TORONTO, July 16, 2020 /CNW/ - Karora Resources Inc.
(TSX: KRR) ("Karora" or the "Corporation") is pleased to
announce another strong quarter with consolidated gold
production of 24,078 gold ounces for the second quarter of 2020
from its Beta Hunt and Higginsville mines in Western Australia. Gold sales for the second
quarter were 23,185 ounces. The difference in ounces sold vs.
produced was sold during the first week of the third quarter.
Karora's consolidated cash balance increased to $50.2 million as at June
30, 2020, a 31% increase from $38.4
million on March 31, 2020. The
improved cash balance is after payments into gold hedge agreements
during the second quarter. As of June 30,
2020, Karora is completely unhedged and will have full
exposure to spot gold prices going forward.
Paul Andre Huet, Chairman &
CEO, commented: "I am extremely pleased with our performance during
the second quarter where, despite the logistical challenges all
miners were faced due to COVID-19 precautions, we delivered yet
another rock solid quarterly performance. In fact, this is our
fourth straight quarter of strong, consistent gold production
results since acquiring the Higginsville mill and mining operations
in June of 2019.
Production for the first half of 2020 was 48,894 ounces placing
us in a good position going into the second half of the year to
achieve our 2020 gold production guidance of 90,000-95,000 ounces
and AISC1 of US$1,050-$1,200 per
There is no better measure of our success than our balance
sheet. With cash now sitting at over $50
million, net of delivery into the last of our hedges, we are
in a stronger financial position than ever before.
We have also made significant progress in our efforts to
aggressively reduce costs to achieve our target of lowering AISC
costs to US$1,000/oz by the end of
2020. As part of these efforts we have negotiated almost 10% in
reductions to our royalty burden on our Western Australian
operations, achieved significant savings in phase one of our
initiatives with vendors, increased workforce productivity and are
on track to achieve significate G&A savings.
We expect to see continued AISC cost reductions despite the
costs of the temporary measures we have in place to mitigate the
risks of the COVID-19 pandemic, including the hiring of additional
medical personnel at our operating sites, special charter flights
for on-site personnel and the building of ore stockpiles and
supplies in front of our gold processing operations.
With a growing cash balance of over $50
million, underpinned by steady state operations and our
success in reducing costs in a rising gold price environment,
Karora is in a very strong position to continue to deliver value to
its shareholders and we are excited about our future."
definition and reconciliation of these measures are included in the
Non-IFRS Measures section of Karora's MD&A dated May 7,
About Karora Resources
Karora is focused on growing gold production and reducing costs
at its integrated Beta Hunt Gold Mine and Higginsville Gold
Operations ("HGO") in Western
Australia. The Higginsville treatment facility is a low-cost
1.4 Mtpa processing plant which is fed at capacity from Karora's
underground Beta Hunt mine and open pit Higginsville mine. At Beta
Hunt, a robust gold mineral resource and reserve is hosted in
multiple gold shears, with gold intersections along a 4 km strike
length remaining open in multiple directions. HGO has a substantial
historical gold resource and highly prospective land package
totaling approximately 1,800 square kilometers. In addition, Karora
has a 28% interest in a nickel joint venture that owns the Dumont
Nickel-Cobalt Project located in the Abitibi region of Quebec. Dumont contains the second largest
nickel reserve and ninth largest cobalt reserve in the world.
Karora has a strong Board and management team focused on delivering
shareholder value. Karora's common shares trade on the TSX under
the symbol KRR. Karora shares also trade on the OTCQX market under
the symbol KRRGF.
Cautionary Statement Concerning Forward-Looking
This news release contains "forward-looking information"
including without limitation statements relating to the liquidity
and capital resources of Karora, production guidance and the
potential of the Beta Hunt Mine, Higginsville Gold Operation and
Dumont Nickel Project.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Karora to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Factors that could
affect the outcome include, among others: future prices and the
supply of metals; the results of drilling; inability to raise the
money necessary to incur the expenditures required to retain and
advance the properties; environmental liabilities (known and
unknown); general business, economic, competitive, political and
social uncertainties; results of exploration programs; accidents,
labour disputes and other risks of the mining industry; political
instability, terrorism, insurrection or war; or delays in obtaining
governmental approvals, projected cash operating costs, failure to
obtain regulatory or shareholder approvals. For a more detailed
discussion of such risks and other factors that could cause actual
results to differ materially from those expressed or implied by
such forward-looking statements, refer to Karora 's filings with
Canadian securities regulators, including the most recent Annual
Information Form, available on SEDAR at www.sedar.com.
Although Karora has attempted to identify important factors
that could cause actual actions, events or results to differ
materially from those described in forward-looking statements,
there may be other factors that cause actions, events or results to
differ from those anticipated, estimated or intended.
Forward-looking statements contained herein are made as of the date
of this news release and Karora disclaims any obligation to update
any forward-looking statements, whether as a result of new
information, future events or results or otherwise, except as
required by applicable securities laws.
Cautionary Statement Regarding the Higginsville Mining
A production decision at the Higginsville gold operations was
made by previous operators of the mine, prior to the completion of
the acquisition of the Higginsville gold operations by Karora and
Karora made a decision to continue production subsequent to the
acquisition. This decision by Karora to continue production and, to
the knowledge of Karora, the prior production decision were not
based on a feasibility study of mineral reserves, demonstrating
economic and technical viability, and, as a result, there may be an
increased uncertainty of achieving any particular level of recovery
of minerals or the cost of such recovery, which include increased
risks associated with developing a commercially mineable deposit.
Historically, such projects have a much higher risk of economic and
technical failure. There is no guarantee that anticipated
production costs will be achieved. Failure to achieve the
anticipated production costs would have a material adverse impact
on the Corporation's cash flow and future profitability. Readers
are cautioned that there is increased uncertainty and higher risk
of economic and technical failure associated with such production
SOURCE Karora Resources Inc.