VANCOUVER, BC, April 6,
2022 /CNW/ - Bluestone Resources Inc. (TSXV:
BSR) (OTCQB: BBSRF) ("Bluestone" or the "Company") is
pleased to announce the Company has filed its Feasibility Study for
the Cerro Blanco Gold Project on SEDAR at www.sedar.com and on the
Company's website at www.bluestoneresources.ca.
The Technical Report, entitled "N.I. 43-101 Technical Report
& Feasibility Study on the Cerro Blanco Gold Project," was
prepared by G Mining Services Inc. in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects
("NI 43-101") and has an effective date of February 22, 2022.
Jack Lundin, President and
CEO, commented, "We are very pleased to complete and file the
43-101 report for the Cerro Blanco Gold Project. A tremendous
amount of effort and work went into the Feasibility Study and
delivering a high-quality project that we are proud of."
Feasibility Study Highlights
The recent completion of
the Feasibility Study highlighted a project that is capable of
producing over 300,000 ounces per year at head grades of +2.0 g/t
gold. The project will produce 2.6 million ounces of gold over the
life of mine at first quartile all-in sustaining costs. As reported
in the press release dated February 22,
2022, highlights include:
- Life of mine production of 2.6 million ounces of gold and 10.6
million ounces of silver over an initial 14-year mine life.
- Peak production of 347,000 ounces and average annual production
of 241,000 ounces gold over the first ten years of operation.
- Average life of mine AISC of $629/oz (net of credits).
- Average annual free cash flow of $228
million per year during the first 10 years and life of mine
total free cash flow of $2.350
billion.
- Net present value (5%) of $1.047
billion after-tax.
- After-tax internal rate of return of 30%.
- Initial capital of $572 million
with an after-tax payback period of 2.2 years.
- Proven & Probable Reserves of 2.8 million ounces of gold
and 12.6 million ounces of silver (53.9 million tonnes at 1.6 g/t
Au and 7.3 g/t Ag).
The development of the Project is expected to provide
substantial economic benefits to Guatemala, both locally and at a national
level. A priority will be to continue to train and develop skills
of the local workforce as the Project advances, which is in line
with the Company's philosophy of creating shared benefits.
Unless otherwise indicated, all dollar amounts are stated in U.S
dollars ("$") at a gold price of $1,600/oz and a silver price of $20/oz.
Management Addition
The Company is pleased to announce
that Mr. Robert Gill, P.Eng., has
been appointed as Vice President and Managing Director,
Guatemala.
Jack Lundin, President and CEO,
commented, "An executive of Bob's calibre and experience will be a
tremendous asset as we continue to advance the Cerro Blanco
Project. In this role, and as a key member of the executive team,
Bob will be based in Guatemala and
responsible for the execution of our business operations
in-country. With the Feasibility Study now complete, it is an
exciting time for Bluestone as we advance the Project through
detailed engineering, project finance and into construction. On
behalf of the Bluestone team and Board of Directors I would like to
welcome Bob on board."
About Robert Gill
Mr.
Gill has over thirty-five (35) years of proven expertise in the
design and operation of open pit and underground mines. He has
lived in nine countries, including Argentina, Brazil, Guatemala, Peru and Venezuela and worked on six continents. Bob
has held executive and management positions with major to junior
mining companies, consulting firms and government regulators, where
he oversaw all aspects of mining including exploration,
development, construction, operation, process improvement and
closure.
Prior to joining Bluestone, Bob was the Country Manager and
President of Anagold (SSR Mining), based in Turkey. He holds a bachelor's degree of
Applied Science in Geotechnical Engineering from the University of British Columbia and is a registered
Professional Engineer and registered member of SME (Society for
Mining, Metallurgy, and Exploration). Bob's language skills include
Spanish and Portuguese.
Qualified Person
David
Cass, P.Geo., Vice President Exploration, is the designated
Qualified Person for this news release within the meaning of
National Instrument 43-101 and has reviewed and verified that the
scientific and technical information set out above in this news
release is accurate and therefore approves this written disclosure
of the technical information.
About Bluestone Resources
Bluestone Resources is a
Canadian-based precious metals exploration and development company
focused on opportunities in Guatemala. The Company's flagship asset is the
Cerro Blanco Gold Project, a near surface mine development project
located in Southern Guatemala in
the department of Jutiapa. The Company released the results of a
Feasibility Study for the Project, outlining an asset capable of
producing over 300 koz/yr at head grades of +2.0 g/t gold. The
Project will produce 2.6 million ounces of gold over the life of
mine at an all-in sustaining cost of $629/oz (as defined per World Gold Council
guidelines, less corporate general and administration costs) over
an initial 14-year mine life. The Company trades under the symbol
"BSR" on the TSX Venture Exchange and "BBSRF" on the OTCQB.
