Marathon Gold Corporation (“Marathon” or the “Company”;
TSX: MOZ) is pleased to report the results of the
Feasibility Study (“FS”) for the Valentine Gold Project in Central
Newfoundland (“Valentine” or the “Project”).
The FS confirms robust economics for a
conventional open pit mining and milling operation at Valentine,
with low initial capital cost and high rate of return. The FS
presents a mine plan based on the same two-pit and centralized mill
strategy first presented in the April 2020 Pre-Feasibility Study,
with updated Mineral Resource and Mineral Reserve estimates,
refined mine and mill designs supported by additional geotechnical
and metallurgical data, and updated capital and operating cost
estimates. Mineral Resources, Mineral Reserves, and the Project’s
financial analysis have been completed at base case assumptions of
US$1,500/troy oz gold and a C$:US$ exchange of $0.75.
Highlights of the FS are as follows (all figures
are in Canadian dollars and troy ounces unless otherwise
noted):
- After-tax
Internal Rate of Return (“IRR”) of 31.5% and Net Present Value at a
5% discount rate (“NPV5%“) of $600M (US$450M) at US$1,500/oz gold,
increasing to 42.2% and $868M (US$651M) at US$1,750/oz gold;
- Initial capital
cost (“Capex”) of $305M (US$229M) yielding a favourable after-tax
NPV5%/Capex ratio of 2.0. Total life-of-mine (“LOM”) capital of
$662M (US$496M);
- After-tax
payback of 1.9 years;
- 13-year mine
life. 22 months construction and commissioning schedule assuming
construction start in January 2022. First gold pour in October
2023;
- Average gold
production of 173,000 oz/year and $119M of annual average free cash
flow (“FCF”) between 2024 and 2033 from the processing of
high-grade mill feed, and 56,000 oz/year and $31M FCF/year between
2034 and 2036 from the processing of low-grade stockpile;
- LOM Total Cash
Costs of US$704/oz and All-In Sustaining Costs (“AISC”) of
US$833/oz;
- Mill capacity
of 6,800 tpd (2.5 Mtpa) based on gravity-leaching, expanding to
11,000 tpd (4.0 Mtpa) in Year 4 based on
gravity-flotation-leaching. LOM average gold recovery of 94.2% for
total LOM recovered gold production of 1.93 Moz;
- Proven and
Probable Mineral Reserves of 2.05 Moz (47.06 Mt at 1.36 g/t Au), an
increase of 0.18Moz, or 10%, compared to the previous estimate in
April 2020;
- Measured &
Indicated (“M&I”) Mineral Resources of 3.14 Moz (56.66 Mt at
1.72 g/t Au), an increase of 0.05 Moz, or 1%, compared to the
previous estimate from January 2020. Mineral Resources are
inclusive of the Mineral Reserves;
- Inferred
Mineral Resources of 1.00 Moz (18.25 Mt at 1.70 g/t Au), an
increase of 0.04 Moz, or 4%, compared to the previous
estimate;
Matt Manson, President & CEO, commented:
“The Feasibility Study for the Valentine Gold Project builds upon
the simplified two-pit/central-mill development plan first
presented in our April 2020 Pre-Feasibility Study and again in our
September 2020 Environmental Impact Statement. All of our site
investigative geotechnical work and metallurgical studies conducted
over the last 12 months have validated this initial mine and mill
design. Optimizations have improved our pit, major facilities and
tailings management facility designs. We have increased our Mineral
Reserves by 10%, including the quantity of high-grade mill feed
which now supports a gold production profile averaging 173 koz/year
for 10 years starting in 2024. Total mine life has increased to 13
years. We have applied caution to our estimates of cost and
construction schedule, following the COVID challenges of the last
12 months. The receipt of budgeted quotes from vendors on our
construction and equipment supply packages, undertaken during
January and February of this year, has coincided with very recent
inflationary pressure in bulk materials pricing and labour rates.
This is reflected in our capital and operating cost estimates.
Nonetheless, today’s Feasibility Study confirms a compelling mine
development opportunity with strong margins, high rate of return
and low capital intensity. Substantial Mineral Resources remain
outside the initial mine plan, and the Project’s exploration
potential offers the prospect of significant mine life extension.
The Valentine Gold Project is projected to be the largest gold mine
in Atlantic Canada, and a major contributor to the socio-economic
well being of the Central Newfoundland.”
The Company will be hosting an online technical
session on the FS results for the Valentine Gold Project tomorrow,
March 30th, at 10:00 A.M. EDT. A presentation by management will be
followed by Q&A. To register, please visit:
https://bit.ly/397P8dF
Valentine Gold Project Feasibility
Study
The FS was completed by Ausenco Engineering
Canada Inc. as Lead Consultant. Moose Mountain Technical Services
acted as Mining Consultant, APEX Geoscience Ltd. as Geological
Consultant, Golder Associates Ltd. as Tailings Consultant and
Stantec Consulting Ltd. as Site Water Management and Environmental
Consultant, and GEMTEC Consulting Engineers and Scientists Limited
as Geotechnical Consultant. The Valentine Gold Project Mineral
Resource Estimate was prepared by John T. Boyd Company. The Mineral
Reserve Estimate was prepared by Moose Mountain Technical
Services.
