VANCOUVER, Sept. 14, 2016 /CNW/ - Sandstorm Gold Ltd.
("Sandstorm" or the "Company") (NYSE MKT: SAND, TSX: SSL) is
pleased to provide an update at various projects underlying the
Company's streams and royalties.
CERRO MORO DEVELOPMENT ON TRACK
The Cerro Moro project is a high grade gold and silver deposit
in the Santa Cruz province of
Argentina, currently in the
development stage with first production planned for 2018. Yamana
Gold Inc. ("Yamana") has been carrying out a 2016 work program at
Cerro Moro including the ramp-up of site construction activities,
the continuation of detailed engineering, as well as the
advancement of underground mining in order to gain a better
understanding of in-situ mining conditions. Yamana's planned
expenditures for 2016 are expected to be approximately US$53 million, leaving US$224 million in total for 2017 and 2018, with
the majority of the capital being spent in 2017. This development
approach allows for further exploration drilling in order to
increase the size of the Cerro Moro mineral resources, and to
improve the current mineral resource categorization. The 2016
exploration program at Cerro Moro is expected to complete a total
of approximately 16,000 metres of drilling and is focused on
discovering a new high grade structure and expanding the current
Indicated mineral resources.
Development progress at Cerro Moro is outlined below:
- 325 metres of underground development (of the 617 metres
planned for 2016) were completed as of the end of the second
quarter 2016;
- the ramp-up of site construction is continuing with bulk
earthworks completed during Q2 2016 and the concrete contractor
having mobilized to site;
- detailed engineering is 73% complete and is advancing to a
planned 85% completion by the end of the 2016 year; and
- procurement progress is tracking well, the upgrade of an
existing mine truck facility is advanced, and the phase 2
construction camp installation as well as the tailings dam design
have concluded.
For more information, visit the Yamana website at
www.yamana.com and see the press release dated
July 28, 2016.
Sandstorm has a silver stream agreement to purchase an amount of
silver from Cerro Moro equal to 20% of the silver produced, up to a
maximum of 1.2 million ounces of silver annually, until Yamana has
delivered to Sandstorm 7.0 million ounces of silver; then 9.0% of
the silver produced thereafter for the life of the mine. Sandstorm
will make ongoing payments for each ounce of silver received, equal
to 30% of the spot price per ounce of silver.
If Yamana's progress at Cerro Moro does not continue as expected
there is a silver stream backstop in place. Specifically, if by
January 1, 2019 the Cerro Moro
processing facility has not averaged 80% of its daily nameplate
production capacity over a 30-day period (the "Commencement of
Production"), then Yamana's producing El Peñon mine in Chile will provide a 24 month backstop until
the Commencement of Production at Cerro Moro has begun. During the
24 month backstop, if applicable, Sandstorm will purchase an amount
of silver equal to 16% of El Peñon's silver production up to a
maximum of 1.2 million ounces per annum at a price equal to 30% of
the spot price per ounce of silver.
As part of the stream transaction between Yamana and the
Company, Yamana was issued Sandstorm warrants exercisable upon
certain capital expenditures being met at Cerro Moro. Yamana
recently fulfilled these requirements.
YAMANA GOLD PROVIDES AN EXPLORATION UPDATE at CHAPADA AND
GUALCAMAYO
Chapada
The Chapada mine, located in central Goias State, Brazil has been in operation since 2007
producing a gold and copper concentrate. To sustain and grow
current production levels at Chapada (historically ranging between
105,000 to 150,000 ounces gold and 120 to 150 million pounds
copper) Yamana has allocated a US$6.0
million exploration budget for 2016. The overall budget
supports local mine infill and exploration drill programs along
with district scale exploration work.
Yamana has completed 23,477 metres of drilling in 172 holes in
the near mine exploration and core mine infill programs through the
end of July, 2016. The near mine program focused on defining and
expanding the Sucupira Mineral Resource immediately adjacent to the
main Chapada pit, and the core mine infill program is concentrating
on providing increased grade definition of the ore zones for
selective mining purposes. Results have been encouraging from all
programs.
