Osisko Development Corp. (“
Osisko Development” or
the “
Company”) (TSX.V-ODV) is pleased to announce
the results from its Preliminary Economic Assessment
(“
PEA” or the
“Study”) completed
by BBA Engineering Ltd., consultants for the Cariboo Gold Project
(“
Cariboo” or the “
Project”) in
Central British Columbia (“
BC”).1
The PEA provides a technical and economic update
based on the updated underground Mineral Resource Estimate
(“MRE”) from the 2021 diamond drill campaign and
current costs and economic estimates. The MRE contains 27.1 million
tonnes (“Mt”) at an average grade of 4.0 grams per
tonne gold (“g/t Au”) for a total of 3.47 million
ounces (“M oz”) in the Measured and Indicated
Category (consisting of a Measured Resource of eight thousand
ounces of gold (47,000 tonnes grading 5.1 g/t Au) and an Indicated
Resource of 3.46 million ounces of gold (27 million tonnes grading
4.0 g/t Au)) and 14.4 Mt at a grade of 3.5 g/t Au for a total of
1.6 M oz in the Inferred category (Table 6). These mineral
resources have informed an 8,000 tonnes per day
(“tpd") scenario over a 12-year operating mine
life, which highlights the potential growth of the Cariboo Gold
Project. The PEA is available on the Company's website and the
profile of the Company at www.sedar.com. The Company notes that
mineral resources are not mineral reserves as they do not have
demonstrated economic viability. The Company notes that a
preliminary economic assessment is preliminary in nature, it
includes inferred mineral resources that are considered too
speculative geologically to have economic consideration applied to
them that would enable them to be categorized as mineral reserves,
and there is no certainty that the preliminary economic assessment
will be realized.
The PEA illustrates potential economics for a
low cost, large scale, underground gold mine, with industry leading
operating costs. The study outlines total gold production of 2.8
million gold ounces, resulting in an average annual gold production
profile of 236,000 ounces with an All-In-Sustaining Cost
(“AISC”) per ounce of $1,222 (US$962) (AISC is a
non-IFRS measure – please see under the heading "Non-IFRS Measures"
below). The Project after-tax net present value
(“NPV”) (5% discount rate) is $764 million with an
after-tax internal rate of return (“IRR”) of 21.4%
at a gold price of $2,223 (US$1,750) per ounce, and $912 million
and 24.5% at a spot gold price for May 19, 2022 at $2,343
(US$1,845) per ounce.
The PEA recommends that the Company continues to
work towards a feasibility study and completes the following
steps:
- Incorporate all
drilling results from 2021 and 2022 currently in progress in the
resources.
- Complete the
development of the ramp and extraction of the 10,000-tonne
(“t”) bulk sample that will help support the
evaluation and testing of the proposed roadheader mining equipment
and ore sorting equipment and gain experience to maximize the full
potential of these technologies.
- Integrate the
information and experience gained with the bulk sample into the
development strategy of the mine and the feasibility study
planning.
- Continue
exploration program with drilling (infill and exploration),
geological mapping, and grab sampling to test the depth extensions
of known high-grade vein corridors and identify new targets.
The Company plans to proceed with a feasibility study in
connection with the work plan recommended by the PEA.
The Company advises that this clarifying
news release is being issued at the request of the Autorité des
marchés financiers following a continuous disclosure review.
Certain previous economics described in the Table 1 below in
relation to the Project disclosed by the Company were not supported
by a technical report prepared in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI
43-101”) and are superseded by the economics set
out in the current NI 43-101 report and the Company cautions the
reader not to rely on such previous economics. The Company is also
filing a restated version of its annual managements' discussion and
analysis and annual information form to, as applicable, remove the
unsupported technical information and qualify other
disclosure.