Table 1: Summary of Key Results
and Assumptions in the Feasibility Study
Production Datanote 1 |
Values |
Units |
|
|
Life of Mine |
13 |
Years |
|
|
Processing Years 2023-2026 (Phase 1) |
6,800 (2.50) |
tpd (Mtpa) |
|
|
Processing Years 2027-2036 (Phase 2) |
11,000 (4.00) |
tpd (Mtpa) |
|
|
Recovered Gold |
1.93 |
Moz |
|
|
Average Gold Recovery |
94.2% |
|
|
|
Prestrip Tonnes |
10.5 |
Mt |
|
|
Total Mined Tonnes (including prestrip) |
387 |
Mt |
|
|
Total Milled Tonnes |
47 |
Mt |
|
|
Overall Strip Ratio |
7.2 |
waste:ore |
|
|
|
|
|
|
2024-2033: High Grade Feed Run Ratenote 2 |
Average Annual Gold Production |
173 |
koz |
|
Average Mill Feed Grade |
1.62 |
g/t |
|
Annual Average After-Tax Free Cash Flow |
$119 |
C$M |
|
|
|
|
|
|
2034-2036: Low Grade Stockpile Run Ratenote 2 |
Average Annual Gold Production |
56 |
koz |
|
Average Mill Feed Grade |
0.49 |
g/t |
|
Annual Average After-Tax Free Cash Flow |
$31 |
C$M |
|
|
|
|
|
|
2024-2036: LOM Run Ratenote 2 |
Average Annual Gold Production |
146 |
koz |
|
Average Mill Feed Grade |
1.34 |
g/t |
|
Annual Average After-Tax Free Cash Flow |
$98 |
C$M |
|
|
|
|
|
|
Capital Costsnote 1 |
Values |
Units |
|
|
Initial Capital |
$305 |
C$M |
|
|
Expansion Capital |
$44 |
C$M |
|
|
LOM Sustaining Capital (including salvage) |
$312 |
C$M |
|
|
LOM Total Capital |
$662 |
C$M |
|
|
Contingency (included in initial and expansion items) |
12% |
|
|
|
Capital Intensity (Initial Capital/oz) |
$119 |
US$/oz |
|
|
|
|
|
|
LOM Operating Costsnotes
1,3 |
Values |
Units |
|
|
Mining (/t mined) |
$2.55 |
C$/t |
|
|
Mining (/t milled) |
$20.44 |
C$/t |
|
|
Processing and Water Treatment (/t milled) |
$12.51 |
C$/t |
|
|
G&A (/t milled) |
$4.58 |
C$/t |
|
|
Total Operating Cost (/t milled) |
$37.52 |
C$/t |
|
|
Refining & Transport |
$3.93 |
C$/oz |
|
|
Silver Credit |
($9.32) |
C$/oz |
|
|
Average Cash Cost |
$704 |
US$/oz |
|
|
Average All-In Sustaining Costnote 4 |
$833 |
US$/oz |
|
|
|
|
|
|
Financial Analysisnote 1 |
Values |
Units |
|
|
Gold Price
Assumption for Financial Analysis |
$1,500 |
US$ |
|
|
US$:C$
Exchange |
0.75 |
|
|
|
Pre-Tax
NPV5% |
$867 |
C$M |
|
|
Pre-Tax
IRR |
36.9% |
|
|
|
Pre-Tax
Payback |
1.8 |
years |
|
|
After-Tax
NPV5% |
$600 |
C$M |
|
|
After-Tax
IRR |
31.5% |
|
|
|
After-Tax
Payback |
1.9 |
years |
|
|
Royaltiesnote 5 |
1.5% |
|
|
|
EBITDA |
$2,048 |
C$M |
|
|
EBITDA
Margin |
53.0% |
|
|
|
Pre-Tax
Unlevered Free Cash Flow |
$1,386 |
C$M |
|
|
After-Tax
Unlevered Free Cash Flow |
$973 |
C$M |
|
|
LOM Direct
Income Taxes and NL Mining Taxes |
$413 |
C$M |
|
|
Effective Cash Tax Rate |
30% |
|
|
|
|
|
|
|
Notes: |
|
|
|
|
1. See note on "Non-IFRS Financial Measures". |
|
2. Measured in full years, excluding 2023 stub-year covering mill
commissioning and ramp-up. |
|
3. LOM operating costs exclude capitalized operating costs prior to
October 2023 and prestrip mining tonnes. |
|
4. AISC includes Total Cash Costs and Sustaining Capital, including
expansion and closure costs. Excludes salvage and Corporate
G&A. |
|
5. Assumes the exercise of a right to repurchase 0.5% of the Franco
Nevada NSR for US$7M prior to December 31, 2022. |
|
|
|
Mineral Resource Estimate, Effective November 20,
2020
An updated Mineral Resource estimate was
prepared for the FS by John T. Boyd Company with an effective date
of November 20, 2020 and utilizing Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Definition Standards on Mineral
Resources and Reserves (2014). The new estimate utilizes the same
drillhole dataset and estimation methodology as the January 2020
estimate prepared for the April 2020 Pre-Feasibility Study, but at
a gold price of US$1,500/oz and using updated mining cost inputs.
Open Pit Mineral Resources are estimated with a bottom cut-off of
0.30 g/t Au, unchanged from the previous estimate. Underground
Mineral Resources are estimated with a bottom cut-off of 1.4 g/t
Au, compared to 1.66 g/t Au previously.
Total Project Measured and Indicated Mineral
Resources (Table 2), which are inclusive of the Mineral Reserves,
are 3.14 Moz (56.66 Mt at 1.72 g/t Au), an increase of 1% compared
to the previous estimate. Additional Inferred Mineral Resources
(Table 3) are 1.00 Moz (18.25 Mt at 1.70 g/t Au), an increase of 4%
compared to the previous estimate.
Mineral Resources which are not Mineral Reserves
do not have demonstrated economic viability.
Table 2: Measured and Indicated
Mineral Resources by Deposit (changes to the previous Jan 2020
estimate shown in italics)
|
Category |
Tonnes (Mt) |
Grade (g/t Au) |
Oz (Moz Au) |
|
|
|
|
|
|
|
|
|
|
|
Marathon |
Measured |
23.99 |
+4 |
% |
1.69 |
-2 |
% |
1.31 |
+2 |
% |
|
|
Indicated |
13.81 |
+6 |
% |
1.48 |
-3 |
% |
0.66 |
+3 |
% |
|
|
Total M&I |
37.80 |
+4 |
% |
1.62 |
-2 |
% |
1.96 |
+2 |
% |
|
|
|
|
|
|
|
|
|
|
|
Leprechaun |
Measured |
8.60 |
+1 |
% |
2.22 |
-0 |
% |
0.61 |
+0 |
% |
|
|
Indicated |
8.48 |
+1 |
% |
1.72 |
-1 |
% |
0.47 |
+1 |
% |
|
|
Total M&I |
17.07 |
+1 |
% |
1.98 |
-0 |
% |
1.08 |
+1 |
% |
|
|
|
|
|
|
|
|
|
|
|
Victory |
Measured |
- |
|
- |
|
- |
|
|
|
|
Indicated |
1.09 |
+1 |
% |
1.46 |
-1 |
% |
0.05 |
+0 |
% |
|
|
Total M&I |
1.09 |
+1 |
% |
1.46 |
-1 |
% |
0.05 |
+0 |
% |
|
|
|
|
|
|
|
|
|
|
|
Sprite |
Measured |
- |
|
- |
|
- |
|
|
|
|
Indicated |
0.70 |
+3 |
% |
1.74 |
-1 |
% |
0.04 |
+1 |
% |
|
|
Total M&I |
0.70 |
+3 |
% |
1.74 |
-1 |
% |
0.04 |
+1 |
% |
|
|
|
|
|
|
|
|
|
|
|
All
Deposits |
Measured |
32.59 |
+3 |
% |
1.83 |
-2 |
% |
1.92 |
+1 |
% |
|
|
Indicated |
24.07 |
+4 |
% |
1.57 |
-2 |
% |
1.22 |
+2 |
% |
|
|
Total M&I |
56.66 |
+3 |
% |
