B2Gold Corp. (TSX:BTO) (NYSE MKT:BTG) (NSX:B2G) (“B2Gold” or the
“Company”) is pleased to announce its operational and financial
results for the fourth quarter and year-end December 31, 2016. The
Company previously released its gold production and gold revenue
for the fourth quarter and full-year 2016, as well as its
production and cash cost guidance for 2017 (see news release dated
02/05/17). All dollar figures are in United States dollars unless
otherwise indicated.
2016
Fourth Quarter
Highlights
- Consolidated gold production of 140,651 ounces, 7% (or 9,182
ounces) greater than the same period in 2015
- Consolidated gold revenue of $181.2 million on record sales of
151,524 ounces at an average price of $1,196 per ounce, an increase
in revenue of 30% (or $42.2 million) over the same period in
2015
- Consolidated cash operating costs (see “Non-IFRS Measures”) of
$546 per ounce (Q4 2015 - $527 per ounce) and consolidated AISC
(see “Non-IFRS Measures”) of $877 per ounce (Q4 2015 - $807)
- Cash flow from operating activities of $82.3 million ($0.09 per
share), an increase of $33.8 million (or 70%) compared with the
fourth quarter of 2015
- Strong cash position of $144.7 million at year-end
- Fekola Project mine construction is 3 months ahead of schedule
for an anticipated October 1, 2017 production start and remains on
budget
- Subsequent to December 31, 2016, on March 14, 2017, the Company
received a binding letter of commitment from the Canadian Imperial
Bank of Commerce to participate in the Company’s revolving credit
facility, thereby increasing the aggregate amount of the facility
from $350 million to $425 million
2016 Full-Year Highlights
- Record annual consolidated gold production of 550,423 ounces of
gold, achieving revised production guidance (of 535,000 to 575,000
ounces) and surpassing initial guidance (of 510,000 to 550,000
ounces)
- Masbate Mine achieved record annual gold production of 206,224
ounces, 17% (or 30,421 ounces) higher than 2015
- Otjikoto Mine achieved record annual gold production of 166,285
ounces, 14% (or 20,562 ounces) higher than 2015
- Record annual consolidated gold revenue of $683.3 million on
record sales of 548,281 ounces at an average price of $1,246 per
ounce
- Consolidated cash operating costs an annual record low of $508
per ounce, at the low end of the Company’s reduced cost guidance
range (of between $500 and $535 per ounce) and well below initial
guidance (of between $560 and $595 per ounce)
- Consolidated AISC of $794 per ounce, near the mid-point of the
Company’s reduced cost guidance range (of between $780 and $810 per
ounce) and well below initial guidance (of between $895 and $925
per ounce)
- Cash flow from operating activities (including $120 million of
proceeds received from Prepaid Sales transactions) an annual record
of $411.8 million ($0.44 per share), an increase of $236.4 million
(or 135%) compared with 2015
- Net income of $38.6 million ($0.04 earnings per share) and
adjusted net income (see “Non-IFRS Measures”) of $99.0 million
($0.11 adjusted earnings per share) for full-year 2016
- Signed a Euro 71.4 million Equipment Facility with Caterpillar
Financial SARL for the Fekola Project
- Additional positive exploration drill results reported for the
Company’s Mali and Burkina Faso greenfield targets
- 2017 outlook provides for forecast annual consolidated gold
production of between 545,000 and 595,000 ounces (including
estimated Fekola pre-commercial production of between 45,000 and
55,000 ounces) with expected higher forecast cash operating costs
and AISC (as compared to 2016) of between $610 and $650 per ounce
and between $940 and $970 per ounce, respectively
- 2018 outlook provides for very strong production growth, with
the planned first full-year of production from the Fekola Project,
consolidated annual gold production is expected to increase
significantly and be between 900,000 and 950,000 ounces (including
estimated Fekola production of between 365,000 to 375,000 ounces)
with cash operating costs and AISC expected to approximate the
Company’s 2016 revised cost guidance ranges (of $500 to $535 per
ounce for cash operating costs and $780 to $810 per ounce for
AISC)
2016 Full-Year and Fourth Quarter
Operational Results
B2Gold achieved another record year of
consolidated gold production in 2016 (for the eighth straight year)
producing 550,423 ounces of gold, near the mid-point of its revised
production guidance range (of 535,000 to 575,000 ounces) and
surpassing its initial guidance range (of 510,000 to 550,000
ounces). Gold production for the year also increased by 12% (or
57,158 ounces) over 2015. The record performance in 2016 reflects
the record performances from the Company’s Masbate and Otjikoto
mines, both setting new annual production records in 2016. The
Company’s La Libertad Mine also met its production guidance, with
2016 production near the high end of its production guidance range.
In the fourth quarter of 2016, consolidated gold production was
140,651 ounces, an increase of 7% (or 9,182 ounces) over the same
period last year.
For the full-year 2016, consolidated cash
operating costs were an annual record low of $508 per ounce, at the
low end of the Company’s reduced cost guidance range (of between
$500 and $535 per ounce) and well below initial guidance (of
between $560 and $595 per ounce). Consolidated cash operating costs
also decreased by $108 per ounce (or 18%) compared to the
prior-year. This significant improvement reflects higher gold
production, lower fuel prices/consumption, and ongoing cost
optimization efforts. In the fourth quarter of 2016, consolidated
cash operating costs were $546 per ounce (Q4 2015 - $527 per
ounce).
Full-year consolidated all-in sustaining costs
(“AISC”) were $794 per ounce, near the mid-point of the Company’s
reduced cost guidance range (of between $780 and $810 per ounce)
and well below initial guidance (of between $895 and $925 per
ounce). Consolidated AISC also decreased by $153 per ounce (or 16%)
compared to the prior-year. The lower consolidated AISC were
primarily driven by the same factors impacting the reduction in
cash operating costs per ounce as well as lower than budgeted
capital expenditures at several mine sites due to the timing of
pre-stripping and underground development activities and land
purchases. In the fourth quarter of 2016, consolidated AISC were
$877 per ounce (Q4 2015 - $807 per ounce).
2016 Full-Year and Fourth Quarter Financial
Results
For the full-year 2016, consolidated gold
revenue was a record $683.3 million on record sales of 548,281
ounces at an average price of $1,246 per ounce compared to $553.7
million (or $576.8 million including $23.1 million of
pre-commercial sales from Otjikoto) on sales of 481,185 ounces (or
499,651 ounces including 18,466 ounces of pre-commercial sales from
Otjikoto) at an average price of $1,151 per ounce in 2015. The 23%
(or $129.6 million) increase in annual gold revenue was mainly
attributable to a 14% increase in gold sales volume and a 8%
increase in the average realized gold price. In the fourth quarter
of 2016, consolidated gold revenue was $181.2 million on record
sales of 151,524 ounces at an average price of $1,196 per ounce
compared to $139 million on sales of 127,482 ounces at an average
price of $1,090 per ounce in the fourth quarter of 2015.
For the full-year 2016, cash flow from operating
activities was an annual record of $411.8 million ($0.44 per share)
compared with $175.4 million ($0.19 per share) in 2015, an increase
of $236.4 million (or 135%). This increase was mainly due to a
$129.6 million increase in gold revenue, $120 million of proceeds
received from the Prepaid Sales transactions (see “Liquidity and
Capital Resources” section below) and a $23.9 million reduction in
production costs which were partially offset by a $15.9 million
increase in income tax expense and an $18.6 million negative change
in non-cash working capital. In the fourth quarter of 2016, cash
flow from operating activities was $82.3 million ($0.09 per share),
an increase of $33.8 million (or 70%) compared with the fourth
quarter of 2015.
Adjusted net income was $99.0 million ($0.11
adjusted earnings per share) for the year compared to $13.3 million
($0.01 earnings per share) in 2015. Adjusted net income in 2016
mainly excluded various unrealized mark-to-market adjustments
(totaling a net loss of $24.0 million), non-cash mineral property
write-offs of $15.0 million and non-cash share based payments of
$13.7 million. In the fourth quarter of 2016, adjusted net income
was $2.5 million ($0.00 per share) compared to $1.6 million ($0.00
per share) in the fourth quarter of 2015.
For the full-year 2016, the Company generated
net income of $38.6 million ($0.04 per share) compared to a net
loss of $145.1 million (negative $0.16 per share) in 2015. In the
fourth quarter of 2016, the Company generated net income of $8.1
million ($0.01 per share) compared to a net loss of $115.1 million
(negative $0.13 per share) in the fourth quarter of 2015. During
the fourth quarter of 2015, the Company revised its long-term gold
price assumption from $1,300 per ounce to $1,250 per ounce
resulting in the Company recording non-cash net impairment charges
totaling $86.7 million.
