True Gold Resumes Construction at Karma
Fully Funded & on Track to Enter Production in March 2016
VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 19, 2015) - True Gold Mining Inc. (TSX VENTURE:TGM) ("True Gold" or the "Company") announced today that it has resumed activity at its Karma Gold Project ("Karma" or the "Project") in Burkina Faso. The Company expects to pour first gold at Karma in March 2016.
Specific developments related to the restart of activity include the following:
| • | A site clean-up and repair program has begun with a ramp-up to full construction set for the end of the month. Specific activities planned in the coming weeks include the remobilizing and commissioning of the mine fleet, ordering of liners and piping, and surveying of ponds and other locations. The local workforce will be re-engaged as construction accelerates. | |
| • | True Gold and the Government of Burkina Faso will continue extensive communication and discussion with community leaders through a reconstituted Community Liaison Committee. | |
| • | Karma remains fully funded through construction to first gold pour, which is expected in March 2016. True Gold has $31 million in cash, and up to $62 million under our finance facility with approximately $70 million of project cost remaining. The Company continues to have full support from its partners, Franco-Nevada and Sandstorm Gold. |
"We are pleased to be returning to work at Karma with the support of the Government of Burkina Faso and leaders in the local community," said Christian Milau, President and CEO, True Gold Mining. "We have said from the beginning of this process that it is our intention to work towards a long-term solution that builds trust with stakeholders in the community and reduces the risk of similar challenges in the future. As we move toward full construction, we remain committed to delivering long-lasting benefits to the local communities and to the country."
"We are grateful for the support and commitment that our employees, shareholders and our valued partners in Burkina Faso have provided over the past several months to get us to this important juncture. Karma is now in select company, with only a handful of gold mines coming on stream globally over the next year," added Mr. Milau.
Karma Project Highlights
Karma has $62 million spent and committed to date, including the mine fleet which has been delivered and is in the final stages of commissioning. Earthworks for the plant site, plant site terraces, maintenance shop, welding bay, administration and medical buildings are 100% complete. Mine stores and the laboratory are 90% complete with civil construction 41% completed.
True Gold views Karma, which is fully funded and fully permitted, as a strong foundation upon which to build a leading mid-tier mining company. The mine is a technically simple open-pit heap leach project that offers low capital and operating costs, rapid payback and strong financial performance. Once in production, Karma will be one of the lowest cost gold mines in West Africa with significant exploration growth potential that could add years to the life of mine. Economic highlights:
- Feasibility Study1: After-tax IRR of 46.3%, NPV5% of $198.8 million @ $1,250/oz gold
- Phase II - North Kao PEA1: After-tax IRR of 213%, NPV5% of $69.6 million @$1,250/oz gold
- Phase III - large resource base and multiple targets for long-term growth
It is estimated that Karma will deliver approximately $1601 million in revenue to the Government of Burkina Faso during the life of the mine through a net smelter royalty, corporate taxes and a 10% carried interest. The mine will also provide extensive local investment in infrastructure, education and procurement.
[1] The estimated figures provided are from the Karma Project definitive feasibility study, Dated December 17, 2013 and the North Kao PEA dated August 10, 2014, (which are available under the Company's profile at www.sedar.com) and based on the assumptions made therein. The estimated figures can be affected by a number of factors, including but not limited to gold prices, consumables pricing, labour, materials and contract pricing.
All amounts in US dollars unless otherwise indicated.
Peter C. Carter, P. Eng., Chief Operating Officer and Vice President Engineering of the Company, is the designated Qualified Person for this news release within the meaning of National Instrument 43-101 Standards of Disclosure for Mineral Projects and has reviewed and verified that the technical information contained in this release is accurate and approves of the written disclosure of same.
About True Gold
True Gold Mining Inc. is where gold comes to life. We are committed to growing a successful gold exploration, development and production company, by focusing on projects with low costs, low technical risks and solid economics. The Company's board, management and technical teams have proven track records in gold exploration, development, operations and production worldwide.
Additional information about the Company and its activities may be found on the Company's website at www.truegoldmining.com and under the Company's profile at www.sedar.com.
ON BEHALF OF THE BOARD
Christian Milau, President & CEO
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.
All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to True Gold within the meaning of applicable securities laws, including statements with respect to the potential quantity and/or grade of minerals, potential size and expansion of a mineralized zone, proposed timing of exploration and development plans. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold, copper, silver and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licenses and permits and obtaining required licences and permits, labour stability, stability in market conditions, availability of equipment, accuracy of any mineral resources, successful resolution of disputes and anticipated costs and expenditures, the Company's ability to efficiently recommence operations at the Karma Project and that the Company will receive additional drawdowns under the financing agreement with Franco-Nevada and Sandstorm. Many assumptions are based on factors and events that are not within the control of True Gold and there is no assurance they will prove to be correct.
Such forward-looking information, involves known and unknown risks, which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information, including, risks related to the interpretation of results at the Karma Project, reliance on technical information provided by third parties as related to the Karma Project; changes in project parameters as plans continue to be refined; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; the costs and timing of the development of new deposits; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; the timing and success of exploration activities generally; satisfaction of Burkina Faso requirements relating to the periodic submissions of Environmental Impact Assessments; possible claims against the Company or its joint venture partners; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration, uncertainties relating to the interpretation of drill results and the estimation of mineral resources, the geology, grade and continuity of mineral deposits, accidents, equipment breakdowns, risk of undiscovered, title defects and surface access, the potential for delays in exploration and permitting activities, uncertainties related to the Company's relationship with communities that surround its properties in Burkina Faso, risks related to the financing agreement with Franco-Nevada and Sandstorm, including the Company's ability to meet its scheduled delivery obligations, the potential for unexpected costs and expenses, commodity price fluctuations, currency fluctuations, political risk as well as those factors discussed in the Annual Information Form of the Company dated April 27, 2015 in the section entitled "Risk Factors", under True Gold's SEDAR profile at www.sedar.com. Although True Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. True Gold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.