Teranga's Ceo Reiterates Rising Gold Production and Declining Costs for 2012; Excited About Significant Upside Potential to Grow Gold Inventory at the Sabodala Pit
TORONTO, ONTARIO -- (Marketwire) -- 03/29/12 -- Teranga Gold Corporation ("Teranga" or "the Company") (TSX: TGZ)(ASX: TGZ) is pleased to provide a summary of remarks made at its first Annual General Meeting held this morning in Toronto.
Highlights:
-- After reviewing the opportunities at the Sabodala open pit, the Company
has increased its goal to add between 500,000 to 1,000,000 ounces to
open pit mineable inventory over the next 18 months up from previous
guidance of 250,000 to 500,000 ounces(1). The Company also expects to
add to the underground gold inventory.
-- The new mill is expected to be commissioned in two weeks' time.
-- Reaffirms guidance: With the completion of the mill expansion, gold
production for 2012 is expected to total between 210,000 and 225,000
ounces(2), an increase of 65 percent over 2011 at lower cash costs of
$600 to $650 per ounce, a decrease of over 20 percent compared to 2011.
-- Despite scheduled shut downs of the mill required for the tie-ins for
the mill expansion, the first quarter of this year is shaping up to be a
record quarter for the Company.
-- The lower cash costs should allow for a doubling of cash margins in 2012
over 2011, and then once the hedge book is extinguished in 2013 (if not
earlier), assuming current gold prices, cash margins should double again
as all production will be sold at spot gold prices.
-- Excluding the recently acquired interest in the Garaboureya North
exploration permit, there are currently more than 40 drill targets that
have been identified on the Regional Land Package, all within trucking
distance of the mill. The Company expects to test a significant portion
of these targets through the end of this year. With the addition of
Garaboureya North, the Regional Land Package increases to approximately
1,500km2 with additional drill targets to be incorporated into the drill
program.
-- Gora Project: To date, a reserve of 114,000 ounces at a grade of 5gpt
has been identified, which is the first satellite target the Company
plans to bring into production. The Company is currently processing 2
gram material from Sabodala and Gora at 5 grams 22 km from the mill. The
Company is currently running a number of processes in parallel to
efficiently develop Gora as quickly as possible with the objective of
having production in early 2013, permitting dependent.
In concluding his remarks, Mr. Alan R. Hill, Chairman and Chief Executive Officer, said, "The combination of producing more gold through our expanded mill at lower cash costs this year in addition to extinguishing our hedge position next year, allows for significant cash margin expansion in 2012 and 2013. The higher production and lower costs go straight to our bottom line, increasing earnings, cash flow and free cash flow; free cash flow which will be reinvested to self-fund our extensive exploration program from which we are confident that we will have success as we work through the year. Our responsibility is to focus on all that is within our control and most importantly deliver on our promises."
About TERANGA
Teranga Gold Corporation is a Canadian-based gold company listed on the Toronto Stock Exchange (TSX: TGZ) and Australian Securities Exchange (ASX: TGZ). Teranga is principally engaged in the production and sale of gold, as well as related activities such as exploration and mine development.
Teranga was created to acquire the Sabodala gold mine and a large regional exploration land package, located in Senegal, West Africa, within the West African Birimian geological belt. Management believes the mine operation, together with the Company's prospective approx. 1,500 km2 land package, provides the basis for growth in reserves, production, earnings and cash flow as new discoveries are made and processed through the Company's existing mill. The Company is focused on growth - growth in reserves, growth in production - while maintaining a strong balance sheet to facilitate its actions.
Forward Looking Statements
Certain information contained in this report, including any information on Teranga's plans or anticipated future results, future financial or operating performance and other statements that express management's expectations or estimates of future performance constitute forward-looking statements. Such statements are based on a number of estimates and assumptions that, while considered reasonable by management at the time, are subject to significant business, economic and competitive uncertainties. Teranga cautions that such statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Teranga to be materially different from the company's estimated future results, performance or achievements expressed or implied by those forward-looking statements. These factors include the inherent risks involved in exploration, development and operations of mineral properties, changes in economic conditions, changes in the worldwide price of gold, silver fuel, electricity and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga.
Nothing in this report should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities.
Accordingly, readers should not place undue reliance on such forward looking statements. Teranga expressly disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.
Competent Persons Statement
The information in this press release that relates to the resource estimate associated with the Sabadala pit is based on information compiled by Ms. Julia Marin, PEng, MAusIMM (CP) who is a full time employee of AMX Mining Consultants Canada and has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which she is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Martin is a Qualified Person in accordance with NI 43-101 and consents to the inclusion in this press release of the matters based on her information in the form and context in which it appears.
The information in this press release that relates to the resource estimate associated with the Sabadala and Gora pits as well as information in this press release relating to exploration results and targets on the Sabodala Mining Licence is based on information compiled by Mr. Bruce Van Brunt, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr. Van Brunt is a full time employee of Teranga and not independent. Mr. Van Brunt has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australian Code of Reporting of exploration Results, Mineral Resources and Ore Reserves". Mr. Van Brunt consents to the inclusion of this information in the form and context in which it appears in this presentation.
(1) While management has confidence in its projections based on exploration work completed to date, this exploration target is not a Mineral Resource. The potential quantity and grade is conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource.
(2) This production target is based on existing proven and probable reserves only.
Contacts:
Teranga Gold Corporation
Kathy Sipos
VP Investor & Stakeholder Relations
+1 416-594-0000
416-594-0088 (FAX)
ksipos@terangagold.com
www.terangagold.com