Endeavour Launches Construction of Ity CIL Project Based on Optimization Study
(Thomson Reuters ONE) -
ENDEAVOUR LAUNCHES CONSTRUCTION OF ITY CIL PROJECT BASED ON OPTIMIZATION STUDY
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HIGHLIGHTS
* Optimization Study significantly improves the previous Feasibility Study
results (published in November 2016) and positions the Ity CIL Project as
Endeavour's next long-life low-cost flagship asset
* Long 14-year mine life based on current reserves which increased by
1.0Moz to 2.9Moz
* Average annual production over the first 5 years increased by 42% to
235koz and AISC decreased by 3% to $494/oz
* Average annual production over the first 10 years increased by 51% to
204koz and AISC decreased by 2% to $549/oz
* Robust economics with after-tax NPV(5%) of $710m, a 73% increase, based
on a gold price of $1,250/oz
* Ity CIL Project has entered the construction phase following Board approval
* Endeavour's in-house construction team has begun to transition from
Houndé to Ity and has commenced mobilisation to site
* $412 million initial capex, fully funded from existing sources of
capital with the recent Revolving Credit Facility upsize
* 20-month construction duration with the first gold pour expected for
mid-2019
Abidjan, September 20, 2017 - Endeavour Mining Corporation ("Endeavour") (the
"Company) (TSX:EDV) (OTCQX:EDVMF) is pleased to announce that its Board of
Directors has approved the construction decision for its Ity CIL project at its
mine in Cote d'Ivoire following the robust results obtained from its
Optimization Study.
The Ity CIL Project Feasibility and Optimization studies have been conducted to
analyze the economic viability of constructing a straight forward gravity
circuit/Carbon-In-Leach ("CIL") plant as an alternate processing route to the
current heap leach process. Following the publication of the November 2016
Feasibility Study ("FS"), an Optimization Study ("OS") was prepared to better
capture the value created from the recent exploration success which has led to
increasing the plant name-plate design from 3.0Mtpa to 4.0Mtpa. In addition,
several changes have been made to leverage construction and operating synergies
between Ity, Agbaou and Houndé.
The production profile and economics have significantly improved, as summarized
in Table 1 below:
Table 1: Summary of 2016 CIL Feasibility Study vs. 2017 Optimization Study
(On a 100% basis) 2017 2016 VARIANCE
OPTIMIZATION STUDY FEASIBILITY STUDY (OS VS. FS)
-------------------------------------------------------------------------------
M&I Resources (inclusive of 3.8Moz 2.3Moz +65%
Reserves)
P&P Reserves 2.9Moz 1.9Moz +53%
Average production (first 5 235koz 165koz +42%
years)
Average AISC (first 5 years) $494/oz $507/oz (3%)
After-tax NPV(5%) based on $710m $411m +73%
$1,250/oz
After-tax IRR based on 40.3% 35.9% +12%
$1,250/oz
After-tax IRR based on 23.2% 19.5% +19%
$1,000/oz
-------------------------------------------------------------------------------
Sébastien de Montessus, President & CEO, stated: "Today's study clearly
positions Ity as our next flagship asset with robust project economics, a strong
long-life production profile, and significant exploration upside. Its average
annual production in the first five years of 235koz with AISC below $500/oz and
an after-tax IRR of +20% even at a low gold price of $1,000 per ounce are proof
of the compelling economics of the project.
With the upcoming first gold pour at Houndé and Ity CIL construction expected to
be completed within 20-months, we remain on track to achieve our strategic
milestones of becoming a +800,000 ounce per year gold producer with group AISC
below $800 per ounce and mine lives above 10 years by 2019."
Jeremy Langford, COO, added: "We have optimized the Ity CIL project by
maximizing the construction and operational synergies between Agbaou, Houndé and
Ity, and by leveraging the same designs, components, equipment and spare parts
where possible from one project to the other, along with incorporating our
extensive construction expertise. The construction team is excited to transition
from Houndé to Ity and to continue to build on its construction track-record."
