UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or
15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of August, 2015.
Commission File Number 001-32399
BANRO CORPORATION
(Translation of registrants name into English)
1 First Canadian Place
100 King Street West, Suite
7070
Toronto, Ontario, Canada
M5X
1E3
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will
file annual reports under cover Form 20-F or Form 40-F
Form 20-F
[X] Form 40-F [
]
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [ ]
Note: Regulation S-T Rule 101(b)(1) only permits the
submission in paper of a Form 6-K if submitted solely to provide an attached
annual report to security holders.
Indicate by check mark if the registrant is submitting the Form
6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [ ]
Note: Regulation S-T Rule 101(b)(7) only permits the
submission in paper of a Form 6-K if submitted to furnish a report or other
document that the registrant foreign private issuer must furnish and make public
under the laws of the jurisdiction in which the registrant is incorporated,
domiciled or legally organized (the registrants home country), or under the
rules of the home country exchange on which the registrants securities are
traded, as long as the report or other document is not a press release, is not
required to be and has not been distributed to the registrants security
holders, and, if discussing a material event, has already been the subject of a
Form 6-K submission or other Commission filing on EDGAR.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
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BANRO CORPORATION |
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/s/ Kevin Jennings |
Date: August 4, 2015 |
Kevin Jennings |
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Chief Financial Officer
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INDEX TO EXHIBITS
Banro Files NI 43-101 Technical Report for Twangiza
Relating to Previously Announced 59% Increase in Twangiza Mineral
Reserves
and Twangiza Mine Life Extension to 14 Years
Toronto, Canada July 29, 2015 Banro Corporation
("Banro" or the "Company") (NYSE MKT - "BAA"; TSX - "BAA") announces that it has
filed on SEDAR a National Instrument 43-101 technical report in respect of the
Companys Twangiza gold mine, which follows the Mineral Reserve update for
Twangiza announced by the Company in its June 8, 2015 press release. This
report, which was prepared by SRK Consulting (UK) Limited (SRK), is dated July
29, 2015 and entitled NI 43-101 Technical Report, Mineral Resource and Reserve
Update, December 31 2014, Twangiza Gold Mine, Democratic Republic of the Congo
(the Technical Report).
Highlights
|
|
As previously reported in Banros June 8, 2015 press
release, as at December 31, 2014, Twangiza Proven and Probable Reserves
increased 59% to 1.64 million ounces (Moz) of gold (22.38Mt @ 2.28g/t
Au) with the inclusion of non-oxide materials in the reserve pit shell
which are now considered to be economically treatable with the existing
plant. |
|
|
Total gold production of 1,246,311 ounces over 14 years,
with an average annual production of 108,733 ounces of gold over the first
5 years. |
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|
Average total cash operating costs over the current life
of mine of US$699/ounce, with total cost per ounce over the current life
of mine of US$888/ounce. |
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Post-tax net present value (NPV) of US$285 million
based on a 5% discount rate and a gold price of US$1,200 per ounce.
|
The reserve growth at Twangiza has been achieved through the
proven ability of the current plant in late 2014 to economically process a blend
of non-oxide materials existing within the reserve pit shell. These processing
capabilities have been further built upon in the first half of 2015. These
ongoing achievements have extended the mine life of the current installed
operations to 14 years, and provide a continuously strengthening foundation for
future optimization and the possible future expansion of the existing Twangiza
operations, commented Banro CEO and President, John Clarke.
Twangiza Mine Overview
The Twangiza mine, which is 100% wholly-owned by Banro, is
located in the South Kivu Province of the Democratic Republic of the Congo
(DRC), some 35 kilometres west of the Burundi Border and 45 kilometres to the
south-southwest of Bukavu, the provincial capital. The Twangiza property
consists of six exploitation permits totalling 1,156 square kilometres which are
wholly-owned by Twangiza Mining SA, a DRC subsidiary of Banro. The Twangiza
project poured its first gold in October 2011. The mine commenced with a
refurbished plant designed primarily to process oxide material at 1.3Mtpa. Since
commissioning, the plant has been improved and expanded to
1.7Mtpa and has been shown to be able to process a blend of oxide material with
harder non-oxide material comprising partially weathered transitional rock
containing residual sulphides and fresh rock containing sulphides.
