Pre-Tax IRR of 57%, Payback Period of 1.7
Years
MONTREAL, Feb. 22, 2022 /CNW Telbec/ - Aya Gold & Silver Inc. (TSX: AYA)
("Aya" or the "Corporation") is pleased to announce positive
results from its Feasibility Study ("FS") to expand the Zgounder
Silver Mine located in the Kingdom of Morocco from 700 tonnes per day ("tpd") to
2,700 tpd capacity. All amounts are in US dollars unless
otherwise stated. All figures are on a 100% ownership basis.
Highlights of the 2,000 tpd Expansion Feasibility
Study
- Robust project economics (base case at $22/oz silver):
-
- Before-tax 5% net present value ("NPV"): $471 million
- Before-tax internal rate of return ("IRR"): 57%
- After-tax 5% NPV: $373
million
- After-tax IRR: 48%
- Payback period: 1.7 years post expansion
- Initial life of mine ("LOM") of 11 years
- 394% increase in annual production: Increased throughput
expected to drive annual silver ("Ag") production to 7.9 million
ounces ("oz") by 2024
- 364% increase in revenue: Annual revenue expected to
increase from $37M in 2021 to
$172M by 2024
- Low quartile costs: LOM all-in sustaining cost
("AISC")1 of $9.58/oz
including sustaining capital expenditures
- Initial proven and probable Mineral Reserves Estimate of
8.59 million tonnes ("t") grading 257 g/t Ag for 71Moz of Ag,
positions Zgounder among the highest-grade Ag projects
globally
- Low initial capital expenditures: $139.4 million, including $16.6 million in contingency cost
- Short expansion timeframe: First Ag pour planned in
Q1-2024
- Further optimisation opportunities:
-
- Exploration along strike and at depth
- Potential to optimise the flow sheet during the front-end
engineering design ("FEED") and the mine plan as part of the
underground expansion
- Enhanced ESG plan: Reduction in water consumption and
carbon emissions intensity
"We are thrilled to deliver our Zgounder expansion feasibility
study less than two years after taking over as management, a
testament to our team's hard work. The feasibility study is
supported by a high-grade maiden reserve and is expected to
quadruple production at industry-low costs while delivering
superior economic returns for all stakeholders," said Benoit La Salle, President and CEO. "With its
low capital outlay, low operating costs and quick payback, Zgounder
ranks among the highest-return silver projects
globally."
"While we see exceptional economics on the basis of
reserves-based mining only, our long-term plan incorporating a
portion of the exploration upside and optimisation opportunities
positions Zgounder as a long-life cornerstone asset for Aya. Based
on the success achieved to date, we believe there remains
significant upside to be gained through exploration."
"With the mine development already underway, Zgounder will be a
significant economic driver in the region with this initial
expansion providing more than 400 jobs during construction, 450
jobs during operations and extending the mine life by at least 11
years. We will draw on our experience and expertise, in addition to
the transformative groundwork laid since 2020, as we expedite
expansion of our unique pure-play silver mine."
1
|
AISC is a non-IFRS
measure and is calculated in accordance with the standard adopted
by the World Gold Council.
|
Silver Price Sensitivity Analysis
The Zgounder sensitivity analysis was performed using a Ag
price varying from $16 oz Ag to
$36 oz Ag as
illustrated in the following table:
|
$16
oz Ag
|
$19
oz Ag
|
Base
Case
$22 oz
Ag
|
Spot
($23.5 oz
Ag)
|
$28 oz Ag
|
$36 oz Ag
|
After-tax 5% NPV ($M)
|
$132M
|
$253M
|
$373M
|
$433M
|
$612M
|
$927M
|
After-tax IRR
(%)
|
21%
|
34%
|
48%
|
54%
|
75%
|
117%
|
Undiscounted LOM
free
cash flow ($M)
|
$213M
|
$368M
|
$522M
|
$599M
|
$828M
|
$1,232M
|
Payback period (years)
|
3.7
|
2.5
|
1.7
|
1.5
|
1.0
|
0.6
|
Project Milestones
- Environmental study impact assessment ("ESIA") approval in
Q1-2022
- Complete front-end engineering design in Q2-2022
- Construction start-up in Q3-2022
- New plant first Ag pour by Q1-2024
- Ongoing exploration with the aim of increasing reserves and
resources and enhancing economics
Mineralization
The mineralization at Zgounder is hosted within a low
sulphidation-Ag epithermal deposit contained in complex lenses,
clusters, and shear zones. The mineralization typically occurs in
three styles: millimetre-thick beds of crystallized, finely
disseminated pyrite associated with quartz; native Ag veinlets
associated with proustite, argentite and filling micro-fractures in
stockwork; and native Ag dissemination in brecciated
sandstone-shale layers and spotted by chlorite and / or carbonate
and quartz and other sulphides. The host lithology consists of
Proterozoic volcano-sedimentary series. The mineralization is
predominately hosted at the contact, or near the contact, between a
sedimentary sequence and a volcanic package. Mineralization is
dominated by mercuriferous native Ag (proustite), with few Ag
sulfosalts (acanthite, pearceite), arsenopyrite and base-metal
sulfides (sphalerite and chalcopyrite).