SUMMARY OF KEY CHANGES FROM PREVIOUS FEASIBILITY STUDY
The Ity CIL Project Optimization Study has been managed by Endeavour's in house
development team and independently prepared by Lycopodium Minerals Pty Ltd
("Lycopodium") with the support of six globally recognized engineering firms,
with the key operational and financial results summarized in the table below:
Table 2: Detailed Summary of 2016 CIL Feasibility Study vs. 2017 Optimization
Study
2017 2016 VARIANCE
OPTIMIZATION FEASIBILITY (OS VS. FS)
STUDY STUDY
-------------------------------------------------------------------------
LIFE OF MINE PRODUCTION
Strip ratio, w:o 1.9 2.1 (10%)
Tonnes of ore processed, Mt 57.0Mt 41.0Mt +39%
Grade processed, Au g/t 1.57 g/t 1.42 g/t +10%
Gold content processed, Moz 2.87 Moz 1.88 Moz +53%
LOM Average Gold recovery, % 86% 83% +3%
Gold production, Moz 2.47 Moz 1.56 Moz +58%
Mine life, years 14.3 years 13.7 years +4%
Average annual gold production, koz 173 Koz 114 Koz +52%
Cash costs, $/oz $554 $528 +5%
AISC, $/oz $580 $603 (4%)
AVERAGE FOR YEARS 1 TO 5:
Gold production, kozpa 235 koz 165 koz +42%
Cash costs, $/oz $472/oz $446/oz +6%
AISC, $/oz $494/oz $507/oz (3%)
AVERAGE FOR YEARS 1 TO 10:
Gold production, kozpa 204 koz 135 koz +51%
Cash costs, $/oz $523/oz $488/oz +7%
AISC, $/oz $549/oz $559/oz (2%)
CAPITAL COST
Initial capital cost, $m $412m $307m +34%
- of which equipment lease, $m $61m $25m +160%
Upfront capital cost, $m $351m $282m +24%
ECONOMICS (BASED ON $1,250/OZ)
After-tax IRR 40% 36% +12%
After-tax NPV ( 0% discount rate) $990m $607m +63%
After-tax NPV ( 5% discount rate) $710m $411m +73%
Payback period 1.8 years 2.1 years (17%)
-------------------------------------------------------------------------
The key changes made in the Optimization Study include:
* CIL process plant increased from 3Mtpa to 4Mtpa to better capture the value
created from the recent exploration success which has discovered the
Bakatouo deposit and increased resources at notably Daapleu and Mont/Ity
Flat.
* Simplified and optimized the process plant design to maximize the
replication of the Houndé design, where applicable, to capture working
capital inventory synergies.
* Improved recoveries based on additional metallurgical testwork, namely on
the Daapleau primary material.
* Addition of a diverter/flop-gate system which allows the Ball Mill to run
independently during periods when the SAG mill is shut down. This
operability allows the plant to maximize utilization and effectively ensure
process milling all year round.
* Addition of a 26MW full back up power station, identical to that installed
at the Houndé project.
* Optimized upfront capital cost and sequenced overall build time with a
higher percentage of "Self-Perform" works.
* Optimized the site layout, which allows the current heap leach operation to
run independently of the CIL project. As such, the construction of the CIL
project is not expected to impact the heap leach operation.
RESERVES INCREASED BY 1.0Moz, UP 53%
The updated Mineral Reserve estimates were undertaken by Snowden Mining industry
Consultants (Snowden). Changes from the previously reported Mineral Reserves are
largely due to revised and updated Mineral Resource estimates on the Daapleu,
Ity and Bakatouo deposits and revised operating costs largely associated with
revised processing capabilities from a 3 Mtpa facility to a 4 Mtpa treatment
facility.
Compared to the 2016 Feasibility Study reserves, a total of 1.0Moz were added,
with the main increases coming from the discovery of Bakatouo (+532koz), and
additional resource to reserve conversion at Mont Ity/Ity Flat (+211koz),
Teckraie/Verse Ouest (+187koz), and at Daapleu (+79koz) following additional
drilling, as shown in the table below. The Colline Sud deposit is expected to be
mined during the heap leach phase and therefore has been excluded from CIL
Mineral Reserves.
