Osino Resources Corp. (
TSXV:OSI)
(
FSE:RSR1) (
OTCQX:OSIIF)
("
Osino” or “
the Company”) is
pleased to provide an update on progress made with the various
development studies underway towards a PFS on the Company’s Twin
Hills Gold Project (“
Twin Hills” or the
“
Project”) in Namibia.
Twin Hills is an orogenic-style,
sedimentary-hosted, structurally controlled gold project
contemplated as an open pit, which Osino is fast-tracking through
development. Osino published a preliminary economic analysis
(“PEA”) on Twin Hills in August 2020 and is in the
process of working towards a PFS on Twin Hills based on the
recently published updated MRE.
Heye Daun, Osino’s President & CEO
commented: “We have never been more excited about the Twin
Hills gold project, and we believe that especially with the recent
resource upgrade and the associated project optimization
opportunities identified, Twin Hills is on its way to become one of
Namibia’s most significant gold projects. We have thus decided to
give ourselves some additional time to fine-tune and grow the
project scope to a higher production level than was previously
planned. We are confident that Twin Hills’ mineral resource
endowment will continue to grow, and we have already commenced with
Indicated resource conversion drilling at Clouds and Twin Hills
West, and follow-up drilling of the recently discovered high-grade
shoots at Twin Hills Central and Clouds. We are also planning
additional down-dip step-outs along the spine of all of the
deposits and we believe that once completed, all of this drilling
should result in another significant resource
upgrade.”
Drilling Update
Of the 186,826m of RC and DD drilling completed
at Twin Hills since the discovery of the deposit approximately
167,597m was included in the recent MRE update up to the data
cut-off date of 19 February 2022. Since then, more than 19,229m of
additional RC and DD drilling was completed, and Osino expects to
complete some additional infill and step-out drilling before the
end of May 2022, aiming to convert more of the current Inferred
resources to the Indicated category which would enable this
material to be added to the PFS mine plan.
During March 2022 Osino also completed
approximately 3,000m of grade control orientation drilling (12.5m x
12.5m drill spacing) at Twin Hills Central (“THC”)
aiming to better define the short-range variability of the THC
mineralization. This grade control exercise may potentially enable
more advanced geostatistical resource estimation techniques to be
applied (uniform conditioning versus ordinary kriging) to the Twin
Hills mineral resource. The aim of this exercise is to model the
effects of selective mining with the aim of potentially improving
the processing head grade.
Drilling is ongoing with 6 DD and 3 RC rigs.
Assay results for most of this drilling are outstanding. It is
expected that this drilling will be completed during May 2022 with
all assays received within 4-6 weeks of completion of drilling.
Development Study Update
Several studies to complete the PFS are underway
with many at an advanced stage. These studies include but are not
limited to the following:
- Metallurgical Testwork and
Trade-off Analyses
- Tailings Disposal Strategy &
Design
- Process Plant & Engineering
Design
- Infrastructure & Site
Layout
- Securing Major Utilities (Water and
Power)
- Geotech and Mine Planning
- Permitting
Lycopodium Minerals Canada Ltd
(“Lycopodium”) were retained by Osino with
responsibility for the overall management of the Twin Hills Project
PFS. This comprises study management, cost estimating, management
of metallurgical testwork and coordination and preparation of the
Technical Report.
Metallurgical Testwork
Update
Metallurgical tests were conducted on composite
core samples from various locations in the mineral deposit. The
tests included sample characterisation including chemical and
mineralogical analysis, fire assay by size fraction, bulk leach
extractable gold tests and diagnostic leaches. After this, the
following potential metallurgical process steps or control
parameters were tested on each sample:
- Crushing and milling tests and
development of milling curves
- Extended gravity recovery tests and
modelling
- Grind size, CIL and oxygen
pre-oxidation leach evaluation
- Lead nitrate and shear
reactor/Aachen leach evaluation
- Whole leach, flotation and site
water leach tests
- Oxygen uptake rate, cyanide
detoxification and carbon loading tests
Several trade-off studies were carried out
including:
- Modelling of alternative crushing
and milling circuits
- Oxidation - oxygen/Aachen reactor
versus lead nitrate addition
- Comparison of vacuum filtration
versus pressure filtration of tailings
- Gravity/flotation gold recovery
followed by leaching compared with the base-case gravity/CIL
circuit
- Comparison of dry-stack tailings
deposition versus conventional pumped slurry tailings disposal
The metallurgical testwork and comminution
studies indicate that Twin Hills’ mineralized material can be
characterized as being moderately hard, with excellent amenability
for conventional CIL processing. Optimization work completed since
the PEA (especially pre-oxidation) has resulted in an improvement
in the potential overall gold recovery from the 90.9% achieved in
the PEA.
