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OREZONE provides update on Bomboré project development and ongoing Sulphide Expansion Feasibility Study

OTTAWA, Feb. 21, 2019 (GLOBE NEWSWIRE) — Orezone Gold Corporation (ORE.V(“Orezone” or the “Company”) is pleased to provide an update on its development schedule and achievements at its 90%-owned Bomboré gold project (“Bomboré”) together with progress on its 2019 Sulphide Expansion Feasibility Study (“2019 FS”).

Project Development Update

The Company recently completed a detailed review of all project development and construction activities at Bomboré with the goal of optimizing the project development and expenditure schedules. Based on this review, the Company has prepared a new project development schedule that further minimizes project execution risks.

Specifically, the optimized development schedule provides a number of significant benefits including:

  • Additional flexibility in the implementation of the upfront Resettlement Action Plan (“RAP”) by extending the construction schedule to ensure the pace of home construction is readily achievable, thereby maximising local workforce training and hiring practices and maintaining the local community and government support.
  • Reduced operational risks and costs to the project’s main infrastructure:
    1. Off-Channel Reservoir (“OCR”) construction to meet the project’s production water demands will now preferentially commence in the dry season.
    2. Tailings Storage Facility (“TSF”) will consume less water for its dam embankment construction and will have a more simplified liner installation.
  • Improved capital deployment schedule for the project:
    1. 2019 burn rate significantly reduced with the Company fully-funded to January 2020.

The key aspect of the review that allowed for a later construction start was the decision to better coordinate the start of the OCR excavation before the onset of the rainy season. This OCR excavation will now commence in Q1-2020, concurrent with major plant earthworks and the TSF construction. Furthermore, with recent completion of the Front-End Engineering and Design (“FEED”) work, all major equipment lead delivery times have been fully identified and incorporated into the schedule as have major construction timeline requirements. The overall impact of this revised schedule is that commissioning and plant start up is now scheduled for Q2-2021.

As a result of this detailed review, the Company expects 2019 project expenditures to be significantly reduced from spending under the original project schedule. The Company is budgeted to spend US$25.2 million on project development for 2019 which will include costs for early stage construction works (e.g. main access roads and camp improvements), FEED completion, construction of Phase I RAP resettlement villages and associated infrastructure, and advancement of permitting efforts for the sulphide expansion and P17S satellite deposit. The Company anticipates a further spend of US$5.0 million for corporate G&A, the 2019 FS report, and project financing efforts.

With a 2018 year-end cash balance of over US$31 million, the Company is fully funded for this upcoming year which the Company will utilize to secure the remaining financing required to construct Bomboré.

RAP Construction Update

RAP construction is progressing with beaconing of houses on the main resettlement sites completed and brick fabrication by local construction contractors well-advanced in preparation for house construction as ongoing foundations are completed. The required Phase I RAP is scheduled for completion by November 2019 which will allow one additional crop harvest by local communities before relocation commences which has been very well-received by local community members.

The Company plans to provide ongoing details and photographs of RAP construction activities on its website throughout 2019.

Sulphide Expansion Feasibility Study Update

The independent 2019 FS is being completed by a team of highly qualified engineering and environmental firms: Lycopodium Minerals Canada Ltd. (study lead), AMC Mining Consultants (Canada) Ltd., Knight Piésold and Co., Roscoe Postle Associates Inc. (“RPA”), Base Metallurgical Laboratories Ltd., and Antea Group. RPA is updating the 2017 Mineral Resource Estimate to incorporate the previously excluded “Restricted Zones” and to expand the resource estimate at the high-grade P17S sulphide target for the additional drilling completed during the 2016 to 2018 period.

The 2019 FS will incorporate the combined oxide and sulphide circuits, and will be based on an expanded plant throughput of 5.2 million tonnes per annum (“Mtpa”) as opposed to the 4.5Mtpa used in the 2018 feasibility study. The sulphide plant will be constructed in Year 2 of oxide operations and sulphide feed will commence in Year 3 at a planned rate of 1.2Mtpa.

Recently completed metallurgical testwork has confirmed the ore grind and gold recoveries from work undertaken in earlier studies. Work indices and abrasion indices have also been confirmed for the various sulphide materials.

The current work for the 2019 FS includes detailed mine scheduling, water balance and waste rock storage designs, and an update of the environmental and permitting studies to provide essential data for the Environmental Social Impact Assessment (“ESIA”) update necessary to permit the expanded mine plan.

Maurice

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