The previous economics were made public by the
Company in connection with the environmental assessment for the
Cariboo Project. These economics were prepared in accordance
with the requirements for major projects in British Columbia to be
assessed for potential environmental, social, economic, health and
cultural effects by the Environmental Assessment Office, as
required by the Environmental Assessment Act (British Columbia)
(the "Environmental Assessment Act"). The
previous economics do not include numbers verified to a NI 43-101
standard, and do not include the suite of investor focused
economics, including the IRR and NPV for the project. These
previous economics were to engineering standards. You will find
below a table showing the differences between the previous
economics and the economics contained in the PEA.
Table 1: Project Economics
Information |
Previous economics |
PEA economics |
Explanation of the differences |
Production Rate (tpd) |
4,750 tpd |
Up to 8,000 tpd |
Based on the Company’s initial expectation a 4,750 tpd mine was
used for the environmental assessment but in accordance with the
MRE, its is expected that production could increase during the life
of the mine to up to 8,000 tpd |
Mine Life |
16 years |
12 years |
Higher production rate |
Initial Capital Cost and Total Capital Cost |
Projected initial capital cost of $400 to $450 million and total
capital cost over the life of mine estimated at just under $900
million |
Projected initial capital cost of $122 million, expansion capital
cost of $716 million and total capital over the life of mine
estimated at $1,364 million |
The differences are influenced by number of factors including:
- higher production rate
- additional resources
- additional environmental and
engineering data
- inflation.
|
The Key Operational Findings of the PEA
are:
- Phased construction approach with an initial construction
enabling a 2,000-tpd mine and an expansion raising the throughput
at 8,000 tpd
- Average life of mine (“LOM”) annual production
of 236,000 ounces per annum
- Peak production of 316,000 ounces and average of 297,000 ounces
when operating at 8,000tpd
- LOM AISC per ounce of $1,222 (US$962)
- Projected to have an initial mine life of 12 years
- First gold pour targeted for Q1 2024
The Key Financial Forecast of the PEA are (at a base
case gold price of US$1,750/oz):
- Initial capital requirement of $121.5 million
- Expansion capital requirement of $716.1 million
- LOM pre-tax undiscounted free cash flow of $2.0 billion
(post-tax $1.3 billion)
- Annual pre-tax free cash flow averages $167 million over 12
years of commercial production
- Annual after-tax free cash flow of $112 million over 12 years
of commercial production
- After-tax NPV (5%) of $764M
- After-tax IRR of 21.4%
- Payback period pre-tax of 5.8 years (post-tax 6.0 years)
Sean Roosen, Chair & Chief Executive
Officer of Osisko Development, commented: “The PEA builds
on previous technical work while incorporating the results of
extensive drilling together with several improvements and
optimizations. The capital and operating cost estimates rely on
recent budgetary quotes reflecting the current cost environment and
our project execution approach. The recent inflation and difficulty
with the supply chain has put to the forefront the challenges the
mining industry is facing. The Project provides an attractive
potential gold production profile of approximately 297,000 ounces
per year when operating at 8,000tpd over an 8-year period, making
it one of the premier gold development projects in North America
and key socio-economic contributor to the Cariboo region,
particularly in Wells, Quesnel, and surrounding areas, and the
Province of BC. This PEA highlights a phased approach with an
initial project able to produce 75,000oz/year at low capital cost,
but most importantly, providing us access to the deposits from
underground to do further exploration and seek to unlock more
potential value outside of the current mine design that has an
average mine depth of 350 meters. We believe this is a more prudent
approach in the actual economic context without compromising the
full potential of the Cariboo Gold Project.”