Table 3: CIL Project Reserves Comparison
Optimization Study Feasibility Study
Deposits Reserves, Reserves,
on a 100% as at September 1, 2017 as at October 1, 2016 Variance
basis --------------------------- --------------------------- (koz)
Tonnage Grade Content Tonnage Grade Content
(Mt) (Au g/t) (Au koz) (Mt) (Au g/t) (Au koz)
-------------------------------------------------------------------------------
Open Pits
Bakatouo 6.9 2.40 532 - - - +532
Colline Sud - - - - - - -
Daapleu 18.4 1.72 1,015 19.3 1.51 936 +79
Mont Ity / 7.4 3.8 2.19 268
Ity Flat 2.03 479 +211
Gbeitouo 2.5 1.37 111 2.6 1.35 112 (1)
Walter 1.2 1.07 41 1.9 1.22 73 (32)
Zia NE 6.2 1.06 210 4.8 1.24 192 +18
-------------------------------------------------------------------------------
Sub-total 42.5 1.75 2,390 32.4 1.52 1,580 +810
Existing
Stockpiles
Aires 5.8 1.09 202 5.8 1.09 202 -
Teckraie/ 8.7 1.02
Verse Ouest 284 2.8 1.07 97 +187
-------------------------------------------------------------------------------
Sub-total 14.5 1.05 486 8.6 1.08 300 +186
Total 57.0 1.57 2,876 41.0 1.42 1,880 +996
-------------------------------------------------------------------------------
Mineral Reserve estimates follow the Canadian Institute of Mining, Metallurgy
and Petroleum ("CIM") definitions standards for mineral resources and reserves
and have been completed in accordance with the Standards of Disclosure for
Mineral Projects as defined by National Instrument 43-101. Notes are provided in
Section "About the Mineral Reserve and Resources" of this Press Release, with
effective date September 1, 2017. Full details on the 2016 Feasibility Study
Reserves are available in the Company's published press release dated November
10, 2016.
INDICATED RESOURCE INCREASED BY 1.5Moz
The updated Indicated and Inferred Mineral Resource estimates were undertaken by
Cube Consulting (Cube), and incorporate all validated RC, DC and AC drilling
completed at the Ity CIL Project up to May 1, 2017.
There is a total of 10 deposit areas included in the updated Mineral Resource
for the Ity CIL Project including four in situ gold deposits that have been or
are currently in production, comprising Mont Ity, Ity Flat, ZiaNE and Walter,
plus three near-mine in situ deposits comprising Gbeitouo, Daapleu, Colline Sud
and Bakatouo, and two rock waste dumps at Teckraie and Verse Ouest and a
discontinued heap leach pad Aires.
Compared to the resource inventory used to build the 2016 Feasibility Study, a
total of 1.5Moz of Indicated Resources were added, with the main increases
coming from the discovery of Bakatouo (+704koz), and additional Indicated
resources outlined at Daapleu (+384koz), Mont Ity / Ity Flat (+189koz), and
Verse Ouest (+187koz), as shown in the table below.
Table 4: Resource Comparison
2017 OPTIMIZATION STUDY INVENTORY 2016 FEASIBILITY STUDY INVENTORY
----------------------------------------------- ----------------------------------------------
Indicated Resources Inferred Resources Indicated Resources Inferred Resources
Deposits ----------------------- ----------------------- ----------------------- ----------------------
on a 100% Tonnage Grade Content Tonnage Grade Content Tonnage Grade Content Tonnage Grade Content
basis (Mt) (Au (Au (Mt) (Au (Au (Mt) (Au (Au (Mt) (Au (Au
g/t) koz) g/t) koz) g/t) koz) g/t) koz)
---------------------------------------------------------------------------------------------------------
Open Pits
Daapleu 28.1 1.50 1,349 0.7 0.92 22 19.9 1.51 965 4.3 1.15 160
Mont Ity 10.1 2.20 716 9.7 1.40 436 7.5 2.19 527 11.1 1.92 684
/ Flat
Gbeitouo 2.9 1.35 124 0.3 1.48 13 2.9 1.35 124 0.3 1.48 13
Walter 1.6 1.23 65 0.6 1.35 26 2.1 1.21 81 0.7 1.32 28
Zia NE 6.7 1.28 274 4.0 1.40 178 7.7 1.31 325 4.0 1.39 179
Bakatouo 10.2 2.14 704 0.6 2.27 44 - - - - - -
Colline - - - - - -
Sud 1.0 2.14 66 0.4 2.11 28
---------------------------------------------------------------------------------------------------------
Sub-total 60.6 1.69 3,298 16.3 1.43 747 40.1 1.57 2,022 20.4 1.62 1,064
Existing
Stockpiles
Aires 5.8 1.09 202 0.2 0.78 6 5.8 1.09 202 0.2 0.78 6
Teckraie 2.8 1.07 97 0.1 0.55 2 2.8 1.07 97 0.1 0.55 2
Verse - - - 8.4 0.85 230
Ouest 5.9 0.99 187 2.3 0.50 37
---------------------------------------------------------------------------------------------------------
Sub-total 14.5 1.04 486 2.6 0.54 45 8.6 1.08 300 8.7 0.85 238
Total 75.1 1.57 3,784 18.9 1.30 792 48.7 1.48 2,322 29.1 1.39 1,302
---------------------------------------------------------------------------------------------------------
Resource estimated to the Indicated status, as such no Measured Resources
available. Mineral Resource estimates follow the Canadian Institute of Mining,
Metallurgy and Petroleum ("CIM") definitions standards for mineral resources and
reserves and have been completed in accordance with the Standards of Disclosure
for Mineral Projects as defined by National Instrument 43-101. Notes are
provided in Section "About the Mineral Reserve and Resources" of this Press
Release, with effective date September 1, 2017. Full details on the 2016
Feasibility Study Inventory are available in the Company's published press
release dated November 10, 2016.
