Member Info for Cowichan

March 7, 2023

Production costs rose 15% to $1.45 billion from $1.26 billion in 2021, and the company expects costs to continue rising in the year ahead as a consequence of inflation.

“Our financial results were impacted by industry pressures including volatile precious metal prices and higher cost inflation,”

The company, the world’s top silver producer and Mexico’s largest gold miner, declared a final dividend of 13.3 cents per share, bringing the annual total to 16.7 cents, down 51% from 33.9 cents a year prior.

https://www.mining.com/fresnillo-halves-dividend-as-inflation-hit-profit/

It is exactly as you say Tibbs - the corruption in the Congo is undeniable - not only that Mr Friedland is knee-deep in several other questionable third-world economies with human rights abuse and environmental degradation aplenty.

That said I was reading a report yesterday that outlined some very troubling statistics :

About 20 million miners in more than 80 countries work in artisanal and small-scale gold mining, including more than four million women and children.

Often unsafe and unregulated, these operations account for 20 per cent of the global gold supply, generating about $30 billion annually.

Responsible for 37 per cent of global mercury pollution, they emit 2,000 tons of the element every year.

More can be read here & here:
https://news.un.org/en/story/2023/02/1133587
https://www.planetgold.org/news

The tricky part for me is to decide which is better - allowing these large companies like our director Ms Cloete runs - to operate in corrupt countries - or leave it to the artisanal? I suppose arguments could be made for both - but I think I'd prefer some oversight versus no oversight in terms of environmental and human rights abuse .

Mr Horgan , if we are going to be critical , failed to create a successful company in Toro Gold ( that is judging by where the production of the Mako mine stood 12 months post sale to Resolute ) Has he made better choices running Centamin ? I can't say yes to that right now , maybe in the future.

Also, Egypt is no better in terms of human rights or corruption than many African countries. Is that enough of a reason for mining companies to stay away ? Shareholders must decide

https://www.bnnbloomberg.ca/video/pdac-ivanhoe-mines-president-interview~2641223?jwsource=cl#.ZAbR37PXJM8.twitter

She's at PDAC representing Ivanhoe ( as president ). Simply based on what she's accomplished in that role I wish she was running Centamin instead of Mr Horgan. That said it doesn't hurt that Robert Friedland is the company's co-chairman. Leadership matters!

Power Supply
Power supply for both stage one and stage two operations phases will be supplied by
medium speed 750/1000 RPM diesel generating sets capable of operating on heavy fuel oil
(HFO) at a viscosity up to 700 centistokes, and generating at 11,000volts at 50HZ. A
35MW power station located at the plant site will consist of 7 x 4MW and 1 x 7MW
engine/alternator sets with associated air coolers, fuel cleaning equipment, switchgear etc.

The power station will be designed to supply nominal output at site based climatic
conditions with minimal derating.

Stage one (oxide and mixed ores) will cater for a load capacity of circa 16,000/17,000kW,
stage two (mixed ores) will cater for a load of circa 22,000kW, while stage three (sulphide
ore) will be only slightly lower than stage two.

The operating mode will be N+1 sets, (where N equals the number of sets required to meet
the load with one additional machine on standby/ repair) operating at an 85% load factor. A
smaller capacity set running on diesel fuel and generating at 400 volts will serve as a black
start facility, as well as emergency power.

The power station main building will consist of:-
• an engine hall containing the generating sets
• auxiliaries annexe containing fuel treatment and engine auxiliary equipment
• switchgear annexe containing generator and main distribution switchgear
• transformer compound containing station earthing, auxiliary and 11kv/33kv step up
transformers.

Fuel (HFO) will be stored in a tank farm adjacent to the power station and incorporate tank
heating for the HFO storage tank(s). The power station auxiliary facilities will include air
start compressors, HFO fuel cleaning and conditioning with facility for sludge removal,
lubrication equipment and prime mover cooling equipment including water treatment.

The power station will operate in a semi automatic mode i.e. normally unattended except
for major load change and machine maintenance selection.