Technical Report
The Technical Report provides:
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|
an update on the expansion and upgrade of the original
processing plant to allow processing of non-oxide material at an annual
throughput of 1.7Mtpa; |
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a summary of changes implemented as a result of
production reconciliation with historical estimates; |
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historical and forecast mining and processing operating
costs based on the ability to process non-oxide material at the increased
annual throughput; |
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mine plan for the 1.7Mtpa processing operating costs, at
a range of gold prices and mining operating costs; |
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a base line production schedule based on an economic
cut-off grade; |
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the tailings management facility plan to accommodate the
increased Mineral Reserve tonnage and throughput rate; and |
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a base line financial model that incorporates the
additional capital to be expensed during the mine life and assesses the
sensitivity of the project to gold price fluctuation.
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Banros Mineral Resources and Mineral Reserves are reported in
accordance with National Instrument 43-101, which incorporates by reference the
CIM Definition Standards on Mineral Resources and Mineral Reserves. The Mineral
Resources are inclusive of the Mineral Reserves component.
Twangiza Mineral Resource and Mineral Reserve Declaration as
at December 31, 2014
Table 1: Twangiza Mineral Resources
Category |
As at December 31, 2013
|
As at December 31, 2014
|
|
Tonnes |
Grade |
Gold |
Tonnes |
Grade |
Gold |
|
(Mt) |
(g/t Au) |
(Moz) |
(Mt) |
(g/t Au) |
(Moz) |
Twangiza (Oxide) |
|
|
|
|
|
|
Measured |
6.56 |
2.62 |
0.55 |
3.72 |
2.30 |
0.28 |
Indicated |
9.00 |
1.89 |
0.55 |
8.76 |
1.88 |
0.53 |
Measured & Indicated |
15.56 |
2.21 |
1.10 |
12.48 |
2.02 |
0.81 |
Inferred |
1.27 |
1.35 |
0.06 |
1.34 |
1.32 |
0.06 |
|
|
|
|
|
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|
Twangiza (Transition & Fresh) |
|
|
|
|
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|
Measured |
5.97 |
2.23 |
0.43 |
3.80 |
2.23 |
0.27 |
Indicated |
92.87 |
1.43 |
4.26 |
93.00 |
1.40 |
4.18 |
Measured & Indicated |
98.85 |
1.48 |
4.69 |
96.80 |
1.43 |
4.45 |
Inferred |
12.10 |
1.22 |
0.47 |
11.65 |
1.12 |
0.42 |
|
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|
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TOTAL MEASURED & INDICATED |
114.41 |
1.57 |
5.79 |
109.28 |
1.50 |
5.26 |
TOTAL INFERRED |
13.37 |
1.23 |
0.53 |
12.99 |
1.15 |
0.48 |
2
As previously reported in Banros June 8, 2015 press release,
Twangizas Measured & Indicated (M&I) Mineral Resource has decreased
9.16% to 5.26 Moz (109.28Mt @ 1.50g/t Au) (December 31, 2013: 5.79 Moz
representing 114.41Mt @ 1.57g/t Au), and Inferred Mineral Resources have
decreased by 9.44% to 0.48 Moz (12.99Mt @ 1.15g/t Au) (December 31, 2013: 0.53
Moz representing 13.37Mt @ 1.23g/t Au). The reduction in the Mineral Resource is
mainly attributed to mining depletion. The current Mineral Resource estimates
consist of in situ Mineral Resources at a 0.4 g/t Au cut-off constrained within
a US$1,600 per ounce optimized pit shell.
Table 2: Twangiza Mineral Reserves
Category |
As at December 31, 2013
|
As at December 31, 2014 |
|
Tonnes |
Grade |
Gold |
Tonnes |
Grade |
Gold |
|
(Mt) |
(g/t Au) |
(Moz) |
(Mt) |
(g/t Au) |
(Moz) |
Proven |
5.62 |
2.49 |
0.45 |
7.47 |
2.41 |
0.58 |
Probable |
8.07 |
2.23 |
0.57 |
14.91 |
2.22 |
1.06 |
Proven + Probable |
13.69 |
2.34 |
1.03 |
22.38 |
2.28 |
1.64 |
Note: Rounding of numbers may result in computational
discrepancies.
Mineral Reserves are included in Mineral Resources.
As previously reported in Banros June 8, 2015 press release,
the Proven and Probable Mineral Reserve of Twangiza has increased by 59% to 1.64
Moz (22.38Mt @ 2.28g/t Au) from 1.03 Moz (13.69Mt @ 2.34g/t Au) (December 31,
2013). This 59% increase is comprised of net mining depletion, discount on bulk
density, artisanal mining voids and an increase in reserves as a result of the
proven ability to process by blending the portions of the non-oxide ore within
the reserve pit using the upgraded Twangiza plant.