MINING OPERATIONS, PROCESSING, AND METALLURGY
MINING AND PROCESSING STRATEGY
A number of schedules were completed to test the impact of limiting stockpile
size and it was found that there was limited benefit to allowing for large
stockpiles. As such, the mining sequence and stockpile management has improved
in the Optimized Study compared to the Feasibility Study. Whereas previously the
mining period was 9 years followed by the processing of stockpiled low-grade ore
for another 5 years, the current mine plan is based on 12 years of mining
followed by the processing of stockpiled low-grade ore for another 2 years.
A combination of strategic pit staging and stockpiling allows gold production to
be brought forward, with about 1.2 Moz mined in the first 5 years from
commissioning and 1.5 Moz in the last 10 years. The overall grade profile
declines gradually over the life of mine as higher grade deposits such as
Bakatouo, Daapleu and Mont Ity / Flat are mined upfront.
Mining Operations
The mine planning, resource and cost estimation for the Feasibility Study is
based on an owner-operated mining operation using 90-tonne haul trucks and a
maximum mining movement of 16Mt per year with a vertical advance of
approximately 40 metres per year. The Company sees these figures as conservative
in nature due to the annual rainfall at the Ity project. Mining is scheduled to
commence three months before the start of the processing plant to pre-strip the
pits and stockpile ore. The mining fleet contract has been awarded to Komatsu to
benefit from synergies relating to minimizing spare parts inventory and
maintenance costs, as both Houndé and Karma have a similar fleet.
Table 5: Mine Plan
Total Y-1 Y-2 Y-3 Y-4 Y-5 Y-6 Y-7 Y-8 Y-9 Y-10 Y-11 Y-12
-------------------------------------------------------------------------------
Total 167
material 15.6 16.0 16.0 16.0 16.0 16.0 13.8 12.7 15.9 13.6 10.1 5.1
moved, Mt
Total ore 57 4.6 5.8 5.9 4.7 4.8 5.1 4.3 3.8 5.4 5.9 4.9 1.9
mined, Mt
Stripping 1.9 2.4 1.8 1.7 2.4 2.3 2.1 2.2 2.3 1.9 1.3 1.1 1.7
ratio, w:o
Grade mined, 1.57 1.70 2.05 1.78 1.87 1.65 1.88 1.20 1.37 1.38 1.30 1.12 1.08
g/t Au
Contained 2,883
gold mined, 250 380 340 284 256 310 166 168 241 246 176 66
koz
-------------------------------------------------------------------------------
Processing Operations
Following updated resource and reserve estimates, the key change to the design
basis is an increase in throughput from 3 Mtpa feed to 4 Mtpa feed based on a
blend of primary and oxide ore with a conventional primary crushing followed by
SAG and Ball milling circuit (SABC) with recycle pebble crusher, gravity
circuit and conventional CIL (Carbon-In-Leach) plant. Soluble copper from the
Bakatouo asset is blended with the low copper Daapleu ore into the plant process
schedule until depletion of Bakatouo. A maximum process plant feed limit of
200ppm cyanide soluble copper constraint has been set, to manage cyanide
consumption within the CIL plant and detoxification circuit.
The process plant will notably be composed of a single stage primary crushing to
produce a crushed product size of 80% passing (P80 of 166 mm) and a two stage
SAG (with pebble crusher recycle)/ Ball milling in closed circuit with
hydrocyclones to produce a P80 grind size of 75 micrometers. A gravity
concentrator and Intensive Leach Reactor (ILR) have been included in the design
as per the FS. The CIL circuit comprises eight CIL tanks (up from six in the FS)
containing carbon for gold and silver adsorption with oxygen sparged from two
25 tonne PSA Oxygen plants and a 18 tonne split Anglo (AARL) elution circuit.