Table 2: Key Economic Outputs of the Study
Description |
Units |
|
Production Date (Operations Period) |
Mine Life |
year |
12 |
Average Process Throughput |
tpd |
6,424 |
Average Process Throughput |
MMt2/ year |
2,346 |
Gold Head Grade |
g/t |
3.40 |
Contained Gold |
koz3 |
3,080 |
Recovery |
% |
92.1 |
Total Gold Production |
koz |
2,837 |
Average Annual Gold Production |
koz |
236,000 |
Average Annual Full Years at 8,000tpd |
koz |
297,000 |
Operating Costs (Average LOM) |
Mining
Cost |
$/t mined |
52.73 |
Processing Cost |
$/t mined |
24.00 |
Concentrate transport |
$/t mined |
3.85 |
Tailings
and Water Management |
$/t mined |
5.81 |
G&A
Cost |
$/t mined |
7.63 |
Total
Site Operating Costs |
$/t mined |
94.02 |
Total
Site Operating Costs |
US$/oz |
734.85 |
AISC |
US$/oz |
961.6 |
Capital Costs |
Initial
Capital |
$ MM |
121.5 |
Expansion
Capital |
$ MM |
716.1 |
Life of
Mine Sustaining Capital |
$ MM |
527.2 |
Total
Capital Costs |
$ MM |
1,364.84 |
Financial Evaluation |
Gold
Price Assumption |
US$/oz |
1,750 |
USD:CAD
FX Assumption |
x |
1.27 |
After-Tax
NPV (5%) |
$ MM5 |
763.8 |
After-Tax
IRR |
% |
21.4 |
Payback |
year |
5.8 |
Figure 1: Average Annual Production Rate
and Gold
Productionhttps://www.globenewswire.com/NewsRoom/AttachmentNg/8afc93c9-ffbc-449c-87ae-11dcb6df1f58
Table 3: Sensitivity Analysis
Scenario |
Unit |
Downside Au Price Case |
Base Case |
Spot Au Price Case (May 19, 2022) |
Upside Au Price Case |
Gold Price |
US$/oz |
1,450 |
1,750 |
1,845 |
2,050 |
After-Tax NPV (5%) |
$ MM |
288.2 |
763.8 |
912.4 |
1,231.0 |
After-Tax IRR |
% |
11.2 |
21.4 |
24.5 |
31.2 |
LOM Free Cash Flow |
$ MM |
697 |
1,342 |
1,546 |
1,988 |
LOM EBITDA |
$ MM |
2,298 |
3,325 |
3,650 |
4,351 |
Payback |
years |
7.6 |
6.0 |
5.6 |
4.9 |
Table 4: Operating Cost Summary
Operating Costs |
$/t Mined |
Mining |
52.73 |
Transportation |
3.85 |
Processing (including underground crushing, ore sorting and paste
backfill) |
24.00 |
Tailings, waste & water management |
5.81 |
General & administration |
7.63 |
Total |
94.02 |
Table 5: Project Capital Cost Summary
Area Description |
Total Capital Cost ($ MM) |
|
|
Mobile Equipment |
10.6 |
Underground Mine |
507.0 |
Water & Waste Management |
101.1 |
Electrical & Communication |
137.5 |
Surface Infrastructure |
117.7 |
Mine Surface Infrastructure |
10.3 |
Processing - Mine Site Complex |
190.6 |
Processing - QR Mill |
57.1 |
Construction Indirect Costs |
86.9 |
Owner’s Costs |
31.0 |
Contingency |
98.6 |
Capitalized Operating Costs |
16.4 |
Total |
1,364.8 |
Closure Costs |
18.5 |
Salvage Value |
-61.1 |
PEA Overview
The Company retained BBA Engineering Ltd. as
lead consultants, along with other engineering consultants, to
complete the Study and prepare a technical report in accordance
with NI 43-101.
The Project surface infrastructure and services
are designed to support the operations at the Mine Site Complex and
at the Quesnel River Mill (“QR Mill”). The Project
also includes off-site infrastructure, such as a new 69 kV / 138 kV
transmission line between the Barlow substation, near Quesnel, BC,
and the Mine Site Complex. Warehousing for major components and
consumables will be provided by third parties in Quesnel and / or
Prince George.
The Project will be comprised of three different
sites: the Mine Site Complex, near the District of Wells, BC, the
Bonanza Ledge Site, and the QR Mill.
