Contango ORE Announces Revised Budget for Manh Choh Project
February 18 2022 - 4:43PM
Business Wire
Contango ORE, Inc. (“CORE” or the “Company”) (NYSE American:
CTGO) announced today that it had received updates to the projected
2022 budget for Peak Gold, LLC ("Peak Gold JV"), in which the
Company holds a non-controlling 30% interest. Peak Gold JV plans to
mine ore from the Main and North Manh Choh deposits located within
the State of Alaska (the "Manh Choh Project").
The Company's quarterly report on Form 10-Q filed with the
Securities and Exchange Commission on February 10, 2022 disclosed
that the Peak Gold JV had approved a $47.9 million spending program
for 2022, of which the Company's share would be approximately $14.4
million. At a meeting of the Management Committee of Peak Gold JV
held on February 14, 2022, Kinross Gold Corporation, the Manager of
Peak Gold JV, presented updated information that resulted in a
decrease in the Peak Gold JV spending program for 2022 to
approximately $26 million, of which the Company’s share would be
approximately $7.8 million. The Manager explained that the decrease
is due to a revised work plan resulting from recent impacts of
inflation, contractor and labor market constraints in Alaska. The
Manager determined that it was in the best interests of the Peak
Gold JV that certain activities that were initially planned for
2022 be delayed pending further analysis of options including a
re-bidding process.
Despite the reduced budget, the Manager expects the Peak Gold
JV's feasibility study to remain on target for the second half of
2022, and for initial production to occur in 2024.
Rick Van Nieuwenhuyse, the Company’s President and CEO,
stated:
“The reduced spend in 2022 reflects the reality that inflation
is hitting all sectors of the economy – especially construction.
With the recent CPI for January hitting 7.5%, this shouldn’t come
as a surprise to anyone. In Alaska, the State has received several
billion dollars in COVID relief money and another $5.6 Billion from
the recently passed Infrastructure bill so again, it should not be
a surprise that competition for construction contractors is on the
rise. It should also be no surprise to gold investors to see the
price of gold rise as well – yesterday piercing above the $1900
level. Gold is doing what it has done for eons and remains a store
of value. The reduced spend this year does not significantly delay
delivery of key milestones: feasibility and permitting by the end
of 2022, main construction in 2023 and production in 2024.
Meanwhile, Contango continues to advance our Lucky Shot project
with our mine contractor now refurbishing and extending the
underground to allow the Company to drill test the downdip of the
Lucky Shot vein this summer. Please stay tuned for updates on all
of our projects.”
ABOUT CORE
CORE is a company that engages in the exploration in Alaska for
gold and associated minerals through a 30% interest in Peak Gold,
LLC, which leases approximately 675,000 acres for exploration and
development, and through Contango Minerals Alaska, LLC, its wholly
owned subsidiary, which leases approximately 200,000 acres for
exploration. The Company also owns the rights to the Lucky Shot,
Coleman and War Baby mines, and approximately 16,600 acres of
surrounding mining claims located in Willow Mining District about
75 miles north of Anchorage, Alaska. Additional information can be
found on our web page at www.contangoore.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements regarding
CORE that are intended to be covered by the safe harbor for
“forward-looking statements” provided by the Private Securities
Litigation Reform Act of 1995, based on CORE’s current expectations
and includes statements regarding future results of operations,
quality and nature of the asset base, the assumptions upon which
estimates are based and other expectations, beliefs, plans,
objectives, assumptions, strategies or statements about future
events or performance (often, but not always, using words such as
“expects”, “projects”, “anticipates”, “plans”, “estimates”,
“potential”, “possible”, “probable”, or “intends”, or stating that
certain actions, events or results “may”, “will”, “should”, or
“could” be taken, occur or be achieved). Forward-looking statements
are based on current expectations, estimates and projections that
involve a number of risks and uncertainties, which could cause
actual results to differ materially from those, reflected in the
statements. These risks include, but are not limited to: the risks
of the exploration and the mining industry (for example,
operational risks in exploring for, developing mineral reserves;
risks and uncertainties involving geology; the speculative nature
of the mining industry; the uncertainty of estimates and
projections relating to future production, costs and expenses; the
volatility of natural resources prices, including prices of gold
and associated minerals; the existence and extent of commercially
exploitable minerals in properties acquired by CORE or Peak Gold
LLC; ability to realize the anticipated benefits of the recent
transactions with an affiliate of Kinross; disruption from the
transactions and transition of the Peak Gold, LLC’s management to
an affiliate of Kinross, including as it relates to maintenance of
business and operational relationships; potential delays or changes
in plans with respect to exploration or development projects or
capital expenditures; the interpretation of exploration results and
the estimation of mineral resources; the loss of key employees or
consultants; health, safety and environmental risks and risks
related to weather and other natural disasters); uncertainties as
to the availability and cost of financing; CORE’s inability to
retain or maintain its relative ownership interest in Peak Gold,
LLC; inability to realize expected value from acquisitions;
inability of our management team to execute its plans to meet its
goals; the extent of disruptions caused by the COVID-19 outbreak;
and the possibility that government policies may change, political
developments may occur or governmental approvals may be delayed or
withheld, including as a result of the recent presidential and
congressional elections in the U.S. or the inability to obtain
mining permits. Additional information on these and other factors
which could affect CORE’s exploration program or financial results
are included in CORE’s other reports on file with the U.S.
Securities and Exchange Commission. Investors are cautioned that
any forward-looking statements are not guarantees of future
performance and actual results or developments may differ
materially from the projections in the forward-looking statements.
Forward-looking statements are based on the estimates and opinions
of management at the time the statements are made. CORE does not
assume any obligation to update forward-looking statements should
circumstances or management’s estimates or opinions change.
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version on businesswire.com: https://www.businesswire.com/news/home/20220218005548/en/
Contango ORE, Inc. Rick Van Nieuwenhuyse (713) 877-1311
www.contangoore.com
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