounce sold"
and "All-in sustaining cost per gold ounce sold" in this press release. Cash cost per gold ounce
sold is equal to production costs less silver sales divided by gold ounces sold. All-in sustaining
cost per gold ounce sold is equal to production costs less silver sales plus general and
administrative expenses, exploration expenses, accretion of reclamation provision and sustaining
capital expenditures divided by gold ounces sold. The Company believes that these measures
provide investors with an improved ability to evaluate the performance of the Company. Non-IFRS
measures do not have any standardized meaning prescribed under IFRS. Therefore they may not
be comparable to similar measures employed by other companies. The data is 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.
Qualified Persons
The scientific and technical content of this news release has been prepared by, or under the
supervision of Michael Brown, MAIG, and has been reviewed and approved by him. Mr Brown is
a Geologist and Member of Australian Institute of GeoScientists and an employee of Austral
Gold Limited. Mr Brown is a “qualified person” for the purposes of National Instrument 43-101,
Standards of Disclosure for Mineral Projects.
About Austral Gold
Austral Gold Limited is a growing precious metals mining, development and exploration
company building a portfolio of quality assets in Chile and Argentina. The Company's flagship
Guanaco project in Chile is a low-cost gold and silver producing mine with further exploration
upside. The Company is also operator of the underground silver-gold Casposo mine in San
Juan, Argentina. With an experienced local technical team and highly regarded major
shareholder, Austral’s goal is to continue to strengthen its asset base through acquisition and
discovery. Austral Gold Limited is listed on the TSX Venture Exchange (TSX-V:AGLD), and the
Australian Securities Exchange (ASX: AGD). For more information, please consult the
company’s website www.australgold.com
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:
"Stabro Kasaneva"
CEO
For Further Information Please Contact:
Alison Crealy Mike Brown
[email protected] [email protected]
+61 (2) 9380 7233 +1 604 568 2496 ext. 21
Forward Looking Statements
Statements in this news release that are not histor ical facts are forward-looking statements. Forward-
looking statements are statements that are not historical, and consist primarily of projections - statements
regarding future plans, expectations and developments. Words such as "expects ", "intends", "plans",
"may", "could", “potential”, "should", "anticipates", "likely", "believes" and words of similar import tend to
identify forward-looking statements. Forward-looki ng statements in this news release include the
Company’s expectation that it could be in a position to make a production decision on Casposo very
shortly; its anticipation that t he new mining methods being adopted at Casposo will impact operations
positively going forward; the Company’s production projection for Guanaco for calendar 2017 of 45,500-
51,000 ounces of Gold (AuEq oz); its expectation t hat construction of the ne w agitation leach plant
(Merrill-Crowe circuit) will be completed by the end of March 2017 and that the pre-feasibility study from
Roscoe Postle & Associates should be complete d by the end of the first quarter of 2017; and its
expectation that production for the calendar year 2017 will be 50,000 gold equivalent ounces with a goal
of reaching an AISC of US$957 per ounce, and expectation that it will pay $1 million to Troy Resources in
March 2017 to earn an additional 19% of Casposo. All of these forward-looking statements are subject to
a variety of known and unknown risk s, uncertainties and other factors t hat could cause actual events or
results to differ from those expressed or implied, including, without limitation, business integration risks;
uncertainty of production, development plans and cost estimates, commodity price fluctuations; political or
economic instability and regulatory changes; currency fluctuations, the state of the capital markets,
uncertainty in the measurement of mineral reserves and resource estimates, Austral’s ability to attract and
retain qualified personnel and management, potent ial labour unrest, reclamation and closure
requirements for mineral properties; unpredictable risks and hazards related to the development and
operation of a mine or mineral property that are bey ond the Company’s control, the availability of capital
to fund all of the Company’s projects and other risks and uncertainties identified under the heading “Risk
Factors” in the Company’s continuous disclosure documents filed on SEDAR. You are cautioned that the
foregoing list is not exhaustive of all factors and assumptions which may have been used. Austral cannot
assure you that actual events, per formance or results will be consistent with these forward-looking
statements, and management’s assumptions may prov e to be incorrect. Austral’s forward-looking
statements reflect current expectations regarding fu ture events and operating performance and speak
only as of the date hereof and Austral does not assume any obligation to update forward-looking
statements if circumstances or management’s beliefs, expectations or opinions should change other than
as required by applicable law. For the reasons set forth above, you should not place undue reliance on
forward-looking statements.
Austral Gold Limited ABN 30 075 860 472 ASX: AGD TSXV: AGLD
Suite 203, 80 William St, Sydney NSW 2011 | T +61 2 9380 7233 | F +61 2 8354 0992 | [email protected] | www.australgold.com.au