Exploration Potential at Zgounder
Prior to the arrival of management in 2020, the Zgounder Project
had seen limited near-mine drilling and no regional exploration.
Since assuming control, the Aya team has conducted over 75,000
meters ("m") of diamond drill hole ("DDH") programs with the view
of updating the resources estimate and delivering a reserve
estimate in support of the FS. Regional fieldwork commenced in
2021, and a regional drill program will be initiated in Q2-2022 on
targets generated by fieldwork and an airborne geophysical
survey.
Significant upside potential exists within and surrounding
the Zgounder mineralized system, which remains open
at depth to the granite.
Aya's overall objective is to expand
resources and reserves to enhance project economics and expand the
mine life. In the short term, the Corporation aims to
expand resources at depth and along strike in addition to
discovering regional resources within trucking distance of the
mine.
An initial budget of $6.4
million has been assigned to the 2022 exploration program on
Zgounder, which will consist of 22,500m of DDH proximal to the mine and
7,500m of regional DDH and RC
drilling. Results will be released on an ongoing basis.
Mineral Resources and Mineral Reserves Estimates
The FS is based on the updated 2021 Mineral Resource Estimate
("MRE") published on December 14,
2021, which outlined a 116% increase over the resource
published in March 2021.
The FS includes an inaugural Mineral Reserves Estimate (see
below) that has been completed by DRA Global Limited ("DRA")
in accordance with the CIM Definition Standards
for National Instrument 43-101 reporting.
The Mineral Reserves have been derived from the Resource
Estimate completed by P&E Mining Consultants Inc, and include
all drilling data obtained until September
10, 2021, and with an effective date of December 13, 2021. The Inferred material within
the pit design was treated as waste.
Using the Mineral Resources dated December 13, 2021 as the basis,
the total proven and probable reserves for
the Zgounder deposit were as follows:
On a 100% basis.
M&I resources shown
inclusive of reserves.
|
Tonnes (k)
|
Grade
(Ag
g/t)
|
Content
(Ag k
oz)
|
Proven
reserves
|
3,100
|
288
|
28,748
|
Probable
reserves
|
5,490
|
239
|
42,128
|
P&P
reserves
|
8,590
|
257
|
70,876
|
|
|
|
|
Measured resources
(incl. reserves)
|
3,511
|
347
|
39,183
|
Indicated resources
(incl. reserves)
|
6,254
|
283
|
56,874
|
M&I resources
(incl. reserves)
|
9,765
|
306
|
96,057
|
Inferred
resources
|
196
|
367
|
6,400
|
The mineral reserves were estimated based on
a Ag price of $20 per oz
and a corresponding cut-off grade of 47 g/t
for Open Pit Reserves, 85 g/t for Underground Reserves and
44 g/t for historical tailings.
For further details, see the reserves and resources
in Tables 1 and 2, respectively, in the
appendix.
Mining Operations, Processing and Metallurgy
Mining Operations
The Zgounder Mine expansion outlines a combined open pit and
underground mining operation over the 11-year projected LOM. Ore
will be sourced from the open pit to build a stockpile prior to the
commissioning of the new processing plant and to supplement
production in the first full year of production.
Approximately 2.5 million tonnes ("Mt") of material or 29% of
current reserves will be mined from the open pit during the LOM
(including the historical tailings storage facility ("TSF")) and
23.5Mt of waste material will come from the open pit (10.6:1
stripping ratio).
