Premier Gold remains bullish after trying year

Premier Gold Mines Ltd. [PG-TSX; PIRGF-OTC] on Friday January 24 said a trying year at its Mercedes Mine in Sonora, Mexico prevented the company for achieving its production targets in 2019.

After producing 67,427 ounces of gold and 192,829 ounces of silver in 2019, which was below guidance of between 75,000 and 85,000 gold ounces, the company is currently working on initiatives to ensure increased and more reliable production for 2020 and beyond.

Premier Gold is a gold producer as well as an exploration and development company with a focus on properties in Canada, the United States and Mexico. Premier is aiming to emerge as a low-cost, mid-tier gold producer via its two producing gold mines, South Arturo and Mercedes, and through future mine development opportunities at Hardrock and McCoy-Cove in Nevada.

Mercedes is a 2,000 tonnes-per-day underground gold-silver mine located in Sonora State in northern Mexico, about 250 km northeast of Hermosillo. As of December 31, 2019, Proven and Probable gold reserves stood at 395,000 ounces at a grade of 3.63 g/t.

The project also hosts proven and probable silver reserves of 2.72 million ounces at a grade of 25.05 g/t.

In 2019, Mercedes produced 59,901 ounces of gold and 191,306 ounces of silver.

At Mercedes, excessive dilution led to lower than planned grades and therefore fewer than planned gold ounces produced during the year.  However, the company said it identified several factors contributing to the lower than planned grades and is working on initiatives to ensure increased and more reliable production for 2020 and beyond.

“2019 was a trying year for our Mercedes Mine,” said Premier Gold President and CEO Ewan Downie. “However, we believe that we understand the challenges faced by the mine this past year and have a plan in place to address them,” he said.

“We believe our continued exploration successes at Mercedes and the resumption of mining at South Arturo will contribute to production for years to come and provide a platform for our company’s growth.”

Premier is completing a 42,000-metre exploration and delineation core drilling program at Mercedes. The aim is to delineate new mineral resources in the Lupita Extension area as well as confirming potentially important discoveries at the San Martin and Neo areas.

Meanwhile, the company said commercial production was declared more than three months ahead of schedule at South Arturo’s El Nino Mine. Ore tons mined during the fourth quarter were considerably above plan the company said.

South Arturo produced 7,526 ounces of gold and 1,523 ounces of silver in 2019.

On Friday, Premier Gold shares eased 0.6% or $0.01 to $1.65, and trade in a 52-week range of $1.41 and $2.55.

Barrick launches new chapter in Tanzania

Barrick Gold Corp. [ABX-TSX; GOLD-NYSE] said Friday January 24 that it has formalized a set of comprehensive agreements announced in October, 2019 that lay out the framework for the company’s relationship with the Government of Tanzania going forward.

The agreements with the Government of Tanzania (GoT) aim to resolve ongoing disputes related to the operations of its recently acquired Acacia Mining unit.

News of the resolution comes more than two years after Tanzania imposed a concentrates export ban after alleging that mining companies had underpaid up to US$50 billion in taxes over the past 20 years. It recommended that an export ban on concentrates remain in place until the back taxes are paid.

The GoT subsequently stated that it would not sign any agreements related to the ongoing disputes directly with Acacia (under its previous management), a move that prompted Barrick to offer to consolidate its ownership of Acacia in order to facilitate a deal with the GoT. Acacia has three mines in Tanzania, including Bulyanhulu, Buzwagi, and North Mara.

The terms of the deal appear to resolve certain key issues, including back taxes, go-forward economic split between Barrick and GoT, lifting of concentrate export ban (in place since March 2017), which should allow Barrick to begin re-opening the Bulyanhulu underground mine.

Barrick shares advanced on the news, rising 0.66% or 16 cents to $24.40 on volume of 1.53 million. The shares are currently trading in a 52-week range of $15.62 and $26.70.

On Friday, Barrick said it has formalized the establishment of a joint venture between Barrick and the government. Barrick President and CEO Mark Bristow said the joint venture, which will give the government full visibility of and participation in operations made for and by the North Mara, Bulyanhulu and Buzwagi mines, was a pioneering move which would take Barrick’s policy of partnership with its host countries to a new level.

The agreement also ratifies the creation of Twiga Minerals Corp., a company owned jointly by Barrick and the government that will oversee management of Barrick’s local operations, which are now owned 84% by Barrick and 16% by the government.

