16 Jun 2020 07:00
http://www.rns-pdf.londonstockexchange.com/rns/0338Q_1-2020-6-15.pdf
16 June 2020
Trans-Siberian Gold plc
("TSG", the "Company", or the "Group")
Mineral Resource Update - Asacha Gold Mine
Trans-Siberian Gold plc (TSG.LN), a low cost, high grade gold producer in Kamchatka, Russia, announces an update of the Mineral Resource Estimate for the Asacha Gold Mine in Kamchatka, Far East Russia.
Highlights:
· Total Mineral Resource Estimate (Measured + Indicated + Inferred) has increased to 452,000oz Au and 1,334,000oz Ag reported as at 30 April 2020
· +44% overall increase in contained gold
· Tripling of Measured and Indicated Resources to 339,000oz at a higher grade of 16g/t
· 75% of Mineral Resources now in Measured and Indicated category
· The newly discovered zone, Vein 25 North, within the East Zone has accounted for a significant increase in the Mineral Resource Estimate
· Management expectations for the operational life of Asacha Gold Mine extended from 2024 to approximately 2027
· Total Mineral Resource inventory for the Group now +1.5Moz (Asacha and Rodnikova)
· Excellent drilling results from current campaign likely to result in an extended drilling programme as significant potential for further exploration is apparent
The Mineral Resource Estimate ('MRE') for the Asacha Gold Mine was updated by SRK Consulting Russia Ltd ('SRK') with an effective date of 30 April 2020.
The purpose of these updates is to incorporate new data available from exploration, drilling, mining development and to account for mining depletion. The main additions to the database since the previous estimation (see RNS announcement dated 8 January 2020) are from drill holes targeting the North Zone (along strike from the Main Zone, mined since 2011), and QV25 of the East Zone (where mining will commence in 2020, and is expected to replace the Main Zone as the principal source of feed for the processing plant). Results from a total of 60 new drill-holes for approximately 15,661 metres have been in incorporated into the updated MRE.
SRK's full report is available on the Company's website at: www.trans-siberiangold.com
Alexander Dorogov, Chief Executive Officer of TSG, commented:
"This is a significant resource upgrade which comes as a direct result of our successful drilling campaign. It is pleasing to substantially increase the size of the overall Mineral Resource and also move our resources into higher confidence categories. Through our high impact drilling we have notably increased the scale of the high grade East Zone which we are on track to bring into production this year".
Mineral Resource Estimate
The Mineral Resource Estimate, classified according to the guidelines of the JORC Code (2012), for the Asacha Gold Mine as at 30 April 2020 is shown in the following table:
Table 1. Asacha Mineral Resource Estimate as at 30 April 2020
Classification | Zone | Tonnes | Au (g/t) | Ag (g/t) | Au (koz) | Ag (koz) | Au (kg) | Ag (kg) |
Measured | Main | 82,000 | 15 | 40 | 40 | 105 | 1,200 | 3,300 |
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Indicated | Main | 162,000 | 9 | 46 | 49 | 242 | 1,500 | 7,500 |
Indicated | North | 54,000 | 11 | 19 | 20 | 32 | 600 | 1,000 |
Indicated | V25N | 291,000 | 18 | 63 | 173 | 591 | 5,400 | 18,400 |
Indicated | V25S | 84,000 | 20 | 29 | 53 | 78 | 1,600 | 2,400 |
Indicated | V7 V8 | 4,000 | 23 | 24 | 3 | 3 | 100 | 100 |
INDICATED | TOTAL | 596,000 | 16 | 49 | 298 | 947 | 9,300 | 29,500 |
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TOTAL MEASURED AND INDICATED | TOTAL | 677,000 | 15 | 48 | 337 | 1,052 | 10,500 | 32,700 |
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Inferred | Main | 19,000 | 7 | 34 | 4 | 21 | 100 | 600 |
Inferred | V25N | 46,000 | 13 | 43 | 19 | 63 | 600 | 2,000 |
Inferred | V25S | 88,000 | 14 | 44 | 40 | 124 | 1,200 | 3,900 |
Inferred | V7 V8 | 108,000 | 15 | 21 | 51 | 73 | 1,600 | 2,300 |
TOTAL INFERRED | TOTAL | 261,000 | 14 | 34 | 115 | 282 | 3,600 | 8,800 |
Notes:
1. Resources are reported using a dual cut-off of 4 g/t Au and 4 m * g/t Au
2. Resources are reported after mining depletion
3. Tonnage, grade and metal content have been rounded to reflect an appropriate level of precision
4. Mineral Resources are classified according to the definitions of the JORC Code
For all Asacha mineralised vein domains, SRK prepared new wireframe interpretations, and revised the geo-statistical estimation methods and parameters. The volumes depleted by mining were re-modelled, based on outlines prepared by TSG showing the extents of mining up to 31 March 2020. SRK also recalculated the cut-off grade for reporting Mineral Resources, from parameters updated by TSG in the first quarter of 2020, but the result did not change from the previous reporting threshold of 4 g/t.