Underground mining methods will account for about 71% of the
total reserves, with a mix of long-hole mining (LH) and overhand
cut and fill (C&F) – the split between LH and C&F being
respectively 60%-40%.
This will deliver a total of 8.6Mt of ore to the milling
facility with an average head grade of 257 g/t Ag. Process
grades for the LOM average 257 g/t Ag for an average
annual production of more than 6,800,000 oz of Ag (once in full
production) at low total cash and AISC1 (see table
below).
Work on the development and construction of the new underground
infrastructures commenced in January
2022 and is being carried out by a Moroccan mining
contractor. In parallel to the construction of the new process
plant, over 11,000m of underground
development will be completed to support the increased mining
rate.
Processing and Metallurgy
The new Zgounder process plant is designed to process 2,000 tpd.
Combined with the two existing processing facilities (the existing
cyanidation and flotation plants), the treatment capacity will
total approximately 961,000t of ore per year.
The process plant will be based on a conventional
comminution circuit, with the crushing circuit composed
of a
primary jaw crusher and secondary cone crusher. Crushed ore
will be conveyed to the grinding circuit using a ball mill in
closed circuit with primary cyclones. The target grind is planned
at 100 microns in order to achieve optimal Ag recovery.
Following grinding, the ore will be fed to a flotation circuit. The
resulting flotation concentrate will be leached in a counter
current decantation ("CCD") circuit, while the flotation tailings
will be thickened and sent to a leaching and carbon-in-pulp ("CIP")
circuit.
Pregnant solution from the CCD circuit and from the
adsorption-desorption-recovery circuit will be fed into the
Merrill-Crowe circuit for Ag precipitation The resulting and cement
will be directed to a refinery for production of Ag ingots.
LOM head grades for the process plant are expected
to average 257 g/t with a Ag recovery of 91.3%. The main
reagents used in the plant are hydrated lime,
cyanide, flotation collector, and hydrogen peroxide.
Electricity will be supplied from the grid, and construction of
a 90km, 60kV power line and substation upgrades have been included
as part of the project. Aya expects to power its operations with
100% renewable energy.
LOM Production Plan
The first Ag pour from Zgounder is expected to occur in Q1-2024.
A production
summary is provided below, and the entire LOM mine plan is presented in Tables 3
and 4 in the appendix.
Production Summary
(for 2,700 tpd)
|
Zgounder
|
OPERATION
TYPE
|
|
Mine type
|
Open pit -
underground
|
Mill type (new
plant)
|
Flotation / CIP
plant
|
RESERVES &
RESOURCES
|
|
P&P
reserves
|
8,590 kt at 257 g/t;
70.9Moz
|
M&I
resources
|
9,765 kt at 306 g/t;
96.1Moz
|
Inferred
resources
|
542 kt at 367 g/t;
6.4Moz
|
LOM
PRODUCTION
|
|
Mine life,
years
|
11
|
Strip ratio, Waste:
Ore
|
10.6:1
|
Tonnes processed,
Mt
|
8.6
|
Grade processed,
Ag g/t
|
257
|
Silver processed,
Moz
|
70.9
|
Average recovery
rate, %
|
91.3%
|
Silver production,
Moz
|
64.7
|
Average annual
production, Koz post expansion1
|
6,828
|
Cash costs,
$/oz
|
7.36
|
AISC1,
$/oz
|
9.58
|
CAPITAL
COST
|
|
Upfront capital cost,
$M
|
139.4
|
Sustaining capital
cost, $M
|
69.7
|
1
|
Average annual
production on the basis of 2,700 tpd operation
|
Project Operating Costs
The table below details the LOM cash operating cost per tonne processed at Zgounder.
Mining and processing operating costs have been prepared by DRA and
are based on a mining contractor fleet for the open pit, and an
owner-operated fleet for underground mining. General and
administration ("G&A") costs derive from the current Zgounder
operation and have been reviewed by DRA.