Under the agreement, Barrick has said it will pay $300 million to settle all outstanding tax. Economic benefits of the mines will be shared on a 50/50 basis (in the form of taxes, royalties, clearing fees, and a new 16% free carried interest).  An annual tune-up mechanism will also be put in place to maintain the 50/50 split.

Barrick said it will partner with the University of Dar es Salaam and commit up to $10 million in funding over a 10-year period for training and skills development in the mining industry. The gold mining giant will also commit up to $40 million to upgrade the road between Bulyanhulu and Mwanza (a port city in northern Tanzania) as well as constructing a housing compound and related infrastructure.

“Reflecting our confidence in the potential of this highly prospective gold region, we have budgeted $50 million for brown and greenfields exploration here in 2020 alone and are looking at various opportunities to sustain and expand our operations,” Bristow said.

Mountain Province optimistic about rough diamond market

Mountain Province Diamonds Inc. [MPVD-TSX, NASDAQ] sees reasons for optimism in the rough diamond market after reporting its fourth quarter 2019 production and sales results from the Gahcho Kue Diamond Mine in Canada’s Northwest Territories.

Record quarterly production of 1.98 million carats at an average grade of 2.11 carats per tonne, marked a 28% increase from the fourth quarter of 2018.

Full year production of 6.82 million carats at an average grade of 1.90 carats per tonne beat the previously (upwardly) revised full year guidance of 6.7-6.8 million carats, but was down 2% in comparison to 2018. Mountain Province confirmed that full year cash costs should come in within the previously downwardly revised $95-$105 per tonne.

In the fourth quarter of 2019, 771,799 carats were sold at an average value of US$64 per carat for total proceeds of US$49.2 million. That compared to 822,548 carats sold at an average value of US$65 per carat for total proceeds of US$53.6 million in the fourth quarter of 2018.

During 2019, 3.28 million carats were sold at an average value of US$63 per carat for total proceeds of US$208.2 million. That compared to 3.25 million carats sold at an average value of US$74 per carat for total proceeds of US$240 million in 2018.

“Sentiment in the rough diamond market became slightly more optimistic towards the end of 2019 and has remained relatively positive as the market prepares for the first selling cycle of 2020,” the company said in a press release. Mountain Province also said its medium to long term outlook for rough diamonds remains positive.

“The major producers reported lower levels of sales through 2019 which, together with the stronger retail selling season, will help normalize inventory levels in the cutting centres,” the company said.

“In addition, anticipated mine closures over the next 12-18 months will help to establish a more balanced supply and demand equilibrium in the diamond market,” it said.

“Importantly, consumer confidence and spending remain strong, particularly in the U.S. and Greater China which together account for approximately 65% by value of global retail sales of diamond jewelry.”

However, as mining activity at Gahcho Kue continues to miss expectations, analysts have warned that this could lead to more shortages of high quality ore in the future (as happened in the third quarter of 2019) and longer term planning issues.

On Friday, Mountain Province shares eased 1.7% or $0.02 to $1.17. The shares are currently trading in a 52-week range of 92 cents and $1.65.

Gahcho Kue is a joint venture between De Beers Canada Inc. (51%) and Mountain Province (49). It is a fly-in-fly-out operation located 280 km northeast of Yellowknife.

Gahcho Kue is also the world’s largest new diamond mine and is expected to produce an average of 4.5 million carats per year (100%) over an initial 12-year lifespan.  Production during the first five years (2017 to 2021) is expected to average 5.4 million carats annually.

Back in June, 2019, Mountain Province announced the discovery of the “Wilson” kimberlite on the Gahcho Kue property. The Wilson kimberlite is located roughly 200 metres east of the Tuzo kimberlite and was discovered during drill testing of geophysical and geological anomalies in the area. The company said it lies well within the open pit mine plan for the Tuzo kimberlite.

The new discovery was named after Alice Evelyn Wilson (1881-1964), who is officially recognized as Canada’s first female geologist.

China National Coal Association to deliver keynote address at 6th Mining Investment Asia in Singapore for first time

Mining Investment Asia (https://www.mininginvestmentasia.com/), South East Asia’s largest mining conference and exhibition, is deeply honoured to welcome Ms Su Chuanrong, Executive Director General of China National Coal Association (CNCA), as the keynote speaker on 17 March. This is the first time that CNCA is sending a delegation to a mining event in Singapore.