At Sucupira, drilling has returned continuous gold and copper
values along a strike length of 1,700 meters with drill hole
intercept lengths of between 9 and 180 meters for the low grade
halo and intercept lengths ranging from 6 to 38 metres for the high
grade core. An example of Sucupira mineralization is represented by
results from hole NM-184 which returned 111.2 metres of 0.26 g/t
gold and 0.42% copper from 182 metres hole depth and a second
interval of 24.6 metres of 0.39 g/t gold and 0.35% copper from 304
metres hole depth. Included in the interval beginning at 182 metres
are higher grade intercepts of 6.26 metres of 0.60 g/t gold and
0.86% copper; 13.7 metres of 0.98 g/t gold and 1.05% copper. The
second interval beginning at 304 metres includes a high grade core
of 8.7 metres assaying 0.86 g/t gold and 0.64% copper.
Drill testing to explore for extensions of the Chapada ore body
have shown positive results immediately beneath the current pit.
Holes NM-159 intersected 53.17 metres of 0.16 g/t gold and 0.29%
copper from 41.8 metre hole depth and hole NM-183 intersected 37.6
metres of 0.20 g/t gold and 0.24% copper, both immediately beneath
the ultimate pit boundary. To put into context these compare to
current head grades being processed at the Chapada mill in the
order of 0.29 g/t gold and 0.32% copper. The Chapada deposit is
open to the southeast and will be further tested in the second half
of 2016.
For more information and complete drill results, visit the
Yamana website at www.yamana.com and see the press release
dated September 6, 2016.
Sandstorm has a copper stream agreement to purchase an amount of
copper from Chapada, equal to 4.2% of the copper produced, up to a
maximum of 3.9 million pounds annually, until Yamana has delivered
to Sandstorm 39 million pounds of copper; then 3.0% of the copper
produced until, on a cumulative basis, Yamana has delivered 50
million pounds of copper to Sandstorm; and then 1.5% of the copper
produced thereafter for the life of the mine. Sandstorm will make
ongoing payments for each pound of copper purchased equal to 30% of
the spot price of copper.
Gualcamayo
The Gualcamayo gold mine is located in Argentina in the north-central portion of San
Juan Province and has been in continuous operation since 2008. To
support long term discovery and growth at Gualcamayo the Yamana
exploration team has developed and prioritized 29 areas to explore
based on proximity to the mine, favorable geology, geochemistry,
geophysics and remote sensing characteristics, size potential and
accessibility.
Exploration drilling commenced in late 2015 to discover and
develop new oxide ounces amenable to current heap leach processing
technology and continued into early 2016 with a budget of
US$4 million. Positive results were
returned from two areas immediately adjacent to the current open
pit. The Cerro Condor target is located along the eastern rim of
the QDD Main pit wall and was defined by channel sample results
including 60 metres of 2.57 g/t gold and 10 metres of 9.19 g/t
gold. The Potenciales target, located along the western flank of
the pit wall was defined by numerous channel sample results,
including 10 metres of 10.5 g/t gold and 10 metres of 13.28 g/t
gold. Given these impressive surface results, a US$3.5 million budget increase was approved in
the first quarter for drill testing. Results of these drill
programs have been very positive and further drilling is planned
for 2016 to expand these new discoveries.
Both of these new discoveries are significant in that they may
define new oxide mineral resources and allow for pit wall lay backs
to exploit more of the QDD Porfundo resources at depth. An updated
Mineral Resource and Mineral Reserve from the new discoveries and
QDD Profundo will be completed in the first quarter of 2017.
Stepping 2 kilometres to the northwest of the QDD Main pit, the
exploration team conducted follow up infill drilling of the Las
Vacas target during the first half of the year yielding positive
results such as 10 metres of 2.01 g/t Au in hole 16LVR-052 and 38
metres of 0.86 g/t Au in hole 16LVR-053. The initial results of
this program indicate that portions of this near surface oxide
deposit will be amenable to the current leaching and gold
extraction circuit.