LOM cash operating
cost
|
$ per tonne
milled
|
Mining ($/t)
|
$29.3
|
Processing ($/t)
|
$19.0
|
G&A &
ESG ($/t)
|
$6.0
|
Operating cost ($/t)
|
$54.3
|
The table below details the LOM AISC1 for the
Zgounder expansion:
LOM
AISC1
|
$/oz
|
G&A
|
0.78
|
ESG
|
0.17
|
UG mine
opex
|
3.50
|
OP mine
opex
|
0.38
|
Process
opex
|
2.53
|
Sustaining
capital
|
1.18
|
Royalties &
mining taxes
|
1.05
|
Total
AISC1 ($/oz)
|
$9.58
|
Figure 2 – LOM After-tax Cash Flow Profile
Zgounder Capital Expenditures
The project capital cost estimate was compiled by DRA with input
from Groupement des Consultants et Ingénieurs du Maroc, a Moroccan
engineering firm, on the tailings storage facility (TSF) aspects.
Aya has provided project-specific portions for mine establishment
and facilities, owner costs, and the high-voltage power supply.
A 24-month construction period, including commissioning, is
projected with the initial cost to expand
the Zgounder plant estimated at $139.4 million, inclusive of equipment and
infrastructures, open pit pre-stripping, owner
costs and contingency costs, as summarized below.
Capital
Expenditures Split
|
Initial
Capex (In millions of $)
|
Sustaining
Capex (In millions of $)
|
Processing plant
|
60.8
|
7.3
|
Infrastructures &
TSF
|
6.6
|
12.2
|
New power
line
|
7.6
|
|
Mining – Open pit
pre-stripping
|
2.9
|
|
Mining – UG equipment
& infrastructures
|
8.8
|
14.7
|
Mining – UG
development
|
|
35.5
|
Indirect
costs
|
30.8
|
|
Indirect
contractors
|
8.8
|
|
Initial spares
& first fills
|
4.1
|
|
Transport &
freight
|
2.2
|
|
EPCM &
commissioning
|
15.7
|
|
Direct
& indirect cost subtotal
|
117.5
|
|
Owner
costs
|
5.4
|
|
Contingency
|
16.6
|
|
Total
|
139.4
|
69.7
|
Closure
costs
|
|
6.6
|
Tailings Management
The tailings system will comprise a new TSF located
2.7 kilometers south-east of the current cyanidation TSF. The
newly built TSF will be fully lined with high-density polyethylene
membrane. Recycled water will be optimised throughout the
process to minimise the addition of fresh water to the process.
The new TSF will take all the tailings produced at the new
processing facility, including all the tailings from the existing
flotation plant. All the material processed at the existing
flotation plant will be directed to the new process plant (the
flotation concentrate to the concentrate leaching circuit, and
flotation tailings to the CIP circuit) for further Ag recovery.
Tailings from the existing flotation plant will go to the CIP
circuit of the new plant for further Ag extraction, and hence all
the tailings produced will go to the new TSF.
Opportunities to Further Enhance Value
Aya has identified the following opportunities to further
enhance the economics of the Zgounder expansion project and current
operations, and will continue to update these opportunities in 2022
and into 2023:
- Expansion of near-mine mineralization along strike
- Expansion and potential discovery of new resources at
depth
- Potential to optimize:
- Costs regarding the initial CAPEX of the expansion project
- Process plant flowsheet during the FEED to reduce the capital
intensity, while simplifying the operability and constructability
of the new plant
- Underground mine design, to reduce the total operating
development meters and accelerate access to high productivity
areas
Enhanced ESG Plan
In 2020, an ESIA was launched for the Zgounder expansion.
Public hearings were successfully completed in Q4-2021, and full
approval of the ESIA is expected in February
2022.
The Corporation has leveraged the FS and other resources to
achieve the most economically and environmentally sustainable
solutions for Zgounder, in addition to maximising its impact in the
community.
Among its ESG initiatives, Aya plans to
- Revegetate and recycle waste from the mine's historical
TSF
- Reduce carbon emissions intensity through
-
- Powering its operations with 100% renewable energy
- Lower fuel consumption through the production of silver
bars
- Evaluation of a clean fleet energy replacement strategy for
end-of-service trucks
- Lower water consumption through
-
- Use of recycled water from the TSF in the cyanidation
circuit
- Production of domestic drinking water with hydropanels which
generate water from moisture in ambient air
- Foster local wealth creation through
-
- Focus on national recruitment and procurement for the mine
expansion
- Creation of 600-900 agri-business livelihood projects over a
5-year business entrepreneurship program
- Support for local healthcare and education facilities
Assumptions
- Silver price of $22.00 per
oz
- Light fuel oil: $0.85 per
liter
- Exchange rate: $0.759 US dollars
to the Canadian dollar
- Exchange rate: $0.108 US dollars
to the Moroccan dirham
- NPV calculated using a discount rate of 5%
- Based on the 2016 Moroccan mining code
Qualified Persons
The complete NI 43-101 Technical Report pertaining to the FS
will be filed within 45 days and will be available on
Aya's website and on www.sedar.com.