1.72 |
-2 |
% |
3.14 |
+1 |
% |
|
|
|
|
|
|
|
|
|
|
|
Table
3: Inferred Mineral Resources by Deposit (changes to the
previous Jan 2020 estimate shown in italics) |
|
|
|
|
|
|
|
|
|
|
|
Category |
Tonnes (Mt) |
Grade (g/t Au) |
Oz (Moz Au) |
|
|
|
|
|
|
|
|
|
|
|
Marathon |
Inferred |
11.68 |
+10 |
% |
1.86 |
-5 |
% |
0.70 |
+5 |
% |
|
|
|
|
|
|
|
|
|
|
|
Leprechaun |
Inferred |
2.99 |
+5 |
% |
1.63 |
-2 |
% |
0.16 |
+3 |
% |
|
|
|
|
|
|
|
|
|
|
|
Victory |
Inferred |
2.33 |
+9 |
% |
1.26 |
-4 |
% |
0.09 |
+5 |
% |
|
|
|
|
|
|
|
|
|
|
|
Sprite |
Inferred |
1.25 |
+5 |
% |
1.26 |
-2 |
% |
0.05 |
+3 |
% |
|
|
|
|
|
|
|
|
|
|
|
All
Deposits |
Total Inferred |
18.25 |
+9 |
% |
1.70 |
-4 |
% |
1.00 |
+4 |
% |
|
|
|
|
|
|
|
|
|
|
|
Notes to the
Mineral Resources (Tables 2 and 3): |
1. The Mineral
Resource has an effective date of November 20, 2020. |
2. Mineral Resources
are based on $1,500/oz gold with a US$:C$ exchange rate of
0.75. |
3. In-pit Mineral
Resources have been determined by the Whittle method based on an
estimate of their reasonable prospects for economic extraction,
using certain assumptions for gold recovery, costs for mining,
processing and sale. |
4. The Mineral
Resources were estimated using a block model with a block size of 6
m by 6 m by 6 m sub-blocked to a minimum block size of 2 m by 2 m
by 2 m using ID3 methods for grade estimation. All Mineral
Resources are reported using an open pit gold cut-off of 0.300 g/t
Au and an underground gold cut-off of 1.4 g/t Au. |
5. The reader is
reminded that mineral resources which are not mineral reserves do
not have demonstrated economic viability. The estimate of mineral
resources may be materially affected by environmental, permitting,
legal, title, socio-political, marketing, or other relevant issues
including risks set forth in in Marathon’s Annual Information Form
for the year ended December 31, 2020 and other filings made with
Canadian securities regulatory authorities and available at
www.sedar.com. |
6. Mineral Resources
are inclusive of the Mineral Reserves. |
7. Columns may not sum
exactly due to rounding. |
|
Mining
The FS contemplates open pit mining from the
Marathon and Leprechaun Deposits only. Mineral Resources contained
within the Sprite or Victory Deposits, or any potential Mineral
Resources at the Berry Zone, have not been considered as part of
the FS, and remain subject to ongoing exploration.
Ore with a cut-off grade of 0.70 g/t Au
(“high-grade”) will be prioritized for mill processing, initially
at 6,800 tonnes per day (“tpd”), or 2.5 Million tonnes per annum
(“Mtpa”), and then at 11,000 tpd, or 4.0 Mtpa, following mill
expansion. Ore between 0.70 g/t and 0.30 g/t Au (“low-grade”) will
be stockpiled for processing at the end of the mine life. Following
a ramp-up in mining and processing in 2023, high-grade mill feed at
+0.70 g/t Au supports a 10-year production period between 2024 and
2033 averaging 173 Moz/year at an average head grade of 1.62 g/t
Au. Thereafter, the low-grade stockpile supports a 3-year
production period between 2034 and 2036 averaging 56 koz/year at an
average head grade of 0.49 g/t Au.
The open pits have been designed and scheduled
to maximise project rate of return. Pit slope optimization has been
undertaken based on geotechnical drill data collected in 2020. Each
deposit will be developed in three phases, with the Marathon pit
reaching a maximum dimension of 1,350 m x 700 m x 328 m deep, and
the Leprechaun pit achieving 1,000 m x 725 m x 306 m deep. LOM
strip ratios will be 6.3 at Marathon, 8.9 at Leprechaun, and 7.2
overall. Mining will be by conventional drill/blast/load/haul
methods, with 12 m benches for waste and using selective mining
practices on 6 m flitches for ore. Dual-lane haul road allowances
will support a diesel-powered mining fleet that will include
seventeen 140-tonne and eleven 90-tonne payload trucks operating
between the two open pits.
Mineral Reserve Estimate, Effective
March 29, 2021
An updated Mineral Reserve estimate was prepared
by Moose Mountain Technical Services, with an effective date of
March 29, 2021 (Table 4). Proven and Probable Mineral Reserves are
derived from the Measured and Indicated Mineral Resources utilizing
Canadian Institute of Mining, Metallurgy and Petroleum (CIM)
Definition Standards on Mineral Resources and Reserves (2014).
Mine planning and Mineral Reserves use block
dimensions of 6x6x6 m with whole block dilution after re-blocking
the Mineral Resource model, which has been sub-blocked at a 2x2x2 m
minimum block size. Mining dilution of 25% and ore loss of 5% is
introduced when compared to the Mineral Resources in the block
model. Ore blocks surrounded by waste on all sides, and blocks
surrounded by waste on three sides with a grade of less than 0.5
g/t Au are also treated as waste. This yields an additional mining
recovery loss of 6% by tonnage and 2% by gold content.
Total Proven Mineral Reserves, estimated at a
gold price of US$1,500/oz with a bottom-cut-off of 0.30 g/t Au,
stand at 1.40 Moz (29.68 Mt at 1.46 g/t Au). Total Probable Mineral
Reserves stand at 0.65 Moz (17.38 Mt at 1.17 g/t Au). These are
increases of 9% and 12% respectively compared to the previous
estimates.
Proven Mineral Reserves estimated with a 0.70
g/t Au cut-off and scheduled for priority processing as high-grade
mill feed, stand at 1.21 Moz (17.94 Mt at 2.11 g/t Au). Probable
Mineral Reserves with a 0.70 g/t Au cut-off stand at 0.53 Moz (9.47
Mt at 1.74 g/t Au). These are increases of 8% and 9% respectively
compared to the previous estimates.