On Behalf of Bluestone Resources Inc.
"Jack Lundin"
Jack Lundin | Chief Executive
Officer & Director
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of
the
TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
Forward Looking Statements
This press release contains
"forward-looking information" within the meaning of Canadian
securities legislation and "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 (collectively, "forward-looking statements"). All
statements, other than statements of historical fact, that address
activities, events, or developments that Bluestone Resources Inc.
("Bluestone" or the "Company") believes, expects, or anticipates
will or may occur in the future including, without limitation: the
estimated value of the Cerro Blanco Project (the "Project"); the
planned open pit development scenario for the Project; the
estimated gold production volume per year from the Project; gold
and silver price estimates used in the preliminary economic
assessment ("PEA"); additional financial estimates of Project
economics resulting from the PEA, including peak and average annual
gold productions amounts, average all-in sustaining costs, average
annual free cash flow, after-tax net present value ("NPV"),
after-tax internal rate of return, initial capital requirements,
life of mine gold and silver production amounts, measured and
indicated resources and NPV assuming a higher gold price estimate;
management's assessment of plans, projects and intentions with
respect to the further development of the Project and future
engineering and construction phases; the expected impact of the
Project on stakeholder groups; mineral resource estimates; the
reasonable prospect of eventual economic extraction demonstrated by
reported mineral resources; gold and silver price estimates and a
reasonable contingency factor used as the basis for mineral
resource estimate cut-off grades; the potential for subsequent
assessment of mining, environmental, processing, permitting,
taxation, socio-economic and other factors to affect mineral
resources; the estimated tonne-per-day recovery volume of the
planned open pit operation; the planned use of pit phasing,
conventional open pit mining techniques and owner operated
machinery; that expectation that the LOM may be extended with
continued exploration; measured and indicated mill feed amounts and
estimated diluted mill feed to be processed over the LOM from the
pit area; planned trucking and crushing operations; anticipated
crushing and waste storage locations; estimated open-pit mining
dilution; estimated average production profile from mining and
stockpiled ore; process plant capacity in tonnes per day of ore;
planned processing rate measured in dry tonnes per year and average
mill feed grade thereof; estimated diluted gold grade and head
grade of mineralized material; process plant design and associated
processing methods, including pre-oxidation, leach and
carbon-in-pulp absorption circuit elements; expected gold and
silver recovery percentages; expected configuration of filtered
tailings in dry stack facilities; the Project's anticipated capital
development and construction timeline; capital and operating cost
estimates; the Company's estimation of VAT amounts and
recoverability thereof; estimated all-in cash costs including
sustaining CAPEX; advancement of project readiness and training
initiatives in preparation of Early Works; planned construction of
an access road, bridge and power transmission line in 2022; the
Project's expected power draw during steady state operation; the
planned facility construction, operations, monitoring, testing,
reporting, treatment and recycling in connection with the Project's
water management plan; the anticipated approval of a permit
amendment application in the Q3 2022; the Company's intention to
hire and train local employees and the initiation of training
programs; and the Project's expected economic benefits to
Guatemala. These forward-looking
statements reflect the current expectations or beliefs of the
Company based on information currently available to Bluestone and
often use words such as "expects", "plans", "anticipates",
"estimates", "intends", "may", or variations thereof or the
negative of any of these terms.
All forward-looking statements are made based on Bluestone's
current beliefs as well as various assumptions made by Bluestone
and information currently available to Bluestone. Generally, these
assumptions include, among others: the presence of and continuity
of metals at the Cerro Blanco Project at estimated grades; the
availability of personnel, machinery, and equipment at estimated
prices and within estimated delivery times; currency exchange
rates; metals sales prices and exchange rates assumed; appropriate
discount rates applied to the cash flows in economic analyses; tax
rates and royalty rates applicable to the proposed mining
operations; the availability of acceptable financing; the impact of
the novel coronavirus (COVID-19); anticipated mining losses and
dilution; success in realizing proposed operations; and anticipated
timelines for community consultations and the impact of those
consultations on the regulatory approval process.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of Bluestone to
differ materially from those discussed in the forward-looking
statements and, even if such actual results are realized or
substantially realized, there can be no assurance that they will
have the expected consequences to, or effects on, Bluestone.