The FS was carried out by DRA Global Limited (DRA). Scientific
and technical information contained in this news release was
reviewed and approved by Daniel
Gagnon, P.Eng, VP Mining & Geology at DRA, who is an
independent qualified person ("QP") as defined by National
Instrument 43-101 - Standards of Disclosure for Mineral Projects.
The Open-pit and historical tailings Reserves Estimate was prepared
by Daniel Gagnon.
The Underground Reserves Estimate was prepared under the
supervision of André-François Gravel, P.Eng, Senior Mining Engineer
for DRA, and QP as defined by NI 43-101.
The technical information contained in this news release has
been reviewed and approved by Aya's technical group comprising
Marc-Antoine Audet, Ph.D. P. Geo,
Geological Consultant and Patrick
Perez, P.Eng, Director of Technical Services, both of whom
are QPs as defined under NI 43-101.
Video
To view a video animation of the Zgounder
expansion, please click on https://bit.ly/3h3yDTH .
About Aya Gold & Silver
Inc.
Aya Gold & Silver Inc. is a
rapidly growing, Canada-based
silver producer with operations in the Kingdom of Morocco.
The only TSX-listed pure silver mining company, Aya operates the
high-grade Zgounder Silver Mine and is exploring its properties
along the prospective South-Atlas Fault, several of which have
hosted past-producing mines and historical resources. Aya's
Moroccan mining assets are complemented by its Tijirit Gold Project
in Mauritania, which is being
advanced to feasibility.
Aya's management team has been focused on maximising shareholder
value by anchoring sustainability at the heart of its operations,
governance, and financial growth plans.
For additional information, please visit Aya's website at
www.ayagoldsilver.com.
Forward-Looking Statements
This press release may contain or incorporate by reference,
certain statements, other than historical facts, including but not
limited to any information as to the future financial or operating
performance of Aya, that constitute forward-looking information
within the meaning of applicable securities laws ("forward-looking
statements"), which reflects management's expectations, estimates
and projections regarding Aya's future growth and business
prospects (including the timing and development of deposits and the
success of exploration activities) and other opportunities as of
the date of this news release.
Forward-looking statements include future events and
opportunities including, without limitation, statements with
respect to: exploration and development potential of Zgounder, our
estimates, expectations, forecasts and guidance, production costs
of sales, all-in sustaining cost and capital expenditures, cost
savings, project economics (including net present value and
internal rates of return) and other information contained in the
feasibility study; as well as references to other possible events,
the future price of silver, the estimation of mineral reserves and
mineral resources, the realization of mineral reserve and mineral
resource estimates, the timing and amount of estimated future
production, costs of production, estimates of necessary capital,
cost of capital, capital expenditures, costs and timing of the
development of the project and mining and processing activities,
permitting timelines, currency fluctuations, requirements for
additional capital, government regulation of mining operations, and
environmental risks.
Wherever possible, words such as "expects", "potential", "plan",
"believe", "upside", "objective", "enhance", "aim", "estimate",
"projected", "opportunities", "further", "continue",
"assume", "confirm", "intend", 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.
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, Aya 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. Aya 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 1)
there being no significant disruptions affecting the operations of
the Corporation whether due to COVID-19 restrictions, artisanal
miners, access to water, extreme weather events and other or
related natural disasters, labour disruptions, supply disruptions,
power disruptions, damage to equipment or otherwise; (2)
permitting, development, operations and production from the
Zgounder project being consistent with the Corporations'
expectations; (3) political and legal developments in the Kingdom
of Morocco being consistent with
its current expectations; (4) the exchange rate between the U.S.