A reconciliation exercise carried out under the supervision of
SRK recommended a revision of the bulk densities of the top 15m material in the
Twangiza Main and North pits, from an average of 2.05 t/m3 to 1.80
t/m3 and 1.89 t/m3, respectively. Due to the extensive
degree of weathering and artisanal mining, a further 19.5% discount was applied
to the overall bulk densities of the measured component of the Twangiza Main
pit. These modifications were not captured in the feasibility studies published
in July 2009. Banro management will continue to revisit the bulk density
discount currently applied to the top 15m of material based on results obtained
from operational mining data. The simultaneous application of the two discounts
may have resulted in a particularly conservative estimate.
During the first half of 2015, Twangiza has progressively
increased the percentage of transition material processed, with single day
levels surpassing 60% of tonnes processed being transition ore. Recoveries
during these periods have indicated the potential for overall recoveries of
blended material (oxide and non-oxide material) to be greater than that of the
stand-alone processing results as indicated by historic laboratory-based
metallurgical recovery analyses. The current NI 43-101 study used the results of
the historic laboratory-based metallurgical recovery analyses. Further testwork
will be conducted to fully evaluate the potential high recovery benefits of
blended materials compared with their component recoveries.
3
Operating Cost, Capital Cost and Financial Analysis Summary
The operating costs and capital costs were estimated and
incorporated into the financial analysis below. These estimates have been
prepared based on a zero-based cost analysis following a review of 2014
historical costs. The financial analysis also reflects the fiscal aspects of the
mining convention governing the Twangiza mine, which includes a 100% equity
interest and a 10 year tax holiday from the start of production. An
administrative tax of 5% for the importation of plant, machinery and consumables
has been included in the projected capital and operating costs.
Table 3: Summary of LOM Operating Costs
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Item |
Actual H2
2014 |
Forecast in Mine Plan
|
|
(Annualised) |
|
|
|
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|
US$ million |
US$ / t |
US$ / oz |
US$ million / |
US$ / t |
US$ / oz |
|
/ annum |
processed |
poured |
annum |
processed |
poured |
Mining |
|
|
|
|
|
|
Payroll |
5.40 |
3.53 |
47.7 |
3.99 |
2.50 |
45 |
Materials |
3.71 |
2.43 |
32.8 |
2.60 |
1.62 |
29 |
Contractors & Consultants |
3.13 |
2.05 |
27.6 |
0.90 |
0.56 |
10 |
Diesel & Power |
3.42 |
2.23 |
30.2 |
1.89 |
1.18 |
21 |
Sundry Expenses |
0.39 |
0.25 |
3.4 |
0.15 |
0.09 |
2 |
|
|
|
|
|
|
|
Mining Total |
16.06 |
10.49 |
141.8 |
9.53 |
5.95 |
107 |
Processing |
|
|
|
|
|
|
Payroll |
6.15 |
4.02 |
54.3 |
5.08 |
3.17 |
57 |
Materials |
9.11 |
5.95 |
80.5 |
11.76 |
7.35 |
132 |
Contractors & Consultants |
1.96 |
1.28 |
17.3 |
1.28 |
0.80 |
14 |
Diesel & Power |
15.16 |
9.91 |
133.9 |
11.80 |
7.37 |
133 |
Sundry Expenses |
3.61 |
2.36 |
31.9 |
2.17 |
1.35 |
24 |
|
|
|
|
|
|
|
Processing Total |
36.00 |
23.52 |
317.9 |
32.09 |
20.04 |
360 |
G&A |
|
|
|
|
|
|
Payroll |
5.39 |
3.52 |
47.6 |
5.68 |
3.55 |
64 |
Materials |
2.07 |
1.35 |
18.3 |
0.73 |
0.46 |
8 |
Contractors & Consultants |
6.78 |
4.43 |
59.9 |
6.40 |
4.00 |
72 |
Diesel & Power |
0.74 |
0.49 |
6.6 |
0.69 |
0.43 |
8 |
Sundry Expenses |
6.63 |
4.33 |
58.6 |
7.12 |
4.45 |
80 |
|
|
|
|
|
|
|
G&A Total |
21.61 |
14.12 |
190.9 |
20.62 |
12.89 |
232 |
|
|
|
|
|
|
|
Total Operating Costs |
73.67 |
48.12 |
650.6 |
62.24 |
38.88 |
699 |
4
Table 4: Summary of Capital Costs
ITEM |
COST (US$ million) |
CAPITALISED EXPENDITURE |
|
MINING SUSTAINING CAPITAL |
25.5 |
