Serabi Gold plc High Gold Grades Maintained, As Serabi Produces Almost 10,000 Ounces For The First Quarter Of 2017

 
TIDMSRB 
 
   For immediate release 
 
   12 April 2017 
 
   Serabi Gold plc 
 
   ("Serabi" or the "Company") 
 
   High gold grades maintained, as Serabi produces almost 10,000 ounces for 
the first quarter of 2017 
 
   Serabi Gold plc (AIM:SRB, TSX:SBI), the Brazilian focused gold mining 
and development company, is pleased to report first quarter production 
of almost 10,000 ounces of gold, in line with production guidance and 
provides an accompanying operational update on its Palito and Sao Chico 
high grade gold operations in the Tapajos region of Para State, Northern 
Brazil. 
 
   HIGHLIGHTS 
 
 
   -- Strong first quarter production of 9,861 ounces of gold, on budget and in 
      line with guidance. 
 
   -- Mine production totalled 36,918 tonnes at 10.12 grammes per tonne ("g/t") 
      of gold. 
 
   -- 46,663 tonnes of ore processed through the plant for the combined mining 
      operations, at a combined grade of 7.09 g/t of gold. 
 
 
   -- 2,251 metres of horizontal mine development completed in the quarter. 
 
   -- At Palito, expansion of working areas continues, with development and 
      production now coming from eight veins from the 25 included in the 
      geological resource. 
 
   -- Test stopes using long-hole mining are underway in the Senna vein, with 
      good success to date.  The Senna vein is showing wider widths, 
      potentially allowing for an increased level of mechanisation. Four 
      sublevels are already in development with a new cross cut being 
      established at the 180mRL. 
 
   -- At Palito Main Zone, the main ramp has now reached the -50mRL, where the 
      G3 vein is now under development. 
 
   -- At Sao Chico the main ramp has now been deepened to the 56mRL, 
      approximately 190 vertical metres below surface.   Production is coming 
      from the 140mRL, and with sublevels developed on levels 128mRL, 116mRL, 
      100mRL, 86mRL and 70mRL, development is well ahead of production. 
 
 
   -- By the end of the first quarter, surface ore stocks were approximately 
      13,000 tonnes (31 December 2016: 21,000 tonnes) with an average grade of 
      4.0 g/t of gold. 
 
   --  Ground induced polarisation ("IP") survey undertaken at Sao Chico has 
      identified some excellent targets within 500 metres of the current 
      operation. 
 
 
   -- At the year end, the combined surface stockpiles at Palito and Sao Chico 
      totalled 21,000 tonnes of ore with an average grade of 4.0 g/t of gold. 
 
 
   Mike Hodgson, CEO, said: 
 
   "A successful 2016 has been followed by a strong first quarter to 2017, 
with almost 10,000 ounces of gold being produced for the quarter; on 
budget and in line with guidance. 
 
   "Mine production from both the Palito and Sao Chico orebodies showed 
steady progress.  Eight veins are now being worked in the Palito orebody, 
with four new veins coming on stream this quarter, significantly 
improving optionality.  The Pipocas, G3 and Senna veins continue to form 
the backbone of production, whilst development of the new Zonta vein to 
the west of Senna, ongoing development of the G1 and G2 veins, and veins 
within the Chico da Santa zone demonstrate the abundance of opportunity 
that exists at Palito. 
 
   "Ore development and production from the Sao Chico orebody continued in 
line with schedule and with excellent mined grades, at an average grade 
of over 12 g/t, achieved for the quarter.  The main ramp has now reached 
the 56mRL with the Main Vein being intersected early in April.  Stope 
ore production is currently focused on the 140mRL whilst development is 
progressing on five levels below and is nicely ahead of stoping 
activity. 
 
   "In the plant, the quarterly performance was very satisfying and the 
milled throughput of 46,000 tonnes for the quarter represents a 10 per 
cent improvement over the previous highest quarterly production level. 
As has previously been reported, the introduction of the third mill last 
year was principally to establish much needed contingency, however, we 
are making inroads into the surface stockpiles, though we still remain 
largely limited by overall plant capacity. 
 
   "In the latter half of 2016 the Company reported that, following the 
extension of its exploration license holdings around the Sao Chico 
orebody, it had recommenced surface exploration, with an IP geophysical 
survey.  The purpose of the survey was to trace the trend of the Main 
Vein, which has sufficient sulphides to provide a clear conductivity 
anomaly and which in turn, we hoped, would provide targets for a 
subsequent drill programme.  Due to the wet season arriving early, the 
programme had to be suspended, but nevertheless we processed the data 
from those areas where work had been completed.  The initial results 
that have become available during this first quarter of 2017 are 
extremely promising.  The survey was designed to traverse the known 
orebody to provide orientation, and focus to the east and west of the 
current strike.  The results to date show two excellent anomalies 600 
metres to the north and 300 metres to the south of the current workings, 
which, from a geophysical perspective, look even stronger than the 
orebody being mined.  These anomalies appear to suggest a geometry 
consistent with the known orebody and could suggest parallel 
mineralisation.  We are set to recommence the programme this coming 
quarter, though clearly we have already generated some exciting drill 
targets. 
 