Liquidity and Capital
Resources
As at December 31, 2016, the Company remained in
a strong financial position with cash and cash equivalents of
$144.7 million compared to cash and cash equivalents of $85.1
million at December 31, 2015. Working capital at December 31, 2016
was $101.0 million compared to working capital of $104.7 million at
December 31, 2015. In addition, the Company has $150 million of
undrawn capacity on its $350 million revolving credit facility
(“RCF”) and a Euro 71.4 million term Equipment Facility with
Caterpillar Financial SARL. Subsequent to December 31, 2016, on
March 14, 2017, the Company received a binding letter of commitment
from the Canadian Imperial Bank of Commerce to participate in the
Company’s RCF, thereby increasing the aggregate amount of the
facility from $350 million to $425 million. The Company believes
that this liquidity coupled with continued strong operating cash
flows from its existing mine operations, will provide adequate
resources both to maintain operations and fund the construction of
the Fekola Project through completion (forecast to be October 1,
2017) based on current assumptions, including current gold prices
and life-of-mine plans.
On August 11, 2016, the Company entered into an
equity distribution agreement (the “ATM Agreement”) with two
placement agents for the sale of common shares for aggregate gross
proceeds of up to $100 million through “at the market”
distributions under the Company’s shelf prospectus and “at the
market” prospectus supplement (the “ATM Offering”). The ATM
Offering runs until the earlier of (i) shares with aggregate gross
proceeds of $100 million have been issued, (ii) February 11, 2018,
or (iii) termination by one of the parties in accordance with the
ATM Agreement. The placement agents, collectively, receive a
placement fee of 2% of the gross proceeds from each placement.
During the year ended December 31, 2016, the Company issued 14.8
million shares for net proceeds for $44.2 million, under the ATM
Offering.
In March 2016, the Company entered into a series
of Prepaid Sales transactions totalling $120 million with its
revolving credit facility bank syndicate. The Prepaid Sales
transactions, in the form of metal sales forward contracts, allow
the Company to deliver predetermined volumes of gold on agreed
future delivery dates in exchange for upfront cash pre-payment. The
Prepaid Sales transactions have a term of 33 months, which
commenced in March 2016, and settlement will be in the form of
physical deliveries of 103,266 ounces of unallocated gold from any
of the Company’s mines in 24 equal monthly installments during 2017
and 2018 (estimated to represent approximately 9% and 6%,
respectively, of the forecast production in those years).
Operations
Mine-by-mine gold production in the fourth
quarter and full-year 2016 was as follows:
Mine |
Q4
2016Production(ounces) |
Full-year 2016
Production(ounces) |
2016UpdatedProduction
Guidance(ounces) |
2016Original Production
Guidance(ounces) |
Masbate |
48,633 |
206,224 |
200,000 – 210,000 |
175,000 – 185,000 |
Otjikoto |
46,846 |
166,285 |
160,000 – 170,000 |
160,000 – 170,000 |
La Libertad |
35,165 |
132,431 |
125,000 – 135,000 |
125,000 – 135,000 |
El Limon |
10,007 |
45,483 |
50,000 – 60,000 |
50,000 – 60,000 |
|
|
|
|
|
B2Gold Consolidated |
140,651 |
550,423 |
535,000 – 575,000 |
510,000 – 550,000 |
Mine-by-mine cash operating costs in the fourth
quarter and full-year 2016 was as follows:
Mine |
Q4 2016Cash Operating
Costs($ per ounce) |
Full-year 2016 Cash Operating
Costs($ per ounce) |
2016UpdatedCost
Guidance($ per ounce) |
2016OriginalCost
Guidance($ per ounce) |
Masbate |
$ |
547 |
$ |
463 |
$465 – $505 |
$620 – $660 |
Otjikoto |
$ |
367 |
$ |
368 |
$365 – $405 |
$400 – $440 |
La Libertad |
$ |
661 |
$ |
659 |
$650 – $680 |
$650 – $680 |
El Limon |
$ |
982 |
$ |
781 |
$690 – $730 |
$610 – $650 |
|
|
|
|
|
B2Gold Consolidated |
$ |
546 |
$ |
508 |
$500 – $535 |
$560 – $595 |
Masbate Gold Mine – Philippines
The Masbate Mine in the Philippines achieved a
very strong year in 2016, producing an annual record 206,224 ounces
of gold, above the mid-point of its revised production guidance
range (of 200,000 to 210,000 ounces) and significantly exceeding
initial guidance (of 175,000 to 185,000 ounces). Gold production
for the year also increased by 17% (or 30,421 ounces) over 2015.
Masbate’s strong operational performance was driven by
better-than-expected grades from the Main Vein Stage 1 pit and
higher recoveries arising from higher-than-budgeted oxide ore
tonnage from the Colorado pit. In addition, recoveries were
positively impacted by the newly completed process plant upgrades
(adding residence time and additional oxygen to the CIL circuit to
achieve optimum leach performance). The Masbate Mine also continued
its strong safety performance, completing 2016 without a
“Lost-Time-Injury” and extending the number of days without a
“Lost-Time-Injury” to 445 days.
In the fourth quarter of 2016, gold production
at Masbate was 48,633 ounces, 13% (or 5,734 ounces) above budget
and 1% (or 675 ounces) higher than the fourth quarter of 2015.
Commencing in August 2016, Masbate’s mine plan was adjusted to
optimize the mine’s development sequence/gold production through to
2017 and beyond. These adjustments included accelerated mining in
the Main Vein Stage 1 pit, expanding the Colorado pit and
commencing site preparations for later Main Vein stages. In
addition, the lower grade (but higher recovery) Colorado pit ore
was prioritized as mill feed ahead of the higher grade Main Vein
ore, largely due to the higher than budgeted oxide ore content
being sourced from the larger Colorado pit. The excess higher grade
ore from Main Vein Stage 1 pit was stockpiled and is budgeted to be
processed in 2017.
For the full-year 2016, Masbate’s cash operating
costs were an annual record low of $463 per ounce, and were even
below the reduced cost guidance range (of between $465 and $505 per
ounce) and significantly below initial guidance (of between $620
and $660 per ounce). Cash operating costs also decreased by $194
per ounce (or 30%) compared to the prior-year. This significant
improvement reflects higher gold production and lower fuel/energy
costs. In the fourth quarter of 2016, Masbate’s cash operating
costs were $547 per ounce (Q4 2015 - $512 per ounce).
Masbate’s AISC for the year were $653 per ounce,
significantly below both budget of $899 per ounce and $965 per
ounce in the prior-year, reflecting the favourable cash operating
costs as well as lower capital expenditures. The lower capital
expenditures resulted from lower than budgeted pre-stripping costs
driven by lower mining costs and a lower strip ratio for the
Colorado pit. Timing delays in land acquisition costs also
contributed to the lower than budgeted capital costs. In the fourth
quarter of 2016, Masbate’s AISC were $788 per ounce (Q4 2015 - $795
per ounce).
Capital expenditures totaled $31.9 million in
2016 which consisted mainly of $14 million for plant upgrades, $4.5
million for pre-stripping costs, $3.9 million for powerhouse
upgrades and $2.3 million in mobile equipment purchases. In the
fourth quarter of 2016, capital expenditures totaled $9.6 million,
consisting mainly of $3.1 million for powerhouse upgrades, $2.7
million in pre-stripping costs and $1.5 million for plant
upgrades.
Otjikoto Gold Mine, Namibia
The Otjikoto Mine in Namibia also had a record
year in 2016, producing an annual record 166,285 ounces of gold,
above the mid-point of its production guidance range (of between
160,000 and 170,000 ounces) and 14% (or 20,562 ounces) higher than
2015 (including 18,815 ounces of pre-commercial production from
Otjikoto). Otjikoto’s 2016 production benefitted from higher
throughput due to the successful completion of its mill expansion
project in September 2015 (which increased plant capacity from 2.5
million tonnes per annum to 3.0 million tonnes per annum) and also
due to overall process optimizations. In the fourth quarter of
2016, the Otjikoto Mine produced 46,846 ounces of gold, slightly
above budget and 19% (or 7,472 ounces) higher than the fourth
quarter of 2015.
For the full-year 2016, Otjikoto’s cash
operating costs were an annual record low of $368 per ounce, at the
low end of its reduced cost guidance range (of between $365 and
$405 per ounce) and significantly beating initial guidance (of
between $400 and $440 per ounce). Cash operating costs also
decreased by $57 per ounce (or 13%) compared to the prior-year
(following commercial production on February 28, 2015). The lower
cash operating costs reflect lower fuel prices and the reduced
consumption of fuel and reagents. Cash operating costs were also
lower in 2016 compared to 2015 as a result of a weaker Namibian
dollar/US dollar foreign exchange rate. In the fourth quarter of
2016, Otjikoto’s cash operating costs were $367 per ounce (Q4 2015
- $385 per ounce).