17 March will feature two conference streams – Coal in Asia and Women in Mining. Given her achievements as a female leader in China’s coal mining industry and the importance of China as the world’s largest coal producer, it is most fitting for Ms Su Chuanrong to deliver the opening keynote address where she will be speaking on the prospect of China’s coal industry.

Ms Su Chuanrong’s work in the Chinese and global coal sector

Ms Su graduated with a Ph.D from China University of Mining and Technology and has been holding various leadership positions at the China National Coal Association since 2008. Besides being the Executive Director General and overseeing international cooperation at CNCA, she is also the Secretary General of the Coal Committee of the World Mining Congress and the Technical Committee of the World Coal Association (WCA).

Other confirmed new speakers

New mining and finance stakeholders from Singapore and beyond have also confirmed their participation at Mining Investment Asia 2020 to share their expertise and insights. They include :

  • Junji Morinaga, Project Director, Japan Oil, Gas and Metals National Corporation
  • Didier Rault, Chairman and CEO, World Mining Investment Limited, Hong Kong SAR
  • Manessa Mungroo, Managing Director, Singapore Mining Club
  • Constance Tan, Principal Consultant, Alvito Capital Holdings, Singapore

New post conference 1 day VALMIN Code training workshop on 20 March

VALMIN Code is increasingly used by corporate finance and legal professionals involved in listing documents, mineral asset valuation and legal disputes. Key learning points to be achieved through this one day training include:

  • Overview of mineral valuation – international standards and regulatory context
  • Relevance of project valuation
  • What is VALMIN Code – requirement and reporting
  • Case studies and learning from well written VALMIN reports
  • Implementation of valuation techniques in exploration and development project

This workshop will be conducted by two highly experienced trainers as follows:

  • Deborah Lord, Director Principal, VRM, VALMIN Committee, Australia
  • Keith Whitchurch, President Director, SMG Consultants, Indonesia

Spaces are still available for sponsors, exhibitors and delegates who wish to be a part of Mining Investment Asia. Enquiries can be sent to Jarred via email at jarred.lau@spire-events.com or phone at +65 6717 6017. More information can be found at the event website:

https://www.mininginvestmentasia.com/

Background on Spire Events

Spire Events is a Singapore based events company specialising in mining & energy conferences and expos. Mining Investment Asia is part of the global Mining Investment Conference Series that spans across various locations in Asia, Africa, Europe, Latin and North America and the Middle East.

Spire Events also organises the MiningTech Conference Series which focuses on technology in mining and they are held in Chile, South Africa and Brazil. Besides conferences, Spire Events also organises large scale mining and energy expos in Africa, namely Mauritania, DRC, Sierra Leone and Botswana. The full calendar of events can be found at www.spire-events.com

ISSUED BY: SPIRE EVENTS SINGAPORE

For media enquiries, please contact:

Mr Ng Chin Chye
Director (Marketing & Public Relations)
Tel: +65 6717 6014
Email: chinchye.ng@spire-events.com

Lundin Mining achieves 2019 production targets

Lundin Mining Corp. [LUN-TSX; LUMI-Sweden] on Thursday January 23 released weaker-than-anticipated operating results in the fourth quarter of 2019, largely driven by lower grades at its Candelaria mine in Chile.

Lundin is a diversified Canadian base metals mining company with operations in Chile, the United States, Portugal, Sweden and Finland, primarily producing copper, nickel and zinc. Lundin also holds an indirect 24% equity stake in the Freeport Cobalt Oy business, which includes a cobalt refinery in Kokkala Finland.

However, despite a somewhat softer end to the year, 2019 production guidance was achieved at every asset, and there were no changes to the company’s previously announced production forecasts.

On Thursday, Lundin shares eased 2.5% or 19 cents to $7.30 on volume of 2.5 million. The 52-week range for the shares is $5.47 and $8.08.

In the fourth quarter of 2019, attributable copper production of 59,000 tonnes was 8% below Scotiabank forecasts of 64,000 tonnes. This was largely a reflection of a weaker performance at Candelaria due to below mine plan head grades, and to a lesser extent, the performance of the Chapada copper-gold mine in Brazil.

