Ssr Mining’S Seabee GOLD Operation Strong Preliminary Economic Assessment Supports MINE Expansion Plan
News Release 17-24
SSR Mining Inc. PHONE +1 604.689.3846 Suite 800 - 1055 Dunsmuir Street
www.ssrmining.com TOLL FREE +1 888.338.0046 PO Box 49088
Vancouver, BC, Canada V7X 1G4
September 7, 2017
SSR MINING’S SEABEE GOLD OPERATION STRONG PRELIMINARY ECONOMIC
ASSESSMENT SUPPORTS MINE EXPANSION PLAN
VANCOUVER, B.C. – SSR Mining Inc. ( NASDAQ: SSRM) (TSX: SSRM) (“SSR Mining”) is
pleased to report the results of a Preliminary Economic Assessment (“PEA”) for the Seabee Gold
Operation in Saskatchewan, Canada prepared with SRK Consulting (Canada) Inc. The PEA
evaluates the expansion of the Seabee Gold Operation to a sustained mining and milling rate of
1,050 tonnes per day for a seven-year period.
Highlights of the Seabee Gold Operation PEA:
(All financial results are in U.S. dollars unless otherwise noted)
Near-term production growth: Estimated peak gold production of 120,000 ounces in 2020
is 55% higher than 2016 output.
Expands operating margins: Estimated LOM cash costs of $548 per payable ounce of gold
sold due to higher sustained throughput and an average mill feed grade of 8.51 g/t gold.
Extends production profile to 2024: Estimated gold production averages 100,000 ounces
per year over the period from 2018 to 2023, a 29% increase from 2016 production.
Improves processing plant performance: Estimated mill production averages 1,050 tonnes
per day beginning in 2019, a 21 % increase to 201 6 throughput, with a projected 96.5 %
recovery.
Low capital investment: Development near existing infrastructure red uces projected total
capex to $90 million, driving low AISC of $682 per payable ounce of gold sold.
Paul Benson, President and CEO said, “We acquired Claude Resources because we recognized
Santoy was a high-quality orebody and we saw the potential for near-term production growth and
improved margins, which this expansion plan confirms. At sub -$550 per ounce cash costs and
peak annual gold production of over 120,000 ounces along with a production profile for at least
another seven years estimated under the PEA , Seabee is firmly positioned as a key asset and
significant cash flow generator in our portfolio. Underpinning our longer-term view, we believe that
recent drilling success at Santoy, our large land position and our option on the Fisher property
represent the potential for further mine life extension.”
SSR Mining Inc.
PAGE 2
SEABEE GOLD OPERATIONS OVERVIEW
The Seabee Gold Operation is located in Northern Saskatchewan, Canada, and has been in
continuous operation since 1991. The operation is accessed by fixed-wing aircraft to an airstrip
located on the property. During winter month s, an ice road is built to transport supplies and
equipment by truck. Electrical power to the property is provided by the provincial power authority
via a 138-kilovolt hydroelectric transmission line from Island Falls, Saskatchewan. Potable water
is obtained locally through the on-site potable water system to support the operation. The Seabee
camp facilities can accommodate 200 employees at site.
Mineral Resources Estimate
The current Mineral Resources estimate for the Seabee Gold Operation is based on data as at
December 31, 2016 and excludes Porky Main Mineral Resources, which are considered a
historical estimate and do not contribute to current Mineral Resources.
Table 1: Seabee Mineral Resources Estimate (as at December 31, 2016)
Category Tonnes Au Au
(Mt) (g/t) (Moz)
Measured 0.81 7.71 0.20
Indicated 1.27 8.22 0.34
Total (M+I) 2.07 8.02 0.54
Inferred 2.50 7.66 0.62
Notes: Mineral Resources are not Mineral Reserves and have not demonstrated economic viability. Mineral Resources are reported
inclusive of Mineral Reserves. All figures are rounded to reflect the relative accuracy of the estimates. Mineral Resources are reported
within classification domains inclusive of in-situ dilution at a diluted cut-off grade of 4.40 g/t gold at the Seabee mine and 3.26 g/t gold
at the Santoy mine assuming an underground extraction scenario, a gold price of US$1,400/oz, C$:US$ exchange rate of 1.25; and
metallurgical recovery of 96.5%. Block modelling techniques were used for Mineral Resources estimates for the Santoy mine and the
majority of the Seabee mine. Polygonal techniques were used in areas of historical mining at the Seabee mine at Porky West. For
additional information regarding the Mineral Resources estimate, please refer to our Annual Information Form dated March 22, 2017,
a copy of which is available under our profile on the SEDAR website at www.sedar.com.