PROCESSING SUSTAINING CAPITAL |
6.4 |
TMF CONSTRUCTION |
46.0 |
TAILINGS SUSTAINING CAPITAL |
30.5 |
GENERAL & ADMINISTRATION - SUSTAINING CAPITAL |
20.6 |
BANRO FOUNDATION |
1.2 |
TOTAL CAPITALISED EXPENDITURE |
130.2 |
Table 5: Financial Analysis Summary
ITEM |
UNIT |
AMOUNT |
LIFE OF MINE GOLD PRODUCTION |
koz |
1,246 |
PRODUCTION PERIOD |
years |
14 |
ANNUAL GOLD PRODUCTION FOR FIRST 5 YEARS |
koz |
109 |
LIFE OF MINE DIRECT OPERATING COSTS |
US$/oz |
699 |
|
|
|
TOTAL CAPITAL COSTS |
US$/oz |
104 |
ALL IN COSTS |
US$/oz |
888 |
NET CASHFLOW AFTER TAX AND CAPEX |
US$ million |
395 |
A sensitivity analysis was performed on the after tax profits
by varying the gold price between US$1,000 and US$1,600 per ounce, at varying
discount rates. The relevant after tax profits are based on the above noted cost
estimates.
Table 6: Cash Flow |
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|
Sensitivity GOLD |
NET PRESENT VALUE (US$ million) |
PRICE (US$/oz) |
|
|
|
|
|
|
|
|
1600 |
1500 |
1400 |
1300 |
1200 |
1100 |
1000 |
NPV 0.0% |
847 |
734 |
621 |
508 |
395 |
282 |
169 |
NPV 5.0% |
612 |
530 |
449 |
367 |
285 |
203 |
122 |
NPV 8.0% |
516 |
447 |
378 |
310 |
241 |
172 |
103 |
NPV 9.5% |
476 |
413 |
350 |
286 |
223 |
159 |
96 |
NPV 10.0% |
464 |
402 |
341 |
279 |
217 |
156 |
94 |
NPV 12.5% |
411 |
356 |
302 |
247 |
193 |
139 |
84 |
NPV 15.0% |
366 |
318 |
270 |
222 |
173 |
125 |
77 |
The above financial analysis does not take into account ongoing
exploration, feasibility, financing or interest costs.
5
Future Opportunities
Banro is actively pursuing a number of alternatives for
enhancing and increasing the economics and financial returns relating to the
Twangiza mine. These include optimal ore blend for enhanced recoveries, low cost
power alternatives, process optimizations to improve throughput constraints and
metallurgical recoveries, process enhancements to increase processing
capabilities to meet the requirements of additional hard rock resources and
delineating additional high grade resources from the known deposits as well as
from a number of prospects. Possible future expansions of operations will be
evaluated to maximize net present values at market discount rates.
Qualified Persons
The "Qualified Persons" (as such term is defined in National
Instrument 43-101) for the purpose of the Technical Report are Martin Pittuck
(CEng, MIMMM), who is a Corporate Consultant of SRK, David Pattinson (PhD, CEng,
MIMMM), who is a Corporate Consultant of SRK, and Daniel Bansah (MSc (MinEx),
MAusIMM(CP)), who is Banros Head of Projects and Operations. Each of the said
Qualified Persons has reviewed and approved the relevant contents of this press
release.
Banro Corporation is a Canadian gold
mining company focused on production from the Twangiza mine, which began
commercial production September 1, 2012, and completion of commissioning of its
second gold mine at Namoya located approximately 200 kilometres southwest of the
Twangiza gold mine. The Companys longer term objectives include the development
of two additional major, wholly-owned gold projects, Lugushwa and Kamituga. The
four projects, each of which has a mining license, are located along the 210
kilometre long Twangiza-Namoya gold belt in the South Kivu and Maniema provinces
of the DRC. All business activities are followed in a socially and
environmentally responsible manner.
Cautionary Note to U.S. Investors
The United States Securities and Exchange Commission (the "SEC")
permits U.S. mining companies, in their filings with the SEC, to disclose only
those mineral deposits that a company can economically and legally extract or
produce. Certain terms are used by the Company, such as "Measured", "Indicated",
and "Inferred" "Resources", that the SEC guidelines strictly prohibit U.S.
registered companies from including in their filings with the SEC. U.S.