Otjikoto’s AISC for the year were $604 per ounce
compared to budget of $629 per ounce and $550 per ounce in 2015
(following commercial production on February 28, 2015). In the
fourth quarter of 2016, Otjikoto’s AISC were $587 per ounce (Q4
2015 - $509 per ounce).
Capital expenditures totaled $39.2 million in
2016 and included pre-stripping costs of $18.3 million and mobile
equipment purchases of $17.7 million. In the fourth quarter of
2016, capital expenditures totaled $5.4 million mainly for
pre-stripping costs of $3.2 million, mobile equipment purchases of
$1.2 million and $0.6 million for the Wolfshag underground
study.
La Libertad Gold Mine - Nicaragua
For the full-year 2016, La Libertad Mine in
Nicaragua produced 132,431 ounces of gold, near the high end of its
production guidance range (of 125,000 to 135,000 ounces) and 11%
(or 12,956 ounces) higher than 2015. Better grade and higher
recoveries contributed to the successful production year. During
the third quarter of 2016, La Libertad’s mine schedule was adjusted
to mine additional high grade ore from the Jabali Central pit to
offset permitting delays at the Jabali Antenna pit. The Jabali
Antenna pit is now planned for production in the third quarter of
2017, pending completion of permitting and relocation activities.
In the fourth quarter of 2016, gold production at La Libertad was
35,165 ounces, consistent with the fourth quarter of 2015.
La Libertad’s cash operating costs were $659 per
ounce in 2016, near the low end of its cost guidance range (of
between $650 and $680 per ounce), and also $57 per ounce (or 8%)
lower compared to the prior-year. The reduction compared to the
prior-year was mainly due to higher gold production. In the fourth
quarter of 2016, La Libertad’s cash operating costs were $661 per
ounce (Q4 2015 - $601 per ounce).
La Libertad’s AISC were $904 per ounce in 2016,
below both budget of $1,036 per ounce and $988 per ounce in the
prior-year, reflecting lower capital expenditures (primarily driven
by lower pre-stripping costs resulting from permitting delays at
Jabali Antenna) and lower cash operating costs. In the fourth
quarter of 2016, La Libertad’s AISC were $878 per ounce (Q4 2015 -
$877 per ounce).
Capital expenditures totaled $18.5 million for
the year, consisting primarily of La Esperanza tailings dam costs
($5.1 million), land acquisition costs ($4.6 million),
pre-stripping costs ($2.8 million), underground development costs
($2.6 million) and Jabali Central development costs ($2.2 million).
In the fourth quarter of 2016, capital expenditures totaled $4.6
million which consisted primarily of land acquisition costs ($1.8
million) and underground development costs ($1.4 million).
El Limon Gold Mine - Nicaragua
For the full-year 2016, El Limon Mine in
Nicaragua produced 45,483 ounces of gold, below its production
guidance range (of 50,000 to 60,000 ounces) and 13% (or 6,781
ounces) lower compared to 2015. In the fourth quarter of 2016, gold
production at Limon was 10,007 ounces (Q4 2015 – 8,903 ounces). In
2016, Limon’s production was negatively affected by mine fleet
availability limitations and water control issues which reduced ore
flow from Santa Pancha. As a result, mill feed was supplemented
with lower grade ore from surface stockpiles. To improve overall
mine performance, the operations and maintenance areas have been
reorganized and additional mining equipment has been purchased. The
underground pumping system has also been overhauled and the
dewatering wells are currently being improved.
El Limon’s cash operating costs were $781 per
ounce for the year, above the high end of its revised cost guidance
range (of $690 to $730 per ounce) and $68 per ounce (or 10%) higher
compared to the prior-year. The increase was mainly due to lower
gold production. In the fourth quarter of 2016, El Limon’s cash
operating costs were $982 per ounce (Q4 2015 - $958 per
ounce).
El Limon’s AISC were $1,189 per ounce in 2016
compared to budget of $1,008 per ounce and $1,279 per ounce in the
prior-year. In the fourth quarter of 2016, El Limon’s AISC were
$1,501 per ounce (Q4 2015 - $1,466 per ounce).
Capital expenditures totaled $7.7 million in
2016 which consisted mainly of underground development costs ($4.4
million) and mining equipment purchases ($1.0 million). In the
fourth quarter of 2016, capital expenditures totaled $2.5 million,
consisting mainly of underground development costs ($1.6
million).
Production Outlook and Cost
Guidance
For 2017, B2Gold is projecting another year of
growth with consolidated gold production expected to be in the
range of between 545,000 and 595,000 ounces (including estimated
pre-commercial production from Fekola of between 45,000 and 55,000
ounces). Based on Fekola’s current mine construction progress, the
Fekola Project is 3 months ahead of schedule and is planning for an
October 1, 2017 production start. Looking forward to 2018, with the
planned first full-year of production from the Fekola Project
(based on current assumptions and updates to the Company’s
long-term mine plans), the Company is projecting its consolidated
gold production to increase significantly and be between 900,000 to
950,000 ounces. The Fekola Project is expected to be a large
low-cost producer and should enable the Company to significantly
reduce its forecast longer term cash operating costs per ounce and
AISC per ounce.
In 2017, consolidated cash operating costs
(including the Fekola pre-commercial production period) are
expected to be between $610 and $650 per ounce. The expected
increase over 2016 reflects the impact of higher projected
operating strip ratios at Masbate and Otjikoto, higher projected
fuel prices, and lower production from Masbate.
Consolidated AISC (including the Fekola
pre-commercial production period) are expected to be between $940
and $970 per ounce for 2017. The expected increase over 2016
reflects higher anticipated cash operating costs per ounce as well
as higher expected capitalized pre-stripping costs and other
capital expenditures. In comparison to 2016, 2017 forecast
sustaining capital expenditures are anomalously high as a result of
Masbate’s planned mining fleet replacement and expansion (see
“Masbate Mine - Philippines” section below) and as a result of
anticipated higher average strip ratios at Otjikoto (which are
expected to be lower in 2018 and 2019).
For 2018, with the planned first full-year of
production from the Fekola Project (based on current assumptions
and updates to the Company’s long-term mine plans), the Company’s
forecast consolidated cash operating costs per ounce and AISC per
ounce are expected to decrease in 2018 (compared to 2017) and be
comparable to the Company’s 2016 revised cost guidance ranges (of
$500 to $535 per ounce for cash operating costs and $780 to $810
per ounce for AISC).
Mine-by-mine 2017 ranges for forecast gold
production, cash operating costs per ounce and AISC per ounce are
as follows:
|
2017 ForecastGold
Production(ounces) |
2017 ForecastCash Operating
Costs($ per ounce) |
2017 ForecastAISC($ per
ounce) |
Masbate |
175,000 – 185,000 |
$690 - $730 |
$1,020 - $1,050 |
Otjikoto |
165,000 – 175,000 |
$510 - $550 |
$855 - $885 |
La Libertad |
110,000 – 120,000 |
$625 - $665 |
$785 - $815 |
El Limon |
50,000 – 60,000 |
$655 - $695 |
$1,065 - $1,095 |
Subtotal |
500,000 – 540,000 |
$615 - $655 |
$960 - $990 |
Fekola (pre-commercial)(1) |
45,000 – 55,000 |
$580 - $620 |
$700 - $730 |
|
|
|
|
B2Gold Consolidated(2)(3) |
545,000 – 595,000 |
$610 - $650 |
$940 - $970 |
(1) Fekola’s 2017 forecasts include estimated gold production
and operating costs during the pre-commercial production period.
For accounting purposes, Fekola’s revenue and cash operating costs
during the pre-commercial production period will be capitalized to
mineral property development costs. For 2018, with the planned
first full-year of production from the Fekola Project, Fekola’s
gold production is expected to be approximately 365,000 to 375,000
ounces. (2) Consistent with prior years, 2017
consolidated gold production is not scheduled to be evenly
distributed across the four quarters. Gold production in 2017 is
anticipated to be weighted towards the second half of the year
(57%) due to the anticipated start-up of Fekola on October 1, 2017
combined with lower expected average strip ratios in the
second-half. (3) Consolidated cash operating costs per
ounce and AISC per ounce are expected to be lower in the
second-half of 2017 compared to the first-half, reflecting higher
expected gold production, lower expected average strip ratios, and
lower capital expenditures in the second-half. Consistent with the
forecast production weighting between the first-half and
second-half, consolidated cash operating costs are expected to be
in the range of between $670 and $690 per ounce in the first-half
of 2017 and are then expected to decrease in the second-half of
2017 to between $584 and $604 per ounce. Consolidated AISC are
expected to be in the range of between $1,148 and $1,168 per ounce
in the first-half of 2017 and are then expected to decrease in the
second-half of 2017 to between $795 and $815 per ounce.