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The above is taken from Sukari's Technical Report 43-101F1 Dated March 14, 2012

So it appears Sukari uses heavy diesel oil , which the Ministry of Petroleum says went up 20%

Incidentally using HFO is polluting to the extreme - thus moving to grid power would not only be cheaper but far less destructive to the environment. Sukari's fleet of haul trucks would obviously use regular diesel , which as you say , remains priced the same

Egypt has gained emergency liquidity for food supplies via two recent loans — one received in June 2022 from the World Bank and the other in January from the International Islamic Trade Finance Corporation, though an installment from the second loan is late to arrive.

Such is the liquidity shortage, that in a rush to distribute a series of around 18 wheat shipments arriving rapidly at ports over the first two months of the year, the government allowed the wheat into the country without completing customs formalities - the importer said that following due procedures would have entailed a major payout in dollars over a short span of time, so the government promised payment at a later date.

The government food supply agency also rushed through a shipment of imported vegetable oils in the absence of liquid cash to pay for them, said a source in the vegetable oil import sector speaking on condition of anonymity.

Private sector traders importing their goods are not able to secure the same exceptional releases. A private sector grain importer speaking on condition of anonymity said that the situation was moderately better in January, when the government made substantial dollar allocations to relieve port congestion and around 60 to 70 percent of shipments could get through. Now, they said, only around 30 to 40 percent of shipments are making it into the country, and the types of shipment depend on what’s deemed most important. Amid turmoil in the poultry rearing industry, fodder crops had priority over recent weeks, meaning that industrial goods and inputs remain stuck.

Prices continue to rise for consumers as a result. Finished food products, like pasta, are as much as 80 percent more expensive, a source working in the food industry told Mada Masr on condition of anonymity. “Wheat is 100% imported within the private sector, so flour and other derivatives all heavily rely on the dollar.” Dollar scarcity is also affecting their company’s ability to finance the maintenance and operation of machinery at full capacity, they added, foreshadowing more difficulties in future.

As a backlog builds up, so do importers’ liabilities. “Importers deposited pounds with the banks months ago in advance payment for the shipments, then waited for [the equivalent in] dollars to be provided by the banks” and transferred to suppliers.

But with liquidity slow to materialize in the banks, importers have had to top up their deposits, as the Egyptian pound has been devalued on three successive occasions over the past six months. They also have to front cash for additional fees in dollars and euros to the shipping companies that own containers and who are late to get their equipment back since the goods are still lingering in storage at ports. The fines compound weekly.

Traders from various sectors are losing their relationships with suppliers abroad as a result.

https://www.madamasr.com/en/2023/03/02/news/u/inflation-persists-as-dollar-scarcity-holds-up-i

Today, the Ministry of Petroleum and Mineral Resources announced an increase in the prices of petroleum products, following the meeting of the Automatic Pricing Committee for Petroleum Products, which is responsible for following up and implementing pricing mechanisms on a quarterly basis.

The price of diesel oil increased by 20%, to six thousand pounds per ton, while the committee fixed its price for the uses of electricity production and food industries

https://twitter.com/MadaMasr/status/1631323491596156929

Speaker(s):
Duncan Hall, Centamin PLC, London, United Kingdom

https://www.linkedin.com/in/duncanjhall15/

PhD geologist with experience in regional mapping and greenfields exploration.

Currently overseeing all technical geological aspects – including planning, implementation, and strategic interpretation of results – of Centamin PLC's Eastern Desert Exploration (EDX) programmes after leading comprehensive prospectivity assessments conducted over the same area during 2021- early 2022.