Investors are urged to consider closely the disclosure in the Company's Form
20-F Registration Statement, File No. 001-32399, which may be secured from the
Company, or from the SEC's website at http://www.sec.gov/edgar.shtml.
Cautionary Note Concerning Mineral Resource and
Mineral Reserve Estimates
The Companys Mineral
Resource and Mineral Reserve figures are estimates and no assurances can be
given that the indicated levels of gold will be produced. Such estimates are
expressions of judgment based on knowledge, mining experience, analysis of
drilling results and industry practices. Valid estimates made at a given time
may significantly change when new information becomes available. While the
Company believes that the Mineral Resource and Mineral Reserve estimates
included in this press release are well established, by their nature Mineral
Resource and Mineral Reserve estimates are imprecise and depend, to a certain
extent, upon statistical inferences which may ultimately prove unreliable.
Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability. There is no certainty that Mineral Resources
can be upgraded to Mineral Reserves through continued exploration.
Due to the uncertainty that may be attached to Inferred
Mineral Resources, it cannot be assumed that all or any part of an Inferred
Mineral Resource will be upgraded to an Indicated or Measured Mineral Resource
as a result of continued exploration. Confidence in the estimate is insufficient
to allow meaningful application of the technical and economic parameters to
enable an evaluation of economic viability worthy of public disclosure (except
in certain limited circumstances). Inferred Mineral Resources are excluded from
estimates forming the basis of a feasibility study.
6
Cautionary Note Concerning Forward-Looking
Statements
This press release contains forward-looking statements. All
statements, other than statements of historical fact, that address activities,
events or developments that the Company believes, expects or anticipates will or
may occur in the future (including, without limitation, statements regarding
estimates and/or assumptions in respect of net present values and future cash
flows, Mineral Resource and Mineral Reserve estimates, future gold production,
costs, mine life extension, gold recoveries, potential Mineral Resources and
Mineral Reserves and the Companys production, development and exploration plans
and objectives) are forward-looking statements. These forward-looking statements
reflect the current expectations or beliefs of the Company based on information
currently available to the Company. Forward-looking statements are subject to a
number of risks and uncertainties that may cause the actual results of the
Company to differ materially from those discussed in the forward-looking
statements, and even if such actual results are realized or substantially
realized, there can be no assurance that they will have the expected
consequences to, or effects on the Company. Factors that could cause actual
results or events to differ materially from current expectations include, among
other things: uncertainty of estimates of capital and operating costs,
production estimates and estimated economic return of the Companys projects;
the possibility that actual circumstances will differ from the estimates and
assumptions used in the economic studies of the Companys projects; failure to
establish estimated Mineral Resources and Mineral Reserves (the Companys
Mineral Resource and Mineral Reserve figures are estimates and no assurance can
be given that the intended levels of gold will be produced); fluctuations in
gold prices and currency exchange rates; inflation; gold recoveries being less
than those indicated by the metallurgical testwork carried out to date (there
can be no assurance that gold recoveries in small scale laboratory tests will be
duplicated in large tests under on-site conditions or during production);
uncertainties relating to the availability and costs of financing needed in the
future; changes in equity markets; political developments in the DRC; lack of
infrastructure; failure to procure or maintain, or delays in procuring or
maintaining, permits and approvals; lack of availability at a reasonable cost or
at all, of plants, equipment or labour; inability to attract and retain key
management and personnel; changes to regulations affecting the Company's
activities; the uncertainties involved in interpreting drilling results and
other geological data; and the other risks disclosed under the heading "Risk
Factors" and elsewhere in the Company's annual report on Form 20-F dated April
6, 2015 filed on SEDAR at www.sedar.com and EDGAR at www.sec.gov. Any
forward-looking statement speaks only as of the date on which it is made and,
except as may be required by applicable securities laws, the Company disclaims
any intent or obligation to update any forward-looking statement, whether as a
result of new information, future events or results or otherwise. Although the
Company believes that the assumptions inherent in the forward-looking statements
are reasonable, forward-looking statements are not guarantees of future
performance and accordingly undue reliance should not be put on such statements
due to the inherent uncertainty therein.
For further information, please visit our website at
www.banro.com, or contact:
Martin Jones
+1 (416) 366-2221, Ext.
3213
+1-800-714-7938, Ext. 3213
info@banro.com
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