VANCOUVER, BC, March 31, 2021 /PRNewswire/ - Aris Gold
Corporation (Aris Gold or the Company) (TSX: ARIS) (OTCQX:
ALLXF) announces fourth quarter (Q4) and full year 2020 financial
results from its wholly owned Marmato mine in Colombia. The Company's 2020 Management's
Discussion and Analysis (MD&A) and Financial Statements have
been filed under the Company's profile on SEDAR at www.sedar.com
and are available on the Company's website at www.arisgold.com.
2020 Achievements
Since the launch of the Company in February 2020, significant achievements and rapid
progress has been made, including:
- Completed a Preliminary Feasibility Study (PFS) for the
expansion of the Marmato mine, which focused on the development of
the Marmato Deep Zone (MDZ) mineralization, construction of a new
4,000 tonne per day (tpd) plant, new dry stack tailings storage
facilities and the use of efficient mechanized mining methods.
- Established a new Life of Mine plan for the Marmato mine based
on a total Mineral Reserve1 of 2.0 million contained
ounces (oz) gold from exploration drilling results to mid-March 2020.
- Launched a 35,000-metre drill program at Marmato which
commenced in May 2020, with the
principal objective of converting Inferred Mineral Resources to
Indicated Mineral Resources while also testing several newly
discovered areas. Drilling results during 2020 included high-grade
mineralization over broad widths demonstrating potential to extend
the 13-year mine life outlined in the PFS. As of March 2021, this drill program was approximately
50% complete.
- Acquired the Juby Gold Project in July
2020, an advanced stage exploration project in northeastern
Ontario, and completed an updated
Mineral Resource Estimate (the Juby MRE). which is included in the
Juby Technical Report (as defined below). The Juby MRE included
Indicated Resources of 770,000 contained oz gold based on 21.3
million tonnes at an average grade of 1.13 g/t and Inferred
Resources of 1,488,000 contained oz of gold based on 47.1 million
tonnes at an average grade of 0.98 g/t.
- Completed three financings for gross proceeds of $186.5 million, which included:
-
- C$50.0 million ($37.4 million) bought deal financing
- $83.1 million senior secured
Gold-Linked Notes (GLN) financing
- C$85.0 million ($66.0 million) private placement led by the
current Board and management
- Arranged a $110.0 million
precious metals streaming financing, the completion of which is
subject to certain customary conditions.
- Achieved the revised 2020 gold production guidance at the
Marmato Upper Zone mine despite challenges associated with COVID-19
(See Q4 and Full Year 2020 Financial and Operating
Highlights).
- Negotiated a 30-year extension of the mining title at the
Marmato mine to October 2051, which
included an agreement with the Agencia Nacional de Mineria (ANM)
for the creation of a social investment fund with a defined
contribution formula based on gold production rates.
Q4 and Full Year 2020 Financial and Operating
Highlights
|
Q4
|
Full Year
|
|
2020
|
2019
|
2020
|
2019
|
Financial
position, as at December 31 ($000s)
|
|
|
|
|
Cash and cash
equivalents
|
|
|
32,007
|
2,672
|
Cash in escrow
(1)
|
|
|
142,096
|
-
|
Total, cash, cash equivalents and cash in escrow
|
|
|
174,103
|
2,672
|
Precious metals
streaming financing (2)
|
|
|
110,000
|
-
|
Long-term
debt
|
|
|
81,742
|
-
|
|
|
|
|
|
Operating
data
|
|
|
|
|
Gold produced
(oz)
|
7,181
|
7,057
|
23,832
|
25,750
|
Average
realized gold price ($/oz sold)
|
$1,870
|
$1,470
|
$1,767
|
$1,387
|
Cash costs
($/oz sold) (3)
|
1,238
|
927
|
1,168
|
983
|
AISC ($/oz
sold) (3)
|
1,941
|
1,281
|
1,653
|
1,222
|
|
|
|
|
|
Financial data
($000s, except per share amounts)
|
|
|
|
|
Revenue
|
$12,550
|
$9,896
|
$42,790
|
$35,648
|
Cost of
sales
|
9,958
|
7,454
|
33,789
|
29,870
|
Social
programs
|
448
|
-
|
931
|
-
|
Income from
mining operations
|
2,144
|
2,442
|
8,070
|
5,778
|
Adjusted EBITDA
(3)
|
768
|
2,686
|
5,238
|
6,743
|
Net (loss)
income (4)
|
(33,744)
|
1,551
|
(83,114)
|
3,605
|
Per share –
basic and diluted
|
(0.32)
|
0.05
|
(1.25)
|
0.13
|
(1)
|
The net proceeds from
the C$85 million private placement and the US$83 million of
gold-linked notes were released from escrow on February 4,
2021
|
(2)
|
The Company has
entered into a definitive Precious Metals Purchase Agreement with
Wheaton Precious Metals International Ltd., the closing of which is
subject to certain customary conditions. On closing, US$38 million
will be paid to the Company with the remaining amount to be paid in
tranches upon achievement of completion of * 50% and (y) 75%, of
the Marmato Deep Zone expansion project construction.