dollar and the Moroccan Dirham being approximately consistent with
current levels; (5) certain price assumptions for silver; (6)
prices for diesel, process reagents, fuel oil, electricity and
other key supplies being approximately consistent with current
levels; (7) production and cost of sales forecasts meeting
expectations; (8) the accuracy of the current mineral reserve and
mineral resource estimates of the Corporation; (9) labour and
materials costs increasing on a basis consistent with the
Corporation's current expectations; and (10) asset impairment (or
reversal) potential, being consistent with the Corporation's
current expectations. Known and unknown factors could cause actual
results to differ materially from those projected in the
forward-looking statements. All of the forward-looking statements
made in this news release are qualified by these cautionary
statements and those made in our other filings with the securities
regulators of Canada including,
but not limited to, the cautionary statements made in the "Risk
Factors" section of our Annual Information Form dated March 31, 2021 and the "Risk Analysis" section of
our Q3/2021 Management's Discussion & Analysis and in other
filings of Aya with securities and regulatory authorities which are
available on SEDAR at www.sedar.com. These factors are not intended
to represent a complete list of the factors that could affect the
Corporation. Aya disclaims any intention or obligation to update or
revise any forward-looking statements or to explain any material
difference between subsequent actual events and such forward
looking statements, except to the extent required by applicable
law.
______________________________________________
1
|
AISC is a non-IFRS
measure and is calculated in accordance with the standard adopted
by the World Gold Council.
|
Table 1 - Mineral Reserves – Zgounder Mine, Morocco
Area
|
Classification
|
Cut-Off
(Ag
g/t)
|
Tonnes (k)
|
Ag
(g/t)
|
Ag
(k
oz)
|
Open pit
reserves
|
Proven
|
47
|
567
|
312
|
5,694
|
Probable
|
47
|
1,611
|
233
|
12,057
|
P&P
|
47
|
2,178
|
253
|
17,750
|
|
|
|
|
|
|
Underground
reserves
|
Proven
|
85
|
2,533
|
283
|
23,054
|
Probable
|
85
|
3,560
|
256
|
29,286
|
P&P
|
85
|
6,093
|
267
|
52,340
|
|
|
|
|
|
|
Sub-total
|
Proven
|
47-85
|
3,100
|
288
|
28,748
|
Probable
|
47-85
|
5,171
|
249
|
41,343
|
P&P
|
47-85
|
8,271
|
264
|
70,090
|
|
|
|
|
|
|
Historical
tailings
reserves
|
Probable
|
44
|
319
|
77
|
785
|
|
|
|
|
|
|
Total
Reserves
|
Proven
|
47-85
|
3,100
|
288
|
28,748
|
Probable
|
44-85
|
5,490
|
239
|
42,128
|
Total
P&P
|
44-85
|
8,590
|
257
|
70,876
|
- The Mineral Reserve is estimated in accordance with the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM
Standards on Mineral Resources and Reserves, Definitions (2014) and
Best Practices Guidelines (2019) prepared by the CIM Standing
Committee on Reserve Definitions and adopted by the CIM
Council.
- The Mineral Reserve is estimated with a variable COG which was
calculated by mining method.
- Ag content (oz) is estimated as in-situ.
- An ONHYM royalty of 3% is included in the Mineral Reserve
Estimate.
- The Mineral Reserve is estimated with a mining recovery of
95%.
- The Mineral Reserve includes both internal and external
dilution. The external dilution included a mining dilution of
0.3 m width on the hanging wall and
footwall for the long-hole mining method and a 0.1 m width on the hanging wall and footwall for
the cut-and-fill mining methods.
- A minimum mining width of 4m was
used for the long hole and cut-and-fill mining methods.
- The economic viability of the Mineral Reserve has been
demonstrated.
- For the historical tailings Reserves Estimate, a silver price
of US$20/oz with a process recovery
of 92%, a process cost of $20.93/t
(including G&A), and a mining cost of $4.31/t (including haulage) were used.
- For the Open-pit Reserves Estimate, a silver price of
US$20/oz with a process recovery of
92%, a process cost of US$22.91/t
(including G&A), and a mining cost of $4.00/t (including haulage) were used.
- For the Underground Reserves Estimate, a silver price of
$20/oz with a process recovery of
92%, a process cost of US$22.91/t
(including G&A), and a mining cost of $24.13/t (including haulage and backfill) were
used for the combined cut-and-fill and long-hole methods.
- The reserves estimate has an effective date of December 13, 2021.
- Totals may not add due to rounding.
