TORONTO, Nov. 29, 2016 /CNW/ - Galane Gold Ltd.
("Galane Gold" or the "Company") (TSX-V: GG) is pleased to announce
the release of its financial results for the three and nine months
ended September 30, 2016. All amounts
are in United States dollars
unless otherwise indicated.
A copy of the unaudited condensed consolidated interim financial
statements for the three and nine months ended September 30, 2016 prepared in accordance with
International Financial Reporting Standards and the corresponding
Management's Discussion and Analysis will be available under the
Company's profile on www.sedar.com.
Third Quarter 2016 Highlights
- Produced 6,243 ounces of gold.
- All-in operating cash cost of $1,055 per ounce (excluding
royalties).(1)
- Positive operating cash flow of $1,803,903.
- Cash balance of $2,011,696 at the
end of the quarter.
- Loss for the quarter of $1,585,352
Subsequent Events
- Commenced commissioning of the first phase of the Galaxy
Project
- Commenced underground mining at the Woodbine, Agnes and Ivy
mineral bodies at the Galaxy property on seventeen level using
conventional shrink stope mining
.
Galane Gold CEO, Nick Brodie
commented: "We are pleased to report that we have again generated
positive operating cash flows and continue to advance the
re-commissioning of Galaxy, investing approximately one and half
million dollars into this project during the quarter.
In the quarter we also commenced the commissioning of the first
phase of the Galaxy Project and also re-commenced underground
mining activities. Our results were affected by two key factors, a
non-cash foreign exchange loss of approximately one million dollars and lower production at Tau
underground. At Tau in the quarter we concentrated on development
of the declines and reef drives for the commencement of our long
term stoping plan for the main reef. We continue to remain
focused on operating profitably in Botswana while advancing the development at
Galaxy."
COMMISSIONING OF THE FIRST PHASE OF THE GALAXY
PROJECT
Galane Gold is also pleased to
announce that it has commenced commissioning the first phase of the
Galaxy capital project, as previously announced in the press
release dated July 18, 2016, at the
Company's Galaxy Gold mine in South Africa.
The first phase of the capital project has come within budget
and on time using internal cash flows from the Company's other
operations. The Company is currently commissioning the tailings
retreatment circuit which has been designed at 28,000 tonnes per
month to meet the projected monthly production target of
approximately 25,000 tonnes per month. This allows for a plant
availability of 90% and involves the following steps:
1. Slime Reclamation - Slime is reclaimed from
two sources, namely the Hostel and Old Mill Sands complexes. The
mode of reclamation is in the form of high pressure water
monitoring using four inch water cannons which are controlled by
trained operators. High pressure water is pumped to the reclamation
site dams from the plant which sources water from the underground
workings. The monitored slurry at both sites then reports to pump
stations which consist of primary in line finger screens to remove
grass and trash and then secondary vibrating screens which remove
the plus 2mm sized fraction. Screened slurry reports to a pump box
where it is mechanically moved to the plant using three pumps in
series (with a standby set) which pumps down a single 100mm line at
a density between 1.45 and 1.55 specific gravity.
2. Plant Reception and Mill Area - Material
from the sites is pumped directly to the primary tank reception
area. Slime and sand is separated using a cyclone. The product
under size (coarse material) reports to the mill for grinding, the
product overflow (fine material) continues onto the thickener or
de-watering cyclone via a tramp screen. The tramp over size
material is discharged off the screen and then is pumped directly
to tailings. This thickener is to allow low density slurry to be
thickened to control the feed to the CIL plant. In this area lime
is added directly to the screen boxes for ph control via a lime
ring main system. The single stage mill is used to further mill the
coarse sands resulting from the cyclone underflow. Mill discharge
is then pumped to a second cyclone which will determine if the
material has reached the correct specification to proceed onto the
thickener stage. This mill will also be used as the project
continues to treat hard rock from the underground operations.
3. Thickening - The thickener is 6 meters in
diameter and centrally driven. Thickener underflow is pumped
to the Filblast oxidation tank area for ph control and oxygen
injection. Clarified thickener overflow flows by gravity back to
the milling circuit to be used as water make up.
4. New Leach / CIL Circuit - Screened slurry
is pumped to the Filblast tank for pre-conditioning before
leaching. The leach feed slurry then passes through a slurry
sampler before dropping into the pre-conditioner tank. Slurry is
pumped from this first tank through 150 m3/hr Filblast Atomaer high
shear reactor units for oxidation purposes. Cyanide solution is
then added from a ring main to a header tank and from there to the
first leach tank, with the facility to add cyanide to the next two
subsequent tanks, should it be required. Cyanide control is via a
TAC 1000 cyanide controller. Compressed air or oxygen is
injected into the bottom of the leach tanks, to ensure sufficient
oxygen for the cyanidation reaction. The CIL area has been bunded
to retain any overflow, spillage, tank draining with a below ground
spillage pump and sump arrangement. The pump delivers
spillage back to the first leach tank. Each CIL tank is equipped
with an inter-stage screen mechanism. The screen has a cylindrical
stainless steel wedge-wire screen surface driven by the tank
agitator. The purpose of the screen is to retain the loaded
carbon in each tank reactor. Carbon is moved from one tank to another using
air lifts.
