Teranga Gold Starts Production at Wahgnion Gold Operations Ahead of Original Schedule
West Africa's newest mine expected to produce 30,000-40,000 ounces in 2019
and contribute to total consolidated production of 300,000-350,000 ounces in 2020
(All amounts are in U.S. dollars unless otherwise stated)
Teranga Gold Corporation ("Teranga" or the "Company") (TSX:TGZ; OTCQX:TGCDF) is pleased to announce that its second mine, Wahgnion Gold Operations ("Wahgnion"), began processing ore during August. Wahgnion, which is located in the southwest portion of Burkina Faso, West Africa, is expected to produce 30,000 to 40,000 ounces of gold in 2019.
Commissioning: August Plant Physicals
"During August, we successfully commissioned the Wahgnion plant and are pleased to report that all aspects of the plant are now operational. Fine tuning will continue during September with throughput and grade expected to ramp up during the fourth quarter, in line with our guidance. Typical with commissioning, low grade ore was used to ensure the extraction process is working well before putting higher grade material into the circuit," said Paul Chawrun, Chief Operating Officer. "We were able to start production ahead of schedule due to the dedication of our owner's team led by Metifex, as well as our EPCM partner Lycopodium."
Mr. Chawrun added, "With safety front and centre, the commissioning phase was completed without a single lost time injury, encompassing over 5.3 million hours worked. This accomplishment reflects the hard work and dedication of all of our employees and contractors, and is aligned with our commitment to responsible mining."
â?? Average annual gold production of 132,000 ounces
â?? Average mill grade of 1.83 grams per tonne
â?? Average all-in sustaining costs of $761 per ounce
"We are very excited to report that construction is complete and that we have achieved first gold pour at Wahgnion, two months ahead of schedule. This moves us a step closer to reaching our goal of becoming a mid-tier gold producer in West Africa," said Richard Young, President and Chief Executive Officer.
"We want to thank the government of Burkina Faso for their support since we purchased Wahgnion in October 2016, and to commend our entire team for taking this project from exploration to production in less than three years, ahead of the original schedule and expected to be under budget," added Mr. Young.
During construction, Teranga recruited and trained more than 650 skilled workers to work at Wahgnion. Recently, the Company transitioned 70 of these employees from construction into operational roles. In addition to a smooth ramp up to commercial production, Teranga is focusing on its local social responsibility efforts, such as building new housing and providing livelihood restoration programs to some near-mine communities, including the development of irrigated agriculture, increased crop production, animal husbandry, training and support to launch small businesses, and sustainable income-generating activities for local women.
Increasing Production and Achieving Multi-jurisdictional Status at a Time of Strong Gold Prices
With Wahgnion now producing gold and Sabodala, the Company's flagship mine in Senegal, Teranga now operates two mines in two jurisdictions. Teranga anticipates its 2020 consolidated annual production to increase to between 300,000 and 350,000 ounces. Free cash flow is expected to be used to fund Teranga's growth plans at Wahgnion, Sabodala, and Golden Hill, the Company's most advanced exploration property.
Wahgnion Drill Program Aimed at Future Growth
Commencing in 2020-2021, the Company plans to embark on a multi-year exploration and drilling program, which will focus on highly prospective exploration targets within trucking distance of the plant, to further optimize the mine plan and extend Wahgnion's mine life. The current reserve estimate and mine plan include only the four initial deposits on the mine license.
Endnotes The Wahgnion NI 43-101 technical report was amended and restated following comments from the OSC as part of its review of the Company's application to file a preliminary shelf prospectus. The amendments related only to an updated cash flow model using various discount rates. For further details, please refer to the Amended and Restated Wahgnion Gold Operations technical report dated July 31, 2019, filed on the Company's website www.terangagold.com or www.sedar.com. This production target is based on proven and probable ore reserves only for Teranga's Wahgnion Gold Operations as at May 31, 2018. For more information regarding the Wahgnion's Mineral Reserves and Resources and related notes, please refer to the NI 43-101 compliant technical report for the Amended and Restated Wahgnion Gold Operations dated July 31, 2019 available on the Company's website at www.terangagold.com and SEDAR at www.sedar.com. This production target is based on proven and probable reserves only from Teranga's Sabodala Gold Operations as of December 31, 2018. For more information regarding Teranga Gold's Mineral Reserves and Resources and related notes, please refer to the Company's Amended Annual Information Form, which is available on the Company's website at www.terangagold.com and on SEDAR at www.sedar.com.