Despite the softer fourth quarter operational results, total 2019 consolidated copper, zinc and nickel production of 235,000 tonnes, 152,000 tonnes and 13,500 tonnes all met or slightly exceeded the most recent annual guidance ranges of 227,000-245,000 tonnes, 149,000-157,000 tonnes and 12,000-15,000 tonnes respectively.

Lundin has recently said it anticipates strong growth in its metal production.

The company said copper production is expected to rise by over 20% in 2020 compare to 2019, with full year contributions from the Chapada copper-gold mine and Candelaria mining complex.

The company said zinc production is forecast to increase by over 15% in the same period while nickel production will jump by over 25%.

Lundin acquired a 100% interest in the Chapada copper-gold mine from Yamana Gold Inc. [YRI-TSX; AUY-NYSE] for US$800 million. A traditional open-pit truck and shovel operation, Chapada was previously expected to produce approximately 54,500 tonnes of copper and 100,000 ounces of gold this year (75,000 tonnes of copper equivalent) at a co-product cash cost of between US$1.60 and US$1.80 a pound for copper and US$430 per ounce for gold equivalent.

The three-year production outlook for Chapada is based on a NI 43-101 technical report that was filed on SEDAR on October 10, 2019. Copper production is forecast to be between 51,000 and 56,000 tonnes over the next three years based on the current 24 million tonne per-year throughput rate.

Chapada gold production is expected to be 70,000 to 95,000 ounces over the next three years, marking a significant increase in Lundin’s upstream gold output.

At Candelaria, copper production is expected to increase during the next two years, primarily on the back of improving copper head grades and as the benefits of reinvestment initiatives are realized.

Copper production there is forecast to average approximately 180,000 tonnes annually over the 10-year period from 2020 to 2029.

Meanwhile, after an expected increase of 25% next year, nickel production is expected to remain at this increased level over the three-year period as higher grade ore from the Eagle East mine in Michigan contributes to mill feed. Eagle is a 2,000 tonnes-per-day underground nickel-copper mine.

Additionally, the Neves-Corvo Zinc Expansion Project (ZEP) in Portugal is advancing on schedule for phased ramp-up in 2020. Following next year’s 15% rise, zinc production is forecast to increase by a further 30% in 2021, over 2020, with a full year contribution from ZEP.

Centerra resumes gold production in Kyrgyzstan

Centerra Gold Inc. [CG-TSX; OTC-CAGDF] said Thursday January 23 that it has received all the necessary approvals and permits to restart open pit mining operations and to continue milling activity at its Kumtor gold mine in Kyrgyzstan for the remainder of 2020.

The announcement comes after two employees went missing following a significant rock movement in the Lysii Waste Rock Dump early on the morning of December 1, 2019.

Centerra said the country’s state agencies have also approved the company’s 2020 mine development plan for the Central Pit, including the revised waste dumping plan and special safety measures to place waste rock material in the Central Valley waste rock dump and the Sarytor waste rock dump.

Open pit mining operations are currently ramping up and are expected to be in full mining production early next week, while the mill continues to process stockpiled ore as planned for 2020. In addition, Kumtor is continuing its own internal review and co-operating with the Kyrgyz authorities’ inquiries in relation to the Lysii Waste Rock Dump.

On Thursday, Centerra shares eased 2.2% or 22 cents to $9.65 on volume of 634,574. The shares are currently trading in a 52-week range of $6.27 and $13.00.

Centerra halted open pit operations at its Kumtor Mine after the two employees went missing in early December.

Kumtor said it initiated an emergency evacuation of all mine personnel from the area and an immediate cessation of mining operations. It said two Kumtor employees who were working in the area did not report to the emergency gathering area and remain missing.

However, after six weeks, the search operation for the company’s two missing employees at Lysii Waste Rock Dump returned no sign of the two missing employees. With the consent of the families and the relevant Kyrgyz state agencies, including the Ministry of Emergency Services, the decision was made to stop the search effort.

A funeral prayer was held at the site attended by family members, relatives and community supporters. “Our thoughts, condolences and prayers are with our employees, families and our deepest appreciation is to all those involved in the search efforts,” Centerra said.

The Kumptor mine is one of two flagship assets in the Centerra Gold portfolio. The other is the Mt. Milligan Mine, which is located in British Columbia. The company’s portfolio also includes the Oksut Gold project in Turkey and the late stage Kemess development project in B.C.

At the time when the two miners were reported missing, Centerra said the Kumtor mill would continue uninterrupted processing ore that has been stockpiled on surface and there was no change to the company’s production outlook for 2019.

