TORONTO, June 24, 2019 /CNW/ - Golden Star Resources
Ltd. (NYSE American: GSS; TSX: GSC; GSE: GSR) ("Golden
Star" or the "Company") announces that it has filed an updated
technical report pursuant to National Instrument ("NI") 43-101 for
its Wassa Gold Mine in Ghana entitled "NI 43-101 Technical Report
on Resources and Reserves, Golden Star Resources, Wassa Gold Mine, Ghana" dated June
20, 2019. This technical report can be accessed under the
Company's profile at www.sedar.com and on the Company's website at
www.gsr.com.
HIGHLIGHTS:
- Proven and Probable underground mineral reserves estimated at a
$1,250/oz gold price, as of
December 31, 2018, are 7.5 Mt at an
average grade of 3.95 grams per tonne ("g/t") containing 949,000
ounces of gold
- Proven and Probable open pit mineral reserves estimated at a
$1,250/oz gold price, as of
December 31, 2018, are 9.9 Mt at an
average grade of 1.57 g/t containing 500,000 ounces of gold
- Measured and Indicated mineral resources estimated at a
$1,450/oz gold price, as of
December 31, 2018, are 43.8 Mt at an
average grade of 2.40 g/t containing 3.4 million ounces of gold.
Measured and Indicated resources are inclusive of reserves
- Inferred mineral resources estimated at a $1,450/oz gold price, as of December 31, 2018, are 53.4 Mt at an average
grade of 3.76 g/t containing 6.4 million ounces of gold
- A 10 year production life
- Total development capital costs estimated at $50 million for the underground and $109 million for the open pit
- Total sustaining capital costs estimated at $65 million for the underground and $32 million for the open pit
- $218 million post-tax free cash
flow and $175 million post tax NPV at
5% discount rate based on a gold price of US$1,300/oz
- $671/oz life of mine cash
operating cost1
- $814/oz life of mine mine-site
all in sustaining cost1
Notes
|
1. See "Non-GAAP
Financial Measures".
|
All monetary amounts refer to United States dollars
unless otherwise indicated.
Company Profile
Golden Star is an established
gold mining company that owns and operates the Wassa and Prestea
underground mines in Ghana,
West Africa. Listed on the NYSE
American, the Toronto Stock Exchange and the Ghana Stock Exchange,
Golden Star is focused on delivering
strong margins and free cash flow from its two high-grade, low cost
underground mines. Gold production guidance for 2019 is
220,000-240,000 ounces at a cash operating cost per ounce of
$620-$680. As the winner of the PDAC 2018
Environmental and Social Responsibility Award, Golden Star is committed to leaving a positive
and sustainable legacy in its areas of operation.
Cautionary note regarding forward-looking information
Some statements contained in this news release are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and "forward looking
information" within the meaning of Canadian securities laws.
Forward looking statements and information include, but are not
limited to, statements and information regarding: Proven and
Probable underground mineral reserves, capital and operating
costs.
Generally, forward-looking information and statements can be
identified by the use of forward-looking terminology such as
"plans", "expects", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates", "believes" or
variations of such words and phrases (including negative or
grammatical variations) or statements that certain actions, events
or results "may", "could", "would", "might" or "will be taken",
"occur" or "be achieved" or the negative connotation thereof.
Investors are cautioned that forward-looking statements and
information are inherently uncertain and involve risks, assumptions
and uncertainties that could cause actual facts to differ
materially. There can be no assurance that future developments
affecting the Company will be those anticipated by management.
Please refer to the discussion of these and other factors in
Management's Discussion and Analysis of financial conditions and
results of operations for the year ended December 31, 2018, and our annual information
form for the year ended December 31,
2018, each of which is filed on SEDAR at www.sedar.com. The
forecasts contained in this press release constitute management's
current estimates, as of the date of this press release, with
respect to the matters covered thereby. We expect that these
estimates will change as new information is received. While we may
elect to update these estimates at any time, we do not undertake to
update any estimate at any particular time or in response to any
particular event.
Non-GAAP Financial Measures
In this news release, we use the terms "cash operating cost" and
"all-in sustaining cost".
