Q3 2018 Highlights:
Ascendant Resources Inc. (TSX: ASND) (OTCQX:
ASDRF; FRA: 2D9) ("Ascendant" or the "Company”) announces
production results from its El Mochito mine for the third quarter
of 2018 demonstrating another strong quarter of steady state
operating performance highlighted by a near-record contained metal
production for the quarter of 22.3 million zinc equivalent (“ZnEq”)
pounds at an average head grade of 6.3% ZnEq.
Q3 2018 Operational
Performance
Contained metal production for the third quarter
of 2018 (“Q3 2018”) was 22.3 million pounds of ZnEq metal, a 27%
increase over Q3 2017 production of 17.5 million pounds of ZnEq and
slightly lower, but in line with, Q2 2018 production of 22.9
million pounds of ZnEq metal. The milled zinc equivalent head grade
of 6.3% was 17% higher than the 5.4% achieved in Q3 2017 and in
line the 6.3% ZnEq grade achieved in Q2 2018, largely due to
improvements made in planning and operations and by focusing on
mining pay-tonnes and minimizing dilution.
More specifically, zinc grades of 4.2% were 20%
higher than achieved in Q3 2017 and in line with the 4.3% achieved
in Q2 2018, somewhat offset by lower lead and silver grades due to
mining sequence. Lead grades in Q3 2018 of 1.4% were slightly down
(-4%) against Q3 2017 and 10% lower than the 1.5% achieved in Q2
2018. Similarly, silver grades in the quarter were 44 g/t up from
38 g/t in Q3 2017 but down 7% from the 48 g/t average achieved in
Q2 2018.
Milled throughput for the quarter was 191,738
tonnes, up 9% over Q3 2017 milled tonnes of 176,035 and in line
with Q2 2018 of 192,428 milled tonnes. Overall mill recoveries have
remained largely consistent during the last seven months with a few
individual variances. Zinc mill recoveries of 88% was 1% lower than
achieved in Q3 2017 and 3% down from 91% in Q2 2018 due to higher
iron content found in certain parts of the Esperanza ore body,
offset by the lead recovery which was 79%, up 7% and 1% from Q3
2017 and Q2 2018 respectively. Silver recovery of 78% was in line
with Q3 2017 but 2% lower than Q2 2018 and is driven by head
grades.
El Mochito had strong performance in July and
August with higher mining and throughput rates. September’s
performance was impacted by slower drilling and blasting cycles due
to some turnover in supervision and changes to operating procedures
requiring additional training. The impact of this has since been
remedied as production rates gained strong momentum exiting the
month.
With the mine continuing to demonstrate a steady
state of production, the Company remains focused on dilution
control and overall grade improvements, aiming to achieve grades in
line with Mineral Resource and Reserve grades. The conventional
mining methods implemented early in the year are beginning to
provide more meaningful contributions and will become an important
source of higher-grade ore going forward. Ore mined from the
high-grade areas of Palmar Dyke and Nueva Este combined with
chimney-type ore from the McKenney, Barbasco and San Juan
ore-bodies also positively contributed to the overall grade for the
quarter. The Esperanza orebody also continues to make a significant
contribution in the trackless section of the mine with the
Esperanza chimney providing very good grades.
Management expects to increase milled tonnes and
grades over the course of the fourth quarter. The Company remains
focused on cost cutting to improve both short-term and long-term
profitability at El Mochito.
1 ZnEq.lbs and grades in % represents zinc metal
considered together with the lead and silver expressed in zinc
equivalent terms of zinc using spot metal prices and production
during the period.