Masbate Mine, Philippines
For the Masbate Mine, 2017 gold production is
expected to be between 175,000 and 185,000 ounces. Masbate’s 2016
production had benefited from better-than-expected grades from the
Main Vein Stage 1 pit and higher recoveries arising from
higher-than-budgeted oxide ore from the Colorado pit.
Cash operating costs per ounce are expected to
be between $690 and $730 per ounce. The expected increase over 2016
is mainly attributable to lower forecast production and higher
projected strip ratios at the new Main Vein Stage 3 pit and
expanded Colorado pit, as well as higher projected prices for
diesel fuel/heavy fuel oil.
AISC are expected to be between $1,020 and
$1,050 per ounce. The expected increase over 2016 reflects higher
anticipated cash operating costs per ounce, higher forecast
capitalized pre-stripping costs and the planned mine fleet
replacement and expansion. In the first-half of 2017, the Company
has elected to replace a significant portion of Masbate’s mine
fleet with new equipment purchases, rather than rebuilding major
components over several years, to optimize its fleet performance
and reduce both operating and capital costs in future years. In
addition, to be able to meet the additional haulage requirements in
2017 to 2021, Masbate’s mine fleet is also planned to be expanded
in 2017. Since the new fleet will commence utilization in 2017, all
of the related purchase costs have been included in Masbate’s 2017
AISC even though the equipment will benefit Masbate operations in
future years as well. Masbate’s mine equipment purchases are
subsequently planned to decrease significantly over the next
several years.
The Masbate exploration budget for 2017 is
approximately $5 million including 27,000 meters of drilling. The
drilling is divided into brownfields drilling to upgrade resources
within the mine licence area, totalling 16,000 metres of
diamond drilling, and another 11,000 metres on regional targets.
New targets such as Montana SE will be further tested. Drill
results from the 2016 program in the Montana SE area contained up
to 2.39 g/t gold over 22.2 metres true width in hole MONRC141 and
1.23 g/t gold over 17.3 metres true width in hole MONRC 139.
As previously reported by the Company on
September 27, 2016, October 18, 2016 and in its MD&A for the
year ended December 31, 2016, the Philippine Department of
Environment and Natural Resources (the “DENR”) announced the
preliminary results of mining audits carried out by the DENR in
respect of all metallic mines in the Philippines and subsequently
issued the Masbate Mine audit report which contains the detailed
findings from the audit and directed the Company to provide
explanations and comments in response to the audit findings as
described in its previous disclosures. The Company provided a
comprehensive response to the findings and recommendations in the
audit, which the Company believes addresses the issues raised. As
reported by the Company on February 2, 2017, the DENR has announced
further results of its mining audit and the Masbate Mine was not
among the mines announced to be suspended or closed. To-date the
Company has not received any updated formal written response from
the DENR confirming the results of the audit in respect of Masbate
and as such, the final outcome of the audit has not been
determined. The Company believes that it continues to be in
compliance with Philippine’s laws and regulations. The Company will
continue to work closely with the DENR to maintain compliance with
regulations and continue to promote improved quality of life in the
communities where it operates. The Company will continue to provide
updates of its progress with the DENR. Operations remain
uninterrupted at the mine and the projections and guidance for the
Masbate Mine and the Company on a consolidated basis are provided
on this basis.
Otjikoto Mine, Namibia
The Otjikoto Mine is forecast to produce between
165,000 and 175,000 ounces of gold in 2017, compared to 166,285
ounces produced in 2016. Cash operating costs are expected to be
between $510 and $550 per ounce. The expected cost increase over
2016 is mainly due to higher projected strip ratios at the new
Otjikoto Phase 2 pit and Wolfshag Phase 1 pit. In addition, fuel
prices are also projected to be higher than 2016. The average strip
ratios at Otjikoto are expected to be lower in 2018 and 2019. AISC
are expected to be between $855 and $885 per ounce in 2017,
reflecting higher expected cash operating costs per ounce and
capital expenditures.
Life-of-mine production plans for the Otjikoto
Mine, incorporating preliminary projections for the Wolfshag open
pit and underground mines, have been completed for various options
and will be further refined as the detailed geotechnical,
hydrogeological, and design studies are completed in 2017. Ongoing
studies are leading the Company to re-evaluate the open pit and
underground interface.
The total exploration budget for Namibia in 2017
is $5.1 million mainly for 5,000 metres of diamond drilling on the
Otjikoto licence area, and 12,000 metres of diamond drilling and
5,000 metres of RAB drilling on the Ondundu joint venture project.
Drilling at Ondundu in 2016 has defined a distinct North South zone
of mineralization with holes containing up to 3.10 g/t gold over
68.4 metres drilled in hole ON-16-092 and 2.58 g/t over 52.1 metres
(true width approximately 50% of drilled width) drilled in hole
ON-16-96. An additional 5,000 metres of diamond and RC drilling are
committed to new targets in and around the Otjikoto area.
La Libertad Mine, Nicaragua
La Libertad Mine is expected to produce between
110,000 and 120,000 ounces of gold in 2017 (compared to 132,431
ounces produced in 2016) at cash operating costs of between $625
and $665 per ounce and AISC of between $785 and $815 per ounce.
La Libertad’s production forecast assumes that
mining from the higher grade Jabali Antenna pit will now enter the
production stream in the third quarter of 2017 (dependent upon the
successful completion of resettlement activities and receipt of the
remaining mining permits). However, as in 2016, La Libertad retains
some flexibility in sourcing its ore from alternate open pit
resources and mineralized zones (subject to permitting) within
close proximity of La Libertad mill while the Jabali Antenna
permitting and relocation activities are being completed. La
Libertad’s cash operating costs per ounce are expected to remain
in-line with 2016, as the decrease in planned production is
expected to be offset by lower mining costs (as a result of less
waste being moved at the Jabali Central pit). Based on current
assumptions, La Libertad Mine has an approximate mine life of 3
years, subject to further exploration success.
La Libertad’s exploration budget for 2017 is
approximately $6.7 million for a total of 15,000 metres of planned
diamond drilling. The program is comprised of 7,000 metres of
brownfields (near mine) drilling and 8,000 metres of drilling
planned on several regional targets. Most of the drilling in 2017
is expected to be detailed drilling related to underground mine
planning.
El Limon Mine, Nicaragua
In 2017, El Limon is expected to produce between
50,000 and 60,000 ounces of gold (compared to 45,483 ounces
produced in 2016) at cash operating costs of between $655 and $695
per ounce. AISC are expected to be between $1,065 and $1,095 per
ounce.
The Limon exploration budget for 2017 is
approximately $5 million for a total of 11,000 metres of planned
diamond drilling focusing on extending the mine life. The program
will focus on the Las Mercedes and Pozo Bono/Limon Central area.
Drill holes from late 2016 contained up to 9.93 g/t gold over 15.5
metres (true width) in hole LIM16-4035 of Limon Central and 8.92
g/t gold over 14.9 metres (true width) in hole LIM16-4026 on Pozo
Bono.
Development update
Fekola Development Project - Mali
The Company is pleased to announce that the
Fekola Project mine construction is approximately 3 months ahead of
schedule and is now on target for an October 1, 2017 production
start. The Fekola Project remains on budget and is expected to be a
large low-cost producer and should enable the Company to
significantly reduce its longer term cash operating costs per ounce
and AISC per ounce. On June 11, 2015, the Company announced robust
results from the optimized Feasibility Study at the Fekola Gold
Project in Mali. According to the Feasibility Study, the current
average annual gold production for the first seven years is
estimated at approximately 350,000 ounces per year at an average
operating cash cost of $418 per ounce and for the life of mine plan
approximately 276,000 ounces per year at an average operating cash
cost of $552 per ounce.
In the fourth quarter of 2016, B2Gold’s
construction team continued to develop the Fekola Project in Mali.
Significant activities during the quarter included:
- A total of 4,000,000 m3 of material has been moved at
site;
- Construction of tailings storage facility and water embankments
is 100% complete;
- Lining of the tailings facility commenced in December
2016;
- Installation of mechanical components is on-going with gyratory
crusher, pebble crusher, conveyors, reclaim tunnel, leach and CIP
tanks. Commencement of mill installation started in January
2017;
- Goldroom and reagent storage area construction is well
underway;
- Powerhouse construction remains on schedule for a June 2017
commencement of commissioning;
- Pit pre-stripping has commenced ahead of schedule and over
800,000 m3 of material has been removed to-date;
- Grade control for the ore zones has commenced and the lab on
site is under construction (expected to start up in the second
quarter of 2017); and
- Commissioning team has arrived at site and begun hiring and
training the mill/lab operators.
