1,400 km2 land package includes historical gold
resource on gold belts hosting world-class discoveries
Teranga Gold Corporation ("Teranga" or the "Company") (TSX:TGZ) has
entered into a memorandum of understanding with Sodim Limited
(“Sodim”), a private investment company, to establish a joint
venture for the exploration and development of the Afema land
package in Côte d’Ivoire (the “Afema JV”).
The Afema JV land package is located in
southeast Côte d’Ivoire and covers more than 1,400 km2, consisting
of the Afema mining license (“Afema ML”) and three exploration
permits – Ayame, Mafere and Aboisso (collectively, the “Afema
Permits”). The Afema ML has a historical near-surface oxide and
sulphide resource within an area hosting several gold mineralized
structures on extensions from prolific Ghanaian gold belts.
Under the terms of the memorandum of
understanding, Teranga can earn a 70% interest in the Afema JV
through the completion of a three-year $11 million exploration and
community relations work program on the Afema ML and Afema Permits
and the delivery of a positive feasibility study pursuant to the
Afema JV. Teranga will sole fund and manage the exploration
programs and feasibility studies under the Afema JV. Upon
Teranga’s delivery of a positive feasibility study, Sodim can elect
to maintain its 30% participating interest or convert its holdings
to a 3% net smelter royalty. Sodim will receive $2.5 million
upon signing of the memorandum of understanding, with progressive
payments of up to $7.5 million with the delivery of a positive
feasibility study.
Teranga’s first priority will be to conduct a
detailed review and update of the previous drill results and
technical studies for the Afema ML project completed by Taurus Gold
Limited (BVI) (“TGL”), the previous owner of the Afema land
package, in order to deliver an optimized project that maximizes
the value of the Afema ML. In parallel, a comprehensive
exploration program will begin on the prospective Afema
Permits.
“Teranga won the joint venture rights to this
highly sought-after land package following a competitive auction
process,” said Richard Young, President and Chief Executive
Officer. “The addition of the Afema JV assets to our growth
pipeline is an important step towards delivering organically on our
vision of becoming a multi-asset, mid-tier West African gold
producer. We are excited to partner with Sodim to advance this
highly prospective land package.”
Afema ML Historical Resource
Estimate
A number of economic and technical studies have
been prepared on the Afema project prior to Teranga’s entry into
the Afema JV with Sodim. The most recent study, which included a
mineral resource estimate for the Afema ML, was issued by RockRidge
Consulting Services Geologists for and on behalf of TGL and is
dated as of June 27, 2016 (the “June 2016 Historical
Estimate”). The June 2016 Historical Estimate includes an
Indicated oxide resource estimate of 110Koz (comprised of 2.7Mt at
an average grade of 1.26 g/t Au) and Inferred oxide resources of
122Koz (comprised of 3.0Mt at an average grade of 1.26 g/t Au). In
addition, it includes an Indicated transitional resource estimate
of 59Koz (comprised of 1.3Mt at an average grade of 1.39 g/t Au)
and an Inferred transitional resource of 28Koz (comprised of 0.8Mt
at an average grade of 1.11 g/t Au). Finally, the June 2016
Historical Estimate provides a sulphide resource estimate as
follows: 865Koz Indicated ounces (comprised of 17.3Mt at an average
grade of 1.55 g/t Au) and 806Koz Inferred ounces (comprised of
17.8Mt at an average grade of 1.40 g/t Au). This historical
estimate is reported as using a cut-off grade of 0.5 g/t
Au.
RockRidge further states that it reviewed the
geological and grade continuity to supplement the review of data
quality in order to confirm the CIM mineral resource classification
categories used. As well, the June 2016 Historical Estimate
states the following with respect to the basis of the mineral
resource estimate:
- mineralized volumes were received for oxide, transitional and
sulphide modelled volumes;
- gold grades were determined using Ordinary Kriging and Inverse
distance squared interpolation (depending on data density) into a
3-Dimensional block model constrained by mineralization
wireframes;
- the block models comprised sub-celled block dimensions of 5m x
5m x 1m and 5m x 5m x 2m (depending on data sampling
interval);
- mineralized wireframes were truncated to the topographic
surface reflecting the mining that had previously occurred on the
property;
- gold values were investigated for outlier values and put though
two statistical capping/cutting routines;
- Datamine Studio 3 was the modelling package; and
- relationship between geology and preliminary mining and
economic factors was taken into account at all times.
