VANCOUVER, Oct. 22, 2018 /CNW/ - B2Gold Corp. (TSX: BTO,
NYSE AMERICAN: BTG, NSX: B2G) ("B2Gold" or the "Company") is
pleased to announce positive results of an expansion study for El
Limon Mine located in Nicaragua
and that the Company has signed a renewed two-year Collective
Agreement with the labour unions.
The expansion study was conducted to evaluate the life-of-mine
("LoM") options for combining the remaining underground Inferred
Mineral Resources with the new El Limon Central zone open-pit
Inferred Mineral Resource. The results of this study recommend the
expansion of the existing plant from 485,000 tonnes per annum
("tpa") to 600,000 tpa and addition of a third stage of milling to
achieve a fine grind. The result would be a much longer mine life
with significantly higher gold production and lower cash operating
costs (see non-IFRS Measures) and all-in sustaining costs
("AISC") (see non-IFRS Measures). The third stage of milling
also allows for the reprocessing of old tailings at the end of the
mine life. All dollar figures are in United States dollars unless otherwise
indicated.
Highlights of El Limon Expansion Study Results
- Projected annual processing rate increase to 600,000 tpa
- LoM is estimated to be extended over 10 years, based on
Inferred Mineral Resources from open pit and underground sources
with an additional 11+ years by processing historic mine
tailings
- Estimated significant increase in average annual gold
production to approximately 75,000 ounces per year during
approximately 10 years of mining. In addition, production would
average over 18,000 ounces of gold per year for 11+ years when
subsequently processing tailings from historic high-grade
mining
- Projected total gold production over 10 years of mining
approximately 750,000 ounces of gold
- Projected total gold production of approximately 985,000 ounces
of gold over 21+ years
- Lower estimated average direct cash operating costs per ounce
below $600 and reduced projected AISC
of approximately $900 per ounce of
gold (excluding expansion capital costs)
- Estimated expansion capital cost of approximately $35 million over a period of approximately 16
months for plant upgrades and expansion
- Forecast LoM after-tax net cash flow of over $235 million at a gold price of $1,300 per ounce
- Forecast after-tax net present value of over $135 million at a 5.0% discount rate and gold
price of $1,300 per ounce, generating
an after-tax internal rate of return of approximately 28%
- Ongoing drilling continues to extend El Limon Central zone to
the north. Mineralization remains open to the north and at
depth
Project Size Trade-off Studies
El Limon
expansion study was evaluated at throughput rates ranging from
500,000 tpa to 1,100,000 tpa. Metallurgical test results indicate
that the existing plant could be expanded to a production level of
600,000 tpa by upgrading the crushing system, adding a pebble
crusher, adding a new thickener, and upgrading the cyclones and
leach circuit. Expansion to 1,100,000 tpa would require an upgrade
of the existing plant as well as the construction of a new 500,000
tpa plant.
Metallurgical testing was also completed to evaluate the optimum
grind size for both El Limon Central ore and the Santa Pancha
underground ore sources. Results indicate that there would
be a significant improvement in recovery for El Limon Central
pit ore and also an improvement for the Santa Pancha recoveries at
finer grind sizes (80% passing 30 microns). The finer grind would
be achieved by adding a third stage of grinding to the milling
circuit. The fine grind capability would also allow for the
retreatment of old tailings at the end of the mine life with only
minor plant modifications. High-level production scenarios, capital cost
estimates and operating cost estimates were developed for various
cases ranging from 500,000 tpa to 1,100,000 tpa with both coarse
and fine grinding.
According to the study, the 600,000 tpa fine grind case with the
processing of old tailings ("600FwT") would result in the
best current project economics. The significant additional capital
costs associated with building a second new plant for the 1 million
+ tpa cases are not justifiable based on the existing Inferred
Mineral Resource. However, these cases may become viable as future
further expansion opportunities if the Mineral Resource is expanded
by further positive drilling results. El Limon Central zone
mineralization continues to be extended to the north by drilling,
and remains open to the north and at depth.
The 600FwT expansion would consist of upgrading the crushing
system, installing a pebble crusher in the SAG mill circuit, adding
a third stage of grinding, replacing the pre-leach thickener,
adding power generating capacity and making improvements to the
gold recovery circuits. The initial capital cost estimates for
these improvements would be approximately $35 million. It has been assumed that open-pit
mining will be done by contract mining using established
contactors. The study assumes the processing of old tailings will
begin after the underground and open-pit resources have been
depleted.
Basis of the Study
In February
2018, the Company announced a positive initial open-pit
Inferred Mineral Resource at the newly-discovered El Limon Central
zone at El Limon property in Nicaragua of 5,130,000 tonnes at a grade of
4.92 grams per tonne ("g/t") of gold containing 812,000 ounces of
gold (see news release dated 02/23/2018). This resource has
provided the open-pit resources for the expansion study. Total
Inferred Mineral Resources from underground and open-pit sources
included in this study consist of approximately 6.0 million tonnes
at a grade of 4.3 g/t, containing approximately 829,000 ounces.
Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability.
