Burbanks Drilling Unlocks Gold Value

Key Concepts

• Burbanks Deposit: A narrow, high-grade gold deposit, currently the largest resource base for the company.
• Resource Categories (JORC Code): Inferred, Indicated, and Measured – representing increasing levels of geological confidence.
• Ore Reserve: The economically mineable part of a Measured or Indicated Resource.
• Black Swan Plant: The processing plant intended to utilize ore from the Burbanks deposit.
• Resource Update: A re-evaluation of the mineral resource estimate based on new drilling data.
• Mining Studies: Analyses to determine the feasibility and optimal methods for extracting ore.

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Burbanks Deposit Drilling Results & Impact on Black Swan Plant

The recent drilling results from the Burbanks deposit are highly encouraging, demonstrating exceptionally high grades consistent with expectations for this narrow, high-grade deposit. These results are crucial for improving the quality of the resource base and ultimately enhancing the project economics for the Black Swan plant. The company views Burbanks as a “cornerstone asset” due to its size and grade.

Resource Base & Conversion to Reserves

Currently, the Burbanks deposit holds a resource base of 466,000 ounces of gold. However, a significant portion – the “large majority” – is classified as ‘Inferred’ under the JORC code. This represents the lowest level of confidence in the resource estimate. The primary focus of the current 15,000-meter drilling program is ‘infield drilling’ aimed at converting these Inferred resources into the higher confidence categories of ‘Indicated’ and ‘Measured’.

This conversion is critical because only Measured or Indicated Resources can be further converted into ‘Ore Reserves’ – the portion of the resource that is economically viable to mine. Improving the “quality of our ounce profile” through this conversion process directly translates to a more robust and economically attractive project.

Economic Benefits of Higher Grade Ore

The company emphasizes the direct correlation between ore grade and project economics. Higher grade ore processed through the Black Swan plant results in:

• More favorable economics: Increased profitability.
• Higher margins: Greater revenue per ounce of gold produced.
• Lower cost per ounce: Reduced operating expenses.
• Lower all-in sustaining costs: Decreased overall production costs.
• Increased ounce profile: The ability to produce a greater quantity of gold per quarter.

As stated, “The higher grade, higher margin ore you put through your plant, the better the economics, the lower the cost per ounce.”

Project Timeline & Future Work

The current drilling program is scheduled for completion in the March quarter. Following this, a resource update incorporating the new drilling data is planned for the June quarter. Subsequently, detailed mining studies will be conducted to determine the optimal methods for feeding ore from the Burbanks deposit into the Black Swan plant. The company expresses “quiet confidence” in achieving a successful conversion of resources to reserves.

Strategic Importance of Burbanks

Burbanks is not only the company’s largest resource base but also its highest grade deposit. The more high-grade results obtained and the more resources converted to reserves, the greater the volume of ore that can be processed through the Black Swan plant, maximizing its potential.