Table 4: Proven and Probable
Mineral Reserves (changes to the previous April 2020 estimate shown
in italics)
|
Category |
Tonnes (Mt) |
Diluted Grade(g/t Au) |
In Situ Gold(Moz Au) |
|
|
|
|
|
|
|
|
|
|
|
Marathon Deposit |
Proven |
20.56 |
+15 |
% |
1.36 |
-3 |
% |
0.90 |
+11 |
% |
|
Probable |
9.11 |
+20 |
% |
1.15 |
-5 |
% |
0.34 |
+14 |
% |
|
|
Total |
29.67 |
+17 |
% |
1.30 |
-4 |
% |
1.24 |
+12 |
% |
|
|
|
|
|
|
|
|
|
|
|
Leprechaun
Deposit |
Proven |
9.12 |
+9 |
% |
1.69 |
-3 |
% |
0.50 |
+5 |
% |
|
Probable |
8.27 |
+15 |
% |
1.19 |
-5 |
% |
0.32 |
+10 |
% |
|
|
Total |
17.39 |
+11 |
% |
1.45 |
-4 |
% |
0.81 |
+7 |
% |
|
|
|
|
|
|
|
|
|
|
|
All Deposits |
Proven |
29.68 |
+13 |
% |
1.46 |
-4 |
% |
1.40 |
+9 |
% |
|
|
Probable |
17.38 |
+18 |
% |
1.17 |
-5 |
% |
0.65 |
+12 |
% |
|
|
Total |
47.06 |
+15 |
% |
1.36 |
-4 |
% |
2.05 |
+10 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Category |
Tonnes (Mt) |
Diluted Grade(g/t Au) |
In Situ Gold(Moz Au) |
|
|
|
|
|
|
|
|
|
|
|
High Grade
(+0.70 g/t) |
Proven |
17.94 |
+8 |
% |
2.11 |
-0 |
% |
1.21 |
+8 |
% |
|
Probable |
9.47 |
+9 |
% |
1.74 |
+0 |
% |
0.53 |
+9 |
% |
|
|
Total |
27.41 |
+8 |
% |
1.98 |
-0 |
% |
1.75 |
+8 |
% |
|
|
|
|
|
|
|
|
|
|
|
Low Grade
(+0.30/-0.70 g/t) |
Proven |
11.74 |
+22 |
% |
0.48 |
-4 |
% |
0.18 |
+17 |
% |
|
Probable |
7.91 |
+29 |
% |
0.48 |
-5 |
% |
0.12 |
+23 |
% |
|
|
Total |
19.65 |
+25 |
% |
0.48 |
-4 |
% |
0.30 |
+19 |
% |
|
|
|
|
|
|
|
|
|
|
|
All Deposits |
Proven |
29.68 |
+13 |
% |
1.46 |
-4 |
% |
1.40 |
+9 |
% |
|
|
Probable |
17.38 |
+18 |
% |
1.17 |
-5 |
% |
0.65 |
+12 |
% |
|
|
Total |
47.06 |
+15 |
% |
1.36 |
-4 |
% |
2.05 |
+10 |
% |
|
|
|
|
|
|
|
|
|
|
|
Notes to the Mineral Reserves: |
|
|
|
|
|
1. The Mineral Reserve
estimate has been prepared by an independent Qualified Person, Marc
Schulte, P.Eng., of Moose Mountain Technical Services, with an
effective date of March 29, 2021. |
2. The Mineral
Reserves are based on the Mineral Resource Estimate effective
November 20, 2020. |
3. The Mineral
Reserves are based on engineering and technical information
developed at a Feasibility level for the Marathon and Leprechaun
Deposits. |
4. Mineral Reserves
are mined tonnes and grade, referenced to the mill feed at the
crusher. This mill feed accounts for modifying factors such as
estimated mining dilution and recovery. |
5. Mineral Reserves
are reported at a cut-off grade of 0.30 g/t Au, based on a
US$1,500/oz gold price, 0.75 US$:C$ exchange rate, 99.8% payable
gold, US$5/oz refining and transport costs, 0% royalties, 87%
process recovery at cutoff, $12.00/t process costs, $3.00/t G&A
costs, and $1.50/t stockpile re-handle costs. |
6. The estimate of
mineral reserves may be materially affected by environmental,
permitting, legal, title, socio-political, marketing, or other
relevant issues including risks set forth in in Marathon’s Annual
Information Form for the year ended December 31, 2020 and other
filings made with Canadian securities regulatory authorities and
available at www.sedar.com. |
7. Columns may not sum
exactly due to rounding. |
|
Measured and Indicated Mineral Resources of 0.76
Moz (15.52 Mt at 1.53 g/t Au) are contained within the Whittle pit
shells used in the Mineral Resource estimate at the Marathon and
Leprechaun Deposits but are located outside the mining pit shells.
These Mineral Resources have a reasonable prospect of economic
extraction, but at a higher strip ratio and lower rate of return
than provided by the optimized mining pits.
Additional Inferred Mineral Resources of 0.61
Moz (12.45 Mt at 1.51 g/t Au) are contained within the Whittle pit
shells used in the Mineral Resource estimate at the Marathon and
Leprechaun Deposits. Of these, a subset of 0.29 Moz (5.92 Mt at
1.50 g/t Au) are contained within the mining pit shells. All of
these Inferred Mineral Resources are cited on an undiluted basis,
and are treated as waste and excluded from the economic analysis.
The successful future conversion of any in-pit Inferred Mineral
Resources would have the effect of increasing mine production and
reducing pit strip ratios.
Processing and Recovery
The FS contemplates an initial milling strategy
based on grinding to 75 µm followed by gravity concentration and
cyanidation of gravity concentrates and tails (“Gravity-Leaching”).
Grinding will be by way of a SAG and a ball mill. Processing
capacity in Phase 1 will be 6,800 tpd (2.5 Mtpa).
Following the first three years of production,
the mill will be expanded by coarsening the initial grind to 150 µm
and adding flotation and regrinding of the flotation concentrates,
followed by cyanidation of both the concentrate and tailings
streams (“Gravity-Flotation-Leaching”). No additional grinding
equipment will be required for this expansion phase other than a
pebble crusher installed on the SAG mill recirculating load.
Processing capacity in Phase 2 will be 11,000 tpd (4.0 Mtpa). The
FS incorporates scheduled ramp-ups to the Phase 1 nameplate
capacity in early 2024 and to the Phase 2 nameplate capacity in
2027.
Mill design, and the strategy of processing
expansion is largely unchanged from the April 2020 Pre-Feasibility
Study. Adjustments have been made in the estimated quantity of
consumables (lime, oxygen) in the gold recovery process, in the
sizing of the SAG and ball mills, the sizing of the ROM bin, lime
silo, carbon stripping circuit and the regrind mill, and in the
layout of the Gravity and Goldroom circuits. Process design has
been supported by a metallurgical test-work program conducted by
the Company and Ausenco under the supervision of Mr. John Goode, a
consultant to Marathon. The test-work program has included studies
in mineralogy, comminution, gravity concentration, flotation,
leaching and cyanide destruction. This work has been performed by a
variety of third-party laboratories starting in 2010, and has been
ongoing since 2018 with a specific focus on the flow sheet elements
utilized in the FS released today.
LOM gold recovery is estimated at 94.2% compared
to 93% in the April 2020 Pre-Feasibility Study. Recoveries are
estimated at an average grade of 1.36 g/t Au, being 87% at the
cut-off grade of 0.30 g/t Au and capped at 96.5%. Phase 1
Gravity-Leaching has the advantage of a lower initial capital cost
but at an average $4.90/t higher overall operating cost and an
estimated 1.7% lower recovery. Phase 2 Gravity-Flotation-Leaching
allows for higher throughput, with an estimated $44M of expansion
capital, at a lower average operating cost and higher recovery.
Capital and Operating Costs
Capital costs (Table 5) have a basis of estimate
at Class 3 (FEL3) with a stated +/-15% accuracy (after the
Association for the Advancement of Cost Engineering International)
and are stated in Q1 2021 Canadian dollars. Contingencies are
estimated on all initial and expansion capital items at an average
12%, and on sustaining capital items at an average 7%. Growth
factors of up to 5% have been applied on an item-by-item basis.
More than 88% of equipment costs, bulk materials and labour rates
are estimated with budget quotes from vendors. The remaining 12% of
costs are estimated from consultant databases on precedent
projects, or from factoring such items as freight and construction
indirects from supply pricing. Over 70% of project costs have been
provided by Newfoundland and Labrador (“NL”) based vendors and
contractors.
