VANCOUVER, BC, Nov. 11, 2021
/PRNewswire/ - New Pacific Metals Corp. ("New Pacific" or the
"Company") reports its unaudited consolidated financial results for
the three months ended September 30,
2021, the first quarter of fiscal 2022. All figures
are expressed in US dollars unless otherwise stated.
QUARTERLY HIGHLIGHTS
- Subsequent to quarter-end, announced results of the 2020-2021
metallurgical test program for the Silver Sand Project. Defined
heap leach process as the preferred processing method, which
achieves 80% silver recovery and significantly de-risks the
project;
- Maintained working capital of $41.70
million, sufficient to advance the flagship Silver Sand
Project, the Carangas Project and other regional exploration
initiatives;
- Silver Sand Preliminary Economic Assessment ("PEA") continues
to advance. A total of 12,857 metres ("m") of drilling were
completed in 55 drill holes as part of the current resource
expansion drill program;
- Received an administrative mining contract for the Silver Sand
Project, establishing a clear title to the project mineral rights;
and
- Completed the Phase I discovery drill program at the Carangas
Project with a total of 3,790 m
drilled in 13 holes. Announced a Phase II drill program to complete
an additional minimum 7,500 m of
drilling by the end of 2021.
Dr. Mark Cruise, CEO of New
Pacific, said, "During the last quarter, we continued to advance
the Silver Sand PEA. As part of our PEA work, we completed a
metallurgical test program, which determined a path forward at
Silver Sand as a bulk-tonnage, open pit, heap leach operation,
producing silver doré on site. We are particularly pleased with
this outcome as it significantly de-risks the project due to its
lower capital and operating cost requirements, lower technical
complexity and optimized project economics. We look forward to
providing updates on our progress, while we maintain focus on
creating value for our shareholders."
FINANCIAL RESULTS
Working Capital: As of September 30, 2021, the Company had working
capital of $41.70
million.
Net loss attributable to equity holders of the
Company for the three months ended September 30, 2021 was $1.38 million or $0.01 per share (three months ended September 30, 2020 – net loss of
$1.13 million or $0.01 per share). The Company's financial
results were mainly impacted by the following: (i) operating
expenses of $1.60 million compared to
$1.52 million in the comparative
quarter; (ii) loss from investments of $0.01
million compared to income of $0.63
million in the in the comparative quarter; and (iii) foreign
exchange gain of $0.26 million
compared to loss of $0.24 million in
the comparative quarter.
Operating expenses for the three months ended
September 30, 2021 were
$1.60 million (three months
ended September 30,
2020 – $1.52 million).
Loss from investments for the three months ended
September 30, 2021 was $0.01 million (three months ended September 30, 2020 – $0.63
million).
Foreign exchange gain for the three
months ended September 30, 2021
was $0.26 million (three
months ended September 30, 2020
– loss of $0.24 million).
The Company holds a large portion of cash and short-term
investments in US dollars to support its operations in
Bolivia. Revaluation of these US-dollar-denominated financial
assets to their Canadian dollar functional currency equivalents
resulted in unrealized foreign exchange gain or loss for the
relevant reporting periods. During the three months ended
September 30, 2021, the US dollar
appreciated by 2.8% against the Canadian dollar (from 1.2394 to
1.2741) while in the comparative quarter the US dollar depreciated
by 2.1% against the Canadian dollar (from 1.3628 to 1.3339).
PROJECT OVERVIEW
SILVER SAND PROJECT
Since acquiring the project in 2017, the Company has carried out
extensive exploration and Mineral Resource definition drill
programs. From 2017 to 2019, the Company completed a total of
97,619 m of drilling in 386 diamond
core drillholes.
On July 27, 2021, the Company
announced the commencement of a 38,000
m diamond drill program at the project with the objectives
to expand the existing resource, which remains open along strike
and at depth, and to complete geotechnical drilling to support the
PEA study. Highlights of the drill program include:
- 80% of the drill program is intended to focus on expanding the
existing Mineral Resources and discovering new resources;
- 5,000 m of the drill program is
dedicated to testing for feeder zones for the large Silver Sand
deposit;
- District exploration drilling to target the North Block and
Snake Hole Zone; and
- Mineral continuity and geotechnical drilling to support the
Silver Sand PEA.
For additional information on the 2021 drill program, please see
the Company's news release dated July
27, 2021. As of the date of this news release, a total
of 12,857 m of drilling were
completed in 55 holes.