5. Acid wash – The acid wash section is still
under construction with the loaded carbon from the CIL received in
the loaded carbon measuring vessel. Once a batch has been
accumulated it will be dropped into the acid wash column where it
will be washed with dilute hydrochloric acid to remove scale prior
to elution. Once complete, the acid washed carbon will be
neutralised and transferred into the elution column.
6. Elution - The elution section is still
under construction. It will use a pressurised Zadra system. Loaded
carbon will be eluted by initially pumping a hot caustic cyanide
solution, typically 3.0% NaOH and 2.0% NaCN, through the column at
90°C. Gold adsorbed onto the loaded carbon will be eluted off
the carbon and plated on the electro-winning cathodes. The elution
circuit heater has an electric fired boiler and thermal water
system with the thermal water being circulated round the heater and
the primary heat exchanger. On completion of the elution, within a
13-16 hour period, the eluted carbon will be transferred
hydraulically from the elution column to the eluted carbon tank for
regeneration.
7. Tailings Circuit - Tailings slurry from the
last CIL tank gravitates to a tailings vibrating screen via a
distribution box for carbon recovery, in the event of damage, wear
or incorrect installation of CIL inter stage screens.
Carbon recovered on the screen is
delivered to a dewatering bulk bag for re-use. Tailings
linear screen underflow passes through an automatic slurry sampler
before dropping into the tails sumps. CIL tails and trash from the
tramp screen are pumped to the tailings dam. Three pumps and
a single pipeline are available to pump the slurry to the tailings
site. Fine tails slurry flow towards the centre of the tailings dam
from the tailings cyclones at selected outlets. Coarse
tailings are used for building the walls of the tailings dam, which
is specifically designed to hold any excess water. The slurry
floes onto the dam and the solids are allowed to settle.
Excess supernatant water will be collected in a pool and pumped
back to the plant.
Work on the second phase of the capital project, the crush and
float sections, is already underway. In addition, the Company has
also recommenced underground mining at the Woodbine, Agnes and Ivy
mineral bodies at the Galaxy property on seventeen level using
conventional shrink stope mining. It expects to start adding hard
rock in the first quarter of 2017 upon commissioning of the second
phase.
Production at the Galaxy property is currently expected to
commence in the fourth quarter of 2016.(2)
Galane Gold CEO, Nick Brodie
commented: "This is the first phase of our Galaxy project and is a
significant step towards our long term plan of turning Galaxy into
a 60,000 ounce of gold producer. As a result, it is an exciting
time for Galane as we begin to see the fruition of the investments
of energy, capital and management expertise over the last five
years to reshape the Company into a long-life and low-cost
operation that aims to produce positive returns for investors
across commodity cycles." (2)
Galaxy Description
The Galaxy Gold mine is located approximately 8 km west of the
town of Barberton and 45 km west of the provincial capital of
Nelspruit (Mbombela), in the Mpumalanga Province of South Africa and covers an area of 5,863 ha.
The Galaxy Gold mine comprises 21 east-west trending gold bodies
and four prospects at 600 – 2,000 meters depth.
The technical disclosure regarding the Galaxy Gold mine is
reported in the technical report entitled "A Technical Report on
the Galaxy Gold Mine, Mpumalanga Province, South Africa" which was issued January 4, 2016 with an effective date of
September 1, 2015 (the "Galaxy
Technical Report"), and was prepared by Minxcon (Pty) Ltd and
approved by Daniel van Heerden, B
Eng (Min.), MCom (Bus. Admin.), Pr. Eng., FSAIMM, AMMSA, a
Qualified Person as defined by National Instrument 43-101 ("NI
43-101"). The Galaxy Technical Report satisfies the requirements to
be a pre-feasibility study and was reviewed by the Directors of
Minxcon (Pty) Ltd, specifically, Daniel van
Heerden; Uwe Engelmann, BSc
(Zoo. & Bot.), BSc Hons (Geol.), Pr.Sci.Nat., MGSSA;
Dario Clemente, NHD (Ext. Met.),
GCC, BLDP (WBS), MMMA, FSAIMM; and Johan
Odendaal, BSc (Geol.), BSc (Min. Econ.), MSc (Min. Eng.),
Pr.Sci.Nat., FSAIMM, MGSSA, all of whom are Qualified Persons as
defined by NI 43-101 and independent of Galane Gold for the purposes of NI 43-101. The
Galaxy Technical Report can be found under the Company's profile on
SEDAR (www.sedar.com) and on the Company's website
(www.galanegold.com).
The Galaxy Technical Report covers the following mineralized
bodies:-
- Woodbine, Giles, Galaxy, Golden
Hill, Agnes Top, Pioneer
& Tiger Trap and Princeton
mineralized bodies;
- Ivy and Ceska Shaft Pillars; and
- Woodbine (East, North and South), Alpine Pioneer, Hostel (East
and West) and Biox North historical dumps.