Electrowinning and induction furnace smelting completes the gold doré production
process. A cyanide detoxification and arsenic removal circuit is included in the
process facility design, for treatment of process residue before discharge to
the fully lined 57Mt Tailings Storage Facility (TSF), located adjacent to the
processing facility. Feed water for the processing facility will come from
various sources such as pit dewatering bores, the Cavally River for (make-up)
and decant return from the TSF.
Table 6: Processing Schedule
Total Y-1 Y-2 Y-3 Y-4 Y-5 Y-6 Y-7 Y-8 Y-9 Y-10 Y-11 Y-12 Y-13 Y-14
---------------------------------------------------------------------------------------
Ore 57.2 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0
processed, 4.0
Mt
Grade 1.57
processed, 2.26 2.32 2.21 1.87 1.99 1.80 1.37 1.57 1.84 1.32 1.45 0.98 0.72 0.53
g/t Au
Recovery 86%
rate, % 86% 84% 84% 88% 87% 87% 85% 80% 80% 93% 90% 90% 84% 86%
Recovered
gold, koz 2,467 250 250 238 212 223 201 151 161 189 159 167 113 77 59
---------------------------------------------------------------------------------------
Metallurgy
The overall life of mine recovery rate increased from 83% in the Feasibility
Study to 86% in the Optimized Study due to the addition of high-recovery
Bakatouo oxide and fresh ore, Mont Ity ore and better recovery on Daapleu
Sulphides following additional testwork.
Table 7: Gold Recovery Rate by Deposit
Bakatouo Bakatouo Daapleu Daapleu Gbeitouo Mont Walter Zia Stockpiles Total
Oxides/Fresh Transition Sulphides Oxides Ity/Flat NE
--------------------------------------------------------------------------------------------------
LOM
Tonnage, 6.07 0.8 7.8 10.6 2.5 7.4 1.2 6.2 14.5 57.0
Mt
% of LOM 11% 1% 14% 19% 4% 13% 2% 11% 25% 100%
Tonnage
Gold
Grade, 2.28 3.29 2.41 1.21 1.37 2.03 1.08 1.06 1.04 1.57
g/t Au
Gold
Recovery 95/97% 84% 66% 85% 88% 89% 96% 97% 92% 86%
rate, %
--------------------------------------------------------------------------------------------------
For the economic model, payable silver in the doré ingots has been estimated on
a conservative ratio of 2 to 1. A detailed investigation of the metallurgical
response of the Bakatouo deposit was undertaken. Most samples showed high gold
extractions but soluble copper levels were also high, particularly in the
transition ore. As such, Endeavour has elected to blend in the soluble copper
ore constraining it to 200ppm per feed blend. The Daapleu Primary ore can be
considered refractory, with elevated Arsenic levels in the fresh ore, however it
has negligible copper. Further detailed testwork has shown improvements,
allowing the reported recovery for the higher Arsenic fresh material to increase
to from 60% in the Feasibility Study to 66% in the Optimization Study.
Low Operating Costs
The operating cost estimates have been re-scoped based on most recent available
cost information and based on a 4mtpa processing operation.
Table 8: Life of Mine Operating Costs in US$, estimated at ± 15% accuracy
2017 2016 VARIANCE
OPTIMIZATION FEASIBILITY (OS VS. FS)
STUDY STUDY
-------------------------------------------------------------------------------
Open Pit Mining and Rehandling, $2.89/t $2.45/t +18%
$/tonne moved
Processing, $/t milled $11.96/t $10.56/t +13%
G&A costs, $/t milled $2.23/t $2.79/t (20%)
-------------------------------------------------------------------------------
Operating Cost, $/t milled $22.90/t $20.56/t +11%
-------------------------------------------------------------------------------
Operating costs have been based on a delivered diesel price of $1.00/L and are
in line with current local pricing. Following the connection to the grid,
electricity costs have been estimated based on $0.1243/kWh.
PROJECT CAPEX SUMMARY
The optimized and fully scoped upfront capital cost has been re-estimated to
reflect the upgrade project scope at $412 million, inclusive of $49 million for
the owner-mining fleet and $34 million for contingencies, as summarised in the
table below. The upfront capital is expected to be $351 million as a $61 million
lease financing is expected to be put in place for the mining fleet and power
station.