On June 29, 2016, the Company announced an
exploration update for its Fekola Project. Based on the positive
drill results to-date (at both near surface targets and deeper
along strike below the main Fekola pit) and exploration potential,
the Company is expanding the throughput at the Fekola mine to 5
million tonnes per year. The optimized Feasibility Study and
Environmental and Social Impact Study were both prepared to
accommodate an uplift in throughput from 4 million tonnes per year
to 5 million tonnes per year. The design factors built into the
original design included 5 million tonnes per year assumptions for
plant design, general infrastructure and tailings dam design and
location. This means that the capacity for throughput of ore at the
Fekola mine could reach up to 5 million tonnes per year in the
initial years of production, beyond the optimized Feasibility
Study’s originally modelled 4 million tonnes per year, for
relatively low additional capital cost. On August 2, 2016, the
Company decided to proceed with the mill expansion and approved an
$18 million expansion budget for additional items including a
pebble crusher, one additional leach tank and an additional
generator. With this additional capital investment, the Fekola mill
expansion is expected to be completed in the fourth quarter of 2017
and commissioned in conjunction with the main plant
commissioning.
A revised geological resource model was
completed in the third quarter of 2016, followed by updates to the
open pit mine designs and production plans in the fourth quarter of
2016, reflecting the mill capacity increase to 5 million tonnes per
year. Based on the updated production plans, Fekola is now
projected to produce an average of 375,000 to 400,000 ounces per
year for the first five years of production (2018 to 2022) and
365,000 to 390,000 ounces per year over the first seven years of
production (2018 to 2024). Mining rates will not materially change
to supply the 5 million tonne per year plant, as the additional
material will be diverted from planned stockpiles. The mining
schedule has been adjusted to ensure sufficient feed for the
October 1, 2017 start date.
The Company has also approved a plan to relocate
the village of Fadougou, located adjacent to the main Fekola pit.
While the relocation of the village was not a requirement in the
Construction Permit, after extensive stakeholder engagement with
the local population the Company decided to proceed with it because
of the near proximity of the village to the mine site. Relocation
of the village will be completed in accordance with a Resettlement
Action Plan (“RAP”) that was completed by an independent consultant
in consultation with all stakeholders. The RAP has been submitted
to the appropriate Malian authorities and the Company is currently
in the process of acquiring the land necessary for relocation. It
is anticipated that the relocation process will take 2 years to
complete. Total estimated relocation costs are approximately $20
million to be incurred in 2016 and 2017.
Total cumulative forecast Fekola Project
construction costs (from inception to completion) include
preconstruction sunk costs, feasibility study construction costs
and $38 million additional construction costs approved in 2016.
Preconstruction sunk costs related to early works (including access
roads, construction aggregate stockpiling, airstrip construction,
and land clearing) were approximately $41 million. The total
feasibility study construction costs were $462 million, comprising
of build costs of $395 million and $67 million of anticipated mine
fleet and power generator costs, expected to be lease financed.
During 2016, the Company also approved $38 million in additional
amendments to the Fekola Project construction costs, comprising $18
million for the Fekola mill expansion and $20 million for
relocating the village of Fadougou, as previously described
above.
As at December 31, 2016, cumulative to-date
expenditures on the Fekola Project were $371.1 million, including
$41.0 million of preconstruction sunk costs expenditures, compared
with a Fekola Project budget to-date of $376.4 million. The Fekola
Project remains on budget and the variances against the revised
budget were mainly due to the timing of payments for construction
of the processing plant.
For 2017, the construction budget for the Fekola
Project totals approximately $173 million, including $18 million
for the Fekola mill expansion and $10 million for relocating the
village of Fadougou. In 2017, the Company expects to complete
construction and commission of the Fekola Project and begin the
transition from construction to steady-state operations. Primary
project areas will include the powerhouse, processing mechanical
and electrical installation, tailing storage facility lining and
pre-stripping in stage one of the Fekola open pit.
In addition to the Fekola Project construction
budget above, a total of $47 million has been budgeted in 2017 for
Fekola pre-stripping and additional mine fleet purchases. Following
the approval of the Fekola mill expansion in 2016 and the
acceleration of the production start date to October 1, 2017, open
pit pre-stripping and mine fleet purchases have been advanced by
six months to ensure ore supply for the earlier mill start-up (and
have now been included in the 2017 budget). Pre-stripping and mine
fleet purchases for 2017 have been budgeted at approximately $25
million and $22 million, respectively. 2017 post-construction and
operational capital costs of $11 million have been budgeted in
2017, including $4 million for aircraft purchases.
Anaconda Project - Mali
A conceptual engineering study is underway for
the Anaconda Project. This work is being done by Lycopodium in
their Brisbane office, and Fekola capital and operating cost
information is being used as a basis for the cost estimates. A base
case of 4 million tonnes per year will be developed, and then
larger and smaller cases will be factored depending on the
estimated mineral resource. Metallurgical test programs have been
completed and will form the basis of the design criteria for the
processing plant. Environmental and social baseline studies are
underway and will continue throughout 2017. The budgeted cost for
the conceptual engineering study for Anaconda is approximately $2.2
million for 2017.
Kiaka Development Project – Burkina Faso
Further engineering studies were completed in
2016 to assess the optimum throughput rate for the Kiaka project
and upgrading projected capital and operating costs.
The current plan is to update the
mineral-resource block model later this year based on ongoing
drilling and then use that model as the basis for additional
project evaluation. This will include re-evaluating project
economics and the potential impact of higher-grade ore being added
from the Toega zone. The 2017 development budget for Kiaka is
approximately $2.7 million.
Toega Project – Burkina Faso
Exploration drilling continued to expand ore
zones at Toega during 2016. Drill results at Toega are up to 3.09
g/t gold over 84 metres (approximate true width) in NKDD014 and
1.61 g/t over 131 metres in NKDD017. The zone remains open and
drilling is ongoing.
When mineral resource estimates become
available, in-house evaluations will be completed to determine if
Toega should be a stand-alone project, or a potential source of
higher grade feed for Kiaka. Metallurgical, environmental and
social baseline studies were initiated at Toega in 2016, and these
programs are planned to continue through 2017. The 2017 development
budget for Toega is approximately $0.8 million.
2017 Exploration Guidance
B2Gold has a 2017 exploration budget totalling
$46 million. Approximately $22 million of the 2017 budget will be
used to support brownfields exploration at the producing mines
(which for accounting purposes will be capitalized and included in
the mine’s sustaining and non-sustaining capital costs). In
addition, a significant portion of the 2017 exploration budget will
be used at all sites to drill several targets that exhibit
potential based on surface mapping, geochemical sampling and
drilling completed in 2016. West Africa will be a primary
focus of 2017 exploration expenditures as will Nicaragua.
In 2017, approximately $20 million will be spent
on exploration in Mali, Burkina Faso and Ghana. Exploration on the
licences in Mali will total $11.6 million focusing on 15 targets
close to the Fekola deposit. The 2017 budget for West Africa
envisions completing 16,500 metres of diamond drilling, 41,000
metres of RC drilling, 22,000 metres of air-core drilling and 8,500
metres of auger drilling.
Outlook
The core activities of the Company remain its
current mining operations and the construction of its Fekola
Project. Based on Fekola’s current mine construction progress, the
Fekola Project is approximately three months ahead of schedule and
is planning for an October 1, 2017 production start. In 2016, the
Company approved an $18 million budget for the expansion of the
Fekola mill from 4 million tonnes per year to 5 million tonnes per
year which is expected to be brought on-line in the fourth quarter
of 2017 in conjunction with the main plant commissioning. Fekola is
expected to be another low-cost mine and should help enable the
Company to significantly increase its production base while at the
same time reduce its longer term forecast consolidated cash
operating costs per gold ounce and all-in sustaining costs per gold
ounce.
For 2017, B2Gold is projecting another growth
year with consolidated gold production expected to be in the range
of between 545,000 and 595,000 ounces (including estimated
pre-commercial production from Fekola of between 45,000 and 55,000
ounces). Looking forward to 2018, with the planned first full-year
of production from the Fekola Project (based on current assumptions
and updates to the Company’s long-term mine plans), the Company is
projecting its consolidated gold production to increase
significantly and be between 900,000 to 950,000 ounces.
For 2018, with the planned first full-year of
production from the Fekola Project (based on current assumptions
and updates to the Company’s long-term mine plans), the Company’s
forecast consolidated cash operating costs per ounce and all-in
sustaining costs per ounce are expected to decrease in 2018
(compared to 2017) and be comparable to the Company’s 2016 revised
cost guidance ranges (of $500 to $535 per ounce for cash operating
costs and $780 to $810 per ounce for all-in sustaining
costs).