Process Plant and Engineering Design
The results of this testwork suggest that the
optimal process flow sheet will comprise three-stage crushing
followed by ball milling. Gravity concentration will then be
applied to a selected size fraction, with the gravity-recovered
gold (“GRG”) concentrate being processed in an
intensive leach reactor followed by electrowinning.
GRG tailings will be recycled to mill
classification and the hydro-cyclone overflow will report to
pre-leach thickening and pre-oxidation. Thickener underflow will be
pumped to a six-stage carbon-in-leach circuit. Gold will be eluted
from loaded carbon with eluate being processed by electrowinning.
Finally, electrowon gold from the intensive and main leach circuits
will be combined and smelted to final product.
Tailings Disposal/Storage
Strategy
The Company is conducting a trade-off study to
determine the optimal Tailings Storage Facility
(“TSF”) strategy for the project. More
specifically, a dry-stack tailings deposition strategy is being
considered versus a more conventional system of pumped slurry
tailings. Dry-stacked tailings deposition has obvious advantages in
terms of lower water consumption and associated environmental
benefits, although this comes at the cost of likely higher total
Life-of-Mine (“LOM”) capex.
However, owing to the modular deposition
strategy which grows in line with production, not all of the
capital expenditure has to be incurred upfront, with the
flexibility to defer some of the dry-stack capital requirements
until later years of the LOM.
With the expected ongoing growth in mineral
resources and likely higher future processing plant throughput
Osino expects the Twin Hills projects water demand to continue to
grow. In the context of Namibia’s generally constrained water
supply situation, owing to its dry climate and seasonal rainfall
variation, it is therefore important that the Company make every
attempt to minimize the Project’s unit water consumption. For this
reason, dry-stack tailings is favoured despite its expected higher
capital cost. A thorough trade-off analysis is underway to
determine the most cost-effective and appropriate tailings
deposition strategy for the project.
Site and Infrastructure Layout
The general site layout has remained largely
unchanged as the individual infrastructure elements continue to
take advantage of the flat lying terrain on the northern side of
the pits.
To minimize haulage costs over the LOM, it is
important to place the processing plant as close as possible to the
centre of the various open pits, close to Bulge and THC, which will
contribute most mineralized material. The offices and stores are
laid out immediately to the north of this pit, and logistically
adjacent to the main access route from the north. The power supply
line linking with the planned Erongo substation is designed to
enter the project area from the west to access the plant.
The base case dry-stacked tailings facility is
positioned to the west of the plant and linked through fixed
overland conveyor to a facility which is planned to be built in
three phases. Grasshopper conveyors are expected to provide
flexibility to the phasing approach to the disposal strategy for
distribution of tailings.
Waste rock dump volumes have been created and
appropriate footprints have been designated for the approximately
5km2 area required for the projected waste volumes to a dump height
of 40m. Engineered waste rock dump designs will be created
following the updated mine schedule.
A graphic accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/d6c3f6b8-ac40-4d3f-8890-775b01736cae
Grid Power Supply
The Twin Hills project is located in an
infrastructure-dense area of Namibia, only 20 km from the existing
substation and grid power supply to the neighbouring Navachab gold
mine. Namibia’s parastatal bulk power utility, Nampower, also has
plans to construct a new substation in Karibib (the Erongo
substation) which will enable the supply of sufficient grid power
to Osino’s Twin Hills project and other consumers in the
region.
In March 2022 Osino signed a power-supply
agreement with Nampower for a 16MW grid connection to the planned
Erongo substation. Depending on the final processing plant
capacity, Twin Hills maximum power demand is expected to grow to
approximately 20MW, and discussions with Nampower have commenced to
amend the power-supply agreement to cater for the additional
expected demand.