   "Exploration and evaluation drilling underground continued with 
approximately 1,950 metres of diamond drilling completed.  This drilling 
is focusing on deeper drilling into inferred resources in the Senna, 
Pipocas and G3 veins in the Palito orebody, and similarly the down dip 
extension of the Main Vein in the Sao Chico orebody, with a view to 
converting substantial inferred resource to indicated status. 
 
   "Following the excellent operational performance of 2016, it is very 
pleasing to see this being continued with a very good first quarter. 
Grades coming out of the Sao Chico orebody have been excellent, the 
plant has processed record tonnages and the operation remains mill 
constrained.  The exploration results which indicate excellent anomalies 
adjacent to the Sao Chico orebody, are obviously very exciting for us, 
and we want to progress these as soon as is practical." 
 
   Results 
 
   Total production for the first quarter of 2017 was 9,861 ounces of gold, 
generated from the processing of the run of mine ("ROM") ore from the 
Palito and Sao Chico orebodies, combined with the Palito surface coarse 
ore and the stockpiled flotation tailings accumulated from Palito mine 
production in 2014. 
 
   Gold production for the first quarter came from the processing of 46,663 
tonnes of ore at overall combined grades of 7.09 g/t gold, which was 
sourced from mined ore from the Palito and Sao Chico orebodies, 
supplemented with lower grade surface stockpiled ROM and flotation 
tailings.  Mined tonnage for the quarter totalled 36,918 tonnes with a 
grade of 10.12 g/t of gold. 
 
   At 31 March 2017, there were coarse ore stocks of approximately 13,000 
tonnes with an average grade of 4.0 g/t of gold, and approximately 
17,000 tonnes of flotation tails with an average grade of 2.5 g/t of 
gold. This stock is being consumed, albeit not as quickly as forecast 
and for now the operation remains plant constrained. 
 
   A total of 2,251 metres of horizontal development has been completed 
during the quarter, of which 1,176 metres was ore development.  The 
balance is the ramp, cross cuts and stope preparation development. 
 
   2017 Guidance 
 
   The Company forecast 40,000 ounces of gold production for the year, with 
an AISC of between $950 and $975 per ounce, broadly in line with the 
cost guidance of 2016.  Gold production for the first quarter is in line 
with the Company's forecast. 
 
   The 2017 guidance of 40,000 ounces is an eight per cent improvement on 
Serabi's initial guidance for 2016 which was 37,000 ounces. Management 
hope that, with the production efficiencies and improvements that can be 
implemented in 2017, Serabi will again be able to improve on its 
production guidance, as it did in 2016, where the Company exceeded its 
initial guidance by 6.5 per cent to produce 39,390 ounces. 
 
 
 
 
                       Quarter  Quarter  Quarter  Quarter  Quarter 
                          1        1        2        3        4      Total    Total 
                        2017     2016     2016     2016     2016     2016     2015 
Horizontal 
 development 
 - Palito     Metres     1,669    1,900    1,910    1,607    1,928    7,345    6,800 
Horizontal 
 development 
 - Sao 
 Chico        Metres       582    1,025    1,031    1,042      696    3,794    2,800 
Horizontal 
 development 
 - Total      Metres     2,251    2,925    2,941    2,649    2,694   11,209    9,600 
 
Mined ore - 
 Palito       Tonnes    26,093   26,752   25,198   31,916   34,611  118,477  111,751 
 Gold grade (g/t)         9.07    11.84    10.48     9.52     7.38     9.62    10.05 
Mined ore - 
 Sao Chico    Tonnes    10,825   10,794    8,408   11,217    9,968   40,387   24,096 
 Gold grade (g/t)        12.64     9.00     6.81     9.88    14.38    10.12     8.66 
Mined ore - 
 Total        Tonnes    36,918   37,546   33,606   43,133   44,579  158,864  135,847 
 Gold grade (g/t)        10.12    11.02     9.56     9.61     8.94     9.74      9.8 
 
Milled ore    Tonnes    46,663   36,615   39,402   42,464   40,485  158,966  130,299 
 Gold grade (g/t)         7.09     8.58     8.17     8.08      7.6     8.11     8.43 
Gold 
 production   Ounces     9,861    9,771    9,896   10,310    9,413   39,390   32,629 
 
 
   1. Gold production figures are subject to amendment pending final agreed 
      assays of the gold content of the copper/gold concentrate and the gold 
      bullion when smelting and refining processes are completed. 
 