Table 9: Initial Capital Cost Estimate Summary (US$, ±15%)
2017 2016
OPTIMIZATION STUDY FEASIBILITY STUDY
-------------------------------------------------------------------------------
Treatment Plant 94 63
Reagents and Services 14 9
Infrastructure and Tailings 71 46
Mining (includes pre-striping and $49m 84 59
for equipment)
Construction Distributables 26 24
Management Costs 17 16
Owners Project Costs 66 59
Owners Operations Costs 5 4
-------------------------------------------------------------------------------
Sub-Total 378 282
Contingency 34 26
-------------------------------------------------------------------------------
Total 412 307
-------------------------------------------------------------------------------
Capital costs include the construction of a 58 km, 91kv overhead power line,
which connects to the national grid at Danane and terminates with a substation
at Ity which will be owned by Côte d'Ivoire Energie ("CIE"). A full 26MW full
high speed diesel back-up power station provides 100% redundancy. The
infrastructure in place will be improved with roads upgraded to an all-weather
and free draining carriageway to provide access for the delivery of equipment,
materials and services to the site. A new camp will be built approximately 1
kilometer north-west of the process plant and will provide accommodation for
200 employees, and provisions have been made to construct a suitable airstrip.
A Cavally River diversion will be installed to allow development of the Daapleu
pit, with a second diversion upstream of the Walter pit. Pit protection bunds
will also be installed and a bridge/culvert road structure from Daapleu over the
Cavally River will also be built.
The proposed approach to project implementation is similar in nature to the
current execution methodology of the Endeavour Project Services In-House team in
that Endeavour will engage a suitably qualified Engineering, Procurement and
Construction Management (EPCM) Engineer for design and construction management
of the process plant and infrastructure, which will then be handed over to an
Owner's operating team. Endeavour will self-perform the development of the mine
infrastructure and provision of ongoing drill and blast and mine operating
services under an Owner's mine technical team.
The schedule anticipates the project being completed within 20 months from EPCM
award.
PROJECT ECONOMICS
The results of the financial model show robust results. Applying a long term
gold price of $1,250/oz on a flat line basis from the commencement of
production, the after-tax NPV(5%) is $710 million, IRR is 40.3% and project
payback period is 1.8 years.
Table 10: Gold Price Sensitivity
Gold Price After-tax NPV ($m)
($US/oz) ---------------------- After-tax IRR
0% 5% 10%
--------------------------------------------------
$1,000/oz 520 343 221 23.2%
$1,050/oz 613 416 280 26.7%
$1,100/oz 707 489 339 30.2%
$1,150/oz 801 563 399 33.6%
$1,200/oz 896 636 458 36.9%
$1,250/oz 990 710 518 40.3%
$1,300/oz 1,072 773 569 43.1%
$1,350/oz 1,166 847 629 46.4%
$1,400/oz 1,260 920 688 49.6%
--------------------------------------------------
PROJECT IS FULLY FUNDED
As shown in Figure 1 below, the Ity CIL Project is fully funded with significant
headroom available based on liquidity and funding sources available which
include cash and undrawn upsized Revolving Credit Facility ("RCF"), the future
cash generation from existing operating mines the upcoming proceeds from the
sale of the Nzema mine, potential Ity power station and equipment financing, and
the upcoming La Mancha anti-dilution equity placement.
Figure 1: Funding Sources
As was successfully implemented during the Houndé construction period, Endeavour
will study the opportunity to put in place a short-term Gold Revenue Protection
Strategy, consisting of Gold Option Contracts on only a portion of its
production, to mitigating risk and increase the certainty of its upcoming free
cash flow during its peak investment phase.
HEAP LEACH OPERATION
It is envisaged that the heap leach operation will run during the construction
period and that heap leach activities will cease once the CIL plant is
commissioned. Endeavour will reassess the risk and opportunity of running both
operations in parallel once the CIL project has been developed.
COMMUNITY AND SOCIAL RESPONSIBILITY ACTIONS
Endeavour recognizes that an active CSR program is the foundation of long-term
success and its social license to operate. Baseline studies for the ESIA from
2013 to 2016 have been completed and an ESIA report was published in March 2016
and a Resettlement Action Plan ("RAP") has been completed.
Three environmental permits have been granted covering the mining and process
plant, Daapleu and Gbeitouo exploitation and mining and surface infrastructure.
Full CSR team complement is now in place and working on establishing CSR best
practices and reporting.