In addition to the 2021 drill program, the Company continues to
advance and has commenced key studies and initiatives in support of
the Silver Sand Project development. These include environmental
baseline, socioeconomic and hydrogeology studies.
Subsequent to quarter-end, the Company reported results of the
metallurgical test program for the Silver Sand Project. Highlights
of the test work include:
- Defined heap leach process as the preferred processing
method;
- 80% silver recovery achieved through heap leach column
testing;
- Approximately 80% of the resource is amenable to heap leaching
and is located near the top of the deposit;
- Lower capital and operating costs compared to alternative
process methods;
- Silver doré production on site further improves project
economics;
- Significantly de-risks the project due to low technical
complexity; and
- Increased project efficiency as the heap leach process may
allow for lower cut-off grade, leading to an increased minable
resource.
For additional details on the metallurgical test program, please
refer to the Company's news release dated October 19, 2021.
For the three months ended September 30,
2021, total expenditures of $2.21
million (three months ended September
30, 2020 - $0.68 million) were
capitalized under the Silver Sand Project.
CARANGAS PROJECT
In April 2021, the Company signed
a mining association agreement with a private Bolivian company to
acquire a 98% interest in the Carangas Project. Under the
agreement, the Company will cover 100% of the future expenditures
of exploration, mining, development and production
activities. The agreement has a term of 30 years and is
renewable for another 15 years.
On June 29, 2021, the Company
announced the commencement of an initial discovery drill program at
the Carangas Project. As of the date of this news release,
Phase I drilling of 3,790 m in 13
holes has been completed.
On October 26, 2021, the Company
announced that based on the encouraging results from the Phase I
drill program, two additional drill rigs were mobilized and the
drill program was expanded to include at least an additional
7,500 m by the end of 2021.
For the three months ended September 30,
2021, total expenditures of $0.55
million (three months ended September
30, 2020 - $nil) were capitalized under the Carangas
Project.
The Carangas Project is comprised of two exploration licenses
covering an area of 6.25 km2 and owned 100% by the
Company's Bolivian partner. New Pacific has entered into a mining
association agreement with the Bolivian partner, under which New
Pacific is required to cover 100% of the future expenditures on
exploration, mining, development, and production activities in
return for 98% economic interest in the Project.
SILVERSTRIKE PROJECT
During 2020, the Company's exploration team completed
reconnaissance and detailed mapping and sampling programs on the
northern portion of the project. The results to date indicate good
to excellent exploration potential for hosting narrow, high-grade,
near-surface broad-zones of silver mineralization. Please
refer to the Company's news release dated September 29, 2020 for details on the exploration
program at the northern areas of the project and to the news
release dated November 19, 2020 for
details on exploration activities and field work on the central and
southern areas of the project.
For the three months ended September 30,
2021, total expenditures of $1,748 (three months ended September 30, 2020 - $0.41
million) were capitalized under the Silverstrike
Project.
MANAGEMENT DISCUSSION AND ANALYSIS
This news release should be read in conjunction with the
Company's Management Discussion and Analysis ("MD&A") and the
unaudited condensed consolidated interim financial statements
and notes thereto for the corresponding period, which have been
filed with the Canadian Securities Administrators and are available
under the Company's profile on SEDAR at www.sedar.com and on the
Company's website at www.newpacificmetals.com.
QUALIFIED PERSON
The scientific and technical information contained in this news
release has been reviewed and approved by Alex Zhang, P. Geo., Vice President of
Exploration, who is a Qualified Person for the purposes of National
Instrument 43-101 – Standards of Disclosure for Mineral Resources
("NI 43-101"). The Qualified Person has verified the information
disclosed herein and are not aware of any significant risks and
uncertainties that could be expected to affect the reliability or
confidence in the information discussed herein.
ABOUT NEW PACIFIC
New Pacific is a Canadian exploration and development company
with precious metal projects, including the flagship Silver Sand
Project, the Silverstrike Project and the Carangas Project,
all of which are located in Bolivia. The Company is focused on progressing
the development of the Silver Sand Project, while growing its
Mineral Resources through the exploration and acquisition of
properties in the Americas.
For further information, please contact:
Stacey Pavlova, CFA
VP, Investor Relations and Corporate Communications
New Pacific Metals Corp.