Kumtor is the largest gold mine operated in Central Asia by a Western-based company. Mining operations are carried out using conventional open-it mining methods.

Higher grades and recoveries at Kumtor and higher gold grades at Mt. Milligan enabled Centerra to produce a better than expected 206,000 ounces of gold and 21.2 million pounds of copper in the third quarter of 2019. That includes 150,305 ounces from Kumtor and 55,355 ounces from Mt. Milligan

Centerra recently raised its 2019 gold production guidance to 730,000-765,000 ounces from an earlier forecast of 705,000-750,000 ounces.

The company said construction at the Oksut Project in Turkey is now 79% complete and remains on scheduled with the first gold pour expected in January of 2020.

President of the Republic of Sierra Leone to attend Mining Indaba 2020

The President of the Republic of Sierra Leone, Brig. Rtd. Julius Maada Wonie Bio, is confirmed to attend the 2020 Investing in African Mining Indaba, taking place in Cape Town from 3 – 6 February 2020. President Bio was elected as the 5th President of the Republic of Sierra Leone in May 2018 and is popularly referred to as the “Father of Democracy” because of his contribution towards the restoration of democracy and attainment of peace in the country.

Sierra Leone has large reserves of diamonds, iron ore, rutile and bauxite as well as small-scale artisanal mining of gold and diamonds. The country possesses one of the largest rutile reserves in the world. Whilst mining contributes about 20% to the national GDP, it is said to account for around three quarters of the country’s exports.

Prudent management of natural resources is a stated pillar of the national Agenda for Prosperity, and there is a strong commitment to using the Extractive Industries Transparency Initiative (EITI) as a tool to bring reforms that will attract much-needed investment in Sierra Leone.

As part of their drive to attract investment, Sierra Leone will be exhibiting at Mining Indaba and their delegation will also include the Minister of Mineral Resources, Hon. Foday Rado Yokie who will be presenting a  country case study –  “The new direction for Sierra Leone’s mining sector” –  where he will be reporting on the recently completed airborne geophysical survey and the achievements that the country has made in formalising the artisanal mining sector which has not only benefitted local communities, and women in particular, with a source of income but also the economy as a whole. Minister Yokie will also be participating in the West Africa panel discussion as part of the Intergovernmental Summit on Wednesday at Mining Indaba.

President Bio’s vision for the future of Sierra Leone is underpinned by his belief that the key to economic development lies in the investment in human capital – 20% of the national budget supports free, quality education, and women admitted to university to study science, technology, engineering and mathematics receive a full scholarship.

“We will have a healthier, better educated and highly skilled young population fit for the 21st century global economy, and that will lead and drive the country’s national development. They will be well-equipped to deploy science, technology and innovation which in term will attract investment.” Explains President Bio.

“The theme for Investing in African Mining Indaba 2020 is Optimising Growth and Investment in the Digitised Mining Economy – and His Excellency Julius Maada Wonie Bio is the new generation African leader recognising that innovation and technology with drive mining investment on the continent.” comments Tom Quinn, Head of Content for Mining Indaba.

The programme content for 2020 is geared towards exploring the key drivers of investment decisions within the African mining market and forging the future direction of the African mining industry. The Ministerial and Government programmed is set to attract some 38 ministers from across the African continent and beyond, cementing Mining Indaba’s reputation as the world’s largest mining investment event.

Following the success of the 25th anniversary, Mining Indaba 2020 is gearing to attract even more junior, mid-tier and major mining companies and even more investors with the aim of facilitating deal-making and investment opportunities. 2020 will also bring industry-leading content including the brand-new General Counsel Forum, Mining 2050, the Intergovernmental Summit, resource nationalism, innovations in technology, Battery Metals Day and the return of the popular Investment Battlefield.

About Mining Indaba

Investing in African Mining Indaba is the largest mining investment event in Africa. With a proven track record of bringing together Heads of State, Ministers, senior Government representatives, Mining Companies, Mid and Junior Miners, Investors, services and equipment providers, Mining Indaba is the place to meet everybody who’s anybody in the African and global mining industry. It is the must-attend event that drives the mining industry forward, provides attendees with an unmatched access to the entire value chain and the most influential players in African mining for four days of high-quality content, deal-making and networking opportunities.