In 2016, the Company put several new attractive
funding measures in place, while minimizing equity dilution. In
addition, higher realized gold prices and better operating cost
performance from the Company’s mines continue to significantly
improve operating cash flows. The Company expects that the
combination of the new funding measures and continued strong
performance from operations will provide sufficient liquidity and
resources to maintain operations and ensure that, based on current
assumptions including the current gold price and life-of-mine
plans, construction of the Fekola Project is fully funded through
to completion (forecast to be October 1, 2017).
In addition to its development of Fekola, the
Company continues to pursue its organic growth strategy.
Sustainable organic growth also requires a continued focus on
exploration, permitting and feasibility programs at the Company’s
existing projects. Exploration will also focus on drilling
additional greenfield opportunities. The Company has a significant
exploration budget for 2017 totaling $46 million. The most
significant areas of exploration focus for the Company are in West
Africa where the Company expects to complete initial resource
estimates for its new Anaconda and Toega prospects.
With its existing growth profile, B2Gold remains
one of the fastest growing gold producers in the world. The
Company’s objective is to continue growing as a profitable and
responsible gold producer through ongoing exploration of its
existing projects and accretive acquisitions, irrespective of the
gold price.
Qualified Person
Peter D. Montano, P.E., the Project Director of
B2Gold, a qualified person under NI 43-101, has approved the
scientific and technical information related to operations and
development matters contained in this news release.
Tom Garagan, Senior Vice President of
Exploration of B2Gold, a qualified person under NI 43-101, has
approved the scientific and technical information related to
exploration matters contained in this news release.
Fourth Quarter and Full Year
2016 Results - Conference Call /
Webcast
B2Gold Corp. will release its fourth quarter and
full year 2016 results before the North American markets open on
Thursday, March 16, 2017.
B2Gold executives will host a conference call to
discuss the results on Thursday, March 16, 2017 at
10:00 am PDT / 1:00 pm EDT. You may access the
call by dialing the operator at +1 416-406-0743 or toll free at +1
800-806-5484 prior to the scheduled start time (passcode: 7458394)
or you may listen to the call via webcast by clicking
http://www.investorcalendar.com/IC/CEPage.asp?ID=175618. A playback
version of the call will be available for one week after the call
at +1 905-694-9451 or toll free at +1 800-408-3053 (passcode:
7435166).
On Behalf of B2GOLD CORP.
“Clive T.
Johnson”President and Chief Executive
Officer
The Toronto Stock Exchange neither approves nor
disapproves the information contained in this News
Release.
This news release includes certain
“forward-looking information” and “forward-looking statements”
(collectively “forward-looking statements”) within the meaning of
applicable Canadian and United States securities legislation,
including projections, estimates and other statements regarding
future financial and operational performance, events, production,
revenue, costs, capital expenditures, investments, budgets, ore
grades, sources and types of ore, stripping ratios, throughput,
cash flows, growth and acquisitions; production estimates and
guidance, including the Company’s projected gold production of
between 545,000 to 595,000 ounces in 2017 and production being
weighted towards the second half of 2017 and projected gold
production of between 900,000 and 950,000 ounces in 2018; and
statements regarding anticipated exploration, development,
construction, production, permitting and other activities and
achievements of the Company, including: expected grades and sources
of ore to be processed in 2017; the development and production from
the Fekola Project by October 2017 and the Fekola Project being on
schedule, on budget and fully funded; the Fekola Mine being a low
cost mine and its anticipated effect on the Company’s gold
production and per ounce costs; the Fekola mill expansion being
completed in late 2017, with potential throughput of up to five
million tonnes per year in the initial years of production, and the
potential to increase estimated production at Fekola; the timing
and cost to complete the relocation of Fadougou according to the
RAP; completion of geotechnical, hydrogeological and design studies
for the Wolfshag zone; the projections included in existing
technical reports, economic assessments and feasibility studies,
including the feasibility study for the Fekola Project; anticipated
or potential new technical reports and studies, including the
potential findings and conclusions thereof; the resolution of the
audit by the DENR in relation to the Masbate Mine and the final
outcome thereof; the plant upgrade at Masbate improving gold
recoveries and sustaining throughput; expected expansion of the
Masbate Mine fleet and amount of new fleet that will be lease
financed; the completion of permitting and resettlement activities
in respect of the Jabali Antenna Pit; production from the Jabali
Antenna Pit in the third quarter of 2017; higher strip ratios at
the Masbate and Otjikoto mines; planned exploration and exploration
budgets, including the planned exploration in Mali, Burkina Faso
and Ghana and the results thereof; the expected timing to release
initial mineral resources for Toega; timing to update mineral
resource block modelling at Kiaka and preparing an optimized
feasibility study; the potential to develop and produce from
currently non-producing properties; the delivery of ounces under
the Prepaid Sales transactions; and the adequacy of capital for
continued operations, including access to funding under the debt
and equity funding facilities described herein. Estimates of
mineral resources and reserves are also forward looking statements
because they constitute projections, based on certain estimates and
assumptions, regarding the amount of minerals that may be
encountered in the future and/or the anticipated economics of
production, should a production decision be made. All statements in
this news release that address events or developments that we
expect to occur in the future are forward-looking statements.
Forward-looking statements are statements that are not historical
facts and are generally, although not always, identified by words
such as “expect”, “plan”, “anticipate”, “project”, “target”,
“potential”, “schedule”, “forecast”, “budget”, “estimate”, “intend”
or “believe” and similar expressions or their negative
connotations, or that events or conditions “will”, “would”, “may”,
“could”, “should” or “might” occur. All such forward-looking
statements are based on the opinions and estimates of management as
of the date such statements are made. Forward-looking statements
necessarily involve assumptions, risks and uncertainties, certain
of which are beyond B2Gold’s control, including risks associated
with the volatility of metal prices and our common shares; risks
and dangers inherent in exploration, development and mining
activities; uncertainty of reserve and resource estimates; risk of
not achieving production, cost or other estimates; risk that actual
production, development plans and costs differ materially from the
estimates in our feasibility studies; risks related to hedging
activities and ore purchase commitments; the ability to obtain and
maintain any necessary permits, consents or authorizations required
for mining activities; uncertainty about the outcome of
negotiations with the Government of Mali; risks related to
environmental regulations or hazards and compliance with complex
regulations associated with mining activities; the ability to
replace mineral reserves and identify acquisition opportunities;
unknown liabilities of companies acquired by B2Gold; ability to
successfully integrate new acquisitions; fluctuations in exchange
rates; availability of financing and financing risks; risks related
to operations in foreign countries and compliance with foreign
laws; risks related to remote operations and the availability
adequate infrastructure, fluctuations in price and availability of
energy and other inputs necessary for mining operations; shortages
or cost increases in necessary equipment, supplies and labour;
regulatory, political and country risks; risks related to reliance
upon contractors, third parties and joint venture partners;
challenges to title or surface rights; dependence on key personnel
and ability to attract and retain skilled personnel; the risk of an
uninsurable or uninsured loss; adverse climate and weather
conditions; litigation risk; competition with other mining
companies; changes in tax laws; community support for our
operations including risks related to strikes and the halting of
such operations from time to time; risks related to failures of
information systems or information security threats; the ongoing
audit by the DENR in relation to our Masbate Project and the final
outcome thereof; ability to maintain adequate internal control over
financial reporting as required by law; as well as other factors
identified and as described in more detail under the heading “Risk
Factors” in B2Gold’s most recent Annual Information Form and
B2Gold’s other filings with Canadian securities regulators and the
U.S. Securities and Exchange Commission (the “SEC”), which may be
viewed at www.sedar.com and www.sec.gov, respectively. The list is
not exhaustive of the factors that may affect the Company’s
forward-looking statements. There can be no assurance that such
statements will prove to be accurate, and actual results,
performance or achievements could differ materially from those
expressed in, or implied by, these forward-looking statements.
Accordingly, no assurance can be given that any events anticipated
by the forward-looking statements will transpire or occur, or if
any of them do, what benefits or liabilities B2Gold will derive
therefrom. The Company’s forward looking statements reflect current
expectations regarding future events and operating performance and
speak only as of the date hereof and the Company does not assume
any obligation to update forward-looking statements if
circumstances or management's beliefs, expectations or opinions
should change other than as required by applicable law. For the
reasons set forth above, undue reliance should not be placed on
forward-looking statements.