A consistent mix of underground and open-pit ore feeding the
plant has always provided the optimum operating conditions for El
Limon Mine, and the new Mineral Resources at El Limon Central zone
will provide long term, open-pit feed to blend with the underground
ore. Approximately 60% of the plant feed is planned to come from
open pits which have an overall strip ratio in the range of 16
tonnes of waste to 1 tonne of mill feed. At the end of the mine
life, plant feed is expected to come from the old tailings at a
rate of 600,000 tpa.
Processing of historic tailings is based on an Indicated Mineral
Resource estimate containing 7.3 million tonnes of historic
tailings at average grades of 1.12 g/t gold and 4.17 g/t silver,
containing approximately 263,000 ounces of gold and 982,000 ounces
of silver. Of that resource, approximately 6.9 million tonnes was
included in the study at gold and silver grades of 1.15 g/t and
4.11 g/t respectively, containing approximately 255,000 ounces of
gold and 916,000 ounces of silver. Annual production rates during
the processing of the tailings from historic high-grade mining are
estimated to average over 18,000 ounces of gold and 64,000 ounces
of silver. Cash operating costs per ounce and AISC per ounce for
the processing of the old tailings are forecast to be slightly
lower compared to processing the open pit and underground ore
resources.
Upside Potential
Positive drilling results continue to
expand El Limon Central zone to the north, indicating the potential
to expand the Mineral Resources. The zone is also open to depth,
indicating the potential to produce ore from underground in El
Limon Central area once open-pit mining is completed.
B2Gold's technical team is currently updating El Limon Inferred
Mineral Resource to include recent additional drilling results and
conducting mine optimization studies with a view to potentially
improve the positive economics for El Limon expansion. These
studies are expected to be completed in the first quarter of 2019.
Renewed Collective Agreement with El Limon Mine Union
Workers
Today, representatives of B2Gold Management and the
Labour Unions at El Limon Mine renewed the existing Collective
Agreement for two years. The renewal ensures the continuance of
stable labour relations and coincides with the positive news
regarding the long-term prospects of El Limon Mine.
About B2Gold Corp.
Headquartered in Vancouver, Canada, B2Gold Corp. is the world's
new senior gold producer. Founded in 2007, today, B2Gold has five
operating gold mines, and numerous exploration and development
projects in various countries including Nicaragua, the
Philippines, Namibia,
Mali, Burkina Faso, Colombia and Finland.
With the first full year of production from the large, new
Fekola Mine, B2Gold is achieving transformational growth in 2018.
Consolidated gold production is forecast to be between 920,000 and
960,000 ounces, representing an increase in annual consolidated
gold production of approximately 300,000 ounces in 2018 versus
2017. Based on current assumptions, in 2018, consolidated cash
operating costs are projected to be between $505 and $550 per
ounce, and consolidated AISC are projected to be between
$780 and $830 per ounce.
Qualified Persons
Tom
Garagan, Senior Vice President of Exploration at B2Gold, a
qualified person under NI 43-101, has approved the scientific and
technical information regarding exploration matters contained in
this news release.
Dale Craig, Vice President of
Operations at B2Gold, a qualified person under NI 43-101, has
approved the scientific and technical information regarding
engineering matters contained in this news release.
ON BEHALF OF B2GOLD
CORP.
"Clive T. Johnson"
President & Chief Executive Officer
Cautionary Statement
The reader
is advised that the results summarized in this news release are
intended to provide only an initial, high-level review of the
project potential and expansion options. The initial mine plans and
economic models include numerous assumptions and the use of
Inferred Mineral Resources. The expansion study is preliminary in
nature, and it includes Inferred Mineral Resources that are
considered too speculative geologically to have the economic
considerations applied to them that would enable them to be
categorized as Mineral Reserves. There is no guarantee that
Inferred Mineral Resources can be converted to Indicated or
Measured Mineral Resources and, consequently, there is no guarantee
the production estimates or project economics described herein will
be achieved.