Joanna Kotyrba

Investing in African Mining Indaba
joanna.kotyrba@miningindaba.com

R&A Strategic Communications

Katherine Bester
+27 11 880 3924
indaba@rasc.co.za

Kukielski named permanent CEO at HudBay

HudBay Minerals Inc.  [HBM-TSX, NYSE] on Wednesday January 22 said its board of directors has formally appointed Peter Kukielski as the company’s permanent President and CEO. Kukielski has served as interim CEO since July, 2019 following the departure of Alan Hair, who spent more than 20 years with Hudbay and was instrumental in the company’s growth, serving as chief operating officer from 2012 to 2015 before being appointed President and CEO in 2016.

Kukielski has more than 30 years of extensive global experience within the base metals, precious metals and bulk materials sectors, having overseen operations across the globe.

On Wednesday, Hudbay shares eased 1.7% or $0.08 to $4.54. The shares are currently trading in a 52-week range of $3.98 and $10.42.

Having put management uncertainty behind it, HudBay is expected to refocus now on developing its growth initiatives.

News of Hair’s departure comes after HudBay and Waterton Global Resource Management Inc. recently reached a settlement agreement regarding the proxy contest for HudBay’s board of directors.

Waterton Global Resource Management is a private equity firm, which owns 12% of HudBay’s outstanding shares.

Under the agreement, Waterton won the right to appoint three of the 11 board seats. The board pledged to launch the search for a new Chair.

The deal was viewed as positive because it eased fears that Waterton might dump its Hudbay shares if it lost the proxy battle.

HudBay is an integrated mining company, primarily producing copper concentrate (containing copper, gold and silver), zinc concentrate and zinc metal. The company owns four polymetallic mines, four ore concentrators and a zinc production facility.

The operations are located in northern Manitoba and Saskatchewan, Peru and Arizona.

The Waterton board nominees were Peter Kukielski, Daniel Muniz Quintanilla, and David Smith.

HudBay’s current Chair Alan Hibben agreed to remain in that position until a successor is found. He is expected to retire from the board at the 2020 annual general meeting.

Waterton and HudBay recently clashed over media speculation that HudBay was in talks to buy Mantos Copper SA, a Chilean private miner owned equally by Audley Capital and Orion Mine Finance. Published reports said Mantos was seeking a buyer to fund its expansion plans.

Waterton responded by saying it was opposed to the idea. It expressed the view that HudBay should not be pursuing growth for the sake of empire building.

Waterton also said if HudBay intended to begin construction of the Rosemont copper project in Arizona in the first quarter of 2019, it could face an imminent funding requirement of $1.1 billion. “This reinforces, from a capital allocation perspective, the need to terminate any potential negotiations for new acquisitions immediately, and specifically acquisitions like the Mantos transaction,” Waterton said.

Jervois ups Idaho cobalt estimate by 22%, stock advances

Jervois Mining Ltd. [JRV-TSXV, ASX; JRVMF-OTC; IHS-FSE] said Wednesday January 22 that it has increased the contained Measured Resource at its Idaho cobalt project by 22%.

Jervois shares advanced on the news, rising 5.3% or $0.01 to 20 cents. The shares are currently trading in a 52-week range of 13 cents and 24 cents.

Jervois is focused on becoming a global supplier in the emerging battery metals market. In keeping with that focus, the company swallowed eCobalt Solutions Inc. last year in a $57.6 million deal, a move that gave Jervois Mining access to eCobalt’s Idaho Cobalt Project, a high-grade cobalt deposit located in Idaho.

Idaho Cobalt Operations (ICO) is Jervois’ flagship primary cobalt deposit located in Idaho near the town of Salmon. Over the course of 20 years, approximately US$100 million has been invested in developing the mine.

It is fully environmentally permitted for ore processing capacity of up to 1,200 tons/day and has high cobalt and copper grades, with a gold by-product.

The ICO is located in the heart of the Idaho Cobalt Belt, a unique mineral rich, prolific metallogenic district unique to North America, which historically produced 2 million tons of contained cobalt between the early 1900s through to the 1960s.

The project consists of 243 contiguous unpatented lode mining claims and is situated in an area ranging in elevation from 6,100 feet to 8,100 feet. Vehicle access is via a series of public-access gravel roads.

The company said Measured and Indicated Resources at the site now stand at 5.2 million tonnes, grading 0.44% cobalt (50.1 million pounds), 0.69% copper (80.1 million pounds), 0.53 g/t gold (89,000 ounces). The estimate is based on a 0.15% cobalt cut-off.

