VANCOUVER, March 19, 2020 /CNW/ - Filo Mining Corp.
(TSXV: FIL) (Nasdaq First North Growth Market: FIL) ("Filo
Mining" or the "Company") is pleased to announce its results for
the year ended December 31, 2019.
View PDF Version.
HIGHLIGHTS
2019 proved to be another pivotal year for the Company as it
continued to unlock value at the 100% owned Filo del Sol Project
(the "Project") through ongoing exploration success while also
effectively demonstrating the positive economic potential of the
Project's current Mineral Resource through completion of a
pre-feasibility study ("PFS"). These two key achievements only
continue to underline the tremendous value of the Filo del Sol
Project.
Confirmation of Large Porphyry System beneath Current
Mineral Resource
Results from the 2018/2019 drill program, which was completed in
March 2019, and partial results
received to date on the 2019/2020 drill program, which is currently
being concluded, have clearly demonstrated the existence of a large
copper-gold porphyry system underlying the current Mineral Resource
and extending to the north. Highlighted results received from these
two programs include:
- Diamond hole FSDH025, which was drilled during the 2018/2019
campaign through the current Mineral Resource, extended copper-gold
mineralization to depths of 1,025 metres below surface, which was
at the time 530 metres deeper than previously known; and
- Diamond hole FSDH032, which is a step-out hole drilled during
the 2019/2020 campaign and for which partial results have been
received to date, included an intercept of 600 metres at 1.12%
Copper Equivalent1 ("CuEq"), comprised of 0.67% Copper,
0.44 g/t Gold, and 16.2 g/t Silver. Of particular interest, this
intercept begins at a depth that effectively coincides with the
floor of the PFS's open pit design and mineralization remains open
to the northeast.
1 Copper equivalent ("CuEq") is calculated
based on US$ 2.80/lb Cu, US$ 1,400/oz Au and US$
16/oz Ag. The formula is: CuEq % = Cu % +
(0.7292 * Au g/t) + (0.0083 * Ag g/t).
PFS Completed on Oxide Material Yields Robust
Results
The PFS, which has an effective date of January 13, 2019, and is based on mining only the
oxidized portion of the Filo del Sol deposit, was highlighted by a
US$ 1.28 billion after-tax NPV using
an 8% discount rate and an IRR of 23% at US$
3.00/lb copper, US$ 1,300/oz
gold and US$ 20/oz silver. The 14
year mine life is characterized by a low strip ratio of 1.5:1
(waste:ore), which includes pre-stripping.
The PFS also introduced an initial Probable Mineral Reserve
estimate for the Project, which is comprised of 259.1 million
tonnes at 0.39% copper, 0.33 g/t gold and 15.1 g/t silver,
containing 2.2 billion pounds of copper, 2.8 million ounces of gold
and 126.0 million ounces of silver. Details of this Mineral Reserve
estimate are contained in the Technical Report referenced under
"Additional Information" below.
OUTLOOK AND STATEMENT ON READINESS AND RESPONSE TO
COVID-19
Exploration results arising out of last two drill programs
undertaken at the Project have confirmed the existence of a large
porphyry system underlying the current Mineral Resource, which may
be transformative for the flagship asset's size and scope. While
the primary focus of the Company's most recent 2019/2020 field
campaign has been the drilling of diamond holes to better define
and extend this deeper mineralization, the Company has also
drill-tested other targets on the project's extensive and largely
unexplored land package, such as the Tamberias West area.
In light of the COVID-19 pandemic, the Company's 2019/2020 field
program is being curtailed with demobilization of personnel and
equipment currently underway. The Company is responding to COVID-19
within the framework of internal protocols, and local and national
health authority requirements and recommendations. The health
and safety of our employees, contractors, visitors, and
stakeholders is our number one priority. Our camp
facilities and offices have implemented travel restrictions,
surveillance, monitoring and response plans to reduce the risk of
COVID-19 exposure and outbreak, including health screening of
personnel when appropriate. All non-critical business travel
has also been curtailed. We will continue to monitor
the situation and are prepared to implement additional changes to
minimize any potential impacts of the global outbreak that might
emerge at our project site or offices as necessary.