|
(3)
|
For full details on
cash costs, AISC and adjusted EBITDA calculations, see "Non-IFRS
Measures" on pages 24 to 26 of the Company's MD&A, available on
SEDAR and on the Company's website at www.arisgold.com. The Company
has changed its methodology of calculating cash costs and AISC.
Historical amounts have been updated for the purposes of
comparison
|
(4)
|
The difference
between Income from mining operations and Net (loss) income for the
full year is primarily related to one-time expenses of $75.3
million included in Losses on financial instruments ($44.8
million), RTO Transaction Expense ($16.7 million), and Financing
fees and expenses ($13.8 million)
|
Outlook
The key achievement of 2020 was the creation of Aris Gold as an
independent public company with a strong financial platform to fund
growth. During 2021, the focus shifts to improving the operating
performance of the Marmato Upper Zone mine and to start realizing
the potential of the Marmato Deep Zone by starting the development
of a new MDZ underground mine and constructing a new processing
facility in Q4.
Marmato – Upper Zone Operations
During 2021, Aris Gold expects steady improvements of Marmato's
current operations through implementation of comprehensive
workforce training and redirecting site-level operations management
while concurrently improving health, safety, and environmental
performance.
During the ongoing modernization and expansion phase of the
Marmato mine, the Company anticipates elevated AISC per oz due to
increased investments in sustaining capital. During 2020,
sustaining capital expenditures totalled $6.4 million or $268 per oz sold, and included $4.0 million or $168 per oz sold related to mine infrastructure
improvements and equipment. The Marmato mine has been in operation
since 1991 and investments are planned to refurbish Upper Zone
operations in advance of the large-scale MDZ expansion project
expected to start in Q4 2021.
Marmato – Developing the MDZ
During 2021, Aris Gold's primary focus is the scheduled start of
the Marmato Deep Zone project in Q4. The Marmato project team is
implementing a comprehensive development plan that includes
completing optimization studies, completing the 35,000-metre drill
program and subsequently updating the mineral resource and reserve
estimates, engaging an EPCM contractor, completing FEL3 design,
amending the environmental management plan and continuing to
advance health, safety, and community support programs.
Corporate Growth Strategy
On February 4, 2021, the Company
changed its name to Aris Gold Corporation in association with the
appointment of the current Board and management team and the
expansion of the corporate growth strategy with the vision of
building Aris Gold into their next globally relevant gold
producer.
Aris Gold is pursuing a growth strategy of acquiring operating
gold mines and projects nearing construction with the goal of
creating value through adding scale and diversification. Aris Gold
has a solid foundation and experienced team to implement its growth
plans.
Technical Information
The scientific disclosure and technical information included in
this Press Release is based upon information included in the
technical reports listed below that were prepared in compliance
with National Instrument 43-101 – Standards of Disclosure for
Mineral Projects (NI 43-101).
- Marmato Technical Report entitled "Revised NI 43-101 Technical
Report Pre-Feasibility Study Marmato Project Colombia" dated
September 18, 2020 with an effective
date of March 17, 2020. The Marmato
Technical Report was prepared by Ben
Parsons, MSc, MAusIMM (CP), Eric J.
Olin, MSc Metallurgy, MBA, SME-RM, MAusIMM, Fernando Rodrigues, BS Mining, MBA, MAusIMM,
MMSAQP, Jeff Osborn, BEng Mining,
MMSAQP, Joanna Poeck, BEng Mining,
SME-RM, MMSAQP, Fredy Henriquez, MS
Eng, SME, ISRM, Breese Burnley, P.E., Cristian A Pereira Farias,
SME-RM, David Hoekstra, BS, PE,
NCEES, SME-RM, David Bird, PG,
SME-RM, Mark Allan Willow, MSc, CEM,
SME-RM, and Tommaso Roberto Raponi,
P.Eng, each of whom is independent of the Company within the
meaning of NI 43-101 and is a "Qualified Person" as such term is
defined in NI 43-101.