"Cash operating cost" for a period is equal to "cost of sales
excluding depreciation and amortization" for the period less
royalties, the cash component of metals inventory net realizable
value adjustments, materials and supplies write-off and severance
charges, and "cash operating cost per ounce" is that amount divided
by the number of ounces of gold sold (excluding pre-commercial
production ounces sold) during the period. We use cash operating
cost per ounce as a key operating metric. We monitor this measure
monthly, comparing each month's values to prior periods' values to
detect trends that may indicate increases or decreases in operating
efficiencies. We provide this measure to investors to allow them to
also monitor operational efficiencies of the Company's mines. We
calculate this measure for both individual operating units and on a
consolidated basis. Since cash operating costs do not incorporate
revenues, changes in working capital or non-operating cash costs,
they are not necessarily indicative of operating profit or cash
flow from operations as determined under IFRS. Changes in numerous
factors including, but not limited to, mining rates, milling rates,
ore grade, gold recovery, costs of labor, consumables and mine site
general and administrative activities can cause these measures to
increase or decrease. We believe that these measures are similar to
the measures of other gold mining companies, but may not be
comparable to similarly titled measures in every instance.
"Cost of sales excluding depreciation and amortization" as found
in the statements of operations includes all mine-site operating
costs, including the costs of mining, ore processing, maintenance,
work-in-process inventory changes, mine-site overhead as well as
production taxes, royalties, severance charges and by-product
credits, but excludes exploration costs, property holding costs,
corporate office general and administrative expenses, foreign
currency gains and losses, gains and losses on asset sales,
interest expense, gains and losses on derivatives, gains and losses
on investments and income tax expense/benefit.
"All-in sustaining costs" commences with cash operating costs
and then adds the cash component of metals inventory net realizable
value adjustments, royalties, sustaining capital expenditures,
corporate general and administrative costs (excluding share-based
compensation expenses), and accretion of rehabilitation provision.
For mine site all-in sustaining costs, corporate general and
administrative costs (excluding share-based compensation expenses)
are allocated based on gold sold by each operation. "All-in
sustaining costs per ounce" is that amount divided by the number of
ounces of gold sold (excluding pre-commercial production ounces
sold) during the period. This measure seeks to represent the total
costs of producing gold from current operations, and therefore it
does not include capital expenditures attributable to projects or
mine expansions, exploration and evaluation costs attributable to
growth projects, income tax payments, interest costs or dividend
payments. Consequently, this measure is not representative of all
of the Company's cash expenditures. In addition, the calculation of
all-in sustaining costs does not include depreciation expense as it
does not reflect the impact of expenditures incurred in prior
periods. Therefore, it is not indicative of the Company's overall
profitability. Share-based compensation expenses are also excluded
from the calculation of all-in sustaining costs as the Company
believes that such expenses may not be representative of the actual
payout on equity and liability based awards.
The Company believes that "all-in sustaining costs" will better
meet the needs of analysts, investors and other stakeholders of the
Company in understanding the costs associated with producing gold,
understanding the economics of gold mining, assessing the operating
performance and the Company's ability to generate free cash flow
from current operations and to generate free cash flow on an
overall Company basis. Due to the capital intensive nature of the
industry and the long useful lives over which these items are
depreciated, there can be a disconnect between net earnings
calculated in accordance with IFRS and the amount of free cash flow
that is being generated by a mine. In the current market
environment for gold mining equities, many investors and analysts
are more focused on the ability of gold mining companies to
generate free cash flow from current operations, and consequently
the Company believes these measures are useful non-IFRS operating
metrics ("non-GAAP measures") and supplement the IFRS disclosures
made by the Company. These measures are not representative of all
of Golden Star's cash expenditures
as they do not include income tax payments or interest costs.
Non-GAAP measures are intended to provide additional information
only and do not have standardized definitions under IFRS and should
not be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. These measures are
not necessarily indicative of operating profit or cash flow from
operations as determined under IFRS.
For additional information regarding the Non-GAAP financial
measures used by the Company, please refer to the heading "Non-GAAP
Financial Measures" in the Company's Management Discussion and
Analysis of Financial Condition and Results of Operations for the
three months ended March 31, 2019,
which are available at www.sedar.com.
Technical Information
The technical contents of this press release have been reviewed
and approved by Dr. Martin Raffield, P. Eng., a Qualified
Person pursuant to National Instrument 43-101. Dr. Raffield
is the Chief Technical Officer for Golden Star Resources.
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SOURCE Golden Star Resources Ltd.