For more information and complete drill results, visit the
Yamana website at www.yamana.com and see the press release
dated September 6, 2016.
Sandstorm holds a 1.0% net smelter returns ("NSR") royalty on
the Gualcamayo mine.
FROOME ZONE (BLACK FOX) UPDATE
The Froome Zone is located approximately 800 metres west of the
operating Black Fox gold mine in Ontario,
Canada and following the announcement of positive drilling
results in Q1 2016, Primero Mining Corp. ("Primero") has been
evaluating the deposit as a medium term alternative to complement
Black Fox ore. Primero is continuing to assess the potential of the
Froome Zone and has commenced an internal economic evaluation of
the project. An initial mining plan has been developed and
preliminary engineering and geotechnical studies have begun with
the focus on accessing the ore body via an underground drift from
the Black Fox pit, expediting the permitting process and timeline
to initial production. Optimization studies will continue in Q3
2016 with the focus on reducing capital cost and de-risking the
project. Primero's regional exploration program is now focused on
the discovery of Froome-like gold targets along the mineralized
trend.
For more information, visit the Primero website at
www.primeromining.com and see the press release dated
August 4, 2016.
Sandstorm has a gold stream agreement to purchase 8% of the life
of mine gold produced from Black Fox for a per ounce cash payment
equal US$524 per ounce. The gold
stream area of interest includes the Froome Zone target.
LUNA GOLD ANNOUNCES SENIOR MANAGEMENT CHANGES AND
FINANCING
Luna Gold Corp. ("Luna") has announced management changes in
connection with the company's goals to restart the Aurizona Gold
mine located in Maranhão State, Brazil. The new Luna senior management team
includes:
- Christian Milau, CEO and
Director – previously CEO and Director of True Gold Mining Inc.
("True Gold"), CFO of Endeavour Mining Corp. ("Endeavour Mining"),
and Treasurer of New Gold Inc.;
- David Laing, COO and Director –
previously COO of True Gold, COO of Quintana Resources Capital, EVP
of Endeavour Mining, SVP of Endeavour Financial, President of MRDI
USA and also roles at Billiton and
Bema Gold Corp.;
- Peter Hardie, CFO – previously
CFO of True Gold and VP Finance and CFO of Nevsun Resources Ltd.;
and
- Scott Heffernan, EVP Exploration
– previously VP Exploration of True Gold, VP Exploration of Wealth
Minerals Ltd. and Exploration Manager (Argentina) of Cardero Resource
Corporation.
The new leadership team brings a breadth of skills and
experience for the next phase in Luna's growth and development with
the focus being to finalize the Aurizona feasibility study, raise
funds for project construction, re-start the Aurizona mine and to
build value for Luna shareholders. The new leadership team's most
recent experience was successfully advancing True Gold's Karma Mine
into production in early 2016. The team's focus was on a successful
construction and ramp-up of the Karma Mine in Burkina Faso and the creation of shareholder
value, taking the market value of True Gold from approximately
C$70 million to over C$300 million at the time of the sale of True
Gold to Endeavour Mining in April
2016. Mr. Milau and Mr. Laing were also original executives
of Endeavour Mining during a period where Endeavour Mining grew
from 80,000 ounces of gold production to over 500,000 ounces of
production per year. During this period the two executives were
instrumental in completing feasibility studies, mine construction,
government and community negotiations and relations, financings,
acquisitions as well as integrations of various mines and companies
in West Africa.
For more information visit the Luna website at
www.lunagold.com and see the press releases dated
August 15, 2016 and August 29, 2016.
Sandstorm has a 3% to 5% sliding scale NSR royalty on the
Aurizona project. At gold prices less than or equal to $1,500 per ounce, the royalty is a 3% NSR. In
addition, Sandstorm holds a 2% NSR royalty on Luna Greenfields, the
190,073 hectare package of exploration ground adjacent to the
Aurizona project. Luna recently announced an exploration agreement
with AngloGold Ashanti Limited ("AngloGold"), whereby AngloGold can
invest up to US$14 million in
exploration to earn a 70% interest in the Luna Greenfields
property.