As a result of an earlier end to the 2019/2020 field program
than initially planned, the Company's completed drilling will be
lower than previously estimated and will total approximately 8,000
metres. Prior to the decision to conclude the field season early,
the Company did successfully complete the planned drone
magnetometer survey and full 3D IP geophysical survey. Despite the
early curtailment to the 2019/2020 field season, the Company was
able to achieve its key strategic operating objective for the
season in successfully drill-testing the mineralization underlying
the current Mineral Resource, as evidenced by hole FSDH032
described above.
The remaining assays results from the 2019/2020 field program
will be made available as data is received and verified by the
Company.
Commenting on the achievements of 2019 and the conclusion of the
2019/2020 program, Adam Lundin,
Chief Executive Officer, stated, "2019 was another successful year
for the Company, as we continued to advance the Filo del Sol
Project and unlock the value of this remarkable asset. It is
evident from hole 25 drilled last season and the results received
so far from hole 32 of this season that the resource growth
potential at Filo del Sol is vast. We look forward to receiving all
assays from this season's exploration program and updating the
market accordingly. Our original plan was to drill into April,
however, as our top priority is always the safety of everyone
involved, we have made the right decision to end the field season
early."
FINANCIAL RESULTS
(In thousands of Canadian dollars, except per share
amounts)
|
|
Three months
ended
|
Year
ended
|
|
|
December
31,
|
December
31,
|
|
|
2019
|
2018
|
2019
|
2018
|
Exploration and
project investigation
|
|
5,759
|
5,183
|
23,008
|
24,118
|
General and
administration ("G&A")
|
|
2,085
|
1,019
|
4,684
|
4,958
|
Net loss
|
|
8,038
|
6,191
|
28,571
|
28,891
|
Basic and diluted
loss per share
|
|
0.09
|
0.09
|
0.37
|
0.41
|
The financial
information in this table were selected from the Company's
consolidated financial statements for the year ended December 31,
2019 (the "Financial Statements"), which are available on SEDAR at
www.sedar.com and the Company's website
www.filo-mining.com.
|
SELECTED FINANCIAL INFORMATION
(In thousands of Canadian dollars)
|
December
31,
|
December
31,
|
|
|
2019
|
|
2018
|
Cash
|
|
13,753
|
|
2,405
|
Working capital
(deficit)
|
|
12,735
|
|
(602)
|
Mineral
properties
|
|
7,312
|
|
7,118
|
Total
assets
|
|
23,750
|
|
11,938
|
The financial
information in this table were selected from the Financial
Statements, which are available on SEDAR at www.sedar.com and
the Company's website www.filo-mining.com.
|
The Company incurred a net loss of $28.6
million during the year ended December 31, 2019, comprised of $23.0 million and $4.7
million in exploration and project investigation costs and
G&A costs, respectively, compared to a net loss of $28.9 million for the year ended December 31, 2018. The variance is primarily due
to lower exploration and project investigation costs in 2019, as
the result of the prior year reflecting higher engineering,
consultation and technical costs, such as metallurgical testwork,
incurred in support of the PFS then underway. This was offset by
higher financing costs incurred during the year ended December 31, 2019, due primarily to Company's
relative heavier use of credit facilities to fund operations during
the year.
LIQUIDITY AND CAPITAL RESOURCES
As at December 31, 2019, the
Company had cash of $13.8 million and
net working capital of $12.7 million,
compared to cash of $2.4 million and
a net working capital deficit of $0.6
million, as at December 31,
2018. The increase in the Company's cash and net working
capital is due primarily to aggregate net proceeds totaling
$38.8 million received from equity
financings undertaken during the year, which closed on August 30, 2019. This cash inflow has been
partially offset by $18.5 million
used to fully repay amounts previously drawn under credit
facilities and funds used in operations.
Corporate Update
Mr. Ashley Heppenstall has
informed the Company that he will not be standing for re-election
at the Company's next Annual General Meeting scheduled for
June 18, 2020. The Company
thanks Mr. Heppenstall for his many years of contribution and
experience to the Company's Board and wishes him the best in his
future endeavours.