Monday March 6th

10:24 AM – 10:48 AM
Modern methods in historically endowed terrains: Centamin’s approach to gold exploration in Egypt’s Eastern Desert

https://www.pdac.ca/convention/attendee-info/schedule-at-a-glance

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Doesn't say who exactly is presenting on behalf of Centamin, perhaps the BMO Florida conference gang on an extending vacation - ski trip to Canada, anyone?

excerpts from " The Momentum Investor March 2023 Newsletter " see link below

1) with a large element of its costs fixed in nature alongside the lower costs of employing labour in Africa has fed through to a significant increase in ebitda margins from 23.2% in H1 ‘19 to a forecast 29.9% in FY’22

2) Sukari has become its “flagship” project accounting for around a third group sales

3) There is potential for a large contract extension here too with Centamin planning a major 30% expansion of mining rates underground from 2025.

https://www.capdrill.com/media/news/TMI-March-23.pdf

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1) the profit margin Capital makes on the Sukari WC contract is almost criminal - Centamin shareholders are played for suckers
2) 33% of Capital's sales (and an even greater proportion of profit) comes from Sukari
3) Capital hopes to continue this lucrative scam beyond 2024

Bottom Line: retail shareholders have failed to hold Centamin to account over this wasteful third party contract - forfeiting cost control norms , overspending by a large margin ,simply to benefit Capital drilling - shameful

March 1, 2023
Harmony's shares slid 2% on Wednesday after it posted an 18% increase in half-year profit but refrained from declaring an interim dividend, citing the need to allocate capital to growth projects.

exploration has been lacking for such a long time and for people to replace assets they will have to look at what their neighbors have and what the opportunities will be," Steenkamp told Reuters in an interview.

https://www.reuters.com/markets/commodities/safricas-harmony-gold-half-year-profit-up-18-2023-03-01/

Posted by
Ahmed AbdelSattar - Senior Geologist at Centamin PLC

We are proud to announce the new employee syndicate at #Sukari_Gold_Mine ! Our team of dedicated professionals have been hard at work, creating an environment where everyone can come together to share ideas and make a difference. With the help of our new employee syndicate, we strive to create a culture of collaboration and innovation that will help us reach our goals faster and better. We are eager to share our new initiative and look forward to seeing the results that our employees can produce when they work together for both employee and company goals.
#innovation #team #collaboration #CentaminEgypt #Syndicate #employees #Sukari

https://www.linkedin.com/posts/ahmed-abdelsattar-499b5642_sukariabrgoldabrmine-innovation-team-activity-7036046574052859905-jiA6

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Last line says 'work together for employee goals...' Like better wages? Working conditions? Less contract workers on site? Flexible hours?

Also, did the syndicate get senior management's blessing before forming?

Barrick Gold announced that it is reducing its dividend by 33% to 10 cents per share
Newmont declared a 40 cent dividend which represents a 27% cut

Both have substantially lower AISC & substantially larger cash reserves than Centamin

Are the world's two largest gold miners acting too cautious?

Should Centamin follow the trend and preserve cash - what will support its share price ? What is its lower range?

Pierre Lassonde predicts $200 oil and $2,400 gold in a month as Putin’s war drags out

Feb 28, 2022
"The longer it lasts [Putin's war] , the more profound the impact is going to be, particularly on the energy market. If this goes on for two, three weeks, a month, I think you’re looking at $200 oil, (and $2400 gold ) full video here: https://www.youtube.com/watch?v=Z7ulPlxXaDs

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So the question for us examining the past is why didn't Mr Lassonde's (and most every other gold bug) prediction of higher gold $ come to pass. Some possibilities:
a) there just isn't as much popular demand for physical as we imagine
b) market manipulation (certainly happens in crypto)
c) the market is always right - gold is where it should be given supply and demand
d) ??

If the answer is 'c' then perhaps undiversified mining companies (single commodity) do not have the smartest business plan at work.

I welcome other thoughts , comments and angst filled comments

After all, Centamin is fond to boast its 'workforce' is +95% Egpytian

Regardless, why fly out so many non-essentials to a conference - are these folks so underpaid as to not afford their own warm-weather vacation?

To think I once believed this company understood its priorities. All talk.
And I'm afraid soon-to-be even less of a company in terms of return to shareholders.

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BMO Capital Markets will host its 32nd Global Metals, Mining & Critical Minerals Conference from February 26 to March 1, 2023 in Hollywood, Florida.