Underground longhole longitudinal retreat with a
combination of paste fill and cemented rockfill mining methods will
be used for the extraction of the economic mineable inventory, as
it is the most economic, and sustainable methodology. The Project
is planned in two phases, Phase 1 is at 2,000 tpd for 2.5 years,
increasing during Phase II to an average production of 8,000 tpd
over a 9.5-year LOM. This Report has focused on five underground
zones: Shaft Zone, Valley Zone, Cow Zone, Mosquito Zone and Lowhee
Zone. The mining zones are accessed via three main portals and are
connected by an internal ramp system.
Property Description, Location and Access
The Project is located in the historic Wells-
Barkerville mining camp of British Columbia and the Mineral Claim
Block extends for 77 kilometres (“km”) from
northwest to southeast. The Project falls, in large portion, within
the towns of Wells. Wells is situated 74 km east of Quesnel,
approximately 115 km southeast of Prince George, and approximately
500 km north of Vancouver.
The Project consists of 412 mineral titles
totalling 155,147.09 hectares across two contiguous property blocks
known as the Cariboo Main Block and the QR Mill Property. These
mineral titles include mineral claims, mineral leases, placer
claims and placer leases. A net smelter return royalty of 5%
payable to Osisko Gold Royalties Ltd is the only royalty that
applies to the Project.
Mineral Resource Estimate
- Measured and
Indicated Resource of 3.4 M oz of gold (27.1 Mt grading
4.0 g/t Au)
- Inferred Mineral
Resource of 1.6 M oz of gold in the Inferred category (14.4 Mt
grading 3.5 g/t Au)
- The 2022 Mineral
Resource Estimate includes eight deposit areas:
Mosquito, Shaft, Valley, Cow, Bonanza Ledge, BC Vein, Lowhee and
KL
- The MRE is based
upon over 650,000 metres (“m”) of diamond drilling
from Osisko Development’s 2015 to 2021 drill programs and
historically verified drill hole data for a total of 3,550
holes
- A total of 471
mineralized solids were used for the MRE: 109 solids for Cow, 100
for Valley, 93 for Shaft, 75 for Mosquito, 47 for Lowhee, BC Vein
and five splays (a total of 6 solids), 40 for KL, and 1 solid
for Bonanza Ledge
- The Approach for
the reasonable prospect for an eventual economical extraction for
the MRE is met using constrained, potentially mineable shapes,
reflecting latest CIM Mineral Exploration Best Practice Guidelines
(CIM Exploration Guidelines, November 2019)
- The MRE includes
the Cow–Island–Barkerville Mountain Corridor. The Cow-Island
segment covers a strike length of 3.7 km and a width of
approximately 400 m, down to a vertical depth of 650 m below
surface. The Barkerville segment covers a strike length of 3.0 km
and a width of approximately 500 m, down to a vertical depth of 500
m below surface
- The BC Vein deposit is 1.7 km
in strike length, 0.5 m to 37 m in thickness, and 400 m
in depth
Table 6: Mineral Resource Estimate
Category |
Deposit |
Tonnes |
Grade |
Ounces |
‘000 |
(g/t Au) |
‘000 |
Measured |
Bonanza Ledge |
47 |
5.1 |
8 |
Indicated |
Bonanza Ledge |
32 |
4.0 |
4 |
BC Vein |
1,030 |
3.1 |
103 |
KL |
389 |
3.2 |
40 |
Lowhee |
1,621 |
3.6 |
188 |
Mosquito |
1,795 |
4.3 |
249 |
Shaft |
11,139 |
4.3 |
1,531 |
Valley |
4,403 |
3.8 |
536 |
Cow |
6,645 |
3.8 |
811 |
Total Measured Resources |
47 |
5.1 |
8 |
Total Indicated Mineral Resources |
27,055 |
4.0 |
3,463 |
Inferred |
BC Vein |
461 |
3.5 |
53 |
KL |
1,905 |
2.8 |
168 |
Lowhee |
520 |
3.5 |
59 |
Mosquito |
1,262 |
3.6 |
146 |
Shaft |
5,730 |
3.9 |
725 |
Valley |
2,135 |
3.4 |
235 |
Cow |
2,394 |
3.1 |
236 |
Total Measured and Indicated Mineral
Resources |
27,102 |
4.0 |
3,470 |
Total Inferred Mineral Resources |
14,407 |
3.5 |
1,621 |
Mineral Resource Estimate notes:
- The independent
and qualified persons for the Mineral Resource Estimates, as
defined by NI 43-101, are Carl Pelletier, P.Geo., and Vincent
Nadeau Benoit, P.Geo. (InnovExplo Inc.). The effective date of the
2022 Mineral Resource Estimate is May 17, 2022.
- These mineral
resources are not mineral reserves as they do not have demonstrated
economic viability.
- The Mineral
Resource Estimate conforms to the 2014 CIM Definition Standards on
Mineral Resources and Reserves and follows the 2019 CIM Estimation
of Mineral Resources and Mineral Reserves Best Practice
Guidelines.
- A total of 471 vein
zones were modelled for the Cow Mountain (Cow and Valley), Island
Mountain (Shaft and Mosquito), Barkerville Mountain (BC Vein, KL,
and Lowhee) deposits and one gold zone for Bonanza Ledge. A minimum
true thickness of 2.0 m was applied, using the grade of the
adjacent material when assayed or a value of zero when not
assayed.
- The estimate is
reported for a potential underground scenario at a cut-off grade of
2.0 g/t Au, except for Bonanza Ledge at a cut-off grade of 3.5 g/t
Au. The cut-off grade for the Cow, Valley, Shaft, Mosquito, BC
Vein, KL, and Lowhee deposits was calculated using a gold price of
USD1,600 per ounce; a USD/CAD exchange rate of 1.30; a global
mining cost of $50.41/t; a processing & transport cost of
$30.41/t; and a G&A + Environmental cost of $16.18/t. The
cut-off grade for the Bonanza Ledge deposit was calculated using a
gold price of USD1,600 per ounce; a USD/CAD exchange rate of 1.30;
a global mining cost of $79.13/t; a processing & transport cost
of $60.00/t; and a G&A + Environmental cost of $51.65/t. The
cut-off grades should be re-evaluated in light of future prevailing
market conditions (metal prices, exchange rate, mining cost,
etc.).
- Density values for
Cow, Shaft, and BC Vein were estimated using the ID2 interpolation
method, with a value applied for the non-estimated blocks of 2.80
g/cm3 for Cow, 2.79 g/cm3 for Shaft, and 2.69 g/cm3 for BC Vein.
Median densities were applied for Valley (2.81 g/cm3), Mosquito
(2.79 g/cm3), KL (2.81 g/cm3) and Lowhee (2.75 g/cm3). A
density of 3.20 g/cm3 was applied for Bonanza Ledge.
- A four-step capping
procedure was applied to composited data for Cow (3.0 m), Valley
(1.5 m), Shaft (2.0 m), Mosquito (2.5 m), BC Vein (2.0 m), KL (1.75
m), and Lowhee (1.5 m). Restricted search ellipsoids ranged from 7
to 50 g/t Au at four different distances ranging from 25 m to 250 m
for each deposit. High grades at Bonanza Ledge were capped at 70
g/t Au on 2.0 m composited data.
- The mineral
resources for the Cow, Valley, Shaft, Mosquito, BC Vein, KL, and
Lowhee vein zones were estimated using Datamine StudioTM RM 1.9
software using hard boundaries on composited assays. The OK method
was used to interpolate a sub-blocked model (parent block size = 5
m x 5 m x 5 m). Mineral resources for Bonanza Ledge were estimated
using GEOVIA GEMSTM 6.7 software using hard boundaries on
composited assays. The OK method was used to interpolate a block
model (block size = 2 m x 2 m x 5 m).
- Results are
presented in situ. Ounce (troy) = metric tons x grade / 31.10348.