This press release contains certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"), which reflects management's expectations regarding Teranga's future growth opportunities, results of operations, performance (both operational and financial) and business prospects (including the timing and development of new deposits and the success of exploration activities) and other opportunities. Wherever possible, words such as "plans", "expects", "does not expect", "scheduled", "trends", "indications", "potential", "estimates", "predicts", "anticipate" "to establish" or "does not anticipate", "believe", "intend", "ability to" and similar expressions or statements that certain actions, events or results "may", "could", "would", "might", "will", or are "likely" to be taken, occur or be achieved, have been used to identify such forward looking information. Specific forward-looking statements in this press release include, but are not limited to, forecasting gold production of between 215,000 and 230,000 ounces of gold at Sabodala and between 30,000 and 40,000 ounces at Wahgnion in 2019, and consolidated gold production of between 300,000 and 350,000 ounces in 2020. Although the forward-looking information contained in this press release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Teranga cannot be certain that actual results will be consistent with such forward-looking information. Such forward-looking statements are based upon assumptions, opinions and analysis made by management in light of its experience, current conditions and its expectations of future developments that management believe to be reasonable and relevant but that may prove to be incorrect.
These assumptions include, among other things, the closing and timing of financing, the ability to obtain any requisite governmental approvals, the accuracy of mineral reserve and mineral resource estimates, gold price, exchange rates, fuel and energy costs, future economic conditions, anticipated future estimates of free cash flow, and courses of action. Teranga cautions you not to place undue reliance upon any such forward-looking statements.
The risks and uncertainties that may affect forward-looking statements include, among others: the inherent risks involved in exploration and development of mineral properties, including government approvals and permitting, changes in economic conditions, changes in the worldwide price of gold and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga, as well as other risks and uncertainties which are more fully described in Teranga's Annual Information Form, and in other filings of Teranga with securities and regulatory authorities which are available at www.sedar.com. Teranga does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Nothing in this document should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities. All references to Teranga include its subsidiaries unless the context requires otherwise.
Teranga is a multi-jurisdictional West African gold company focused on production and development as well as the exploration of approximately 6,400 km of land located on prospective gold belts. Since its initial public offering in 2010, Teranga has produced more than 1.8 million ounces of gold at its Sabodala operation in Senegal. Focused on diversification and growth, the Company is preparing for the first gold pour at its second gold mine, Wahgnion, which is located in Burkina Faso, as well as carrying out exploration programs in three West African countries: Burkina Faso, Cote d'Ivoire and Senegal. The Company had more than 4.1 million ounces of mineral gold reserves as of December 31, 2018. Teranga applies a rigorous capital allocation framework for its investment decisions and is focused on funding future organic growth plans responsibly.
Steadfast in its commitment to set the benchmark for responsible mining, Teranga operates in accordance with the highest international standards and aims to act as a catalyst for sustainable economic, environmental, and community development as it strives to create value for all of its stakeholders. Teranga is a participant of the United Nations Global Compact and a leading member of the multi-stakeholder group responsible for the submission of the first Senegalese Extractive Industries Transparency Initiative revenue report.
Contact Information Richard Young Trish Moran President & CEO VP, Investor Relations & Corporate Communications T: +1 416-594-0000 | E: email@example.com T: +1 416-607-4507 | E: firstname.lastname@example.org
A photo accompanying this announcement is available at: https://www.globenewswire.com/NewsRoom/AttachmentNg/0f98b524-1006-46a7-84da-51a1d2dd6507