Galane GOLD Ltd. Releases Financial and Operating Results FOR 2016
-1-
For immediate release
GALANE GOLD LTD. RELEASES FINANCIAL
AND OPERATING RESULTS FOR 2016
TORONTO, ONTARIO – May 1, 2017: Galane Gold Ltd. (“Galane Gold” or the “Company”)
(TSX-V: GG) is pleased to announce the release of its financial results for the year ended
December 31, 2016. All amounts are in United States dollars unless otherwise indicated.
A copy of the audited consolidated financial statements for the year ended December 31,
2016 prepared in accordance with International Financial Reporting Standards and the
corresponding Management’s Discussion and Analysis will be available under the
Company’s profile on www.sedar.com.
2016 Highlights
Increased production and cash-flows and reduced cash cost(1) compared to 2015.
Production at Tau Underground in 2016, 206,591 tonnes at a head grade of 3.05
grams per tonne (“g/t”) were mined (2015 - 93,617 tonnes at a head grade of
2.74 g/t).
Operating cash cost(1) of $918 per ounce (excluding royalties) for the year (2015 -
$1,039).
Produced 26,783 ounces of gold at the Mupane property at a head grade of 1.29
g/t (2015 - 24,321 at a head grade of 1.29 g/t).
Operating cash inflow of $4.7 million (2015 - $2.3 million).
Capital investment in the Galaxy property of $1.3 million and operating costs of
$0.7 million.
Capital investment in Tau underground of $3.4 million (2015 - $5.2 million).
Galane Gold CEO, Nick Brodie commented: “The results for 2016 were very pleasing with
an increase in ounces produced, an increase in Tau underground production ( ahead of
internal forecasts), an increase in operating cash flows and a reduction in cash costs per
ounce. We are optimistic that we can continue these trends in 2017. The C ompany
continues to be prudent in managing its cash reserves an d, with the decline in gold price
towards the end of the 2016 fiscal year, management of the Company decided to delay
full commissioning at the Company’s Galaxy property . If the price of gold continues to
improve and the Company has sufficient funds available, o ur goal for the 2017 fiscal
year is to complete commissioning at the Galaxy propert y and benefit from the capital
and hard work already invested in restarting the operation.”(2)
Outlook(2)
Mupane Property
The Company completed a new five year mine plan for the Mupane p roperty in 2016
which will form the guide for the Company’s short term goals and long term strategy.
The Company intends to utilize the following resources during 2017:
Tau Underground – It is estimated that the Company will process approximately
400,000 tonnes at an average grade of 2.6 grams per tonne (“g/t”). While
developing underground, the Company intends to continue exploration to attempt
to confirm the extension of the Ta u mineralised body at depth as previously
announced in the Company’s press release of October 24, 2016 on the discovery
of the potential extension.
Low Grade Stockpiles – the Company expects to process approximately 380,000
tonnes of low grade stockpile at an average grade of 0.78 g/t, which is located at
the run-of-mine pad at the processing plant and at Golden Eagle.
Tekwane – the Company will continue to selectively mine the high grade areas
and will use a screening plant at the mine site to reduce the tonnage and increase
the potential grade to be delivered to the plant. The Company is planning to
process approximately 30,000 tonnes at an average grade of 1.2 g/t.
The Mupane p roperty mine plan is subject to change according to the prevailing gold
price. The Company will adopt the appropriate plan for the prevailing gold price
environment.
Galaxy Property
The Company announced in January 2017 that a t the current stage the Galaxy p roperty
does not generate positive cash flows and further capital expenditures are required to
complete the full commissioning. The Company is committed to fund the commissionin g
and operations at the Galaxy p roperty p roject from cash flows generated from the
Company’s Mupane mine. Mupane continues to generate positive operating cash flows;
however at the current gold price it is insufficient to fully fund commissioning at the
Galaxy property. Management has decided to be prudent and delay full commissioning at
the Galaxy property until the Company has sufficient funds available.
About Galane Gold
Galane Gold is an un -hedged gold producer and explorer with mining operations and
exploration tenements in Botswana and South Africa . Galane Gold is a public company
and its shares are quoted on the TSX Venture Exchange and the B otswana Stock
Exchange under the symbol “GG”. Galane Gold’s management team is comprised of
senior mining professionals with extensive experi ence in managing mining and
processing operations and large -scale exploration programmes. Galane Gold is
committed to operating at world -class standards and is focused on the safety of its
employees, respecting the environment, and contributing to the com munities in which it
operates.