Calculations used metric units (metres, tonnes, g/t). The number of
tonnes was rounded to the nearest thousand. Any discrepancies in
the totals are due to rounding effects. Rounding followed the
recommendations as per NI 43-101.
- Other than as set
out in the PEA, the qualified persons responsible for this section
of the technical report are not aware of any environmental,
permitting, legal, title, taxation, socio-economic, marketing,
political or other relevant factors that could materially affect
the Mineral Resource Estimate.
Environmental Assessment
An Environmental Assessment for the Project was
initiated with the submission and acceptance of an initial project
description in 2020, as per the Environmental Assessment Act, at a
production rate of 4,750 tpd. Issuance of an Environmental
Assessment Certificate (“EAC”) is expected after
successful review of the Application. The use of the updated
resources in the PEA demonstrates the potential growth of the
Project allowing for a scaled ramp up of activity to 8,000 tpd
pending required permitting. Any changes to the Certified Project
Description (or activities/works not authorized by the EAC),
resulting from the increased production rate will first require an
amendment to the Project EAC before proceeding to an updated
detailed design and ensuing permit amendment applications.
Community and Indigenous Engagement
Osisko Development recognizes that early and
frequent engagement is key to our business success. Through
listening and open communication, we are better positioned to plan
and design our projects in ways that reduce potential environmental
and social impacts. The Company actively engages with Indigenous
nations, the public, its employees, and local, regional,
provincial, and federal governments and agencies. We understand
that the level of involvement and interest differs amongst
different groups, and we adjust communication strategies
accordingly.
Engagement for the Project began in 2016. In
October 2020, a Life of Project Agreement was signed between Osisko
Development and Lhtako Dené Nation, which includes commitments for
training, employment, and contracting opportunities. Agreements
with Xatśūll First Nation and Williams Lake First Nation are in
negotiation. In July 2021, discussions with the Wells District and
Council began to initiate a Memorandum of Understanding
(“MOU”) between the town and Osisko Development,
and a MOU was signed in March 2022.
Qualified Persons
Vincent Nadeau-Benoit, P.Geo., and Carl
Pelletier, P.Geo., of InnovExplo Inc. each of whom is a "qualified
person" within the meaning of NI 43-101 and considered to be
"independent" of Osisko Development for purposes of Section 1.5 of
NI 43-101, have reviewed and approved the contents of this news
release.
Colin Hardie, P.Eng., of BBA Engineering Ltd.,
is a "qualified person" within the meaning of NI 43-101 and
considered to be "independent" of Osisko Development for purposes
of Section 1.5 of NI 43-101, has reviewed and confirmed that the
news release fairly and accurately reflects the information in the
technical report for which he is responsible.
Mathieu Belisle, P.Eng., of BBA Engineering
Ltd., is a "qualified person" within the meaning of NI 43-101 and
considered to be "independent" of Osisko Development for purposes
of Section 1.5 of NI 43-101, has reviewed and confirmed that the
news release fairly and accurately reflects the information in the
technical report for which he is responsible.
Éric Lecomte, P. Eng., of InnovExplo Inc., is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which he is responsible.
Tim Coleman, P.Eng., of SRK Consulting (Canada)
Inc., is a "qualified person" within the meaning of NI 43-101 and
considered to be "independent" of Osisko Development for purposes
of Section 1.5 of NI 43-101, has reviewed and confirmed that the
news release fairly and accurately reflects the information in the
technical report for which he is responsible.
Paul Gauthier, P. Eng., of WSP Golder, is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which he is responsible.
Aytaç Göksu, P.Eng., of WSP Golder, is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which he is responsible.
Thomas Rutkowski, P.Eng., of WSP Golder, is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which he is responsible.
John Cunning, P.Eng., of WSP Golder, is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which he is responsible.
Kristin Salzsauler, P.Geo., of WSP Golder, is a
"qualified person" within the meaning of NI 43-101 and considered
to be "independent" of Osisko Development for purposes of Section
1.5 of NI 43-101, has reviewed and confirmed that the news release
fairly and accurately reflects the information in the technical
report for which she is responsible.