Comparison with previous Mineral Resource Estimate
The total Mineral Resource Estimate (Measured + Indicated + Inferred) has increased to 452,000oz Au and 1,334,000oz Ag reported as at 30 April 2020 from 313,000oz Au and 675,000oz Ag as at 01 December 2019.
Table 2. Metal content comparison to previous Mineral Resource estimate
Domain Group | SRK MRE (30/4/20) Metal content of Mineral Resources (Measured, Indicated, Inferred), Au oz | Seequent MRE (1/12/19) Metal content of Mineral Resources (Measured, Indicated, Inferred), Au oz |
Main Zone | 93,000 | 97,000 |
North Zone | 20,000 | 16,000 |
East Zone - QV7 and QV8 | 55,000 | 66,000 |
East Zone - QV25 | 285,000 | 133,000 |
TOTAL | 452,000 | 313,000 |
Table 2 shows the updated MRE has substantially increased the Mineral Resources for East Zone domain QV25, due to the 49 new holes (13,649m) targeting this domain. Only a small increase in Mineral Resources occurred for the North Zone, even though 11 new holes (2,011m) were added to the database. The volume of the North Zone increased in SRK's new interpretation, but much of the additional material is estimated to be below cut-off.
Summary of new drilling included in the Mineral Resource Estimate
As the Company has previously announced, it has been conducting an ambitious exploration programme.
Table 3. Summary of new drilling completed since the previous Mineral Resource Estimate
Year | Hole Type | Area | Number of Holes | Total Metres |
2019 | East Zone | Surface DDH | 13 | 3,422 |
2020 | East Zone | Surface DDH | 36 | 10,227 |
North Zone | Surface DDH | 11 | 2,011 | |
TOTAL | 60 | 15,661 | ||
For the Main, North and East Zones, a consistent feature of both the overall shape of the mineralisation domains, and the distribution of high Au and Ag grades within the veins, is a shallow north plunge, within the overall steeply dipping structure. Based on this plunge, the main opportunities for defining further mineralisation and adding to the Mineral Resource inventory appear to be from drilling to the north (down-plunge) of the East Zone domains QV25 North and QV8B.
In May and June 2020, after the effective date of the Mineral Resource statement presented in this report, TSG completed or commenced 18 drill holes (approximately 5,100m), for the purpose of infilling and extending the nominal 50m x 50m drilling coverage of QV25 North to 55400N (along strike) and 0 elevation (down dip). TSG is also planning a further 30 holes (approximately 9,200m), later in 2020, to:
· Test the extension of QV25 North down dip for a further 50m;
· Test the extension of QV25 North along strike to the north for a further 600m;
· Test the extension of QV25 South along strike to the south for a further 400m; and
· Infill the southern end of QV25 North.
The location of projected intersections from the completed or planned additional drilling in 2020 is shown in Figure 1.
Figure 1. Location of projected QV25 intersections from further drilling completed or planned by TSG in 2020, in relation to SRK 30/4/20 estimation for QV25 and existing intersections.
Notes:
· Holes commenced or completed in May and June 2020 are shown by red spheres
· Holes planned for later in 2020 are shown by green spheres.