Mobile equipment and camp buildings are assumed
to be lease financed with associated costs contained within
sustaining capital estimates. Capital costs of $44M for the Phase 2
(Gravity-Flotation-Leaching) expansion of the mill are financed
internally out of cash flow at gold price assumptions above
US$1,460/oz.
The initial capital cost of $305M (US$229M)
represents a 12% increase compared to the estimate contained within
the April 2020 Pre-Feasibility Study. The total LOM capital cost of
$662M (US$496M) represents an 18% increase compared to the previous
estimate. These increases reflect inflationary trends in materials
costs experienced in the first quarter of 2021 for items such as
steel and lumber, as well as the provision of larger mobile
equipment, increases in labour rate estimates within NL, increased
G&A and project execution costs partly attributable to COVID-19
provisions, and an extension of the project construction and
commissioning schedule from 18 to 22 months.
Table 5: Capital Costs
Item |
Cost (C$M) |
|
|
|
|
Pre-strip Mining Capex |
$ |
32 |
|
|
Mining |
$ |
19 |
|
|
Process
Plant |
$ |
88 |
|
|
Infrastructure |
$ |
54 |
|
|
Offsite
Infrastructure |
$ |
21 |
|
|
Contractor
Indirects |
$ |
16 |
|
|
Project
Delivery |
$ |
29 |
|
|
Owners
Cost |
$ |
15 |
|
|
Contingency |
$ |
32 |
|
|
Total Initial Capital |
$ |
305 |
|
|
|
|
|
Mill
Expansion |
$ |
40 |
|
|
Contingency |
$ |
4 |
|
|
Mill Expansion Capital |
$ |
44 |
|
|
|
|
|
Sustaining
Capital, Mining |
$ |
186 |
|
|
Sustaining
Capital, Infrastructure |
$ |
89 |
|
|
Closure |
$ |
36 |
|
|
Salvage |
$ |
(20 |
) |
|
Contingency |
$ |
21 |
|
|
Total Sustaining Capital |
$ |
312 |
|
|
|
|
|
Total |
$ |
662 |
|
|
|
|
|
Notes: |
|
|
1. See note on "Non-IFRS Financial Measures". |
|
2. Columns may not sum exactly due to rounding. |
|
|
|
|
Mine operating costs (Table 6) are estimated at
$2.55/t mined or $20.44/t milled (LOM) based on an annual average
mining rate of approximately 38 Mt. Mining costs reflect the
relatively high strip ratios in the Marathon and Leprechaun pits
and the relatively short haul distances for waste. Mining costs for
selectively mined tonnes, along ore/waste boundaries, are estimated
at $3.11/t, comprised of $3.63/t in ore and $2.72/t in waste.
Mining costs for bulk mined tonnes, which are to be mined with
larger equipment with less stringent grade control practices, are
estimated at $2.42/t, comprised of $3.15/t in ore and $2.38/t in
waste. Process-related costs (LOM) are estimated at $12.51/t milled
and G&A at $4.58/t milled, for total site costs of $37.52/t
milled. Bullion transport and refinery charges are estimated at
$3.93/oz. A credit of $9.32/oz has been estimated for payable
silver content within doré. Diesel costs are estimated at
$0.96/litre and power at $0.063/kWh.
Overall LOM Total Cash Costs of US$704/oz
represent an increase of 11% compared to the estimate contained
within the April 2020 Pre-Feasibility Study. This increase reflects
similar trends in Q1 2021 bulk materials pricing and indirect costs
such as labour that are reflected in the capital cost estimates.
LOM AISC of US$833/oz represent an increase of 13% compared to the
April 2020 Pre-Feasibility Study, driven primarily by the increase
in Total Cash Costs.
Table 6: Operating
Costs
Item |
Value |
Units |
|
|
|
|
|
Tonnes Mined, excluding pre-strip |
|
376 |
|
Mt |
|
Tonnes
Milled, LOM |
|
47 |
|
Mt |
|
Payable
Ounces |
|
1.93 |
|
Moz |
|
|
|
|
|
Mining Costs |
$ |
962 |
|
C$M |
|
$ |
2.55 |
|
C$/tonne
mined |
|
$ |
20.44 |
|
C$/tonne milled |
|
|
|
|
|
Processing & Water Treatment |
$ |
589 |
|
C$M |
|
$ |
12.51 |
|
C$/tonne milled |
|
|
|
|
|
G&A |
$ |
215 |
|
C$M |
|
$ |
4.58 |
|
C$/tonne milled |
|
|
|
|
|
Total |
$ |
1,765 |
|
C$M |
|
$ |
37.52 |
|
C$/tonne milled |
|
|
|
|
|
Off-Site
Costs, Refining and Transport |
$ |
8 |
|
C$M |
|
Silver
Credit |
$ |
(18 |
) |
C$M |
|
Royalties |
$ |
58 |
|
C$M |
|
|
|
|
|
Total Cash Costs |
$ |
704 |
|
US$/oz |
|
|
|
|
|
Sustaining
Capital (excluding salvage) |
$ |
332 |
|
C$M |
|
|
|
|
|
Total AISCnote 2 |
$ |
833 |
|
US$/oz |
|
|
|
|
|
Notes: |
|
|
|
1. Columns may not sum exactly due to rounding. |
|
2. AISC includes Cash Costs and Sustaining Capital, including
closure costs; excludes salvage and corporate G&A. |
|
|
|
|
|
Financial Analysis
At a US$1,500 gold price and a US$:C$ exchange
of 0.75 the Project generates an after-tax NPV5% of $600M, at a 5%
discount rate, and IRR of 31.5% based on an effective cash tax rate
of 30%. Payback on initial capital is 1.9 years. Before taxes,
NPV5% is $867M, IRR is 36.9%, and payback is 1.8 years. The
Project’s valuation is discounted to December 31, 2021.
LOM after-tax FCF is estimated at $973M on an
unlevered basis. Annual average after-tax FCF during the 10-year
high-grade production period between 2024 and 2033 is estimated at
$119M.
Compared to the April 2020 Pre-Feasibility
Study, after-tax NPV5% and after-tax LOM FCF have grown by 27% and
37% respectively, reflecting increased Mineral Reserves and mine
life, increased metallurgical recoveries, and an increased gold
price. IRR has decreased from 36.2% to 31.5% reflecting the higher
up-front capital costs and extension of the construction schedule,
partially offset by the items noted above.
At US$1,750/oz gold the Project generates an
after-tax NPV5% of $868M and IRR of 42.2% (Table 7). The Project
generates a 15% after-tax IRR at a gold price of US$1,185/oz, more
than US$500/oz below the current spot price. The Project is most
sensitive to revenue attributes such as gold price, head grade and
exchange rate, followed by operating cost and capital cost (Table
8).
A 1.5% Net Smelter Royalty (“NSR”) is applied to
all gold production. In February 2019 the Company sold a 2% net
smelter returns royalty on the Valentine Gold Project to
Franco-Nevada Corp. The FS assumes the exercise of a right in
favour of the Company to repurchase 0.5% of the NSR for US$7M prior
to December 31, 2022, the cost of which is excluded from the
Project-level economic analysis.
