ORZCF - Orezone Announces Bomboré Phase II Expansion Study Results | Benzinga

Phase II average annual gold production of 209,000oz at AISC of $1,121/oz, with LOM After-tax NPV5% of US$635.9M
(All reported figures are in US dollars and are on a 100% project basis unless otherwise stated)

VANCOUVER, British Columbia, Oct. 11, 2023 (GLOBE NEWSWIRE) -- Orezone Gold Corporation (TSX:ORE, OTCQX:ORZCF) ("Orezone" or "Company") is pleased to report the results of its Phase II Expansion and Updated Life-of-Mine Feasibility Study ("2023 Study") for its 90%-owned Bomboré Gold Mine, located in central Burkina Faso.

Bomboré achieved commercial production of its Phase I oxide plant in December 2022, which has operated successfully above nameplate to produce 76,783oz of gold at an All-In Sustaining Cost¹ ("AISC") of $1,006/oz sold in H1-2023. The planned expansion at Bomboré from a processing rate of 5.9 million tonnes per annum ("Mtpa") to 10.3Mtpa will deliver a significant increase in gold production at a low incremental capital cost. Construction of the new standalone 4.4Mtpa hard rock processing facility will enable Bomboré to produce an average of 209,000oz/yr at an AISC of $1,121/oz. First gold from the hard rock plant is scheduled for Q3-2025.

Bomboré 2023 Study Highlights (at Base Case gold price of $1,750/oz)

• After-tax NPV_5% of $635.9M with rapid payback
• Mine-life of 11.3 years with gold production totalling 2.11Moz
• Conventional open pit mining at a low strip ratio of less than 2:1
• Phase II hard rock plant capital costs of $167.5M
• Average annual gold production of 231,000oz in the first three full years after expansion at an AISC of $1,081/oz
  

Patrick Downey, President and CEO, commented: "The Bomboré 2023 Expansion and Updated Life-of-Mine feasibility study marks a major milestone in the growth of Orezone. The updated study highlights a material step-change in the mine's future production profile, while maintaining a low overall cost structure. Furthermore, based on ongoing drilling results, we see excellent opportunities to continue to add higher grade resources and reserves that should enhance the production profile in future years.

With the continued support of our senior lender, Coris Bank International, the Company expects to finance the construction of the hard rock plant using a combination of debt and free cash flow from current operations.

Following the commissioning of the oxide plant in December 2022, on-time and under budget, and providing strong operational results through its first operating year, Orezone remains well positioned to deliver this next stage of brownfield growth at Bomboré. The parallel hard rock plant will be constructed at a modest capital cost as compared to a greenfield project as it will utilize many of the existing systems and infrastructure already in place including connection to the national electrical grid by the end of 2023.

Mining will continue as conventional open pit with a low overall strip ratio. We will use our operational and management experience in working with local mining contractors over the past two years to further enhance optimization in this area.

We now have firm bids and delivery times for several long lead pieces of equipment including the SAG mill and we intend to conclude evaluation and place orders for this equipment in Q4-2023. Full construction is expected to commence in Q1-2024 subject to financing and board approval.

The Phase II Expansion will create several hundred new employment opportunities during construction on top of the 2,400 direct local jobs that currently support existing operations. Once complete, the expansion will also create further long-term local employment and promote further investment in community programs and livelihood restoration projects that aim to improve the lives of local residents while providing a larger source of tax and royalty revenue for Burkina Faso."

Idrissa Nassa, CEO of Coris Bank International, commented: "We congratulate Orezone on the release of a robust expansion study, and look forward to maintaining our close partnership with the Company and supporting the next stage of growth at Bomboré."

Lycopodium Minerals Canada Ltd. ("Lycopodium") of Toronto, Canada was the lead 2023 Study consultant (Process Engineering and Overall Study Manager), supported by P&E Mining Consultants Inc. (Mineral Resource Estimates), Knight Piésold Pty Limited of Perth, Australia (Tailings and Water Management), AMC Mining Consultants (Canada) Ltd. ("AMC") of Vancouver, Canada (Mineral Reserves and Mining), and Africa Label Group Inc. (Social & Environmental).