Mineral Reserves Estimate
The current Mineral Reserves estimate for the Seabee Gold Operation is based on data as at
December 31, 2016.
Table 2: Seabee Mineral Reserves Estimate (as at December 31, 2016)
Category Tonnes Au Au
(Mt) (g/t) (Moz)
Proven 0.52 6.97 0.12
Probable 0.85 8.93 0.25
Total 1.37 8.19 0.36
Notes: All figures have been rounded to reflect the relative accuracy of the estimate. Mineral Reserves are based on a cut-off value
of 3.65 g/t gold for the Santoy mine and 4.92 g/t gold for the Seabee mine assuming: a gold price of US$1,250/oz; a C$:US$ exchange
rate of 1.25; milling recoveries of 96.5%; royalty of 3.0%; and operating cost of C$172/t at Santoy mine and C$231/t at Seabee mine.
Mineral Reserves are stated at a mill feed reference point and include for diluting materials and minin g losses. For additional
information regarding the Mineral Reserves estimate please refer to our Annual Information Form dated March 22, 2017, a copy of
which is available under our profile on the SEDAR website at www.sedar.com.
SSR Mining Inc.
PAGE 3
PRELIMINARY ECONOMIC ASSESSMENT
Based on our operating experience and investment in exploration to increase Mineral Resources
at the Seabee Gold Operation since our acquisition in May 2016, the PEA contemplates the
technical and investment requirements for and demonstrates the robust economics of a potential
expansion to a sustained mining and milling rate of 1,050 tonnes per day. This results in increased
gold production and decreased cash costs, over a seven -year operating period. The increased
utilization of latent capacity within site infrastructure allows for lower capital investment required
for an expansion.
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 PEA will be realized.
Mining and Processing
The Seabee Gold Operation is comprised of two underground gold mines, Santoy and Seabee,
and the Seabee mill. Production as outlined by the PEA is primarily sourced from the Santoy
mine.
Primary access at the Santoy mine is provided via a main ramp from surface. The Santoy mine
portal is located at the top of the Santoy 8 deposit. The Santoy mine uses longitudinally retreating
longhole mining methods for the majority of production, while areas with minimal strike length use
Alimak mining methods to reduce lateral development costs. As the number of advanced mining
fronts increases at the Santoy mine, the PEA contemplates an increase in production tonnage of
20% to 1,042 tonnes per day compared to 2016 production rates of 870 tonnes per day, which
were reported for the period from our acquisition of the Seabee Gold Operation on May 31, 2016
to December 31, 2016. The tonnage movement rate under the expansion averages 1,050 tonnes
per day over the life of the production plan beginning in 2019. On completion of individual stopes
within the Santoy mine, stopes are backfilled with development waste rock. Material is trucked,
using 40-tonne haul trucks, from the Santoy mine approximately 13 kilometers along a dedicated
haul road to the Seabee mill. The PEA includes additional mining equipment with the increase in
haulage and drilling demand as mining advances along strike and deeper at the Santoy mine and
the installation of additional electrical distribution capacity.
The PEA contemplates that material will continue to be processed at the Seabee mill, a
conventional crushing and grinding circuit, adjacent to the Seabee mine. The mill utilizes gravity
concentration and cyanide leaching with carbon-in-pulp for gold recovery to produce doré bars on
site. Primary crushing is carried out with a jaw crusher followed by cone crushing in closed circuit
with a triple deck screen. The grinding circuit consists of a primary ball mill and two secondary
ball mills. A portion of the primary grinding mi ll discharge is pumped directly to a Knelson
concentrator with the upgraded material further concentrated on a shaking table. The gravity
concentrate is generally smelted with the gold recovered in the electrowinning circuit. The PEA
assumes a forecast go ld recovery rate of 96.5% for the life of the production plan , which is
consistent with recent historical average recovery rates. Tailings are pumped to one of two
existing tailings management facilities located approximately two kilometers east of the Sea bee
mill. A n expansion to the tailings management facility will be required under operations
contemplated in the PEA.
Selected operating and production statistics from the PEA are presented in Table 3 and Table 4.
SSR Mining Inc.