Eric Poirier, P.Eng., PMP, of WSP Canada Inc.,
is a "qualified person" within the meaning of NI 43-101 and
considered to be "independent" of Osisko Development for purposes
of Section 1.5 of NI 43-101, has reviewed and confirmed that the
news release fairly and accurately reflects the information in the
technical report for which he is responsible.
Davide Willms, P.Eng., of Klohn Crippen Berger
Ltd., is a "qualified person" within the meaning of NI 43-101 and
considered to be "independent" of Osisko Development for purposes
of Section 1.5 of NI 43-101, has reviewed and confirmed that the
news release fairly and accurately reflects the information in the
technical report for which he is responsible.Michelle Liew, P.Eng.,
of Klohn Crippen Berger Ltd., is a "qualified person" within the
meaning of NI 43-101 and considered to be "independent" of Osisko
Development for purposes of Section 1.5 of NI 43-101, has reviewed
and confirmed that the news release fairly and accurately reflects
the information in the technical report for which she is
responsible.
Katherine Mueller, P.Eng., of Falkirk
Environmental Consultants Ltd., is a "qualified person" within the
meaning of NI 43-101 and considered to be "independent" of Osisko
Development for purposes of Section 1.5 of NI 43-101, has reviewed
and confirmed that the news release fairly and accurately reflects
the information in the technical report for which she is
responsible.
For further information regarding the Cariboo
Gold Project, please see the technical report titled “Preliminary
Economic Assessment for the Cariboo Gold Project, District of
Wells, British Columbia, Canada”, dated May 24, 2022 with an
effective date of May 24, 2022 on the Company's website or under
the Company's profile at www.sedar.com.
About Osisko Development Corp.
Osisko Development Corp. is uniquely positioned
as a premier gold development company in North America to advance
the Cariboo Gold Project and other Canadian and Mexican properties,
with the objective of becoming the next mid-tier gold producer. The
Cariboo Gold Project, located in central British Columbia, is
Osisko Development's flagship asset. The considerable exploration
potential at depth and along strike distinguishes the Cariboo Gold
Project relative to other development assets. Osisko Development's
project pipeline is complemented by its interest in the San Antonio
gold project, located in Sonora.
For further information, please contact Osisko
Development Corp.:
|
Jean Francois LemondeVP Investor
Relationsjflemonde@osiskodev.comTel: 514-299-4926 |
|
Non-IFRS Measures
The Company used in this news release, certain
non-IFRS measures including, “all-in sustaining cost” or "AISC".
All-in sustaining cost per gold ounce is defined as production
costs less silver sales plus general and administrative,
exploration, other expenses and sustaining capital expenditures
divided by gold ounces. The Company believes that such
measures provide investors with an alternative view to evaluate the
performance of the Company. Non-IFRS measures do not have any
standardized meaning prescribed under IFRS. Therefore they may not
be comparable to similar measures employed by other companies. The
data is intended to provide additional information and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS.
The following table provides a reconciliation of
AISC per gold ounce to the 2021 consolidated financial
statements:
Table 7: Operating
Cost Summary |
|
|
|
|
|
|
|
Operating Costs |
Units |
For the year ended 2021(1) |
PEA Total LOM |
Mining Cost |
(USD MM) |
0.0 |
1,169.1 |
Transportation |
(USD MM) |
0.0 |
85.4 |
Processing |
(USD MM) |
0.0 |
532.1 |
Tailings, waste and water management |
(USD MM) |
0.0 |
128.8 |
General & administration |
(USD MM) |
0.0 |
169.1 |
Royalty & Refining Charges |
(USD MM) |
0.0 |
261.7 |
Sustaining Capex |
(USD MM) |
0.0 |
415.1 |
Closure Cost & Salvage Value |
(USD MM) |
0.0 |
-33.6 |
AISC Total |
(USD MM) |
0.0 |
2,727.7 |
Gold ounces |
(koz) |
0.0 |
2,836.6 |
AISC per gold ounce |
(USD/ounce) |
0.0 |
961.62 |
(1) The Company did not disclose AISC
information in its 2021 financial filings as none of the Company’s
test mining operations were in commercial production.