   2. Gold production totals for 2017 include treatment of 4,941 tonnes of 
      flotation tails (2016 full year: 16,716 tonnes) 
 
 

   This announcement is inside information for the purposes of Article 7 of 
Regulation 596/2014. 
 
   Enquiries: 
 
 
 
 
Serabi Gold plc 
Michael Hodgson                           Tel: [phone] 
Chief Executive                           Mobile: [phone] 
 
Clive Line                                Tel: [phone] 
Finance Director                          Mobile: [phone] 
 
Email: [e-mail] 
Website: www.serabigold.com 
 
Beaumont Cornish Limited 
 Nominated Adviser and Financial Adviser 
Roland Cornish                            Tel: [phone] 
Michael Cornish                           Tel: [phone] 
 
Peel Hunt LLP 
 UK Broker 
Matthew Armitt                            Tel: [phone] 
Ross Allister                             Tel: [phone] 
 
Blytheweigh 
 Public Relations 
Tim Blythe                                Tel: [phone] 
Camilla Horsfall                          Tel: [phone] 
 
 
   Copies of this announcement are available from the Company's website at 
www.serabigold.com. 
 
   Neither the Toronto Stock Exchange, nor any other securities regulatory 
authority, has approved or disapproved of the contents of this 
announcement. 
 
   GLOSSARY OF TERMS 
 
   The following is a glossary of technical terms: 
 
   "Au" means gold. 
 
   "assay" in economic geology, means to analyze the proportions of metal 
in a rock or overburden sample; to test an ore or mineral for 
composition, purity, weight or other properties of commercial interest. 
 
   "development" - excavations used to  establish access to the mineralised 
rock and other workings 
 
   "DNPM" is the Departamento Nacional de Produção Mineral. 
 
   "grade" is the concentration of mineral within the host rock typically 
quoted as grams per tonne (g/t), parts per million (ppm) or parts per 
billion (ppb). 
 
   "g/t" means grams per tonne. 
 
   "granodiorite" is an igneous intrusive rock similar to granite. 
 
   "igneous" is a rock that has solidified from molten material or magma. 
 
   "Intrusive" is a body of igneous rock that invades older rocks. 
 
   "on-lode development" - Development that is undertaken in and following 
the direction of the Vein 
 
   "mRL" - depth in metres measured relative to a fixed point - in the case 
of Palito and Sao Chico this is sea-level.  The mine entrance at Palito 
is at 250mRL. 
 
   "saprolite" is a weathered or decomposed clay-rich rock. 
 
   "stoping blocks" - a discrete area of mineralised rock established for 
planning and scheduling purposes that will be mined using one of the 
various stoping methods. 
 
   "vein" is a generic term to describe an occurrence of mineralised rock 
within an area of non-mineralised rock. 
 
   Qualified Persons Statement 
 
   The scientific and technical information contained within this 
announcement has been reviewed and approved by Michael Hodgson, a 
Director of the Company. Mr Hodgson is an Economic Geologist by training 
with over 26 years' experience in the mining industry. He holds a BSc 
(Hons) Geology, University of London, a MSc Mining Geology, University 
of Leicester and is a Fellow of the Institute of Materials, Minerals and 
Mining and a Chartered Engineer of the Engineering Council of UK, 
recognising him as both a Qualified Person for the purposes of Canadian 
National Instrument 43-101 and by the AIM Guidance Note on Mining and 
Oil & Gas Companies dated June 2009. 
 
   Forward Looking Statements 
 
   Certain statements in this announcement are, or may be deemed to be, 
forward looking statements. Forward looking statements are identified by 
their use of terms and phrases such as "believe", "could", "should" 
"envisage", "estimate", "intend", "may", "plan", "will" or 
the negative of those, variations or comparable expressions, including 
references to assumptions. These forward looking statements are not 
based on historical facts but rather on the Directors' current 
expectations and assumptions regarding the Company's future growth, 
results of operations, performance, future capital and other 
expenditures (including the amount, nature and sources of funding 
thereof), competitive advantages, business prospects and opportunities. 
Such forward looking statements reflect the Directors' current beliefs 
and assumptions and are based on information currently available to the 
Directors. A number of factors could cause actual results to differ 
materially from the results discussed in the forward looking statements 
including risks associated with vulnerability to general economic and 
business conditions, competition, environmental and other regulatory 
changes, actions by governmental authorities, the availability of 
capital markets, reliance on key personnel, uninsured and underinsured 
losses and other factors, many of which are beyond the control of the 
Company. Although any forward looking statements contained in this 
announcement are based upon what the Directors believe to be reasonable 
assumptions, the Company cannot assure investors that actual results 
will be consistent with such forward looking statements. 
 
   ENDS 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: Serabi Gold plc via Globenewswire 
 
 
  http://www.serabigold.com 
 

(END) Dow Jones Newswires

April 12, 2017 02:00 ET (06:00 GMT)

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