Speakers:
Martin Horgan CEO
Participants:
Alexandra Barter-C**** ; Head Corporate Communications
Sally Eyre ; Lead Independent Director
Ross Jerrard ; CFO
Jim Rutherford ; Non Executive Chairman
Michael Stoner ; Group Corporate Manager

Link: https://www.bmogmm.com/gmm/2.0/company-profile.aspx?id=14637

Burkina Faso's energy and mines ministry issued a statement on Tuesday saying it had "commandeered" 200 kilograms of gold from the Mana mine for "public necessity".

The company will be compensated for its value, the statement added without providing further detail.

The government spokesman did not respond to a request for comment on Wednesday.

"Endeavour confirms that it has signed a sales contract for 200kg (approximately 7,000 ounces) of gold to the Burkina Faso government at current market prices, from its Mana mine," the company told Reuters in an emailed response on Wednesday.

"This sale is in line with the country's Mining Code which stipulates that it may acquire gold directly from mining companies, in exceptional circumstances for reasons of public necessity, subject to fair and pre-agreed terms," it added.

His government has increased the security budget, and set up a "patriotic support fund" to raise money for the mass recruitment of volunteer auxiliaries to support the army.

Endeavour acquired the Mana mine in July 2020, as part of its acquisition of Canada-based gold miner Semafo. The company owns 90% and Burkina Faso's government owns the rest

https://www.bloomberg.com/news/articles/2023-02-16/burkina-faso-regime-forcibly-purchases-gold-from-endeavour-mine

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Perhaps it is a good thing gold has not rocketed beyond $2000 like some gold bugs desire - if it did it would certainly be harder for countries short on cash not to create matching 'Patriotic Support Funds' to protect their national interests - Egypt included

Phoebe D.
(She/Her)
HSES Advisor (Health, Safety, Environment and Sustainability) at Centamin PLC, currently working on site at the Sukari Gold Mine, Egypt. MSc Environment and Development (Distinction), King's College London.
5h • Edited • 5 hours ago

Over September-October 2022, I had the most fantastic two months working with Centamin PLC in Egypt at their Sukari Gold Mine, working on two projects relating to Sustainability Performance Monitoring and Supply Chain Due Diligence. I learned a great deal about how mining companies can conduct business responsibly and sustainably, and the vast number of things that need to be tracked and monitored in order to do so. This experience has solidified my decision to pursue a career in sustainability the mining industry and I would like to say a massive thank you to Women In Mining UK (WIM UK) and Centamin PLC for providing this internship.

I am pleased to share that I got the opportunity to head back to Sukari, to continue working on my projects and taking on some new ones.

Please click the link below to read my blog sharing the highlights of my experience!

https://www.womeninmining.org.uk/women-in-mining-uk-2022-summer-internship-at-centamin-plc-phoebe-dawes/

London – 17 February 2023: Women in Mining UK 2022 Summer Internship at Centamin PLC – Phoebe Dawes

Written by: Phoebe Dawes

I was offered an eight-week internship with Centamin PLC, a FTSE 250 gold miner and one of Women in Mining UK’s (WIM UK) Industry Partners, over September and October 2022. I was based at Centamin’s principal asset, the Sukari Gold Mine, located in Egypt’s Nubian Shield. I undertook two projects relating to Supply Chain Due Diligence and Sustainability Performance Monitoring, working with multiple departments at Sukari and under the supervision of the Corporate Head of ESG. I’d like to thank Women in Mining UK and Centamin for providing this opportunity as I gained valuable experience that has solidified my decision to pursue a career in the mining industry.

Upon my arrival in Egypt, I started the internship straight away on site. The site itself is very impressive, about a 35-minute drive from my accommodation in Marsa Alam – and it’s not uncommon to see a herd of camels on your daily commute! When my internship started at Sukari, there were still very few women working on site as the Egyptian law that had previously restricted women from working in certain roles on mine sites had only changed fairly recently. Despite this, it was clear from the start that the site is very welcoming to women and the company is working constantly to improve any challenges arising from the legacy gender imbalance.