PAGE 4
Table 3: Estimated PEA Operating and Production Statistics
Units Annual
Average (1) Total (2)
Tonnes Milled kt 381 2,654
Processing Rate tpd 1,042 -
Mine Life years - 7
Gold Grade g/t 8.51 8.30
Gold Recovery % 96.5% -
Gold Production koz 100 683
Notes:
1. Annual Average figures are for the period from 2018 to 2023.
2. Total figures are for the period from H2 2017 to 2024.
Table 4: Estimated PEA Annual Operating Statistics
Year
Units H2 2017 2018 2019 2020 2021 2022 2023 2024
Tonnes milled kt 168 365 383 384 384 383 384 203
Tonnes milled tpd 920 1,000 1,050 1,050 1,051 1,051 1,051 1,051
Gold mill feed grade g/t 7.71 7.85 8.40 10.10 9.11 8.09 7.44 6.48
Gold recovery % 96.5% 96.5% 96.5% 96.5% 96.5% 96.5% 96.5% 96.5%
Gold production koz 41 89 100 120 108 96 88 41
Percent of gold
ounces attributable
to Inferred Mineral
Resources
% 7% 18% 45% 63% 48% 74% 95% 47%
The total Mineral Resources processed in the PEA include 62% of the 2016 Inferred Mineral
Resources estimate presented in Table 1 above. The PEA does not impact the Seabee Gold
Operation’s current 2016 Mineral Resource and Mineral Reserve estimates.
Capital Costs Summary
Capital cost estimates in the PEA consider historical construction costs, equipment purchase
prices and actual development costs. The total capital required to expand the Seabee Gold
Operation to a 1,050 tonnes per day operation over the seven-year operating plan in the PEA is
estimated to be $89.6 million. The underground expansion includes the associated lateral
development for Alimak mining, ramp development to support multi -stope longhole mining and
additional mining equipment. The surface infrastructure expansion includes mine electrical
distribution and tailings management facility expansion. A summary of estimated capital costs is
presented in Table 5 and annual estimated capital costs are shown in Table 6.
SSR Mining Inc.
PAGE 5
Table 5: Summary of PEA Capital Costs
Capital Costs Value ($M)
Infrastructure Capital $50.2
Capital Development $23.4
Capitalized Exploration $15.9
Total $89.6
Table 6: Estimated Annual PEA Capital Costs
Year
Units H2 2017 2018 2019 2020 2021 2022 2023 2024
Infrastructure Capital $M $4.2 $16.2 $13.7 $7.4 $4.5 $4.2 $0.0 $0.0
Capital Development $M $1.8 $5.1 $4.4 $4.8 $3.7 $3.2 $0.4 $0.0
Capitalized Exploration $M $1.9 $2.7 $2.7 $2.5 $2.5 $2.5 $0.7 $0.4
Operating Costs Summary
Cash costs and all -in sustaining costs (“AISC”) per payable ounce of gold sold are non -GAAP financial
measures. Please see “Cautionary Note Regarding Non-GAAP Measures”.
Total estimated operating costs in the PEA are presented in Table 7. These operating costs were
developed based on actual operating experience at the Seabee Gold Operation and are adjusted
where appropriate to characteristics specific to the Santoy mine and Seabee mill considering the
throughput increase to 1,050 tonnes per day.
Table 7: Summary of PEA Operating Costs
Operating Costs Value ($/t milled)
Mining $58
Processing $20
General and Administrative $52
Total $130
Cash costs, which include mining, processing and administrati ve costs ( net of capital
development), royalties and refining costs, total $548 per payable ounce of gold sold over the
seven-year operating plan in the PEA . AISC, which include infrastructure capital, capital
development, capitalized exploration and reclamation, total $682 per payable ounce of gold sold
over the seven-year operating plan in the PEA.
SSR Mining Inc.
PAGE 6
Financial Analysis
Over the seven-year operating plan outlined in the PEA, the post -tax NPV using a 5% discount
rate is $292.0 million. Key financial estimates presented in Table 8 are based on the key economic
assumptions presented in Table 9.
Table 8: Key PEA Financial Estimates
Units Total
Net Revenue $M $893.5
Mining Costs $M $(154.3)
Processing Costs $M $(52.8)
Administration Costs $M $(138.9)
Royalties and Other $M $(28.5)
Operating Cash Flow $M $519.1
Change in Net Working Capital $M $10.3
Operating Cash Flow $M $529.3
Infrastructure Capital $M $(50.2)
Capital Development $M $(23.4)
Capitalized Exploration $M $(15.9)
Reclamation $M $(7.2)
Pre-Tax Cash Flow $M $432.7
Tax $M $(86.0)
Post-tax Cash Flow $M $346.7
Pre-Tax NPV (5%) $M $363.5
Post-Tax NPV (5%) $M $292.0
Notes: Figures may not total exactly due to rounding.