Jervois said it updated the Measured Resource estimate after completing 3,125 metres of drilling in 19 holes to support its bankable feasibility study. The updated model uses modified methodology to improve estimation using industry standard applications for narrow orebodies, with Jervois also adopting a more appropriate approach to stope and mine plan design.

“This has involved block rotation and adoption of a smaller cell size than previously used, as the previous MRE released by eCobalt Solutions on February 7, 2018 was unrotated and used cell sizes not conducive to the narrow high-grade interzone intercepts found in the Main Ram Zone, the company said in a press release.

Jervois also said the bankable feasibility study remains on track for completion by the end of March 2020, with first concentrate production scheduled in the fourth quarter of 2021.

Cobalt is generally mined as a by-product of copper and nickel

“Battery demand for cobalt is expected to rise sharply, and ethical, non-Democratic Republic of Congo, low capital sources of supply outside the Idaho Cobalt Operations are essentially non-existent,” the company said.

Meanwhile, mine design and scheduling are progressing as is plant design, the company added.

In a separate development, Jervois also released an update on drilling at its Kilembe and Bujagali area properties in central and western Uganda following a partial receipt of confirmed assays from 2019 exploration.

Drilling at the Kilembe area properties targeted surficial gold copper mineralization detected through earlier geochemical programmes.  Drilling at Bujagali targeted the Waragi anomalies detected through earlier geochemical and geophysical anomalies with 1,740 metres completed.

The company said the latest drilling results and high-grade rock chip samples provide further encouragement to continue with the current exploration pace on the Ugandan projects for both copper-cobalt and copper-gold.

X-Terra steps up New Brunswick gold drilling

X-Terra Resources Inc. [XTT-TSXV; XTR-FSE] shares rallied on Wednesday January 22 after the company said it is planning to do additional drilling on high priority targets on its Grog and Northwest properties, located in Restigouche County, New Brunswick.

The targets were defined as a result of the fieldwork and data processing completed during exploration in 2019.

X-Terra shares advanced on the news, rising 19% or $0.02 to 12.5 cents on active volume of almost 1.5 million. The shares are trading in a 52-week range of $0.07 and 18 cents.

X-Terra is a Quebec-focused gold exploration company. Its flagship Veronneau Project lies on the Colomb-Chaboullie greenstone belt about 200 km north of Matagami.

X-Terra currently has the option to acquire an interest in 34 mining claims that included the Grog, Rim, Dome and Bonanza mining properties, which are located approximately 30 km southwest of the town of Campbellton. It can acquire a 70% stake in the properties over four years.

Under an agreement, X-Terra pledged to issue 7.0 million shares to the optionor and spend $3.1 million on exploration. Three of the mining claims are known as the Grog property, which is subject to a 1% net smelter return royalty payable to the former owner. Dome, Bonanza and Rim are collectively known as the Northwest property.

X-Terra said it completed its due diligence over the properties in October, 2018, which it said confirmed the potential of a large disseminated gold system at Grog Brook. It said the best gold values were obtained over the Northwest property and include 1,205.06 g/t gold at the Rim section of the Northwest property, 149.97 g/t gold at Bonanza and 47.88 g/t at the Dome section.

X-Terra recently said geochemical surveys, a high-resolution magnetic survey and induced polarization were completed last year across the Grog and Northwest properties, in addition to the trenching and structural mapping that produced a first drilling plan.

The company said Grog gold mineralization targets correspond to an area of about six km along the Northeast McKenzie Fault Zone.

The Northwest veins system is located about 25 km further south in a distinct geological environment composed of wacke sediments metamorphosed to the greenschist metamorphism facies.

In this context, low sulfides, free gold-bearing quartz veins are hosted in strongly-dipping shear zones marked locally by drag folding.

The objective of the first drill holes was to confirm the position of gold-bearing structures, evaluate the geometrical parameters such as dip and thickness, and recover information that will validate geological controls on gold mineralization.

X-Terra has previously said that six distinct high-priority targets were modelled to be tested first with one or two shallow drill holes. The company was planning to drill between one and three shallow holes per target.

However, based on the success and observations in the field, the company said it has decided to add additional holes to certain targets in order to gain a better understanding of the underlying geological system and mineralized corridors.