Operational performance for Q3 2018 relative to
Q1 and Q2 2018 and 2017 is provided in the table below:
|
|
|
2018 |
|
2017 |
|
|
|
Units |
Q3 |
Q2 |
Q1 |
Q4 |
Q3 |
Q2 |
Q1 |
Ore Milled |
tonnes |
191,738 |
|
192,428 |
|
186,955 |
|
198,354 |
|
176,035 |
|
150,785 |
|
131,116 |
|
Average Head Grade |
Zinc |
% |
4.2% |
|
4.3% |
|
4.2% |
|
3.7% |
|
3.5% |
|
3.4% |
|
3.4% |
|
Lead |
% |
1.4% |
|
1.5% |
|
1.6% |
|
1.4% |
|
1.5% |
|
1.3% |
|
1.3% |
|
Silver |
g/t |
44 |
|
48 |
|
46 |
|
34 |
|
38 |
|
49 |
|
52 |
|
|
Zinc equivalent grade* |
% |
6.3% |
|
6.3% |
|
6.1% |
|
5.3% |
|
5.4% |
|
5.5% |
|
5.6% |
|
Average Recoveries |
Zinc |
% |
87.8% |
|
89.7% |
|
89.3% |
|
88.5% |
|
88.8% |
|
88.9% |
|
89.8% |
|
Lead |
% |
78.9% |
|
79.1% |
|
76.7% |
|
74.6% |
|
73.7% |
|
72.3% |
|
76.9% |
|
Silver |
% |
77.8% |
|
79.4% |
|
78.3% |
|
75.0% |
|
78.0% |
|
79.3% |
|
78.8% |
|
Contained Metal Production |
Zinc |
000's lbs |
15,760 |
|
16,343 |
|
15,301 |
|
14,133 |
|
12,100 |
|
9,933 |
|
8,888 |
|
Lead |
000's lbs |
4,666 |
|
5,109 |
|
5,125 |
|
4,556 |
|
4,175 |
|
3,216 |
|
2,957 |
|
Silver |
ozs |
206,906 |
|
229,043 |
|
215,599 |
|
169,039 |
|
168,181 |
|
188,245 |
|
173,041 |
|
Zinc equivalent metal* |
000's lbs |
22,331 |
|
22,926 |
|
21,412 |
|
19,576 |
|
17,495 |
|
15,377 |
|
13,672 |
|
*Calculated from average Q3 2018 metal prices of
US$1.15/lb for zinc, US$0.96/lb for lead, and US$15.10/oz for
silver |
|
President and CEO Chris Buncic stated: “We are
pleased with yet another strong operational quarter demonstrating
that the bulk of the operational turnaround at El Mochito has been
achieved. El Mochito has continued to demonstrate its ability to
maintain higher levels of production at improved zinc equivalent
grades.”
He continued, “While lower metal prices
persisted throughout the quarter in the wake of the strong dollar
and continued global trade war tensions, we remain positive on
metals prices going forward as fundamentals continue to become more
compelling as supply tightens and global inventories of zinc are
depleted to decade lows. Regardless of these compelling external
factors for higher prices, we continue to make additional
operational improvements to drive down costs and improve
profitability to position the mine on a profitable path in any
reasonable metals price environment.”
Change to the Board of Directors and
Health, Safety and Technical Committee
Mr. Kurt Menchen has been appointed Chairman of
the Health, Safety and Technical Committee replacing Mr. Renaud
Adams. Mr. Menchen is a well accomplished mining engineer with over
40 years’ experience of successfully building and operating mines.
Mr. Menchen was instrumental in the success of Desert Sun Mining
Corp. whose Jacobina Mine in Brazil was sold to Yamana Gold Inc. in
2006, representing the biggest mining deal of that year. Most
recently, Mr. Menchen successfully developed and constructed Largo
Resources’ Maracás Menchen Vanadium Mine. Largo Resources Ltd.
currently has a market cap of over $1.8 billion based on the
Maracás Menchen Mine. Previously he had oversight of Anglo
American’s Vaal Reefs’ underground gold mine in South Africa and De
Beers Goldfields in Angola.
The Company also announces that following his
appointment as Chief Executive Officer at New Gold Inc., Renaud
Adams has resigned as a director of the Company. Ascendant would
like to thank Mr. Adams for his insightful and highly valued
contributions throughout his tenure and wishes him all the best in
his new endeavour.
“Renaud has been a tremendous asset during his
time on the Board of Ascendant. His strong technical expertise and
history with El Mochito provided guidance and stewardship during a
crucial time for the Company as we transformed El Mochito back into
a steady state producing mine. On behalf of the Board and
management, I would like to thank him for his contributions and
wish him all the best in his new and exciting opportunity,” stated
Chris Buncic, President and CEO.