Table 2 – Mineral Resources (exclusive of reserves)
Area
|
Classification
|
Cut-Off (Ag g/t)
|
Tonnes (k)
|
Ag (g/t)
|
Ag
(k
oz)
|
Pit-Constrained
|
Measured
|
65
|
108
|
477
|
1,659
|
Indicated
|
65
|
406
|
325
|
4,247
|
M&I
|
65
|
514
|
368
|
5,906
|
|
|
|
|
|
|
Out-of-Pit
|
Measured
|
75
|
3,403
|
343
|
37,493
|
Indicated
|
75
|
5,576
|
289
|
51,792
|
M&I
|
75
|
8,979
|
311
|
89,285
|
Inferred
|
75
|
196
|
367
|
6,400
|
|
|
|
|
|
|
Tailings
|
Indicated
|
50
|
272
|
94
|
817
|
|
|
|
|
|
|
Total
Resources
|
Measured
|
65-75
|
3,512
|
348
|
39,152
|
Indicated
|
50-65-75
|
5,982
|
289
|
56,856
|
M&I
|
50-65-75
|
9,494
|
316
|
95,192
|
Inferred
|
65-75
|
196
|
367
|
6,400
|
- Mineral Resources are not Mineral Reserves and do not have
demonstrated economic viability. The estimate of Mineral Resources
may be materially affected by environmental, permitting, legal,
title, taxation, socio-political, marketing, or other relevant
issues. There is no certainty that Mineral Resources will be
converted to Mineral Reserves.
- The Inferred Mineral Resource in this estimate has a lower
level of confidence that that applied to an Indicated Mineral
Resource and must not be converted to a Mineral Reserve. It is
reasonably expected that the majority of the Inferred Mineral
Resource could be upgraded to an Indicated Mineral Resource with
continued exploration.
- The Mineral Resources in this news release were estimated in
accordance with the Canadian Institute of Mining, Metallurgy and
Petroleum (CIM), CIM Standards on Mineral Resources and Reserves,
Definitions (2014) and Best Practices Guidelines (2019) prepared by
the CIM Standing Committee on Reserve Definitions and adopted by
the CIM Council.
- A silver price of US$22.5/oz with
a process recovery of 90%, US$20/t
rock process cost, US$16.5/t tailings
process cost and US$7/t G&A cost
were used.
- The constraining pit optimization parameters were US$15/t of mineralized material (including waste
mining) and 50-degree pit slopes with a 65 g/t Ag cut-off.
- The out-of-pit parameters used a US$22/t mining cost. The out-of-pit Mineral
Resource grade blocks were quantified above the 75 g/t Ag cut-off,
below the constraining pit shell and within the constraining
mineralized wireframes. Out–of-pit Mineral Resources exhibit
continuity and reasonable potential for extraction by the cut and
fill underground mining method.
- The historical tailings parameters were at a US$9/t mining cost, and Mineral Resource grade
blocks were quantified above the 50 g/t Ag cut-off.
- Individual calculations in tables and totals may not sum
correctly due to rounding of original numbers.
- Grade capping of 6,000 g/t Ag was applied to composites before
grade estimation.
- A bulk density value of 2.77 t/m3 was determined
from core samples and used for the Mineral Resource Estimate.
- 1.2m composites were used during
grade estimation.