Under the terms of the contract the grid power
supply is subject to a 36 to 48-month Nampower procurement and
construction lead time from signature (i.e. from March 2022).
Discussions are currently underway to shorten this procurement
period. In addition, investigations are ongoing to procure
contingency power sources to bridge any potential supply gaps.
Osino expects to have the required power available when full
production commences.
Osino has also engaged a local Namibian
electrical engineering consultancy to assist in designing &
procuring large-scale photovoltaic power supply in addition to grid
power. Various attractive proposals have been received and are
being investigated further.
Mine Water Supply
The Twin Hills project is located only 25km from
the local town of Karibib, and the neighbouring Navachab Gold mine,
both of which are supplied with bulk water by Namibia’s water
parastatal, Namwater, via pipeline from Swakoppoort dam. Supplies
from this source are however limited due to seasonal rainfall.
Osino thus commissioned two specialist Namibian
consultants, Knight Piesold and SLR Consulting, to carry out the
necessary hydrological studies and drill programs to develop our
own water sources for the Twin Hills project, based primarily on
three sources:
- Ground water
abstraction from existing, nearby marble aquifers on a sustainable
yield basis
- The development
of sand aquifers using ground weirs in the nearby, ephemeral Khan
river system
- Additional
augmentation using piped water (effluent and fresh) from the nearby
town of Karibib
A total of 40 hydrological assessment and water
abstraction boreholes have been drilled within the Twin Hills
mining area since 2019, with a demonstrated combined water yield of
168m3/hr or 1.49m m3/year. Total mine make-up water demand at an
assumed 4.5mtpa processing capacity is approximately 1.5m m3/year
which will be supplied from the boreholes indicated in green dots
in Figure 2 below.
A graphic accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/a7f71b3f-043f-41e5-9414-5984685b3dc0
Further water will be obtained from pit
dewatering and, thus mine water supply has been secured from ground
water only. A new phase of borehole drilling of 17 positions is now
underway in previously untested areas to explore additional aquifer
potential (Figure 2 blue dots).
Additional technical studies are under way to
develop additional water sources a) from developing ground weirs
and associated Khan River sand aquifers and b) from piped bulk
water from the local town of Karibib (untreated effluent water from
the town of Karibib or fresh make-up water from Swakoppoort
dam).
These additional waters sources are being
developed to diversify the supply base and to allow for a planned
further increase in processing plant capacity.
It is anticipated that these additional water
sources could supply up to 30-40% of total mine water demand,
depending on final processing plant production rate and TSF
strategy chosen. Trade-off studies are underway to determine the
optimal solution.
Geotech and Mine Planning
A phase two geotechnical drill program was
completed during Q1 2022. This program consisted of four additional
geotechnical assessment holes in the THC-Bulge pit and three holes
in the previously untested Clouds pit, designed to provide a level
of confidence to the pit design suitable for future work towards a
Bankable Feasibility Study and to allow for the determination of
mineral reserves as part of the upcoming PFS.
This geotechnical drilling plus the associated
testwork and analysis was completed under the direction of SRK
Consulting (Pty) Ltd. and has resulted in improved confidence and
slightly steeper pit slopes in some areas of the Twin Hills
pits.
Mine planning is currently underway to
incorporate the upsized mineral resource and to reflect the
improved metallurgical testwork results and design parameters in an
updated mine plan. The mine planning objective is to maximize
annual gold production and project NPV.
Once the additional Inferred mineral resources
have been converted to Indicated status and all project planning
assumptions have been confirmed, the mine plan will be updated
accordingly.
Permitting Process and Environmental and
Social Impact Assessment (ESIA)
Under Namibia’s regulatory environment several
steps are required toward approval of the mining license which the
Company applied for in August 2021.
The most important of these steps are the
completion and approval of the Environmental & Social Impact
Assessment (“ESIA”), including public
consultation, and the compilation of an Environmental Management
Plan (“EMP”). Once these are approved, the
Namibian Ministry of Environment, Fisheries and Tourism
(“MEFT”) issues an Environmental Clearance
Certificate (“ECC”) which is generally the
precursor to the granting of a mining license by the Ministry of
Mines & Energy (“MME”).