The disclosure in this news release and in the
documents described in this news release regarding mineral
properties was prepared in accordance with Canadian National
Instrument 43-101 (“NI 43-101”), which differs significantly from
the mineral reserve disclosure requirements of the SEC set out in
Industry Guide 7. In particular, NI 43-101 permits companies to use
the term “resources”, which are not “reserves”. Under U.S.
standards, companies are not normally permitted to disclose
mineralization that does not constitute “reserves” in filings with
the SEC. Accordingly, while mineral resources are recognized and
required to be disclosed by NI 43-101, the SEC’s disclosure
standards normally do not permit companies to disclose mineral
resources in their filings with the SEC. In addition, the
definitions of “reserves” and related terms under NI 43-101 and the
SEC’s Industry Guide 7 differ significantly. Under SEC standards,
mineralization may not be classified as a “reserve” unless the
determination has been made that the mineralization could be
economically and legally produced or extracted at the time the
reserve determination is made. Among other things, all necessary
permits would be required to be in hand or issuance imminent in
order to classify mineralized material as reserves under the SEC
standards. Investors are specifically cautioned not to assume that
any part or all of “measured mineral resources”, “indicated mineral
resources” or “inferred mineral resources” will ever be converted
into a higher category, including SEC defined mineral reserves.
Investors should also understand that “inferred mineral resources”
have a great amount of uncertainty as to their existence and great
uncertainty as to their economic and legal feasibility. It cannot
be assumed that all or any part of an “inferred mineral resource”
exists or is economically or legally mineable. Further, while NI
43-101 permits companies to disclose economic projections contained
in preliminary economic assessments and pre-feasibility studies,
which are not based on “reserves”, U.S. companies are not normally
permitted to disclose economic projections for a mineral property
in their SEC filings prior to the establishment of “reserves”. For
the above reasons, information contained in this news release that
describes the Company’s mineral reserve and resource estimates or
that describes the results of feasibility or other studies is not
comparable to similar information made public by companies that
report in accordance with U.S. standards.
Non-IFRS Measures This news
release includes certain terms or performance measures commonly
used in the mining industry that are not defined under
International Financial Reporting Standards (“IFRS”), including
“cash operating costs” and “all-in sustaining costs” (or “AISC”)
and “adjusted net income”. Non-IFRS measures do not have any
standardized meaning prescribed under IFRS, and therefore they may
not be comparable to similar measures employed by other companies.
The data presented is intended to provide additional information
and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS and should
be read in conjunction with B2Gold’s consolidated financial
statements. Readers should refer to B2Gold’s management discussion
and analysis, available under B2Gold’s corporate profile at
www.sedar.com or on its website at www.b2gold.com, under the
heading “Non-IFRS Measures” for a more detailed discussion of how
B2Gold calculates such measures and reconciliation of certain
measures to IFRS terms.
B2GOLD CORP. |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(Expressed
in thousands of United States dollars, except per share
amounts) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended
Dec. 31, 2016 |
|
For the three months ended Dec. 31, 2015 |
|
|
For the twelve months ended
Dec. 31, 2016 |
|
For the twelve months ended Dec. 31, 2015 |
|
|
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|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold revenue |
$ |
181,189 |
|
$ |
139,008 |
|
|
$ |
683,293 |
|
$ |
553,656 |
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
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Cost of
sales |
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|
|
|
|
|
|
|
|
|
Production costs |
|
(77,668 |
) |
|
(70,148 |
) |
|
|
(275,400 |
) |
|
(299,317 |
) |
Depreciation and depletion |
|
(54,839 |
) |
|
(40,742 |
) |
|
|
(172,324 |
) |
|
(144,294 |
) |
Royalties
and production taxes |
|
(6,232 |
) |
|
(6,913 |
) |
|
|
(25,493 |
) |
|
(23,016 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cost of sales |
|
(138,739 |
) |
|
(117,803 |
) |
|
|
(473,217 |
) |
|
(466,627 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
42,450 |
|
|
21,205 |
|
|
|
210,076 |
|
|
87,029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative |
|
(17,119 |
) |
|
(7,562 |
) |
|
|
(40,918 |
) |
|
(36,392 |
) |
Share-based
payments |
|
(2,216 |
) |
|
(3,002 |
) |
|
|
(13,651 |
) |
|
(15,215 |
) |
Gain (loss) on sale of
mineral properties |
|
(1,338 |
) |
|
- |
|
|
|
(9,886 |
) |
|
2,192 |
|
Write-down of mineral
property interests |
|
- |
|
|
(7,978 |
) |
|
|
(5,068 |
) |
|
(16,095 |
) |
Foreign exchange
(losses) gains |
|
(847 |
) |
|
1,202 |
|
|
|
(2,737 |
) |
|
(3,169 |
) |
Provision for
non-recoverable input taxes |
|
(1,259 |
) |
|
(77 |
) |
|
|
(2,767 |
) |
|
(660 |
) |
Impairment of
long-lived assets |
|
- |
|
|
(107,984 |
) |
|
|
- |
|
|
(107,984 |
) |
Other |
|
(4,493 |
) |
|
(1,872 |
) |
|
|
(8,791 |
) |
|
(4,479 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss) |
|
15,178 |
|
|
(106,068 |
) |
|
|
126,258 |
|
|
(94,773 |
) |
|
|
|
|
|
|
|
|
|
|
Unrealized (loss)
gain on fair value of convertible notes |
|
5,927 |
|
|
1,061 |
|
|
|
(46,742 |
) |
|
6,903 |
|
Community
relations |
|
(2,529 |
) |
|
(1,713 |
) |
|
|
(5,051 |
) |
|
(4,687 |
) |
Interest and financing
expense |
|
(1,959 |
) |
|
(3,075 |
) |
|
|
(10,184 |
) |
|
(16,104 |
) |
Realized loss on
derivative instruments |
|
(1,451 |
) |
|
(1,928 |
) |
|
|
(13,962 |
) |
|
(5,367 |
) |
Unrealized gain (loss)
on derivative instruments |
|
20,265 |
|
|
(8,477 |
) |
|
|
22,697 |
|
|
(23,487 |
) |
Write-down of long-term
investments |
|
(2,671 |
) |
|
(1,537 |
) |
|
|
(2,856 |
) |
|
(6,752 |
) |
Other |
|
(222 |
) |
|
296 |
|
|
|
(1,630 |
) |
|
823 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before taxes |
|
32,538 |
|
|
(121,441 |
) |
|
|
68,530 |
|
|
(143,444 |
) |
|
|
|
|
|
|
|
|
|
|
Current income tax,
withholding and other taxes |
|
(10,065 |
) |
|
(4,836 |
) |
|
|
(25,064 |
) |
|
(9,171 |
) |
Deferred income tax
(expense) recovery |
|
(14,396 |
) |
|
11,192 |
|
|
|
(4,866 |
) |
|
7,502 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) for the period |
$ |
8,077 |
|
$ |
(115,085 |
) |
|
$ |
38,600 |
|
$ |
(145,113 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable
to: |
|
|
|
|
|
|
|
|
|
Shareholders of the Company |
$ |
6,221 |
|
$ |
(119,941 |
) |
|
$ |
39,131 |
|
$ |
(149,946 |
) |
Non-controlling interests |
|
1,856 |
|
|
4,856 |
|
|
|
(531 |
) |
|
4,833 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) for the period |
$ |
8,077 |
|
$ |
(115,085 |
) |
|
$ |
38,600 |
|
$ |
(145,113 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per share (attributable to shareholders of the
Company) |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.01 |
|
$ |
(0.13 |
) |
|
$ |
0.04 |
|
$ |
(0.16 |
) |