EXPLORATION POTENTIAL
The Ity area has significant exploration potential with several deposits located
within 5 kilometers of one another in addition to several exploration targets
identified as per the blue dashed area in the Figure below. This area represents
a small portion of the 80km corridor controlled by Endeavour.
Figure 2: Ity Mine Area and Surrounding Exploration Targets
ABOUT THE MINERAL RESERVES AND RESOURCES
The in situ Mineral Resources, which include Daapleu, Mont Ity / Ity Flat,
Bakatouo, Gbeitouo, Walter, Zia NE and Colline Sud, have been reported inside
optimised pit shells and above a 0.5 g/t Au cut-off. Reporting within an
optimised pit shell satisfies the requirement for the Mineral Resource to have
reasonable prospects for future economic extraction. The pit optimisation
assumes a US$1,500/oz Au price.
The Mineral Resource for the rock dumps, which include the Teckraie and Verse
Ouest Mineral Resources and also the Aires heap leach pad, have not been
reported inside an optimised pit shell. These deposits have been built up above
the existing topography and the associated shallow laterite located directly
below, therefore satisfying the requirement for the Mineral Resource to have
reasonable prospects for future economic extraction. The Teckraie and Verse
Ouest rock dump Mineral Resources and Aires leach pad Mineral Resources have
been reported above 0.0 g/t Au because there is unlikely to be any grade
selectivity during mining. The underlying laterite Mineral Resources for each of
the deposits has been reported above 0.5 g/t Au given the possibility for some
mining selectivity. The Colline Sud deposit is expected to be mined during the
heap leach phase and therefore has been excluded from CIL Mineral Reserves. All
Mineral Resources are current as at April 30, 2017. Mineral resources which are
not mineral reserves do not have demonstrated economic viability.
Reported tonnage and grade figures have been rounded from raw estimates to
reflect the relative accuracy of the estimate. Minor variations may occur during
the addition of rounded numbers.
The statistical analysis, geological modelling and resource estimation for
Colline Sud were prepared by Kevin Harris, CPG. Mr. Harris is Endeavour Mining's
Group Resource Manager and is a "Qualified Person" as defined by National
Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").
The statistical analysis, geological modelling and resource estimation for
Bakatouo, Mt Ity/Ity flat, Daapleu and Verse Ouest were prepared by Mark Zammit,
CPG. Mr. Zammit is a principal consultant geologist with Cube Consulting Pty Ltd
and is a "Qualified Person" as defined by National Instrument 43-101 - Standards
of Disclosure for Mineral Projects ("NI 43-101").
The statistical analysis, geological modelling and resource estimation for
Bakatouo, Mt Ity/Ity flat, Daapleu, Gbeitouo, Walter, Zia NE. Aires and Verse
Ouest were prepared by Mark Zammit, CPG. Mr. Zammit is a principal consultant
geologist with Cube Consulting Pty Ltd and is a "Qualified Person" as defined by
National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI
43-101").
The Qualified person for the Ity Mineral Reserve estimation is Mr Allan Earl
AWASM FAusIMM. Mr. Earl is an executive consultant with Snowden Mining industry
Consultants Pty Ltd and is a "Qualified Person" as defined by National
Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").
A gold price of US$1,250/oz was used in the pit optimizations for Mineral
Reserves. The estimation of break-even cut-off grades are based on net revenue
(gold price x process recovery) and the throughput (ore related) costs.
QUALIFIED PERSONS
Jeremy Langford, Endeavour's Chief Operating Officer - Fellow of the
Australasian Institute of Mining and Metallurgy - FAusIMM, is a Qualified Person
under NI 43-101, and has reviewed and approved the operational analysis,
operating and capital estimates, and other technical information in this news
release.
CONFERENCE CALL AND LIVE WEBCAST FOR ITY CIL PROJECT
Management will host a conference call and live webcast today at 9:30am Toronto
time (EST) to discuss the results of the Ity CIL Project Optimization Study.
The conference call and live webcast are scheduled at:
9:30am Toronto time
6:30am in Vancouver
9:30am in Toronto and New York
2:30pm in London
9:30pm in Hong Kong and Perth
The live webcast can be accessed through the following link:
https://edge.media-server.com/m6/p/44r6ckra
Analysts and interested investors are also invited to participate and ask
questions using the dial-in numbers below:
International: +1646 254 3360
North American toll-free: 1877 280 2342
UK toll-free: 0800 279 4992
Confirmation code: 5815693
The conference call and webcast will be available for playback on Endeavour's
website.