My first couple of days were spent completing health and safety inductions and visiting each area of the site to gain an understanding of the process from ore extraction to processing and the management of tailings. I do not have a background in geology or chemistry so the details of how (continues via

Published on : 2023-02-19

Egypt will announce details of the first-ever bid for obsolete energy fields by the end of February, Egypt Today reported, citing Petroleum Minister Tarek El-Molla.

The economic model will be determined to increase production from the obsolete fields through unconventional methods and specialised technology to extract the quantities available in these fields, he added.

The rise in global oil prices has encouraged investments in these fields, El-Molla said.

https://petroleum-today.com/en/article.php

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Will somebody remind these clowns that the world's largest gold miner is still waiting for the mineral exploitation terms to be finalized. Priorities, please.

Ah, if only Centamin shareholders could!

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Expert Geophysics Limited
LinkedIn post 12h ago

#ThrowbackThursday to the discovery of the Sukari Gold Mine in Egypt in the 1990s and now one of the largest gold mines in the world. The Sukari Gold Mine has played a crucial role in the development of Egypt's mining industry, providing jobs and economic growth for the country.

Today, the story continues with modern technology and airborne exploration, and our MobileMT surveys are leading the way. With advanced electromagnetic surveys and highly accurate results, we're making mineral exploration faster, more efficient, and more accurate than ever before. Join us in exploring Egypt's mineral potential with MobileMT surveys!

#EgyptMining #MobileMT #airbornegeophysics #mineralexploration #ThrowbackThursday

https://www.linkedin.com/posts/expertgeophysics_throwbackthursday-egyptmining-mobilemt-activity-7031841227754876928-ws2g

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My Thoughts

The Egyptian focused link/advert shows some aerial equipment & the pyramids but swaps out the electromagnetic and magnetic data map with K92's porphyry deposit in Papua New Guinea.

A shame Centamin does not follow fellow gold miner K92's commitment to keep its shareholders informed. No one should accept Mr Horgan's rationale for keeping this and all other prior surveys from Centamin shareholders, citing 'protecting proprietary information.'

The data belongs to all Centamin shareholders to make informed investment choices — not its BOD & CEO to trade (or not trade) on insider information.

An excerpt from K92's presentation to shareholders:

In November 2021, airborne geophysics was flown over the entire ~860 km2 Property held by K92Mining in the Kainantu region including EL470. Expert Geophysics Limited (EGL) carried out a helicopter-borne MobileMT electromagnetic and magnetic survey. MobileMT is the latest generation of airborne AFMAG technologies, designed in 2017 by the inventor of the ZTEM system. MobileMT measurement frequency range is 25 Hz – 30,000 Hz, while ZTEM range is 25 Hz – 720 Hz, thus delivering a much greater depth range of investigation.

Electromagnetic and magnetic data was collected along east-west survey lines, nominally spaced at 200m, and north-south tie lines nominally spaced at 2,000 m. The results from the MobileMT geophysics show good correlation between known mineral deposits and conductive bodies. New vein and porphyry targets on K92ML’s licenses were identified as well as highlighting known mineralized porphyries, including A1, Blue Lake, Tankaunan and Timpa.

Egypt, Regional Exploration
In Egypt, the handover of Barrick’s third exploration license
Hamash-Sukari was completed and the first-year work
program has commenced. The total land package held by
Barrick is now 1,675 km2
spread between the HamashSukari, Fatiri and Atalla licenses. Field teams are actively
screening the three licenses for indications of mineralized
systems with Tier One gold system potential with the aim to
execute maiden drill programs on prioritized targets later in
2023.

https://s25.q4cdn.com/322814910/files/doc_financial/quarterly_results/2022/q4/Barrick_Q4_2022_MD-A.pdf

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Simmering on the back burner...

The reverse absolute valuation spread is turning bullish ever since the double downward trend touched the 60 day median - stay positive as this is one to watch short, medium and long term notwithstanding the aggregate reversing soon. Also, remember to monitor gold - might be important to swing this back towards semi reversion if weakness does not persist.