About Filo Mining
Filo Mining is a Canadian exploration and development company
focused on advancing its 100% owned Filo del Sol copper-gold-silver
deposit located in Chile's Region
III and adjacent San Juan Province, Argentina. Filo Mining is a member of the
Lundin Group of Companies. Filo Mining is listed on the TSX Venture
Exchange ("TSXV") and Nasdaq First North Growth Market under the
trading symbol "FIL".
Qualified Persons
The scientific and technical disclosure for the Filo del Sol
Project included in this news release have been reviewed and
approved by Bob Carmichael, P.Eng.
and James Beck, B.A.Sc., P. Eng. Mr.
Carmichael is Filo Mining's Vice President of Exploration and a
Qualified Person under National Instrument 43-101 Standards of
Disclosure of Mineral Projects ("NI 43-101"). Mr. Beck is Filo
Mining's President and is also a Qualified Person under NI
43-101.
Additional information
The technical information relating to the pre-feasibility study
is based on a technical report titled "NI 43-101 Technical Report,
Pre-feasibility Study for the Filo del Sol Project" dated
February 22, 2019, with an effective
date of January 13, 2019 (the
"Technical Report"). The Technical Report was prepared for Filo
Mining by Ausenco Engineering Canada Inc. ("Ausenco"). The
Qualified Persons, as defined under NI 43-101, responsible for the
Technical Report are Scott Elfen, P.E., Ausenco; Robin Kalanchey, P.Eng., Ausenco; Bruno Borntraeger, P.Eng., Knight Piesold Ltd.;
Fionnuala Devine, P.Geo., Merlin
Geosciences Inc.; Ian Stillwell, BGC
Engineering Inc.; Neil Winkelmann,
FAusIMM, SRK Consulting (Canada)
Inc.; James N. Gray, P.Geo.,
Advantage Geoservices Limited; and Jay
Melnyk, P.Eng., AGP Mining Consultants, all of whom are
independent of Filo Mining. The Technical Report is available for
review under the Company's profile on SEDAR at www.sedar.com and on
the Company's website at www.filo-mining.com.
The Company's consolidated financial statements for the year
ended December 31, 2019 and related
management's discussion and analysis are available on the Company's
website at www.filo-mining.com or under its profile on SEDAR at
www.sedar.com.
The Company's certified advisor on Nasdaq First North Growth
Market is Pareto Securities AB, +46 8 402 50 00,
certifiedadviser.se@paretosec.com.
The information contained in this news release was accurate at
the time of dissemination, but may be superseded by subsequent news
release(s). The Company is under no obligation nor does it
intend to update or revise the forward-looking information, whether
as a result of new information, future events or otherwise.
This information was submitted by Filo Mining Corp. for
publication, through the agency of the contact person set out
below, on March 19, 2020 18:30 Pacific Time.
On behalf of Filo Mining,
Adam Lundin, CEO
Filo Mining Corp.
Cautionary Note Regarding Forward-Looking Statements
Certain statements made and information contained herein in this
press release constitutes "forward-looking information" and
forward-looking statements" within the meaning of applicable
securities legislation (collectively, "forward-looking
information") concerning the business, operations, financial
performance and condition of Filo Mining. The forward-looking
information contained in this press release is based on information
available to the Company as of the date of this press release.
Except as required under applicable securities legislation, the
Company does not intend, and does not assume any obligation, to
update this forward-looking information. Generally, any
statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance, (often, but not
always, identified by words or phrases such as "plans", "expects"
or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "projects" , "estimates",
"budgets", "scheduled", "forecasts", "assumes", "intends",
"strategy", "goals", "objectives", "potential", "possible",
"anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or statements that certain
actions, events, conditions or results "will", "may", "could",
"would", "should", "might" or "will be taken", "will occur" or
"will be achieved" or the negative connotations thereof and similar
expressions) are not statements of historical fact and may be
forward-looking statements.