Diluted |
$ |
0.00 |
|
$ |
(0.13 |
) |
|
$ |
0.04 |
|
$ |
(0.16 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding (in
thousands) |
|
|
|
|
|
|
|
|
|
Basic |
|
960,976 |
|
|
924,241 |
|
|
|
941,737 |
|
|
922,114 |
|
Diluted |
|
1,044,461 |
|
|
924,241 |
|
|
|
955,145 |
|
|
922,114 |
|
B2GOLD CORP. |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(Expressed
in thousands of United States dollars) |
(Unaudited) |
|
|
|
|
|
For the three months ended Dec. 31,
2016 |
|
For the three months endedDec. 31, 2015 |
|
|
For the twelve months ended Dec. 31,
2016 |
|
For the twelve months endedDec. 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
activities |
|
|
|
|
|
|
|
|
|
Net
income (loss) for the period |
$ |
8,077 |
|
$ |
(115,085 |
) |
|
$ |
38,600 |
|
$ |
(145,113 |
) |
Mine
restoration provisions settled |
|
(31 |
) |
|
72 |
|
|
|
(153 |
) |
|
(414 |
) |
Non-cash
charges |
|
55,390 |
|
|
161,860 |
|
|
|
245,434 |
|
|
313,100 |
|
Changes
in non-cash working capital |
|
12,612 |
|
|
3,383 |
|
|
|
(4,336 |
) |
|
14,252 |
|
Proceeds
from prepaid sales |
|
- |
|
|
- |
|
|
|
120,000 |
|
|
- |
|
Changes
in long-term value added tax receivables |
|
6,290 |
|
|
(1,717 |
) |
|
|
12,266 |
|
|
(6,423 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by operating activities |
|
82,338 |
|
|
48,513 |
|
|
|
411,811 |
|
|
175,402 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
activities |
|
|
|
|
|
|
|
|
|
Credit
facility, drawdowns net of transaction costs |
|
50,000 |
|
|
49,926 |
|
|
|
100,000 |
|
|
243,661 |
|
Repayment
of credit facility |
|
- |
|
|
- |
|
|
|
(125,000 |
) |
|
(150,000 |
) |
Otjikoto
equipment loan facility, drawdowns net of transaction costs |
|
- |
|
|
- |
|
|
|
11,043 |
|
|
3,883 |
|
Repayment
of Otjikoto equipment loan facility |
|
(4,537 |
) |
|
(1,716 |
) |
|
|
(8,360 |
) |
|
(6,865 |
) |
Repayment
of Nicaraguan equipment loans |
|
(428 |
) |
|
(394 |
) |
|
|
(1,783 |
) |
|
(1,531 |
) |
Common
shares issued for cash on exercise of stock options |
|
2,729 |
|
|
23 |
|
|
|
39,758 |
|
|
563 |
|
Common
shares issued under At-The-Market offering, net of issuance
costs |
|
19,504 |
|
|
- |
|
|
|
44,467 |
|
|
- |
|
Interest
and commitment fees paid |
|
(6,235 |
) |
|
(5,919 |
) |
|
|
(18,336 |
) |
|
(14,584 |
) |
Restricted cash movement |
|
53 |
|
|
(389 |
) |
|
|
(1,319 |
) |
|
263 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by financing activities |
|
61,086 |
|
|
41,531 |
|
|
|
40,470 |
|
|
75,390 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing
activities |
|
|
|
|
|
|
|
|
|
Expenditures on mining interests: |
|
|
|
|
|
|
|
|
|
Otjikoto
Mine, development and sustaining capital |
|
(5,392 |
) |
|
(6,963 |
) |
|
|
(39,241 |
) |
|
(34,780 |
) |
Masbate
Mine, development and sustaining capital |
|
(9,631 |
) |
|
(9,755 |
) |
|
|
(31,892 |
) |
|
(37,691 |
) |
Libertad
Mine, development and sustaining capital |
|
(4,556 |
) |
|
(6,636 |
) |
|
|
(18,543 |
) |
|
(20,503 |
) |
Limon
Mine, development and sustaining capital |
|
(2,460 |
) |
|
(2,075 |
) |
|
|
(7,749 |
) |
|
(18,846 |
) |
Fekola
Project, development |
|
(80,120 |
) |
|
(52,074 |
) |
|
|
(241,739 |
) |
|
(91,439 |
) |
Fekola
Project, pre-construction |
|
- |
|
|
- |
|
|
|
- |
|
|
(37,926 |
) |
Gramalote
Project, prefeasibility and exploration |
|
(6,978 |
) |
|
(2,219 |
) |
|
|
(11,784 |
) |
|
(10,638 |
) |
Other
exploration and development |
|
(13,664 |
) |
|
(11,473 |
) |
|
|
(37,036 |
) |
|
(33,997 |
) |
Purchase
of non-controlling interest |
|
- |
|
|
- |
|
|
|
(6,000 |
) |
|
(6,138 |
) |
Acquisition of rights |
|
- |
|
|
- |
|
|
|
- |
|
|
(4,000 |
) |
Other |
|
1,330 |
|
|
(176 |
) |
|
|
2,137 |
|
|
1,041 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash used by investing activities |
|
(121,471 |
) |
|
(91,371 |
) |
|
|
(391,847 |
) |
|
(294,917 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents |
|
21,953 |
|
|
(1,327 |
) |
|
|
60,434 |
|
|
(44,125 |
) |
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
|
(1,040 |
) |
|
(315 |
) |
|
|
(906 |
) |
|
(3,296 |
) |
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period |
|
123,758 |
|
|
86,785 |
|
|
|
85,143 |
|
|
132,564 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of year |
$ |
144,671 |
|
$ |
85,143 |
|
|
$ |
144,671 |
|
$ |
85,143 |
|
|
|
|
|
|
|
|
|
|
|
B2GOLD CORP. |
CONSOLIDATED BALANCE SHEETS |
(Expressed in thousands of United States dollars) |
(Unaudited) |
|
|
|
|
|
|
|
As atDecember
31, 2016 |
|
As atDecember
31,2015 |
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
Current |
|
|
|
|
Cash and
cash equivalents |
$ |
144,671 |
|
$ |
85,143 |
|
Accounts
receivable, prepaids and other |
|
10,723 |
|
|
11,532 |
|
Value-added and other tax receivables |
|
16,984 |
|
|
20,597 |
|
Inventories |
|
104,691 |
|
|
86,324 |
|
|
|
|
|
|
|
|
|
|
|
|
|
277,069 |
|
|
203,596 |
|
|
|
|
|
|
Long-term
investments |
|
10,028 |
|
|
10,163 |
|
|
|
|
|
|
Value-added tax
receivables |
|
18,024 |
|
|
24,804 |
|
|
|
|
|
|
Mining
interests |
|
|
|
|
- Owned
by subsidiaries |
|
1,950,356 |
|
|
1,723,366 |
|
-
Investments in joint ventures |
|
53,724 |
|
|
42,394 |
|
|
|
|
|
|
Other
assets |
|
26,934 |
|
|
20,059 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2,336,135 |
|
$ |
2,024,382 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
Current |
|
|
|
|
Accounts
payable and accrued liabilities |
$ |
81,722 |
|
$ |
58,744 |
|
Current
taxes payable |
|
13,180 |
|
|
10,686 |
|
Current
portion of long-term debt |
|
13,935 |
|
|
11,726 |
|
Current
portion of derivative instruments at fair value |
|
3,466 |
|
|
10,618 |
|
Current
portion of mine restoration provisions |
|
- |
|
|
483 |
|
Current
portion of prepaid sales |
|
57,450 |
|
|
- |
|
Other
current liabilities |
|
6,288 |
|
|
6,663 |
|
|
|
|
|
|
|
|
|
|
|
|
|
176,041 |
|
|
98,920 |
|
|
|
|
|
|
Derivative
instruments at fair value |
|
6,439 |
|
|
18,968 |
|
|
|
|
|
|
Long-term
debt |
|
472,845 |
|
|
451,466 |
|
|
|
|
|
|
Prepaid
sales |
|
62,550 |
|
|
- |
|
|
|
|
|
|
Mine
restoration provisions |
|
81,162 |
|
|
63,539 |
|
|
|
|
|
|
Deferred income
taxes |
|
74,072 |
|
|
68,939 |
|
|
|
|
|
|
Employee
benefits obligation |
|
7,860 |
|
|
6,814 |
|
|
|
|
|
|
Other long-term
liabilities |
|
602 |
|
|
3,197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
881,571 |
|
|
711,843 |
|
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
Shareholders’
equity |
|
|
|
|
|
|
|
|
|
Share
capital |
|
|
|
|
|
|
|
|
|
Issued:
964,892,433 common shares (Dec 31, 2015 – 927,073,436) |
|
2,151,993 |
|
|
2,036,778 |
|
|
|
|
|
|
Contributed surplus |
|
56,191 |
|
|
70,051 |
|
|
|
|
|
|
Accumulated other comprehensive loss |
|
(95,435 |
) |
|
(96,254 |
) |
|
|
|
|
|
Deficit |
|
(667,760 |
) |
|
(706,891 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
1,444,989 |
|
|
1,303,684 |
|
|
|
|
|
|
Non-controlling
interests |
|
9,575 |
|
|
8,855 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,454,564 |
|
|
1,312,539 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2,336,135 |
|
$ |
2,024,382 |
|
|
|
|
|
|
For more information on B2Gold please visit the Company website at www.b2gold.com or contact:
Ian MacLean
Vice President, Investor Relations
604-681-8371
imaclean@b2gold.com
Katie Bromley
Manager, Investor Relations & Public Relations
604-681-8371
kbromley@b2gold.com
B2Gold (TSX:BTO)
Historical Stock Chart
From Mar 2024 to Apr 2024
B2Gold (TSX:BTO)
Historical Stock Chart
From Apr 2023 to Apr 2024