Table 7: After-Tax Valuation
Sensitivities to the Gold Price at a US$:C$ exchange of
0.75
Gold Price (US$/oz) |
|
$1,250 |
$1,350 |
$1,450 |
$1,500 |
$1,550 |
$1,650 |
$1,750 |
|
Price Case |
|
Downside |
|
|
Base Case |
|
|
Spot |
|
NPV (C$M) |
0% |
$579 |
$739 |
$894 |
$973 |
$1,052 |
$1,205 |
$1,351 |
|
3% |
$403 |
$537 |
$663 |
$727 |
$792 |
$915 |
$1,033 |
|
5% |
$313 |
$432 |
$544 |
$600 |
$657 |
$765 |
$868 |
|
8% |
$208 |
$309 |
$402 |
$450 |
$497 |
$587 |
$672 |
|
10% |
$153 |
$245 |
$328 |
$370 |
$412 |
$492 |
$568 |
|
15% |
$52 |
$125 |
$190 |
$223 |
$255 |
$316 |
$375 |
|
|
|
|
|
|
|
|
|
|
|
IRR |
|
18.8% |
24.4% |
29.2% |
31.5% |
33.9% |
38.1% |
42.2% |
|
|
|
|
|
|
|
|
|
|
|
NPV5%/Capex |
|
1.0 |
1.4 |
1.8 |
2.0 |
2.2 |
2.5 |
2.8 |
|
|
|
|
|
|
|
|
|
|
|
Paybacknote 2 |
Years |
5.4 |
3.8 |
3.3 |
1.9 |
1.7 |
1.5 |
1.4 |
|
|
|
|
|
|
|
|
|
|
|
Total FCFnote 3 |
C$M |
$579 |
$739 |
$894 |
$973 |
$1,052 |
$1,205 |
$1,351 |
|
|
|
|
|
|
|
|
|
|
|
Average Annual FCFnote 4 |
C$M |
$84 |
$98 |
$112 |
$119 |
$126 |
$139 |
$152 |
|
|
|
|
|
|
|
|
|
|
|
Notes: |
|
|
|
|
|
|
|
|
|
1. See note on "Non-IFRS Financial Measures". |
|
|
|
|
|
|
2. Payback is defined as achieving cumulative positive free
cashflow after all cash costs and capital costs, including
sustaining and expansion. |
|
3. Calculated LOM, unlevered. |
|
4. Calculated for the period 2024-2033 of sustained high grade mill
feed, unlevered. |
|
|
|
|
|
|
|
|
|
|
|
Table 8: After-Tax Valuation Sensitivity to
Certain Operating Parameters (NPV5%, C$M)
Factor |
|
-20% |
-10% |
0% |
10% |
20% |
Head Grade |
IRR |
15.9% |
24.4% |
31.5% |
38.1% |
44.2% |
NPV |
$249 |
$432 |
$600 |
$765 |
$920 |
Operating Cost |
IRR |
37.5% |
34.7% |
31.5% |
28.2% |
24.9% |
NPV |
$752 |
$680 |
$600 |
$520 |
$442 |
Initial Capital Cost |
IRR |
38.5% |
34.7% |
31.5% |
28.9% |
26.6% |
NPV |
$639 |
$620 |
$600 |
$581 |
$561 |
Mining Cost (C$/t Mined) |
IRR |
35.6% |
33.6% |
31.5% |
29.4% |
27.3% |
NPV |
$690 |
$646 |
$600 |
$554 |
$510 |
$C:$US F/X |
IRR |
47.1% |
38.8% |
31.5% |
25.0% |
18.8% |
NPV |
$999 |
$783 |
$600 |
$447 |
$312 |
|
|
|
|
|
|
|
Notes: |
|
|
|
|
|
|
1. See note on "Non-IFRS Financial Measures". |
|
|
|
|
|
|
|
|
|
|
|
Infrastructure and Facilities
The FS contains a revised site layout for the
mill, primary crusher and related facilities to provide for a
potential future open pit at the nearby Berry Zone, which is
currently subject to ongoing exploration. The construction of the
mill building structure will be based on pre-engineered components
erected at site. The mine truck maintenance facility with 8 vehicle
bays will be constructed in two phases as the mining fleet is
expanded. Mine administrative buildings and a 300-person
accommodation camp will be modular construction.
A water treatment plant will be located close to
the mill facilities for process water management. Site water will
be collected in a system of ditching and sedimentation ponds for
treatment as required. The Tailings Management Facility (“TMF”)
design has been optimized since the April 2020 Pre-Feasibility
Study, with a refined dam alignment for reduced height and fill
requirements, a polishing pond located closer to the mill for
efficient integration with the water treatment plant, and updated
foundation and liner provisions following site geotechnical surveys
in 2020. The TMF will have a design capacity of 30Mt and be
constructed in six stages between 2022 and 2029. Thereafter, the
(then) depleted Leprechaun Pit will receive the remaining 17Mt of
tailings materials scheduled in the FS mine plan.
Cost provision has been made for the upgrading
and widening of the current 80 km long access road from Millertown
via Red Indian Lake, and upgrading several bridges. Site
communications will be by way of sequenced microwave towers
providing broadband connectivity. The FS contains a capital cost
estimate provided by NL Hydro for a 66 kV transmission line from
the nearby Star Lake Hydroelectric Generating Station and a related
site sub-station. This power line, which is subject to a separate
environmental assessment and permitting process being conducted by
NL Hydro, is expected to be approximately 40 km long and follow
existing road easements for most of its length. Peak power demand
for Phase 1 mill processing at the Project (Gravity-Leach) is
estimated at 17 MW, increasing to 20 MW following the Phase 2 mill
expansion (Gravity-Flotation-Leaching).
Environment, Permitting and
Communities
The Valentine Gold Project is subject to
regulation under the environmental protection regimes of the
Canadian Environmental Assessment Act, 2012 and the Newfoundland
and Labrador Environmental Protection Act. On September 29, 2020,
the Company filed an Environmental Impact Statement (“EIS”) for the
Project with the Impact Assessment Agency of Canada (“IAAC”), and
the NL Department of Environment, Climate Change and Municipalities
(“NLDECCM”). Following an initial 30-day review period, the IAAC
assessed the EIS to be in conformity with federal guidelines issued
in July 2019, and the EIS was accepted into the formal IAAC and
NLDECCM technical review processes. These reviews are expected to
occur over a period of approximately 12 months and include
information requests and submissions, as well as public
consultations.
The EIS has been authored by Marathon and
Stantec of St. John’s, NL, and utilizes extensive environmental
baseline data collected at the Project site by Marathon and its
consultants starting in 2011. It incorporates the results of a
Current Land Use and Traditional Knowledge Study completed by the
Qalipu Mi’kmaq First Nation, land and resource use information
provided by the Miawpukek Mi’kmaq First Nation, and an independent
economic assessment of the Project completed by Strategic Concepts
Inc. of St. John’s, NL. Starting in March 2019, and continuing
through to the summer of 2020, a series of public meetings,
engagements and information sessions on the Project were conducted
with the Qalipu and Miawpukek Mi’kmaq First Nations, the
communities of Millertown, Buchans, Buchans Junction, Badger, Grand
Falls-Windsor and Bishop’s Falls, and regional civil society
groups. Feedback received from these sessions has been incorporated
into the Project’s planning and design process contained within the
FS.