Forward-looking Statements
Certain statements contained in this press
release may be deemed “forward-looking statements” within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 and “forward-looking information” within the meaning of
applicable Canadian securities legislation. These forward‐looking
statements, by their nature, require Osisko Development to make
certain assumptions and necessarily involve known and unknown risks
and uncertainties that could cause actual results to differ
materially from those expressed or implied in these forward‐looking
statements. Forward‐looking statements are not guarantees of
performance. Words such as “may”, “will”, “would”, “could”,
“expect”, “believe”, “plan”, “anticipate”, “intend”, “estimate”,
“continue”, or the negative or comparable terminology, as well as
terms usually used in the future and the conditional, are intended
to identify forward‐looking statements. Information contained in
forward‐looking statements is based upon certain material
assumptions that were applied in drawing a conclusion or making a
forecast or projection, including the Company’s expectations and
ongoing and proposed work at the Project, operating and other cost
estimates, metal price assumptions, cash flow projections,
potential mineralization, ability to realize upon any
mineralization in a manner that is economic, metal recoveries and
grades, mine life projections, production rates, estimated AISC,
NPV and IRR, potential to further enhance the economics of the
Project, securing the required financing, permits and licences for
operation, and any other information herein that is not a
historical fact may be “forward looking information”. Material
assumptions also include, management’s perceptions of historical
trends, current conditions and expected future developments,
results of further exploration work to define and expand mineral
resources, as well as other considerations that are believed to be
appropriate in the circumstances. Osisko Development considers its
assumptions to be reasonable based on information currently
available, but cautions the reader that their assumptions regarding
future events, many of which are beyond the control of Osisko
Development, may ultimately prove to be incorrect since they are
subject to risks and uncertainties that affect Osisko Development
and its business. Such risks and uncertainties include, among
others, risks relating to capital market conditions, regulatory
framework, the ability of exploration activities (including drill
results) to accurately predict mineralization; errors in
management’s geological modelling; the ability of to complete
further exploration activities, including drilling; property and
stream interests in the Project; the ability of the Company to
obtain required approvals; the results of exploration activities;
risks relating to exploration, development and mining activities;
the global economic climate; metal prices; dilution; environmental
risks; and community and non-governmental actions and the responses
of relevant governments to the COVID-19 outbreak and the
effectiveness of such responses.
For additional information on risks,
uncertainties and assumptions, please refer to the most recent
Annual Information Form of Osisko Development filed on SEDAR at
www.sedar.com which also provides additional general assumptions in
connection with these statements. Osisko Development cautions that
the foregoing list of risk and uncertainties is not exhaustive.
Investors and others should carefully consider the above factors as
well as the uncertainties they represent and the risk they entail.
Osisko Development believes that the assumptions reflected in those
forward-looking statements are reasonable, but no assurance can be
given that these expectations will prove to be accurate as actual
results and prospective events could materially differ from those
anticipated such the forward looking statements and such
forward-looking statements included in this press release are not
guarantee of future performance and should not be unduly relied
upon. The forward‐looking statements set forth herein concerning
Osisko Development reflect management’s expectations as at the date
of this news release and are subject to change after such date.
Osisko Development disclaims any intention or obligation to update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise, other than as required
by law.
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. No stock exchange,
securities commission or other regulatory authority has approved or
disapproved the information contained herein.
1 Unless otherwise indicated, all amounts are expressed in
Canadian Dollars.2 MMt means millions of tonnes.3 koz means
thousand ounces.4 This amount doesn’t include the Closure cost and
the Salvage Value of the equipment and infrastructures5 MM means
millions.
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