Third Quarter 2018 Conference
Call
Ascendant plans to release third quarter 2018
financial results after market close on November 7, 2018. A
conference call will be held on November 8, 2018, at 10:00am EST to
discuss third quarter 2018 operational and financial results.
Conference Call Details:Date of
Call: Thursday, November 8, 2018Time of Call: 10:00am ESTConference
ID: 2598904Dial-In Numbers:North American Toll-Free:
1-833-696-8362International: 1-612-979-9908
About Ascendant Resources
Inc.
Ascendant is a Toronto-based mining company
focused on its flagship 100%-owned producing El Mochito zinc, lead
and silver mine in west-central Honduras, which has been in
production since 1948. After acquiring the mine in December 2016,
Ascendant spent 2017 implementing a rigorous and successful
optimization program restoring the historic potential of El Mochito
delivering record levels of production with profitability restored.
The Company now remains focused on cost reduction and further
operational improvements to drive robust profitability in 2018 and
beyond. Expanding and upgrading El Mochito’s significant Mineral
Reserves and Resources through exploration work for near-mine
growth is an ongoing focus for the Company. With a significant land
package of 11,000 hectares in Honduras and an abundance of
historical data, there are several regional targets providing
longer term exploration upside which could lead to further resource
growth.
Ascendant also holds an interest in the
high-grade polymetallic Lagoa Salgada VMS Project located in the
prolific Iberian Pyrite Belt in Portugal. The Company is engaged in
exploration of the Project with the goal of expanding already
substantial defined Mineral Resources and testing additional known
targets. The Company’s acquisition of its interest in the Lagoa
Salgada Project offers a low-cost entry point to a potentially
significant exploration and development opportunity. The Company
holds an additional option to increase their interest in the
Project upon completion of certain milestones.
Ascendant Resources is engaged in the ongoing
evaluation of producing and development stage mineral resource
opportunities, on an ongoing basis. The Company's common shares are
principally listed on the Toronto Stock Exchange under the symbol
"ASND". For more information on Ascendant Resources, please visit
our website at www.ascendantresources.com.
Neither the Toronto Stock Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX) accepts responsibility for the adequacy or
accuracy of this release. For further information please
contact:Katherine PrydeDirector, Communications & Investor
RelationsTel: 888-723-7413info@ascendantresources.com
Cautionary Notes to US
Investors
The information concerning the Company’s mineral
properties has been prepared in accordance with National Instrument
43-101 (“NI-43-101”) adopted by the Canadian Securities
Administrators. In accordance with NI-43-101, the terms “mineral
reserves”, “proven mineral reserve”, “probable mineral reserve”,
“mineral resource”, “measured mineral resource”, “indicated mineral
resource” and “inferred mineral resource” are defined in the
Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”)
Definition Standards for Mineral Resources and Mineral Reserves
adopted by the CIM Council on May 10, 2014. While the terms
“mineral resource”, “measured mineral resource”, “indicated mineral
resource” and “inferred mineral resource” are recognized and
required by NI 43-101, the U.S. Securities Exchange Commission
(“SEC”) does not recognize them. The reader is cautioned that,
except for that portion of mineral resources classified as mineral
reserves, mineral resources do not have demonstrated economic
value. Inferred mineral resources have a high degree of uncertainty
as to their existence and as to whether they can be economically or
legally mined. It cannot be assumed that all or any part of any
inferred mineral resource will ever be upgraded to a higher
category. Therefore, the reader is cautioned not to assume that all
or any part of an inferred mineral resource exists, that it can be
economically or legally mined, or that it will ever be upgraded to
a higher category. Likewise, you are cautioned not to assume that
all or any part of a measured or indicated mineral resource will
ever be upgraded into mineral reserves.
Readers should be aware that the Company’s
financial statements (and information derived therefrom) have been
prepared in accordance with International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting
Standards Board and are subject to Canadian auditing and auditor
independence standards. IFRS differs in some respects from United
States generally accepted accounting principles and thus the
Company’s financial statements (and information derived therefrom)
may not be comparable to those of United States companies.