- Juby Technical Report entitled "Technical Report on the Updated
Mineral Resource Estimate for the Juby Gold Project" dated
October 5, 2020 with an effective
date of July 14, 2020. The Juby
Technical Report was prepared by Joe
Campbell, B.Sc., P.Geo., Alan
Section, M.Sc., P.Geo., Duncan
Studd, M.Sc., P.Geo. and Allan
Armitage, Ph.D., P.Geo., each of whom is independent of the
Company within the meaning of NI 43-101 and is a "Qualified Person"
as such term is defined in NI 43-101
About Aris Gold
Aris Gold is a Canadian mining company listed on the TSX under
the symbol ARIS. The Company is led by an executive team with a
demonstrated track record of creating value through building
globally relevant gold mining companies. Aris Gold operates the
Marmato mine in Colombia, where a
modernization and expansion program is underway, and the Juby
project, an advanced exploration stage gold project in the Abitibi
greenstone belt of Ontario,
Canada. Aris Gold plans to pursue acquisition and other
growth opportunities to unlock value creation from scale and
diversification.
Additional information on Aris Gold can be found at
www.arisgold.com and www.sedar.com.
Forward-looking Information
This news release contains "forward-looking information" or
forward-looking statements" within the meaning of Canadian
securities legislation. All statements included herein, other than
statements of historical fact, including without
limitation statements relating to the possibility of
converting inferred resources to indicated resources at the Marmato
Mine, completion of the precious metals stream financing and
statements made under the heading "Outlook" are
forward-looking. Generally, the forward-looking information and
forward looking statements can be identified by the use of forward
looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate",
"will continue" or "believes", or variations of such words and
phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved". Statements concerning mineral resource estimates may
also be deemed to constitute forward looking information to the
extent that they involve estimates of the mineralization that will
be encountered. The material factors or assumptions used to develop
forward looking information or statements are disclosed throughout
this presentation.
Forward looking information and forward looking statements,
while based on management's best estimates and assumptions, are
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance
or achievements of Aris Gold to be materially different from those
expressed or implied by such forward-looking information or forward
looking statements, including but not limited to: the ability of
the Aris Gold management team to successfully integrate with the
current operations, risks related to international operations,
risks related to general economic conditions, uncertainties
relating to operations during the COVID-19 pandemic, actual results
of current exploration activities, availability of quality assets
that will add scale, diversification and complement Aris Gold's
growth trajectory; changes in project parameters as plans continue
to be refined; fluctuations in prices of metals including gold; the
ability to convert mineral resources to mineral reserves;
fluctuations in foreign currency exchange rates, increases in
market prices of mining consumables, risks associated with holding
derivative instruments (such as credit risks, market liquidity risk
and mark-to-market risk), possible variations in mineral reserves,
grade or recovery rates; failure of plant, equipment or processes
to operate as anticipated; changes in national and local government
legislation, taxation, controls, regulations, regulations and
political or economic developments in Canada or Colombia, accidents and operations, labour
disputes, title disputes, claims and limitations on insurance
coverage and other risks of the mining industry; delays in
obtaining governmental approvals including obtaining required
environmental and other licenses, or 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 the Company operates, as well as those factors discussed
in the section entitled "Risk Factors" in Aris Gold's most recent
AIF available on SEDAR at www.sedar.com.
Although Aris Gold has attempted to identify important factors
that could cause actual results to differ materially from those
contained in forward-looking information and 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 information or statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such information or statements. The Company has and
continues to disclose in its Management's Discussion and Analysis
and other publicly filed documents, changes to material factors or
assumptions underlying the forward-looking information and
forward-looking statements and to the validity of the information,
in the period the changes occur. The forward-looking statements and
forward-looking information are made as of the date hereof and Aris
Gold disclaims any obligation to update any such factors or to
publicly announce the result of any revisions to any of the
forward-looking statements or forward-looking information contained
herein to reflect future results. Accordingly, readers should not
place undue reliance on forward-looking statements and
information.
This announcement does not constitute an offer of securities for
sale in the United States, nor may
any securities referred to herein be offered or sold in
the United States absent
registration or an exemption from registration as provided in the
U.S. Securities Act of 1933 as amended (the "Securities Act") and
the rules and regulations thereunder. The securities referred to
herein have not been registered pursuant to the Securities Act and
there is no intention to register any of the securities in
the United States or to conduct a
public offering of securities in the
United States.
__________________________
|
1 Proven and Probable Mineral
Reserves include proven mineral reserves of 0.807 million
tonnes at 5.13g/t for 133,000 contained oz and probable mineral
reserves of 18.898 million tonnes at 3.11 g/t for 1,888,000
contained oz. Full details of the Marmato Mineral Reserve Estimate
are included in the Marmato Technical Report (as defined
below).
|
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SOURCE Aris Gold Corporation