Forward-looking Statement
The Toronto Stock
Exchange and the NYSE American LLC neither approve nor
disapprove 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; outlook; guidance;
forecasts; estimates; and other
statements regarding future or estimated financial
and operational performance events, gold
production and sales, revenues and cash flows,
capital and operating costs, including projected cash
operating costs and AISC, and budgets;
statements regarding future or estimated mine life,
metal price assumptions, ore grades and
sources, stripping ratios, throughput, ore
processing; statements regarding anticipated
exploration, drilling, development, construction, permitting and
other activities or achievements of B2Gold;
and including, without limitation: the source and rates of plant
feed; the significant, additional capital costs associated with
building a second new plant for the 1 million+ tpa cases
potentially becoming viable if the mineral resource can be
expanded; El Limon Central zone mineralization continuing to be
extended to the north, and remaining open to the north and at
depth; and the results of El Limon expansion study being presented
to the B2Gold Board, the timing thereof, and that decisions on
specific expansion strategies and the timing for implementing such
strategies being made at such time. Estimates of Mineral
Resources and Reserves, including the recently announced
Inferred Mineral Resource estimate for El Limon Central zone,
are also forward-looking statements because they constitute
projections 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 or related to: the
volatility of metal prices and B2Gold's common shares; the dangers
inherent in exploration, development and mining activities; the
uncertainty of reserve and resource estimates; not achieving
production, cost or other estimates; actual production, development
plans and costs differing materially from the estimates in B2Gold's
feasibility studies; the ability to obtain and maintain any
necessary permits, consents or authorizations required for mining
activities; the current ongoing instability in Nicaragua; environmental regulations or
hazards and compliance with complex regulations associated with
mining activities; the ability to replace Mineral Reserves and
identify acquisition opportunities; the unknown liabilities of
companies acquired by B2Gold; the ability to successfully integrate
new acquisitions; fluctuations in exchange rates; the availability
of financing; financing and debt activities, including potential
restrictions imposed on B2Gold's operations as a result thereof and
the ability to generate sufficient cash flows; operations in
foreign and developing countries and the compliance with foreign
laws, including those associated with operations in Mali, Namibia, the
Philippines, Nicaragua and
Burkina Faso and including risks
related to changes in foreign laws and changing policies related to
mining and local ownership requirements; remote operations and the
availability of 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,
including local instability or acts of terrorism and the effects
thereof; the reliance upon contractors, third parties and joint
venture partners; the lack of sole decision-making authority
related to Filminera Resources Corporation, which owns the Masbate
Project; challenges to title or surface rights; the dependence on
key personnel and the 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
B2Gold's operations, including risks related to strikes and the
halting of such operations from time to time; conflicts with small
scale miners; failures of information systems or information
security threats; the final outcome of the audit by the Philippines
Department of Environment and Natural Resources in relation to the
Masbate Project; the ability to maintain adequate internal controls
over financial reporting as required by law, including Section 404
of the Sarbanes-Oxley Act; compliance with anti-corruption laws; 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, B2Gold's current Form 40-F Annual Report 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
"Websites"). The list is not exhaustive of the factors that may
affect B2Gold's forward-looking statements.
B2Gold's forward-looking statements are based on the
applicable assumptions and factors management considers reasonable
as of the date hereof, based on the information available to
management at such time. These assumptions and factors include, but
are not limited to, assumptions and factors related to B2Gold's
ability to carry on current and future operations, including:
development and exploration activities; the timing, extent,
duration and economic viability of such operations, including any
Mineral Resources or Reserves identified thereby; the accuracy and
reliability of estimates, projections, forecasts, studies and
assessments; B2Gold's ability to meet or achieve estimates,
projections and forecasts; the availability and cost of inputs; the
price and market for outputs, including gold; the timely receipt of
necessary approvals or permits; the ability to meet current and
future obligations; the ability to obtain timely financing on
reasonable terms when required; the current and future social,
economic and political conditions; and other assumptions and
factors generally associated with the mining industry.
B2Gold's forward-looking statements are based on the
opinions and estimates of management and reflect their
current expectations regarding future events and operating
performance and speak only as of the date hereof.
B2Gold 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.
There can be no assurance that forward-looking
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. For the reasons set forth above, undue reliance should
not be placed on forward-looking statements.
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"). 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 on the Websites, under the
heading "Non-IFRS Measures" for a more detailed discussion of how
B2Gold calculates such measures.
Cautionary Note to United States
Investors
The disclosure in this news release was
prepared in accordance with Canadian National Instrument 43-101
("NI 43-101"), which differs significantly from the requirements of
the SEC set out in Industry Guide 7. Accordingly, such disclosure
may not be comparable to similar information made public by
companies that report in accordance with U.S. standards. In
particular, this news release refers to "Mineral Resources,"
"measured Mineral Resources," "indicated Mineral Resources" or
"inferred Mineral Resources". While these categories of
mineralization are recognized and required by Canadian securities
laws, they are not recognized by the SEC and are not normally
permitted to be disclosed in SEC filings by U.S. companies. U.S.
investors are cautioned not to assume that any part of a "mineral
resource," "measured mineral resource," "indicated mineral
resource" or "inferred mineral resource" will ever be converted
into a "reserve." In addition, "reserves" reported by the Company
under Canadian standards may not qualify as reserves under SEC
standards. Under SEC standards, mineralization may not be
classified as a "reserve" unless the mineralization can be
economically and legally extracted or produced at the time the
"reserve" determination is made. Further, while NI 43-101 permits
companies to disclose economic projections contained in
pre-feasibility studies and preliminary economic assessments, 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".
Accordingly, information contained or referenced in this news
release containing descriptions of the Company's mineral deposits
may not be compatible to similar information made public by U.S.
companies subject to the reporting and disclosure requirements of
U.S. federal securities laws, rules and regulations. "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
will ever be upgraded to a higher category. Disclosure of
"contained ounces" in a resource is permitted disclosure under
Canadian reporting standards; however, the SEC normally only
permits issuers to report mineralization that does not constitute
"reserves" by SEC standards as in-place tonnage and grade without
reference to unit measures. Historical results or feasibility
models presented herein are not guarantees or expectations of
future performance.
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SOURCE B2Gold Corp.