There are a range of additional, secondary
approvals, most of which are usually obtained subsequent to the
granting of a mining license. There are no prescribed timelines,
but mining licenses are commonly granted after the completion of
the ESIA process.
The following tasks have been completed
to-date:
- Project
registration and baseline specialist study compilation (2021)
- Public
participation meetings and stakeholder feedback documentation
(2021)
- Public review
of the ESIA and EMP (2022)
- Final
submission of the ESIA and EMP to government for approval
(2022)
The final step of the approval process is now
underway as the completed ESIA is under review by the MEFT. The
submission was accompanied by a successful presentation in March.
No significant risks were identified and MEFT is expected to make a
positive recommendation to issue an ECC within a reasonable time
period, generally between three to six months of submission of the
ESIA.
Live Webinar
Investors are invited to participate in a live
webinar with Osino’s management to discuss the significantly
upsized resource, progress with development studies and the
Company’s plans to continue to grow and fast-track the project.
There will be a Q&A period following the presentation.
Date: |
April 20, 2022 at 11am ET (8am PT) |
Registration Link: |
https://attendee.gotowebinar.com/register/5857855327493794571 |
The presentation and webinar playback will be
available on the Company’s website following the webinar.
Qualified Person’s
Statement
David Underwood, BSc. (Hons) is Vice President
Exploration of Osino Resources Corp. and has reviewed and approved
the scientific and technical information in this news release and
is a registered Professional Natural Scientist with the South
African Council for Natural Scientific Professions (Pr. Sci. Nat.
No.400323/11) and a Qualified Person for the purposes of National
Instrument 43-101.
About Osino Resources
Osino is a Canadian gold exploration and
development company focused on the development of our Twin Hills
gold discovery in central Namibia. The Twin Hills Gold Project is
at an advanced stage of exploration with various advanced
development studies underway with the aim of fast-tracking the
project.
Osino has a large ground position of
approximately 6,700km2 located within Namibia’s prospective Damara
sedimentary mineral belt, mostly in proximity to and along strike
of the producing Navachab and Otjikoto Gold Mines. The Company is
actively advancing a range of gold prospects and targets along the
belt by utilizing a portfolio approach geared towards discovery,
targeting gold mineralization that fits the broad orogenic gold
model.
Our core projects are favorably located north
and north-west of Namibia’s capital city Windhoek. By virtue of
their location, the projects benefit significantly from Namibia’s
well-established infrastructure with paved highways, railway, power
and water in close proximity. Namibia is mining-friendly and lauded
as one of the continent’s most politically and socially stable
jurisdictions.
Osino continues to evaluate new ground with a
view to expanding our Namibian portfolio.
Further details are available on the Company's
website at https://osinoresources.com/
CONTACT INFORMATIONOsino
Resources Corp.Julia Becker: Investor RelationsTel: +1 (604) 785
0850jbecker@osinoresources.com
Cautionary
Statement Regarding
Forward-Looking Information
This press release contains "forward-looking
information" within the meaning of applicable Canadian securities
legislation. Forward-looking information includes, without
limitation, statements regarding the use of proceeds from the
Company's recently completed financings, and the future plans or
prospects of the Company, including prospects for economic
recoverability of mineral resources. Generally, forward-looking
information can be identified by the use of forward-looking
terminology such as "plans", "expects" or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes",
or variations of such words and phrases or state that certain
actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved". Forward-looking
statements are necessarily based upon a number of assumptions that,
while considered reasonable by management, are inherently subject
to business, market and economic risks, uncertainties and
contingencies that may cause actual results, performance or
achievements to be materially different from those expressed or
implied by forward-looking statements. Although the Company has
attempted to identify important factors that could 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 information will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking information. Other factors
which could materially affect such forward-looking information are
described in the risk factors in the Company's most recent annual
management's discussion and analysis which is available on the
Company's profile on SEDAR at www.sedar.com. The Company does
not undertake to update any forward- looking information, except in
accordance with applicable securities laws.
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 press release.
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