Click here to add Webcast reminder to Outlook Calendar
CONTACT INFORMATION
Martino De Ciccio DFH Public Affairs in Toronto
VP - Strategy & Investor Relations John Vincic, Senior Advisor
+44 203 640 8665 (416) 206-0118 x.224
mdeciccio(at)endeavourmining.com jvincic(at)dfhpublicaffairs.com
Brunswick Group LLP in London
Carole Cable, Partner
+44 7974 982 458
ccable(at)brunswickgroup.com
ABOUT ENDEAVOUR MINING CORPORATION
Endeavour Mining is a TSX-listed intermediate gold producer, focused on
developing a portfolio of high quality mines in the prolific West-African
region, where it has established a solid operational and construction track
record.
Endeavour is ideally positioned as the major pure West-African multi-operation
gold mining company, operating 5 mines across Côte d'Ivoire (Agbaou and Ity),
Burkina Faso (Karma), Mali (Tabakoto), and Ghana (Nzema). In 2017, it expects to
produce between 500koz and 530koz at an AISC of US$855 to US$900/oz, following
the full-year deconsolidation of the discontinued Nzema mine. Endeavour is
currently building its Houndé project in Burkina Faso, which is expected to
commence production in Q4-2017 and to become its flagship low-cost mine with an
average annual production of 190koz at an AISC of US$709/oz over an initial 10-
year mine life, based on reserves. The development of the Houndé and Ity CIL
projects are expected to lift Endeavour's group production to +900kozpa and
decrease its average AISC to circa $800/oz by 2019, while exploration aims to
extend all mine lives to +10 years.
Corporate Office: 5 Young St, Kensington, London W8 5EH, UK
This news release contains "forward-looking statements" including but not
limited to, statements with respect to Endeavour's plans and operating
performance, the estimation of mineral reserves and resources, the timing and
amount of estimated future production, costs of future production, future
capital expenditures, and the success of exploration activities. Generally,
these forward-looking statements can be identified by the use of forward-looking
terminology such as "expects", "expected", "budgeted", "forecasts", and
"anticipates". Forward-looking statements, while based on management's best
estimates and assumptions, are subject to risks and uncertainties that may cause
actual results to be materially different from those expressed or implied by
such forward-looking statements, including but not limited to: risks related to
the successful integration of acquisitions; risks related to international
operations; risks related to general economic conditions and credit
availability, actual results of current exploration activities, unanticipated
reclamation expenses; changes in project parameters as plans continue to be
refined; fluctuations in prices of metals including gold; fluctuations in
foreign currency exchange rates, increases in market prices of mining
consumables, possible variations in ore reserves, grade or recovery rates;
failure of plant, equipment or processes to operate as anticipated; accidents,
labour disputes, title disputes, claims and limitations on insurance coverage
and other risks of the mining industry; delays in the completion of development
or construction activities, changes in national and local government regulation
of mining operations, tax rules and regulations, and political and economic
developments in countries in which Endeavour operates. Although Endeavour has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking statements, there may
be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate, as actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. Please refer to Endeavour's most recent
Annual Information Form filed under its profile at www.sedar.com for further
information respecting the risks affecting Endeavour and its business. AISC,
all-in sustaining costs at the mine level, cash costs, operating EBITDA, all-in
sustaining margin, free cash flow, net free cash flow, free cash flow per share,
net debt, and adjusted earnings are non-GAAP financial performance measures with
no standard meaning under IFRS, further discussed in the section Non-GAAP
Measures in the most recently filed Management Discussion and Analysis.
MINE PLAN
View News Release in PDF Format:
http://hugin.info/171882/R/2135599/817191.pdf
View Funding Sources:
http://hugin.info/171882/R/2135599/817192.PNG
View Presentation in PDF Format:
http://hugin.info/171882/R/2135599/817196.pdf
View Ity Mine Area and Surrounding Exploration Targets:
http://hugin.info/171882/R/2135599/817193.jpg
View Mine Plan:
http://hugin.info/171882/R/2135599/817194.pdf
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Endeavour Mining Corporation via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 20.09.2017 - 13:44 Uhr
Sprache: Deutsch
News-ID 560664
Anzahl Zeichen: 47102
contact information:
Town:
George Town, Grand Cayman
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 182 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Endeavour Launches Construction of Ity CIL Project Based on Optimization Study"
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Endeavour Mining Corporation (Nachricht senden)
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