Factors that could cause actual results or events to differ
materially from current expectations include, among other things:
potential changes to the mining method and the current development
strategy; risks and uncertainties related to expected production
rates; timing and amount of production and total costs of
production; risks and uncertainties related to the ability to
obtain, amend, or maintain necessary licenses, permits, or surface
rights; risks associated with technical difficulties in connection
with mining development activities; risks and uncertainties related
to the accuracy of mineral resource estimates and estimates of
future production, future cash flow, total costs of production, and
diminishing quantities or grades of mineral resources; changes in
Project parameters as plans continue to be refined; title matters;
risks associated with geopolitical uncertainty and political and
economic instability in Guatemala;
risks related to global epidemics or pandemics and other health
crises, including the impact of the novel coronavirus (COVID-19);
risks and uncertainties related to interruptions in production;
risks related to Project working conditions, accidents or labour
disputes; the possibility that future exploration, development, or
mining results will not be consistent with Bluestone's
expectations; uncertain political and economic environments and
relationships with local communities and governmental authorities;
risks relating to variations in the mineral content and grade
within the mineral identified as mineral resources from that
predicted; variations in rates of recovery and extraction;
developments in world metals markets; and risks related to
fluctuations in commodity prices and currency exchange rates. For a
further discussion of risks relevant to Bluestone, see "Risk
Factors" in the Company's annual information form for the year
ended December 31, 2020, available on
the Company's SEDAR profile at www.sedar.com.
Any forward-looking statement speaks only as of the date on
which it was made, and except as may be required by applicable
securities laws, Bluestone disclaims any intent or obligation to
update any forward-looking statement, whether as a result of new
information, future events or results, or otherwise. Although
Bluestone believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking
statements are not guarantees of future performance, and
accordingly, undue reliance should not be put on such statements
due to their inherent uncertainty. There can be no assurance
that forward-looking statements will prove to be accurate, and
actual results and future events could differ materially from those
anticipated in such statements.
Non-GAAP Financial Performance Measures
The Company has included certain non-Generally Accepted
Accounting Principles ("GAAP") measures in this news release that
are not defined under International Financial Reporting Standards
("IFRS"), including cash costs and AISC per payable ounce of gold
sold and per tonne processed. Non-GAAP 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 Company believes that these measures, in addition to measures
prepared in accordance with GAAP, provide investors an improved
ability to evaluate the underlying performance of the Company and
to compare it to information reported by other companies. The non-
GAAP measures are intended to provide additional information and
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with GAAP. These
measures do not have any standardized meaning prescribed under
GAAP, and therefore may not be comparable to similar measures
presented by other issuers.
Cash costs
Cash operating costs and cash operating costs per ounce sold are
non-IFRS financial measures and ratios. In the gold mining
industry, these metrics are common performance measures but do not
have any standardized meaning under IFRS. The Company follows the
recommendations of the Gold Institute Production Cost Standard. The
Gold Institute, which ceased operations in 2002, was a
non-regulatory body and represented a global group of producers of
gold and gold products. The production cost standard developed by
the Gold Institute remains the generally accepted standard of
reporting cash operating costs of production by gold mining
companies. Cash operating costs include mine site operating costs
such as mining, processing and administration, but exclude royalty
expenses, depreciation and depletion, share based payment expenses
and reclamation costs. Revenue from sales of by-products including
silver, lead and zinc reduce cash operating costs. Cash operating
costs per ounce sold is based on ounces sold and is calculated by
dividing cash operating costs by volume of gold ounces sold. The
most directly comparable measure prepared in accordance with IFRS
is production costs. Cash operating costs and cash operating costs
per ounce of gold sold should not be considered in isolation or as
a substitute for measures prepared in accordance with IFRS.
Net free cash flow
The Company calculates net free cash flow by deducting cash
capital spending from net cash provided by operating activities.
The Company believes that this measure provides valuable assistance
to investors and analysts in evaluating the Company's ability to
generate cash flow after capital investments and build the cash
resources of the Company. The most directly comparable measure
prepared in accordance with IFRS is net cash provided by operating
activities less net cash used in investing activities.
All-in sustaining costs
The Company believes that all-in sustaining costs ("AISC") more
fully defines the total costs associated with producing gold.
The Company calculates AISC as the sum of refining costs, third
party royalties, site operating costs, sustaining capital costs,
and closure capital costs all divided by the gold ounces sold to
arrive at a per ounce amount. Other companies may calculate this
measure differently as a result of differences in underlying
principles and policies applied. Differences may also arise due to
a different definition of sustaining versus non-sustaining
capital.
AISC reconciliation
AISC and costs are calculated based on the definitions published
by the World Gold Council ("WGC") (a market development
organization for the gold industry comprised of and funded by 18
gold mining companies from around the world). The WGC is not a
regulatory organization.
SOURCE Bluestone Resources Inc.