Forward Looking
Information
This news release contains "forward-looking statements" and
"forward-looking information" (collectively, "forward-looking
information") within the meaning of applicable Canadian securities
legislation. All information contained in this news release, other
than statements of current and historical fact, is forward-looking
information. Often, but not always, forward-looking information can
be identified by the use of words such as "plans", "expects",
"budget", "guidance", "scheduled", "estimates", "forecasts",
"strategy", "target", "intends", "objective", "goal",
"understands", "anticipates" and "believes" (and variations of
these or similar words) and statements that certain actions, events
or results "may", "could", "would", "should", "might" "occur" or
"be achieved" or "will be taken" (and variations of these or
similar expressions). Forward-looking information is also
identifiable in statements of currently occurring matters which may
continue in the future, such as "providing the Company with", "is
currently", "allows/allowing for", "will advance" or "continues to"
or other statements that may be stated in the present tense with
future implications. All of the forward-looking information in this
news release is qualified by this cautionary note.
Forward-looking information in this news release
includes, but is not limited to, statements regarding the
consistency of processing recovery levels, improvements of grades
in 2018, deployment of new mining equipment, increase in contained
metal production, maintenance of production rates, increase of mill
feed grades, reduction of costs, the ability to fully fund planned
development, exploration expenditures and the undertaking of
various long-term optimization programs. Forward-looking
information is not, and cannot be, a guarantee of future results or
events. Forward-looking information is based on, among other
things, opinions, assumptions, estimates and analyses that, while
considered reasonable by Ascendant at the date the forward-looking
information is provided, inherently are subject to significant
risks, uncertainties, contingencies and other factors that may
cause actual results and events to be materially different from
those expressed or implied by the forward-looking information. The
material factors or assumptions that Ascendant identified and were
applied by Ascendant in drawing conclusions or making forecasts or
projections set out in the forward-looking information include, but
are not limited to, the ability of the Company to maintain the
consistency of processing recovery levels, to improve grades in
2018, to deploy new mining equipment, increase contained metal
production, maintain production rates, increase mill feed grades,
reduce costs, fully fund planned development, exploration and
capital expenditures and undertake various long-term optimization
programs and other events that may affect Ascendant's ability to
develop its project; and no significant and continuing adverse
changes in general economic conditions or conditions in the
financial markets.
The risks, uncertainties, contingencies and
other factors that may cause actual results to differ materially
from those expressed or implied by the forward-looking information
may include, but are not limited to, risks generally associated
with the mining industry, such as economic factors (including
future commodity prices, currency fluctuations, energy prices and
general cost escalation), uncertainties related to the development
and operation of Ascendant's projects, dependence on key personnel
and employee and union relations, risks related to political or
social unrest or change, rights and title claims, operational risks
and hazards, including unanticipated environmental, industrial and
geological events and developments and the inability to insure
against all risks, failure of plant, equipment, processes,
transportation and other infrastructure to operate as anticipated,
compliance with government and environmental regulations, including
permitting requirements and anti-bribery legislation, volatile
financial markets that may affect Ascendant's ability to obtain
additional financing on acceptable terms, the failure to obtain
required approvals or clearances from government authorities on a
timely basis, uncertainties related to the geology, continuity,
grade and estimates of mineral reserves and resources, and the
potential for variations in grade and recovery rates, uncertain
costs of reclamation activities, tax refunds, hedging transactions,
as well as the risks discussed in Ascendant's most recent Annual
Information Form on file with the Canadian provincial securities
regulatory authorities and available at www.sedar.com.
Should one or more risk, uncertainty,
contingency, or other factor materialize, or should any factor or
assumption prove incorrect, actual results could vary materially
from those expressed or implied in the forward-looking information.
Accordingly, the reader should not place undue reliance on
forward-looking information. Ascendant does not assume any
obligation to update or revise any forward-looking information
after the date of this news release or to explain any material
difference between subsequent actual events and any forward-looking
information, except as required by applicable law.
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