Figure 2. Drilling on the Main, North and East Zones. Holes completed since the previous resource update in December 2019 are displayed in red
Operational Mine Life Guidance
Based on the updated MRE, the Directors considered that the operational life of the Asacha Gold Mine can be extended from 2024 to approximately 2027. As the Company does not have published JORC Code compliant Ore Reserves this estimate should not be construed as a formal Life of Mine statement.
Exploration Update
The Group continues to conduct its drilling campaigns. The low sulphidation epithermal style of mineralisation found at the Asacha Gold Mine is favourable for high-grade deposits. The Asacha licence area and the regional district more widely remains under-explored which the Company believes presents an opportunity to define local, near mine extensions to mineralisation and exploration targets. As such, the Company expects to increase the scope and scale of its exploration activities including an extended drilling programme.
Strategy
The Group retains its strategic intent to become a mid-tier gold producer and developer by:
· enhancing existing operations;
· utilising our stable platform for future growth opportunities; and
· pursuing selective accretive M&A opportunities
The Board expect the delivery of the Company's strategy to drive shareholder value through:
· strong cash flow to support organic growth;
· sustainable dividend payments; and
· capital appreciation through an increase in enterprise value.
The five-year vision for the Group is to become a multi-asset gold producer targeting production of +100,000oz. per annum
ENDS
Contacts |
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TSG |
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Stewart Dickson | +44 (0) 7799 694195 |
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Arden Partners plc |
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Paul Shackleton (Corporate Finance)Tim Dainton / Fraser Marshall (Equity Sales) | +44 (0) 207 614 5900 |
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Hudson Sandler (Financial PR) | +44 (0) 207 796 4133 |
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Charlie Jack / Katerina Parker / Elfreda Kent |
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About TSG
TSG is focused on low cost, high grade mining operations and stable gold production from its 100% owned Asacha Gold Mine in Far East Russia. The Group also holds the licence for the development and exploration of the Rodnikova deposit, one of the largest gold fields in South Kamchatka.
Additional information is available from the Company's website: www.trans-siberiangold.com
Qualified Person Review
The updated Mineral Resource Estimate was prepared by Mr Robin Simpson, a full-time employee of SRK Consulting (Russia) Ltd and has consented to the inclusion of the matters in this announcement based on the information in the form and context in which it appears.
The information in this release that relates to the updated Mineral Resource Estimate is based on, and fairly represents, information, which has been compiled by Mr. Simpson.
Mr. Simpson is a Competent Person as defined by the JORC Code, 2012 Edition, and for the purposes of the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009, having over five years' experience that is relevant to the style of mineralisation and type of deposit described in the Mineral Resource Estimate, and to the activity of Mineral Resource estimation and is a Member of the Australian Institute of Geoscientists.
Technical Glossary
"Au" | the chemical symbol of gold |
"Ag" | the chemical symbol of silver |
"cut-off grade" | the lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification.
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"Exploration Target" | is a statement or estimate of the exploration potential of a mineral deposit in a de ned geological setting where the statement or estimate, quoted as a range of tonnes and a range of grade (or quality), relates to mineralisation for which there has been insufficient exploration to estimate a Mineral Resource.
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"g/t" | grams per tonne
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"Indicated Mineral Resource" | a part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed
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"Inferred Mineral Resource" | a part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.
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"JORC Code" | the code for reporting of the Australasian Joint Ore Reserves Committee, which is sponsored by the Australian mining industry and its professional organisations. The code is widely accepted as a standard for professional reporting purposes for reporting of mineral resources and ore reserves.
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"Measured Mineral Resource"
| A part of a Mineral Resource for which quantity, grade (or quality), densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and evaluation of the economic viability of the deposit.
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"Mineral Resource" | a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.
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"Mineralisation" | the process or processes by which a mineral is introduced into a rock, resulting in a valuable or potentially valuable deposit. It is a general term, incorporating various types; e.g., fissure filling, impregnation, and replacement. |
Market Abuse Regulations
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.
Disclaimer
This announcement contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "should" or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, uncertainties arise from the behaviour of financial and metals markets, fluctuations in interest and/or exchange rates and metal prices; and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory nature. These uncertainties may cause our actual future results to be materially different that those expressed in our forward-looking statements.