MARIANA REPORTS INCREASED HIGH GRADE GOLD-COPPER RESOURCE AND
MAIDEN ZINC RESOURCE AT HOT MADEN
Mariana Resources Ltd. ("Mariana") announced the results of an
updated Mineral Resource estimate for the high grade gold-copper
Hot Maden project in north eastern Turkey ("Hot Maden"). The updated Mineral
Resource estimate was based on assay results received for drill
holes up to, and including HTD‐62 as of June
22, 2016.
The milestones ahead for Hot Maden include continued exploration
and infill drilling at the project, the release of a Preliminary
Economic Assessment in early October, 2016 and the completion of a
Pre-Feasibility Study, expected during the first half of 2017.
For more information and complete resource details visit the
Mariana Resources website at www.marianaresources.com and
see the press release dated July 25,
2016.
Sandstorm holds a 2.0% NSR royalty on the Hot Maden project.
COLUMBUS GOLD GRANTED
PERMITS COVERING POTENTIAL EXTENSIONS OF THE MONTAGNE D'OR GOLD
DEPOSIT - FEASIBILITY STUDY TO BE COMPLETED IN Q1-2017
Columbus Gold Corp. ("Columbus") has received two exploration
permits along strike of the east and west extensions of
Columbus' Montagne d'Or gold
deposit, covering a total surface area of 54.8 km2. The
permits were granted on July 6, 2016
by decree of the French Minister of Economy.
The Montagne d'Or deposit hosts pit-confined Indicated mineral
resources of 83.2 million tonnes grading 1.45 g/t gold (3.9 million
ounces) and Inferred mineral resources of 22.4 million tonnes
grading 1.55 g/t gold (1.1 million ounces). The resources have been
drilled to within 250 meters of the western boundary of the
concession hosting the deposit and to within 600 meters of the
eastern boundary. The newly granted exploration permits provide
Columbus with undrilled potential
where gold-soil anomalies extend for up to 2.0 kilometres to the
west and 2.7 kilometres to the east of the deposit. Only two holes
have ever been drilled within the areas covered by the new
exploration permits; one of those holes, drilled 750 meters east of
the deposit, intercepted 31.94 g/t gold over 3.5 meters. The
following map illustrates the expansion potential:
www.columbusgoldcorp.com/i/nr/2016-07-27-map.pdf. Resources are
calculated using a 0.4 g/t Au COG as described in Technical Report
dated April 11, 2015 (SRK/QP: B.
Stryhas, E. Olin).
A first phase exploration program on the new permits will be
implemented in September 2016 and a
Feasibility Study on the Montagne d'Or gold deposit will be
completed in Q1, 2017. For more information visit the Columbus website at
www.columbusgoldcorp.com and see the press release dated
July 27, 2016 and October 16, 2015.
Sandstorm holds a 1% NSR royalty on the Paul Isnard gold project
which hosts the Montagne d'Or gold deposit.
RISE IN GOLD PRICE LEADS TO INCREASE IN FINANCING ACTIVITY
AMONG SANDSTORM PARTNERS
With the price of gold up over 20% so far in 2016, access to
capital has significantly improved in the mining sector. Several of
Sandstorm's stream and royalty partners have been the beneficiaries
of the improved markets and have been able to complete financings
that will allow them to develop mines and explore their properties.