Teranga considers the June 2016 Historical
Estimate to be a “historical estimate” as defined under NI 43-101
and relevant as the most recent resource estimate on the Afema
project. Further drilling, resource modelling and updates to
key economic assumptions would be required to upgrade or verify
these historical estimates as current mineral resources and
accordingly they should be relied upon only as a historical
resource estimate. A Qualified Person has not done sufficient work
to classify the historical estimate as current mineral resources or
mineral reserves and Teranga is not treating the historical
estimate as current mineral resources or mineral reserves.
Forward-Looking Statements
This press release contains certain statements
that constitute forward-looking information within the meaning of
applicable securities laws ("forward-looking statements"), which
reflects management's expectations regarding Teranga’s future
growth opportunities, results of operations, performance (both
operational and financial) and business prospects (including the
timing and development of new deposits and the success of
exploration activities) and other opportunities. Wherever possible,
words such as "plans", "expects", "does not expect", "scheduled",
"trends", "indications", "potential", "estimates", "predicts",
"anticipate" “to establish” or "does not anticipate", "believe",
"intend", "ability to" and similar expressions or statements that
certain actions, events or results "may", "could", "would",
"might", "will", or are "likely" to be taken, occur or be achieved,
have been used to identify such forward looking information.
Specific forward-looking statements in this presentation include
the establishment of a joint venture agreement with SODIM,
anticipated work programs for the Afema properties, the potential
future advancement of the Afema properties, and the future earn-in
rights of Teranga into the Afema JV. Although the
forward-looking information contained in this press release reflect
management's current beliefs based upon information currently
available to management and based upon what management believes to
be reasonable assumptions, Teranga cannot be certain that actual
results will be consistent with such forward-looking information.
Such forward-looking statements are based upon assumptions,
opinions and analysis made by management in light of its
experience, current conditions and its expectations of future
developments that management believe to be reasonable and relevant
but that may prove to be incorrect. These assumptions include,
among other things, the ability to obtain any requisite Ivory Coast
governmental approvals, the accuracy and reliability of historical
economic and technical studies on the Afema ML, gold price,
exchange rates, fuel and energy costs, future economic conditions,
and other courses of action. Teranga cautions you not to place
undue reliance upon any such forward-looking statements.
The risks and uncertainties that may affect
forward-looking statements include, among others: the inherent
risks involved in exploration and development of mineral
properties, including government approvals and permitting, changes
in economic conditions, changes in the worldwide price of gold and
other key inputs, changes in mine plans and other factors, such as
project execution delays, many of which are beyond the control of
Teranga, as well as other risks and uncertainties which are more
fully described in Teranga's Annual Information Form
dated March 30, 2017, and in other filings of Teranga with
securities and regulatory authorities which are available
at www.sedar.com. Teranga does not undertake any obligation to
update forward-looking statements should assumptions related to
these plans, estimates, projections, beliefs and opinions change.
Nothing in this document should be construed as either an offer to
sell or a solicitation to buy or sell Teranga securities. All
references to Teranga include its subsidiaries unless the context
requires otherwise.
About Teranga
Teranga is a multi-jurisdictional West African
gold company focused on production and development as well as the
exploration of more than 5,000 km2 of land located on prospective
gold belts. Since its initial public offering in 2010,
Teranga has produced more than 1.2 million ounces of gold from its
operations in Senegal, which as of June 30, 2017 had a reserve base
of 2.7 million ounces of gold. Focused on diversification and
growth, the Company is advancing its Banfora development project
and conducting extensive exploration programs in three countries:
Burkina Faso, Senegal and Côte d’Ivoire. Teranga has a strong
balance sheet and the financial flexibility to grow its
business.
Steadfast in its commitment to set the benchmark
for responsible mining, Teranga operates in accordance with the
highest international standards and aims to act as a catalyst for
sustainable economic, environmental, and community development as
it strives to create value for all of its stakeholders.
Teranga is a member of the United Nations Global Compact and a
leading member of the multi-stakeholder group responsible for the
submission of the first Senegalese Extractive Industries
Transparency Initiative revenue report. The Company's
responsibility report is available at
www.terangagold.com/responsibilityreport and is prepared in
accordance with its commitments under the United Nations Global
Compact and in alignment with the Global Reporting Initiative
guidelines.
Contact Information
Richard
Young
President & CEO
T: +1 416-594-0000 | E: ryoung@terangagold.com
Trish Moran Head of Investor Relations T: +1 416-564-4290 | E:
tmoran@terangagold.com