Newcore Gold: Advancing a Gold Project in Ghana with Favorable Economics

Key Concepts

• Newore Gold: A mining company advancing the Enti project in Ghana.
• Enti Project: A district-scale exploration project in Ghana.
• PEA (Preliminary Economic Assessment): An early-stage economic study for a mining project.
• PFS (Pre-Feasibility Study): A more detailed study than a PEA, assessing the technical and economic viability of a project.
• Feasibility Study: The most comprehensive study, providing detailed engineering and financial information for a project.
• Heap Leach Operation: A mining method where crushed ore is piled and leached with a chemical solution to extract metals.
• NPV (Net Present Value): A measure of the profitability of an investment, calculated by discounting future cash flows to their present value.
• IRR (Internal Rate of Return): The discount rate at which the NPV of all the cash flows from a project equals zero.
• Capex (Capital Expenditure): Funds used by a company to acquire, upgrade, and maintain physical assets.
• District Scale Exploration: Exploring a large area with the potential for multiple deposits.
• Jurisdiction: The legal and regulatory environment in which a mining project operates.

Newore Gold: Advancing the Enti Project in Ghana

Luke Alexander, CEO of Newore Gold, discusses the company's progress with the Enti project in Ghana. Newore Gold is focused on advancing this district-scale exploration project, which is underpinned by robust economics outlined in a 2024 PEA. The company is currently working towards a Pre-Feasibility Study (PFS) and simultaneously conducting 45,000 meters of drilling to explore the project's full potential.

Newore Gold emphasizes its alignment with shareholders, with management and the board owning 15% of the company and 55% institutional ownership from long-term focused mining and precious metals investors.

Enti Project Economics and Development Timeline

1. PEA Highlights (2024):

• Operation Type: Simple open-pit heap leach operation.
• Gold Price Assumption: $3,000 per ounce (considered conservative by Alexander).
• Key Metrics:
  • After-tax NPV: $970 million.
  • After-tax IRR: 136%.
  • Payback Period: Approximately half a year.
• Production: 122,000 ounces of gold per year over a 9-year mine life.
• Low Capex: A significant driver of economics, estimated at $106 million for the heap leach operation.
• Market Valuation: The company's market capitalization is approximately $125 million USD, trading at about 0.1 to 0.15 times the project's NPV.

2. Path to Production:

• Current Stage: Advancing from PEA to PFS.
• Next Steps:
  • Complete the PFS to further de-risk the project.
  • Complete a full Feasibility Study.
  • Secure project financing.
  • Commence construction.
• Projected Timeline:
  • Construction decision: Aiming for 2028.
  • Production: Potentially by 2029, considering a 15-month build time as outlined in the PEA.

Financial Position and Funding

• Current Cash: $10 million in the bank.
• Expected Additional Capital: An additional $10 million anticipated from warrant exercises at a price of $0.50, assuming a robust market.
• Funding Coverage:
  • Current funds cover the ongoing 45,000 meters of drilling and the PFS work.
  • The expected additional capital will enable the commencement of the Feasibility Study and expansion of drilling programs.
  • Newore Gold is well-funded through 2026.

Ghana: A Stable and Supportive Jurisdiction

• Jurisdictional Stability: Ghana is highlighted as a consistently stable jurisdiction, ranking highly in Africa for safety and free elections.
• Major Gold Producers: Four of the top 10 largest gold producers globally have significant operations in Ghana.
• Newmont's Investment: Newmont has invested an additional $1 billion into its AFO project, located north of Newore Gold's Enti project on the Sefwi Bibiani belt. Newmont considers the AFO project a cornerstone asset, underscoring Ghana's tier-one jurisdiction status.
• Government Support: There is strong government support in Ghana for advancing mining projects to production. The Enti project is recognized as one of the two most advanced-stage projects in the country.

Synthesis and Conclusion

Newore Gold is strategically positioned to advance its Enti project in Ghana towards production. The project's economics, as demonstrated in the PEA, are robust, with a low capex heap leach operation and significant NPV and IRR figures. The company's financial position is secure, covering near-term exploration and study requirements, with further capital expected to fund later-stage development. Ghana's stable political and regulatory environment, coupled with strong government support and the presence of major mining players, provides a favorable backdrop for Newore Gold's development plans. The company's timeline projects a construction decision in 2028 and potential production by 2029, offering significant upside potential for shareholders, especially given the current favorable gold price environment which enhances the project's already strong economics.