- Previously mined areas of the deposit were depleted from the
Mineral Resource Estimate
Table 3 – Zgounder LOM Operating Plan
|
|
2022
|
2023
|
2024
|
2025
|
2026
|
2027
|
2028
|
2029
|
2030
|
2031
|
2032
|
Mine - UG
tonnes
|
t
|
226,285
|
251,387
|
594,875
|
671,621
|
673,134
|
673,142
|
673,172
|
673,180
|
673,184
|
745,933
|
237,513
|
Mine - OP
tonnes
|
t
|
0
|
70,709
|
269,503
|
386,546
|
330,406
|
316,680
|
296,614
|
267,607
|
240,512
|
288,000
|
30,811
|
Mined
grade
|
g/t
|
264
|
268
|
304
|
242
|
245
|
283
|
316
|
244
|
259
|
185
|
189
|
Process -
tonnes
|
t
|
226,285
|
221,387
|
886,875
|
959,621
|
961,134
|
961,142
|
961,172
|
961,180
|
961,184
|
963,933
|
526,900
|
Process
grade
|
g/t
|
264
|
286
|
304
|
266
|
259
|
288
|
319
|
240
|
249
|
182
|
148
|
Recovery
|
|
84.6%
|
84.6%
|
91.7%
|
91.7%
|
91.7%
|
91.7%
|
91.7%
|
91.7%
|
91.7%
|
91.7%
|
92.0%
|
Ag
production
|
(oz)
|
1,627,609
|
1,724,679
|
7,942,552
|
7,521,808
|
7,337,999
|
8,166,134
|
9,052,849
|
6,806,443
|
7,066,809
|
5,170,036
|
2,312,094
|
Table 4 - Zgounder LOM Operating & Revenue
Plan
|
2022
|
2023
|
2024
|
2025
|
2026
|
2027
|
2028
|
2029
|
2030
|
2031
|
2032
|
Process -
tonnes
|
t
|
226,285
|
221,387
|
886,875
|
959,621
|
961,134
|
961,142
|
961,172
|
961,180
|
961,184
|
963,933
|
526,900
|
Process
grade
|
g/t
|
264
|
286
|
304
|
266
|
259
|
288
|
319
|
240
|
249
|
182
|
148
|
Ag
production
|
(oz)
|
1,627,609
|
1,724,679
|
7,942,552
|
7,521,808
|
7,337,999
|
8,166,134
|
9,052,849
|
6,806,443
|
7,066,809
|
5,170,036
|
2,312,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
$/yr
|
35,375,342
|
37,485,122
|
172,627,755
|
163,483,081
|
159,488,088
|
177,487,224
|
196,759,565
|
147,934,960
|
153,593,886
|
112,368,394
|
50,252,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
costs
|
|
|
|
|
|
|
|
|
|
|
|
|
Mining
opex
|
$/yr
|
15,861,793
|
18,634,471
|
30,471,543
|
32,201,359
|
31,573,878
|
23,784,517
|
22,306,776
|
22,867,465
|
23,125,589
|
21,098,263
|
9,483,233
|
Process
opex
|
$/yr
|
5,249,815
|
5,136,168
|
16,881,947
|
18,091,470
|
18,139,875
|
18,140,134
|
18,141,112
|
18,141,369
|
18,141,503
|
18,229,456
|
9,157,521
|
G&A &
ESG
|
$/yr
|
3,333,080
|
3,957,641
|
6,274,786
|
6,169,600
|
6,123,648
|
6,330,682
|
6,552,360
|
5,990,759
|
6,055,851
|
5,581,658
|
4,867,174
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royalties &
mining
taxes
|
$/yr
|
1,740,116
|
2,090,841
|
7,771,964
|
8,078,993
|
7,795,261
|
8,294,080
|
8,812,147
|
7,260,412
|
7,348,907
|
6,472,851
|
2,312,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
$/yr
|
9,190,539
|
7,666,003
|
111,227,517
|
98,941,662
|
95,855,427
|
120,937,814
|
140,947,173
|
93,674,956
|
98,922,038
|
60,986,168
|
24,429,202
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
costs
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial
capex
|
$/yr
|
55,315,862
|
79,105,119
|
5,002,553
|
|
|
|
|
|
|
|
|
Sustaining capex
&
closure cost
|
$/yr
|
7,673,111
|
8,908,480
|
11,261,964
|
7,381,983
|
9,228,458
|
5,929,644
|
3,932,903
|
907,068
|
909,662
|
911,473
|
7,060,841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
income
|
$/y
|
1,142,584
|
-10,704,733
|
88,491,138
|
75,914,652
|
71,290,418
|
95,889,188
|
115,775,765
|
68,064,584
|
72,851,397
|
35,603,892
|
-6,290,051
|
Taxes
payable
|
$/y
|
228,517
|
0
|
17,698,228
|
15,182,930
|
14,258,084
|
19,177,838
|
23,155,153
|
13,612,917
|
14,570,279
|
7,120,778
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
after
tax cash
flow
|
$/y
|
-54,026,951
|
-80,347,595
|
77,264,774
|
76,376,748
|
66,460,583
|
95,830,332
|
113,859,117
|
72,886,203
|
83,442,096
|
52,953,916
|
17,368,361
|
SOURCE Aya Gold & Silver
Inc