Currently, over 75 historical adits exist within the mining
area, as well as tailings storage facilities comprised of
previously mined and processed material. Galaxy's existing
processing plants are in need of refurbishment and consist of a
south plant where crushing, milling, flotation, elution and
smelting take place, and a north plant where biological oxidation
and leaching of flotation concentrate takes place. The south plant
is designed to have a total run of mine capacity of approximately
15,000 tonnes per month and can be expanded through refurbishment
and the introduction of larger mills and flotation equipment.
About Galane Gold
Galane Gold is an un-hedged gold
producer and explorer with mining operations and exploration
tenements in Botswana and
South Africa. Galane Gold is a public company and its shares
are quoted on the TSX Venture Exchange and the Botswana Stock
Exchange under the symbol "GG". Galane Gold's management team is comprised of
senior mining professionals with extensive experience in managing
mining and processing operations and large-scale exploration
programmes. Galane Gold is
committed to operating at world-class standards and is focused on
the safety of its employees, respecting the environment, and
contributing to the communities in which it operates.
Note:
(1) Total Operating cash cost excluding royalties is
a non-GAAP measure. Refer to "Supplemental Information to
Management's Discussion and Analysis" in the Company's Management's
Discussion and Analysis for the three months ended June 30, 2016 for reconciliation to measures
reported in the Company's financial statements.
(2) This is forward-looking information and is based
on a number of assumptions. See "Cautionary Notes".
Cautionary Notes
Certain statements contained in this press release constitute
"forward-looking statements". All statements other than statements
of historical fact contained in this press release, including,
without limitation, those regarding the Company's future financial
position and results of operations, strategy, proposed
acquisitions, plans, objectives, goals and targets, and any
statements preceded by, followed by or that include the words
"believe", "expect", "aim", "intend", "plan", "continue", "will",
"may", "would", "anticipate", "estimate", "forecast", "predict",
"project", "seek", "should" or similar expressions or the negative
thereof, are forward-looking statements. These statements are not
historical facts but instead represent only the Company's
expectations, estimates and projections regarding future events.
These statements are not guarantees of future performance and
involve assumptions, risks and uncertainties that are difficult to
predict. Therefore, actual results may differ materially from what
is expressed, implied or forecasted in such forward-looking
statements.
Additional factors that could cause actual results, performance
or achievements to differ materially include, but are not limited
to: the Company's dependence on two mineral projects; gold price
volatility; risks associated with the conduct of the Company's
mining activities in Botswana and
South Africa; regulatory, consent
or permitting delays; risks relating to the Company's exploration,
development and mining activities being situated in Botswana and South
Africa; risks relating to reliance on the Company's
management team and outside contractors; risks regarding mineral
resources and reserves; the Company's inability to obtain insurance
to cover all risks, on a commercially reasonable basis or at all;
currency fluctuations; risks regarding the failure to generate
sufficient cash flow from operations; risks relating to project
financing and equity issuances; risks arising from the Company's
fair value estimates with respect to the carrying amount of mineral
interests; mining tax regimes; risks arising from holding
derivative instruments; the Company's need to replace reserves
depleted by production; risks and unknowns inherent in all mining
projects, including the inaccuracy of reserves and resources,
metallurgical recoveries and capital and operating costs of such
projects; contests over title to properties, particularly title to
undeveloped properties; laws and regulations governing the
environment, health and safety; operating or technical difficulties
in connection with mining or development activities; lack of
infrastructure; employee relations, labour unrest or
unavailability; health risks in Africa; the Company's interactions with
surrounding communities and artisanal miners; the Company's ability
to successfully integrate acquired assets; risks related to
restarting production; the speculative nature of exploration and
development, including the risks of diminishing quantities or
grades of reserves; development of the Company's exploration
properties into commercially viable mines; stock market volatility;
conflicts of interest among certain directors and officers; lack of
liquidity for shareholders of the Company; risks related to the
market perception of junior gold companies; and litigation
risk.Management provides forward-looking statements because it
believes they provide useful information to investors when
considering their investment objectives and cautions investors not
to place undue reliance on forward-looking information.
Consequently, all of the forward-looking statements made in this
press release are qualified by these cautionary statements and
other cautionary statements or factors contained herein, and there
can be no assurance that the actual results or developments will be
realized or, even if substantially realized, that they will have
the expected consequences to, or effects on, the Company. These
forward-looking statements are made as of the date of this press
release and the Company assumes no obligation to update or revise
them to reflect subsequent information, events or circumstances or
otherwise, except as required by law.
Information of a technical and scientific nature that forms
the basis of the disclosure in the press release has been approved
by Charles Byron Pr. Sci. Nat., MAusIMM., MGSSA and Chief Geologist
for Galane Gold, and a "qualified
person" as defined by National Instrument 43-101.
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.
SOURCE Galane Gold Ltd.