CONFERENCE CALL AND WEBCAST

The Company will host a conference call and webcast to further discuss the Bomboré 2023 Study results. To participate, please use the following dial-in phone numbers or join the webcast using the link below:

Webcast

Please register for the webcast here: Orezone 2023 Study Conference Call and Webcast

Conference Call

A copy of the presentation will be available on the Company's website.

2023 Study Summary

Table 1 – Summary of 2023 Study Results (starting Q2-2023)

Figure 1 – Bomboré 2023 LOM Production and Cost Profile (starting Q2-2023)

Figure 2 – Bomboré Mine Layout and Infrastructure

Comparison of 2023 Study to 2019 Feasibility Study

The results of the 2023 Study supersede the 2019 Feasibility Study ("2019 FS"). The 2023 Study incorporates the following main scope changes from the 2019 FS:

• Increased Resource Cut-off Grades: The applied cut-off grades utilized for the primary oxide and fresh rock units in the 2023 Mineral Resource calculation have increased a respective 25% and 18% relative to that utilized in the 2019 FS, as a result of global inflation and realized costs achieved to-date.
• Expanded Mineral Reserve Base: Total gold content of Proven and Probable mineral reserves now stand at 2.4Moz, which factoring for mine depletion to the end of Q1-2023, marks a 37% increase relative to the 1.8Moz outlined in the 2019 FS. The increase in mineral reserves is supported by over 100,000m of additional drilling.
• Increased Mill Throughput: The 2019 FS was based on an initial oxide mill design throughput of 5.2Mtpa, reducing to 3.0Mtpa upon the commissioning of a partially integrated 2.2Mtpa hard rock mill in Year 3. In contrast, the 2023 Study maintains the current 5.9Mtpa oxide mill throughput but envisions the commissioning of an independent and upsized 4.4Mtpa hard rock plant in Year 3 (2025).
  
  Overall, expanded mill throughput of 10.3Mtpa under the 2023 Study is 98% higher than the 5.2Mtpa throughput outlined in the 2019 FS.

• Reduced Hard Rock Leach Time: Additional metallurgical test work conducted in 2023 confirmed a 24hr leach time versus the 48hr leach time utilized in the 2019 FS. The faster leach kinetics contributes to lower capital and operating costs, and further de-risks project execution as the hard rock Carbon-in-Leach ("CIL") circuit will duplicate the existing oxide CIL circuit.
• Expanded Production Profile: The expanded mineral reserve base and increased annual mill throughput have led to higher LOM and annual gold production. At the full processing rate of 10.3Mtpa, the 2023 Study outlines an average production profile of 209,000oz/yr over the first 8 years, a 70% increase relative to the 123,00oz/yr in the 2019 FS.
  

MINERAL RESOURCE AND MINERAL RESERVE

Gold mineralization on the Property is predominantly hosted in the Bomboré Shear Zone, a major structure within a 50km long northeast-southwest trending greenstone belt. The updated mineral resource estimate has an effective date of March 28, 2023 and was completed by P&E Mining Consultants Inc. The updated mineral resource is based on a total of 601,795m of drilling, and excludes material mined up to the effective date, as well as excluding stockpiles.

Table 2 – Bomboré Mineral Resource Estimate as of March 28, 2023

The updated mineral reserve estimate was completed by AMC with an effective date of March 28, 2023. Orezone developed new re-blocked mine models for each of the resource block models accounting for internal dilution and mining recoveries. AMC applied appropriate modifying factors for conversion of mineral resources to mineral reserves. Those factors include amongst others, weathering profiles, operating costs, and pit slope angles. Cut-off grade determinations for block assignments (ore versus waste) were based on a gold price of $1,500/oz. Mine planning included standard procedures of optimization, design and scheduling.

Table 3 – Bomboré Mineral Reserve Estimate as of March 28, 2023

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