Phone: (604) 633-1368
U.S. & Canada toll-free: 1
(877) 631-0593
E-mail: info@newpacificmetals.com
www.newpacificmetals.com
To receive company news by e-mail, please register using New
Pacific's website at www.newpacificmetals.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
Certain of the statements and information in this news
release constitute "forward-looking statements" within the meaning
of the United States Private Securities Litigation Reform Act of
1995 and "forward-looking information" within the meaning of
applicable Canadian provincial securities laws. Any
statements or information that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions or future events or performance (often, but
not always, using words or phrases such as "expects", "is
expected", "anticipates", "believes", "plans", "projects",
"estimates", "assumes", "intends", "strategies", "targets",
"goals", "forecasts", "objectives", "budgets", "schedules",
"potential" or variations thereof or stating that certain actions,
events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved, or the negative of any of these terms
and similar expressions) are not statements of historical fact and
may be forward-looking statements or information. Such statements
include, but are not limited to: statements regarding anticipated
exploration, drilling, development, construction, and other
activities or achievements of the Company; timing of receipt of
permits and regulatory approvals; timing and content of the PEA,
and estimates of the Company's revenues and capital
expenditures.
Forward-looking statements or information are subject to a
variety of known and unknown risks, uncertainties and other factors
that could cause actual events or results to differ from those
reflected in the forward-looking statements or information,
including, without limitation, risks relating to: global economic
and social impact of COVID-19; fluctuating equity prices, bond
prices, commodity prices; calculation of resources, reserves and
mineralization, general economic conditions, foreign exchange
risks, interest rate risk, foreign investment risk; loss of key
personnel; conflicts of interest; dependence on management,
uncertainties relating to the availability and costs of financing
needed in the future, environmental risks, operations and political
conditions, the regulatory environment in Bolivia and Canada, risks associated with community
relations and corporate social responsibility, and other factors
described under the heading "Risk Factors" in the Company's Annual
Information Form for the year ended June 30,
2021 and its other public filings.
This list is not exhaustive of the factors that may affect
any of the Company's forward-looking statements or
information.
The forward-looking statements are necessarily based on a
number of estimates, assumptions, beliefs, expectations and
opinions of management as of the date of this news release that,
while considered reasonable by management, are inherently subject
to significant business, economic and competitive uncertainties and
contingencies. These estimates, assumptions, beliefs,
expectations and options include, but are not limited to, those
related to the Company's ability to carry on current and future
operations, including: the duration and effects of COVID-19 on our
operations and workforce; development and exploration activities;
the timing, extent, duration and economic viability of such
operations; the accuracy and reliability of estimates, projections,
forecasts, studies and assessments; the Company's ability to meet
or achieve estimates, projections and forecasts; the stabilization
of the political climate in Bolivia; the Company's ability to obtain and
maintain social license at its mineral properties; the availability
and cost of inputs; the price and market for outputs; foreign
exchange rates; taxation levels; the timely receipt of necessary
approvals or permits, including the ratification and approval of
the Mining Production Contract with COMIBOL by the Plurinational
Legislative Assembly of Bolivia;
the approval of the mining association agreement for the
Silverstrike Project by AJAM; the ability of the Company to convert
the exploration licenses at the Carangas Project to AMC; 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.
Although the forward-looking statements contained in this
news release are based upon what management believes are reasonable
assumptions, there can be no assurance that actual results will be
consistent with these forward-looking statements. All
forward-looking statements in this news release are qualified by
these cautionary statements. Accordingly, readers should not
place undue reliance on such statements. Other than specifically
required by applicable laws, the Company is under no obligation and
expressly disclaims any such obligation to update or alter the
forward-looking statements whether as a result of new information,
future events or otherwise except as may be required by law.
These forward-looking statements are made as of the date of this
news release.
CAUTIONARY NOTE TO US INVESTORS
This news release, including the documents incorporated by
reference herein, has been prepared in accordance with the
requirements of the securities laws in effect in Canada which differ from the requirements of
United States securities laws. All
mining terms used herein but not otherwise defined have the
meanings set forth in NI 43-101.
Accordingly, information contained in this news release and
the documents incorporated by reference herein containing
descriptions of the Company's mineral deposits may not be
comparable to similar information made public by U.S. companies
subject to the reporting and disclosure requirements of
United States federal securities
laws and the rules and regulations thereunder.
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SOURCE New Pacific Metals Corp.