The EIS assesses the potential environmental and
socio-economic effects of the Project in fifteen separate areas of
study, including water and air quality, wildlife, vegetation and
wetlands, fish and fish habitat, communities, Indigenous groups,
and the regional and provincial economies. A particular focus of
study has been delineating potential effects on water quality and
fish habitat through the placement of the Project’s infrastructure
and facilities, and potential effects on the nearby Victoria Lake
hydroelectric reservoir and dam. The EIS also describes the
potential effects on migration of the Buchans caribou herd, which
is known to transit seasonally through the area of the Project and
is one of several herds located in the central region of NL. In
each of the fifteen areas of study, the EIS assesses and
characterises the potential effects from the Project’s development,
and the mitigation measures to be adopted with the aim of reducing
the Project’s environmental footprint.
The project is expected to have a significant
economic impact on Central Newfoundland. The FS estimates direct
total taxation to provincial and federal authorities in excess of
$400M over the 13 year mine life, with direct employment peaking at
over 400 persons. Strategic Concepts Inc. assessed that, based on
the April 2020 Pre-Feasibility Study, the Project would create
average annual employment (direct, indirect and induced) of nearly
1,300 person years in Canada, including an annual average of 725
person years within NL, it would generate approximately C$1.3
billion in income to workers and businesses within Canada,
including C$750 million to workers and businesses located within
NL, and it would contribute approximately C$3.6 billion to Canada’s
gross domestic product (“GDP”), including C$2.9 billion to NL’s
GDP.
In December 2020, Marathon announced the
completion of Cooperation Agreements with each of the six Central
Newfoundland communities within the immediate socio-economic impact
of the Project. The agreements identify the interests of each
community in employment, business opportunities, community
investment, and environmental protection. Marathon is also
currently engaged with the Qalipu and Miawpukek Mi’kmaq First
Nations in areas of economic and employment participation and
environmental protection. Additionally, Marathon is engaged with
the Government of Newfoundland and Labrador on the completion of an
NL Benefits Agreement, including a Gender Equity, Diversity and
Inclusivity Plan, that would govern the period of mine
construction, operation, and closure.
Project Schedule
The Valentine Gold Project FS contemplates
ground-breaking for site construction in January 2022, with a total
22-month construction period and first gold production by October
2023. This schedule is dependent upon the completion of the EA and
the receipt of Federal and Provincial Ministerial Approval by the
end of the third quarter of this year, and the receipt of
sufficient site-specific permits to be able to commence
construction. The reader is cautioned that while the FS has been
developed with due consideration of potential impacts on cost and
schedule from the ongoing COVID-19 challenges, any additional
prolongation of COVID-related work restrictions, such as disruption
to supply chains, travel, labour markets, work practices and
permitting, amongst other factors, may materially impact the
Project’s execution schedule.
NI 43-101 Technical Report
Marathon will file an updated Technical Report
prepared in accordance with the requirements of National Instrument
43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”)
for the Valentine Gold Project FS including a description of the
updated Mineral Resource Estimate.
Qualified Persons
Disclosure of a scientific or technical nature
in this news release has been approved by Mr. Tim Williams,
FAusIMM, Chief Operating Officer of Marathon, Mr. Paolo Toscano,
P.Eng. (Ont.), Vice President, Projects for Marathon, and Mr. James
Powell, P.Eng. (NL), Vice President, Regulatory and Government
Affairs for Marathon. Ms. Jessica Borysenko, P.Geo. (NL), Manager,
GIS, is responsible for data quality assurance and control for
Marathon. Mr. Williams and Ms. Borysenko have verified the data
disclosed in this news release, including sampling, analytical and
test data underlying the information it contains. This included a
site inspection, drill database verification, and independent
analytical testwork.
The Qualified Person responsible for the
preparation of the November 2020 Valentine Gold Project Mineral
Resource Estimate is Robert Farmer, P.Eng. of John T Boyd Company.
The Qualified Person responsible for the preparation of the Mineral
Reserves and mine planning is Marc Schulte, P.Eng., of Moose
Mountain Technical Services. Roy Eccles, P.Geo., of APEX Geoscience
Ltd. is the Qualified Person responsible for geological technical
information including a QA/QC review of drilling and sampling data
used in the Mineral Resource Estimate. Paul Staples P.Eng., of
Ausenco Engineering Canada Inc. is the Qualified Person responsible
for the design of the process plant and infrastructure, and
financial modelling. Peter Merry, P.Eng., of Golder Associates Ltd.
is the Qualified Person responsible for design of the TMF and its
water management infrastructure. Sheldon Smith, P.Geo., of Stantec
Consulting Ltd. is the Qualified Person responsible for site water
balance and surface water management. Shawn Russell. P.Eng. and
Carolyn Anstey-Moore, P.Geo of GEMTEC Consulting Engineers and
Scientists Limited are the Qualified Persons responsible for site
wide geotechnical and hydrogeological considerations. Each of Mr.
Farmer, Mr. Eccles, Mr. Staples, Mr. Schulte, Mr. Merry, Mr. Smith,
Mr. Russell and Mrs. Anstey-Moore are considered to be
“independent” of Marathon and the Valentine Gold Project for
purposes of NI 43-101.
Non-IFRS Financial Measures
The Company has included certain non-IFRS
financial measures in this news release, such as Initial Capital
Cost, Total Cash Cost, AISC, Expansion Capital, Capital Intensity,
EBITDA and Effective Cash Tax Rate which are not measures
recognized under IFRS and do not have a standardized meaning
prescribed by IFRS. As a result, these measures may not be
comparable to similar measures reported by other corporations. Each
of these measures are intended to provide additional information to
the reader and should not be considered in isolation or as a
substitute for measures prepared in accordance with IFRS.
Certain non-IFRS financial measures used in this
news release and common to the gold mining industry are defined
below.
Total Cash Cost and Total Cash Cost per
Ounce
Total Cash Cost is reflective of the cost of
production. Total Cash Cost reported in the FS include mining
costs, processing & water treatment costs, general and
administrative costs of the mine, off-site costs, refining costs,
transportation costs and royalties. Total Cash Cost per Ounce is
calculated as Total Cash Cost divided by payable gold ounces.
All-in Sustaining Cost (AISC) and AISC per
Ounce
AISC is reflective of all of the expenditures
that are required to produce an ounce of gold from operations. AISC
reported in the FS includes total cash costs, sustaining capital,
expansion capital and closure costs, but excludes corporate general
and administrative costs and salvage. AISC per Ounce is calculated
as AISC divided by payable gold ounces.