Notes:
(1) Total operating cash cost excluding royalties is a non- GAAP measure. Refer to “Supplemental
Information to Management’s Discussion and Analysis” in the Company’s Management’s Discussion
and Analysis for the year ended December 31, 2016 for reconciliation to measures reported in the
Company’s financial statements.
(2) This is forward-looking information and is based on a number of assumptions. See “Cautionary Notes”.
Cautionary Notes
Certain statements contained in this press release constitute “forward -looking
statements”. All statements other than statements of historical fact contained in this
press release , including, without limitation, those regarding the Company’s future
financial position and results of operations, strategy, proposed acquisitions, plans,
objectives, goals and targets, and any statements preceded by, followed by or that
include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”,
“would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or
similar expressions or the negative thereof, are forward -looking statements. These
statements are not historical facts but instead represent only the Company’s
expectations, estimates and projections regarding future events. These statements are
not guarantees of future performance and involve assumptions, risks and uncertainties
that are difficult to predict. Therefore, actual results may differ materially from what is
expressed, implied or forecasted in such forward-looking statements.
Additional factors that could cause actual results, performance or achievements to differ
materially include, but are not limited to: the Company’s dependence on two mineral
projects; gold price volatility; risks associated with the conduct of the Company’s mining
activities in Botswana and South Africa; regulatory, consent or permitting delays; risks
relating to the Company’s exploration, development and mining activities being situated
in Botswana and South Africa; risks relating to reliance on the Company’s management
team and outside contractors; risks regarding mineral resources and reserves; the
Company’s inability to obtain insurance to cover all risks, on a commercially reasonable
basis or at all; currency fluctuations; risks regarding the failure to generate sufficient
cash flow from operations; risks relating to project financing and equity issuances; risks
arising from the Company’s fair value estimates with respect to the carrying amount of
mineral interests; mining tax regimes; risks arising from holding derivative instruments;
the Company’s need to replace reserves depleted by production; risks and unknowns
inherent in all mining projects, including the inaccuracy of reserves an d resources,
metallurgical recoveries and capital and operating costs of such projects; contests over
title to properties, particularly title to undeveloped properties; laws and regulations
governing the environment, health and safety; operating or technic al difficulties in
connection with mining or development activities; lack of infrastructure; employee
relations, labour unrest or unavailability; health risks in Africa; the Company’s
interactions with surrounding communities and artisanal miners; the Comp any’s ability
to successfully integrate acquired assets; risks related to restarting production; the
speculative nature of exploration and development, including the risks of diminishing
quantities or grades of reserves; development of the Company’s exploration properties
into commercially viable mines; stock market volatility; conflicts of interest among
certain directors and officers; lack of liquidity for shareholders of the Company; risks
related to the market perception of junior gold companies; and li tigation
risk.Management provides forward -looking statements because it believes they provide
useful information to investors when considering their investment objectives and
cautions investors not to place undue reliance on forward -looking information .
Consequently, all of the forward -looking statements made in this press release are
qualified by these cautionary statements and other cautionary statements or factors
contained herein, and there can be no assurance that the actual results or developments
will be realized or, even if substantially realized, that they will have the expected
consequences to, or effects on, the Company. These forward -looking statements are
made as of the date of this press release and the Company assumes no obligation to
update or revise them to reflect subsequent information, events or circumstances or
otherwise, except as required by law.
Estimates set out above under “Outlook” in respect of Tau Underground ,
Tekwane, Low Grade Stockpiles and Galaxy are preliminary in nature and
include inferred mineral resources. There is no certainty that such estimates
will be realized. Mineral resources are not mineral reserves and do not have
demonstrated economic viability. Inferred mineral resources are estimated on
limited information not sufficient to verify geological and grade continuity or to
allow technical and economic parameters to be applied. Inferred mineral
resources are too speculative geologically to have economic considerations
applied to them to enable them to be categori zed as mineral reserves. There is
no certainty that mineral resources can be upgraded to mineral reserves
through continued exploration.
Information of a technical and scientific nature that forms the basis of the disclosure in
the press release has been a pproved by Charles Byron Pr. Sci. Nat., MAusIMM., MGSSA
and Chief Geologist for Galane Gold, and a “qualified person” as defined by National
Instrument 43-101.
Neither the 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.
For further information please contact:
Nick Brodie
CEO, Galane Gold Ltd.
+ 44 7905 089878
www.GalaneGold.com