Table 9: Key Economic Assumptions
Assumption Units Value
Gold Price $/oz $1,300
CAD:USD Exchange Rate (2017 to 2018) $ $1.275
CAD:USD Exchange Rate (2019 onwards) $ $1.250
SSR Mining Inc.
PAGE 7
Sensitivity Analysis
The Seabee Gold Operation expansion under the PEA demonstrates strong economic
performance across a range of gold prices and exchange rates. Estimated NPV sensitivities for
key operating and economic metrics are presented in Tables 10 and 11.
Table 10: NPV Sensitivity Analysis: Gold Price and Canadian Exchange Rate
Pre-tax NPV (5%) Sensitivities ($M)
Gold Price ($/oz)
$1,100 $1,200 $1,300 $1,400 $1,500
Canadian
Exchange Rate
1.15:1 $216 $272 $329 $386 $442
1.20:1 $233 $289 $346 $403 $459
1.25:1 $250 $307 $364 $420 $477
1.30:1 $263 $319 $376 $433 $489
1.35:1 $276 $333 $389 $446 $502
Notes: The Canadian exchange rate for the row labeled “1.25:1” is assumed to be 1.275:1 in 2017 and 2018 and 1.25:1 thereafter.
Table 11: NPV Sensitivity Analysis: Site Costs and Infrastructure Capital
Pre-tax NPV (5%) Sensitivities ($M)
Site Costs (% change)
-20% -10% 0% 10% 20%
Infrastructure
Capital
(% change)
20% $420 $387 $354 $322 $289
10% $424 $392 $359 $326 $294
0% $429 $396 $364 $331 $298
-10% $433 $401 $368 $335 $303
-20% $438 $405 $373 $340 $307
Notes: Site costs include mining costs, processing costs, administrative costs, capital development, and capitalized exploration.
Environmental and Permitting
Based on the PEA production schedule, the tailings management facility expansion will be
required earlier than contemplated under our current operations. Such expansion will require an
environmental assessment screening by the relevant regulatory authorities. The PEA assumes
that all requisite approvals and permits for the expansion will be obtained. While we believe that
such approvals and permits can be obtained on a timely basis and on acceptable terms, there is
no certainty that this will be the case.
SSR Mining Inc.
PAGE 8
Opportunities and Next Steps
Several potential opportunities to improve the economics of the Seabee Gold Operation
contemplated under the PEA have been identified. Examples include, but may not be limited to:
The Seabee mill has the potential to achieve operating throughput of up to 1,200 tonnes per
day based on upgraded mill facilities and operating experience at similar mills. This would
further increase production from that contemplated under the PEA and potentially improve
operating costs due to economies of scale and extend mine life.
The implementation of Operational Excellence projects identified based on our operating
experience that may present incremental improvements to production and operating cost s,
which may include the following:
Drilling and blasting studies to improve fragmentation, reduce over -blast and reduce
dilution, leading to lower costs and better grade control;
Equipment availability and utilization improvements to increase equipment efficiency
and lower costs;
Installation of a ventilation-on-demand system to lower ventilation costs;
Improvement and modification of current ground support systems, increasing
efficiency and reducing costs;
Evaluation of digital tracking of underground op erations and equipment to improve
efficiencies;
Further capacity and efficiency improvements in the process plant to reduce costs and
increase production; and
Evaluation of a runway extension to allow larger direct flights to reduce costs and
improve efficiency of shift changes.
Further opportunity exists for potential Mineral Resources discovery and conversion of Mineral
Resources to Mineral Reserves at the current Seabee Gold Operation, including:
Exploration drilling during 2017 has been successful in expanding known gold mineralization
at Santoy 8 and Santoy Gap as well as identifying new gold mineralization in the area of Gap
Hanging Wall. These results are expected to upgrade Mineral Resources when we report
Mineral Resources and Mineral Reserves estimates for year-end 2017. See our news release
dated September 5, 2017, for information about recent exploration results at the Seabee Gold
Operation.
Potential for new mineralization discoveries in close proximity to existing infrastructure,
including potential at the Carr target, located four kilometers to the north of Santoy Gap, and
on the extension of the Santoy shear on the Fisher property.
Given the positive financial analysis included in the PEA, we expect to advance further exploration
and engineering work on the expansion of the Seabee Gold Operation , which will be supported
by our current drilling program to upgrade Inferred Mineral Reso urces prior to planned mining.
Stakeholder engagement plans have been developed to support the proposed expansion of the