All statements other than statements of historical fact may be
forward-looking statements. Forward-looking information is
necessarily based on estimates and assumptions that are inherently
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance
or achievements of the Company to be materially different from
those expressed or implied by such forward-looking information,
including but not limited to: risks and uncertainties relating to,
among other things, the inherent uncertainties regarding Mineral
Reserve and Resource estimates, cost estimates, changes in
commodity prices, currency fluctuation, financings, unanticipated
resource grades, infrastructure, results of exploration activities,
cost overruns, availability of materials and equipment, timeliness
of government approvals, taxation, political risk and related
economic risk and unanticipated environmental impact on operations
as well as other risks, and uncertainties and other factors,
including, without limitation, those referred to in the "Risks and
Uncertainties" section of the Company's most recent MD&A and/or
Annual Information Form, under the heading "Risks Factors", and
elsewhere, which may cause the actual results, level of activity,
performance or achievements of the Company to be materially
different from those expressed or implied by such forward-looking
information.
The Company believes that the expectations reflected in the
forward-looking information included in this press release are
reasonable but no assurance can be given that these expectations
will prove to be correct and such forward-looking information
should not be unduly relied upon. Information contained in
this press release is as of the date of this press release.
In particular, this press release contains forward-looking
information pertaining to the assumptions used in the PFS for the
Filo del Sol project, the assumptions used in the Mineral Reserves
and Resources estimates for the Filo del Sol project, including,
but not limited to, geological interpretation, grades, metal price
assumptions, metallurgical and mining recovery rates, geotechnical
and hydrogeological conditions, as applicable; ability to develop
infrastructure; assumptions made in the interpretation of drill
results, geology, grade and continuity of mineral deposits;
expectations regarding access and demand for equipment, skilled
labour and services needed for exploration and development of
mineral properties; and that activities will not be adversely
disrupted or impeded by exploration, development, operating,
regulatory, political, community, economic and/or environmental
risks. In addition, this press release contains
forward-looking information pertaining to: the Company's plans for
its 2019/2020 field program at its 100% owned Filo del Sol Project,
including the expected timing of results related thereto; potential
upside at the Filo del Sol Project; assumptions and interpretations
around prospectivity of the Tamberias West area; the ability of the
Company to secure additional financing and/or the quantum and terms
thereof; support of the Lundin Family Trusts; exploration and
development plans and expenditures; the timing and nature of
studies and any potential development scenarios; opportunities to
improve project economics; the success of future exploration
activities; potential for resource expansion; potential for the
discovery of new mineral deposits; ability to build shareholder
value; expectations with regard to adding to its Mineral Reserves
or Resources through exploration; expectations with respect to the
conversion of inferred resources to an indicated resources
classification; ability to execute planned work programs;
estimation of commodity prices, Mineral Reserves and Resources,
estimations of costs, and permitting time lines; ability to obtain
surface rights and property interests; currency exchange rate
fluctuations; requirements for additional capital; government
regulation of mining activities; environmental risks; unanticipated
reclamation expenses; title disputes or claims; limitations on
insurance coverage; and other risks and uncertainties.
Forward-looking information is based on certain assumptions that
the Company believes are reasonable, including that the current
price of and demand for commodities will be sustained or will
improve, the supply of commodities will remain stable, that the
general business and economic conditions will not change in a
material adverse manner, that financing will be available if and
when needed on reasonable terms and that the Company will not
experience any material labour dispute, accident, or failure of
plant or equipment. These factors are not, and should not be
construed as being, exhaustive. Although the Company has
attempted to identify important factors that would cause actual
results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated, or intended.
There can be no assurance that such statements will prove to be
accurate, as the Company's actual results and future events could
differ materially from those anticipated in such statements, as a
result of the factors discussed in the "Risk and Uncertainties"
section of the Company's most recent management's discussion and
analysis and elsewhere and in the "Risk Factors" section in the
Company's most recent Annual Information Form, which are available
under the Company's profile on SEDAR at www.sedar.com. All of
the forward-looking information contained in this document is
qualified by these cautionary statements. Readers are
cautioned not to place undue reliance on forward-looking
information due to the inherent uncertainty thereof.
Statements relating to "Mineral Resources" are deemed to be
forward looking information, as they involve the implied
assessment, based on certain estimates and assumptions, that the
Mineral Resources described can be profitably produced in the
future.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release
SOURCE Filo Mining Corp.