About Marathon
Marathon (TSX:MOZ) is a Toronto based gold
company advancing its 100%-owned Valentine Gold Project located in
the central region of Newfoundland and Labrador, one of the top
mining jurisdictions in the world. The Project comprises a
series of four mineralized deposits along a 20-kilometre system. A
March 2021 Feasibility Study outlined an open pit mining and
conventional milling operation over a thirteen-year mine life with
a 30% after-tax rate of return. The Project has estimated Proven
Mineral Reserves of 1.40 Moz (29.58 Mt at 1.46 g/t) and Probable
Mineral Reserves of 0.65 Moz (17.38 Mt at 1.17 g/t). Total Measured
Mineral Resources (inclusive of the Mineral Reserves) comprise 1.92
Moz (32.59 Mt at 1.83 g/t) with Indicated Mineral Resources
(inclusive of the Mineral Reserves) of 1.22 Moz (24.07 Mt at 1.57
g/t). Additional Inferred Mineral Resources are 1.00 Moz (18.25 Mt
at 1.70 g/t Au). Please see Marathon’s Annual Information Form for
the year ended December 31, 2020 and other filings made with
Canadian securities regulatory authorities and available at
www.sedar.com for further details and assumptions relating to the
Valentine Gold Project.
About Ausenco
Ausenco is a global company based across 26
offices in 14 countries, with projects in over 80 locations
worldwide. Combining deep technical expertise with a 30-year track
record, Ausenco delivers innovative, value-add consulting studies,
project delivery, asset operations and maintenance solutions to the
mining & metals, oil & gas and industrial sectors.
For more information, please
contact:
Matt MansonPresident & CEOTel: 416
987-0711mmanson@marathon-gold.com |
Hannes PortmannCFO & Business DevelopmentTel: 416
855-8200hportmann@marathon-gold.com |
Amanda MalloughSenior Associate, Investor RelationsTel: 416
855-8202amallough@marathon-gold.com |
To find out more information on Marathon Gold
Corporation and the Valentine Gold Project, please visit
www.marathon-gold.com.
Cautionary Statement Regarding
Forward-Looking Information
Certain information contained in this news
release, constitutes forward-looking information within the meaning
of Canadian securities laws (“forward-looking statements”). All
statements in this news release, other than statements of
historical fact, which address events, results, outcomes or
developments that Marathon expects to occur are forward-looking
statements. Forward-looking statements include statements that are
predictive in nature, depend upon or refer to future events or
conditions, or include words such as “expects”, “anticipates”,
“plans”, “believes”, “estimates”, “considers”, “intends”,
“targets”, or negative versions thereof and other similar
expressions, or future or conditional verbs such as “may”, “will”,
“should”, “would” and “could”. We provide forward-looking
statements for the purpose of conveying information about our
current expectations and plans relating to the future, and readers
are cautioned that such statements may not be appropriate for other
purposes. More particularly and without restriction, this news
release contains forward-looking statements and information about
the FS and the results therefrom (including IRR, NPV5%, Capex, FCF,
AISC and other financial metrics), the realization of mineral
reserve and mineral resource estimates, the future financial or
operating performance of the Company and the Project, capital and
operating costs, the ability of the Company to obtain all
government approvals, permits and third-party consents in
connection with the Company’s exploration, development and
operating activities, the potential impact of COVID-19 on the
Company, the Company’s ability to successfully advance the Project
and anticipated benefits thereof, economic analyses for the
Valentine Gold Project, processing and recovery estimates and
strategies, future exploration and mine plans, objectives and
expectations and corporate planning of Marathon, future
environmental impact statements and the timetable for completion
and content thereof and statements as to management's expectations
with respect to, among other things, the matters and activities
contemplated in this news release.
Forward-looking statements involve known and
unknown risks, uncertainties and assumptions and accordingly,
actual results and future events could differ materially from those
expressed or implied in such statements. You are hence cautioned
not to place undue reliance on forward-looking statements. In
respect of the forward-looking statements concerning the
interpretation of exploration results and the impact on the
Project’s mineral resource estimate, the Company has provided such
statements in reliance on certain assumptions it believes are
reasonable at this time, including assumptions as to the continuity
of mineralization between drill holes. A mineral resource that is
classified as “inferred” or “indicated” has a great amount of
uncertainty as to its existence and economic and legal feasibility.
It cannot be assumed that any or part of an “indicated mineral
resource” or “inferred mineral resource” will ever be upgraded to a
higher category of mineral resource. Investors are cautioned not to
assume that all or any part of mineral deposits in these categories
will ever be converted into proven and probable mineral
reserves.
By its nature, this information is subject to
inherent risks and uncertainties that may be general or specific
and which give rise to the possibility that expectations,
forecasts, predictions, projections or conclusions will not prove
to be accurate, that assumptions may not be correct and that
objectives, strategic goals and priorities will not be achieved.
Factors that could cause future results or events to differ
materially from current expectations expressed or implied by the
forward-looking statements include risks and uncertainties relating
to the interpretation of drill results, the geology, grade and
continuity of mineral deposits and conclusions of economic
evaluations; uncertainty as to estimation of mineral resources;
inaccurate geological and metallurgical assumptions (including with
respect to the size, grade and recoverability of mineral
resources); the potential for delays or changes in plans in
exploration or development projects or capital expenditures, or the
completion of feasibility studies due to changes in logistical,
technical or other factors; the possibility that future
exploration, development, construction or mining results will not
be consistent with the Company’s expectations; risks related to the
ability of the current exploration program to identify and expand
mineral resources; risks relating to possible variations in grade,
planned mining dilution and ore loss, or recovery rates and changes
in project parameters as plans continue to be refined; operational
mining and development risks, including risks related to accidents,
equipment breakdowns, labour disputes (including work stoppages and
strikes) or other unanticipated difficulties with or interruptions
in exploration and development; risks related to the inherent
uncertainty of production and cost estimates and the potential for
unexpected costs and expenses; risks related to commodity and power
prices, foreign exchange rate fluctuations and changes in interest
rates; the uncertainty of profitability based upon the cyclical
nature of the mining industry; risks related to failure to obtain
adequate financing on a timely basis and on acceptable terms or
delays in obtaining governmental or other stakeholder approvals or
in the completion of development or construction activities; risks
related to environmental regulation and liability, government
regulation and permitting; risks relating to the Company’s ability
to attract and retain skilled staff; risks relating to the timing
of the receipt of regulatory and governmental approvals for
continued operations and future development projects; political and
regulatory risks associated with mining and exploration; risks
relating to the potential impacts of the COVID-19 pandemic on the
Company and the mining industry; changes in general economic
conditions or conditions in the financial markets; and other risks
described in Marathon’s documents filed with Canadian securities
regulatory authorities, including the Annual Information Form for
the year ended December 31, 2020.
You can find further information with respect to
these and other risks in Marathon’s Annual Information Form for the
year ended December 31, 2020 and other filings made with Canadian
securities regulatory authorities available at www.sedar.com. Other
than as specifically required by law, Marathon undertakes no
obligation to update any forward-looking statement to reflect
events or circumstances after the date on which such statement is
made, or to reflect the occurrence of unanticipated events, whether
as a result of new information, future events or results
otherwise.
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