Examples of recent financings among Sandstorm partners are listed
below:
Project
|
Company
|
Recent
Financing
|
Sandstorm
Royalty
|
Hugo North
Extension
|
Turquoise Hill
Resources
|
US$4.4
billion
|
5.26% Au,
4.26% Ag,
0.42% Cu
|
Coringa
|
Anfield
Gold
|
C$32.0
million
|
2.5% NSR
|
Bomboré
|
Orezone
Gold
|
C$26.45
million
|
0.45% NSR
|
Prairie
Creek
|
Canadian
Zinc
|
C$10.2
million
|
1.2% NSR
|
Aurizona
|
Luna Gold
|
C$12.0
million
|
3%-5% NSR
|
Cadillac
Break
|
Alexandria
Minerals
|
C$5.1
million
|
1.0% NSR
|
Los Verdes
|
Minera
Alamos
|
C$4.0
million
|
2.0% NSR
|
QUALIFIED PERSON
Keith Laskowski (MSc),
Sandstorm's Vice President, Technical Services is a Qualified
Professional (#01221QP) of the Mining and Metallurgical Society of
America and a Qualified Person as defined by Canadian National
Instrument 43-101. Mr. Laskowski has not independently verified the
resource estimates contained in this disclosure. He has reviewed
and approved the technical information in this press release.
ABOUT SANDSTORM GOLD
Sandstorm Gold Ltd. is a gold streaming and royalty company.
Sandstorm provides upfront financing to gold mining companies that
are looking for capital and in return, receives the right to a
percentage of the gold produced from a mine, for the life of the
mine. Sandstorm has acquired a portfolio of 131 streams and
royalties, of which 20 of the underlying mines are producing.
Sandstorm plans to grow and diversify its low cost production
profile through the acquisition of additional gold streams and
royalties.
For more information visit: www.sandstormgold.com
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release contains "forward-looking statements", within
the meaning of the U.S. Securities Act of 1933, the U.S. Securities
Exchange Act of 1934, the Private Securities Litigation Reform Act
of 1995 and applicable Canadian securities legislation, concerning
the business, operations and financial performance and condition of
Sandstorm. Forward-looking statements include, but are not limited
to, statements with respect to the future price of gold, the
estimation of mineral reserves and resources, realization of
mineral reserve estimates, and the timing and amount of estimated
future production. Forward-looking statements can generally be
identified by the use of forward-looking terminology such as "may",
"will", "expect", "intend", "estimate", "anticipate", "believe",
"continue", "plans", or similar terminology.
Forward-looking statements are made based upon certain
assumptions and other important factors that, if untrue, could
cause the actual results, performances or achievements of Sandstorm
to be materially different from future results, performances or
achievements expressed or implied by such statements. Such
statements and information are based on numerous assumptions
regarding present and future business strategies and the
environment in which Sandstorm will operate in the future,
including the price of gold and anticipated costs. Certain
important factors that could cause actual results, performances or
achievements to differ materially from those in the forward-looking
statements include, amongst others, gold price volatility,
discrepancies between actual and estimated production, mineral
reserves and resources and metallurgical recoveries, mining
operational and development risks relating to the parties which
produce the gold Sandstorm will purchase, regulatory restrictions,
activities by governmental authorities (including changes in
taxation), currency fluctuations, the global economic climate,
dilution, share price volatility and competition.
Forward-looking statements are subject to known and unknown
risks, uncertainties and other important factors that may cause the
actual results, level of activity, performance or achievements of
Sandstorm to be materially different from those expressed or
implied by such forward-looking statements, including but not
limited to: the impact of general business and economic conditions,
the absence of control over mining operations from which Sandstorm
will purchase gold and risks related to those mining operations,
including risks related to international operations, government and
environmental regulation, actual results of current exploration
activities, conclusions of economic evaluations and changes in
project parameters as plans continue to be refined, risks in the
marketability of minerals, fluctuations in the price of gold,
fluctuation in foreign exchange rates and interest rates, stock
market volatility, as well as those factors discussed in the
section entitled "Risks to Sandstorm" in Sandstorm's annual report
for the financial year ended December 31,
2015 available at www.sedar.com. Although Sandstorm has
attempted to identify important factors that could cause actual
results to differ materially from those contained in
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 statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements. Sandstorm does
not undertake to update any forward looking statements that are
contained or incorporated by reference, except in accordance with
applicable securities laws.
SOURCE Sandstorm Gold Ltd.