Jun 26 2013
Continental Gold Limited ("Continental" or the "Company") is pleased to provide a development update for its Buriticá project in Antioquia, Colombia. The Company remains debt-free and well-funded with approximately $145 million of cash in its treasury, and is spending approximately $3.5 million per month - increasing to $4 million per month by the fourth quarter of 2013.
- Successful integration of 12 individual licences into one new 1,894-hectare exploitation (mining) licence valid for 30 years (until March 30, 2043). This exploitation licence covers essentially all of the Yaraguá and Veta Sur vein deposits and their potential exploration extensions.
- On track to submit the second and final modification required to the existing Environmental Impact Assessment to Corantioquia at the beginning of the fourth quarter of 2013.
- Well ahead of schedule in purchasing surface rights in advance of a construction decision in 2014, owning approximately 90% of the total areas required.
- Geotechnical, hydrological, metallurgical and electrical studies continue to advance smoothly ahead of a pre-feasibility study ("PFS") scheduled for 2014, prepared in accordance with National Instrument 43-101 ("NI 43-101"). Of particular importance are preliminary geotechnical study results indicating that future infrastructure will not have to be secured through piling to bedrock, but rather can be stabilized with in-situ cement-based reinforcement into the colluvium material in the Higabra Valley.
- Planned construction of a 3.5-metre x 3.5-metre ramp towards the Yaraguá deposit will commence on schedule early in the fourth quarter of 2013. A dirt access road and surface work located at the planned box-cut location of the ramp are already progressing. This ramp will be the final surface access point required to prepare the project for future production, subject to delivery of a successful PFS in 2014 (see Figures 1 and 2).
- Both the Higabra Valley tunnel and the Veta Sur ramp continue to progress within budgeted parameters with approximately 300 metres and 525 metres completed, respectively (see Figures 1 and 2).
- Construction of a six-kilometre two-lane paved road will commence in the fourth quarter of 2013, connecting the existing two-lane paved road traversing Buriticá with the Higabra Valley future infrastructure site. This construction is expected to take 12-18 months to be completed (see Figure 2).
"Continental is in the fortunate position of being well-funded and endowed with a high-grade multi-million ounce precious metal project," commented Ari Sussman, CEO. "In these challenging times for the natural resources industry where work programs on metals projects for the majority of the industry are either slowing down or stalling completely, Continental plans to continue on with its plans at Buriticá. We intend to emerge from these difficult economic times an even stronger company than we are today, with a project that is further de-risked and advanced towards ultimate production. Furthermore, in this time frame, we fully intend to deliver robust growth to our total number of mineral resource ounces while simultaneously upgrading the ounce-quality of the deposit by converting existing inferred ounces into the measured and indicated categories under NI 43-101 guidelines."
With the PFS progressing towards completion in 2014, Continental is rapidly advancing on a number of critical items required ahead of the formal construction decision, which will be based on the success of the PFS.
The Company remains on track to submit to Corantioquia, at the beginning of the fourth quarter of 2013, the second and final modification to its existing Environmental Impact Assessment. Corantioquia is the Autonomous Regional Corporation responsible for issuing and controlling environmental permits in Antioquia, and is the same agency that approved the Company's first environmental permit modification on August 30, 2012. The Company continues to meet with Corantioquia on a regular basis in order to update them on the modification plans ahead of the formal submission in the fourth quarter.
Empresas Públicas de Medellín ("EPM") approved the Company's proposal to connect to EPM's substation at Chorodó, Antioquia, located 32.5 kilometres from the proposed infrastructure site, with a 110-kilo volt line and an estimated power consumption requirement of up to 12 megavolt amps. Pre-feasibility stage engineering for this project is underway.
Engineering is progressing ahead of schedule on the selected water management solutions for the future infrastructure site in the Higabra Valley, and costing will be completed ahead of the PFS in 2014.
A preliminary geotechnical study concluded that the processing plant foundations in the Higabra Valley will not have to be piled to bedrock. The colluvium in the Higabra Valley is consolidated enough for in-situ cement-based reinforcement. Engineering will begin shortly to design and cost this initiative ahead of the PFS and it is expected that this alternative will be less costly than piling to bedrock depths of up to 60 metres.
Underground development at the Veta Sur ramp and the Higabra Valley tunnel continues with advances completed to date of approximately 525 metres and 300 metres, respectively. The overall development budget is in line with the Veta Sur ramp being approximately 15% under budget and the Higabra Valley tunnel being 20% over budget. Although difficult ground conditions were anticipated in the Higabra Valley, development has progressed slightly slower than expected. The Higabra Valley tunnel will continue to advance slowly for another 300-350 metres in fractured basalts until encountering the Tonusco fault, which will require an additional 50-60 metres of development to cross. At this point, the development will enter the same highly-competent andesitic rock package currently present at the Yaraguá Mine, where 4,000 lateral metres x 150 vertical metres of development has been completed on a small scale since 1992. Once development crosses the Tonusco fault, the Company does not anticipate any future requirement to advance in fractured basalts (see Figures 1 and 2).
The third working front at Buriticá, located at the Yaraguá Mine, is currently on schedule for ramp development beginning early in the fourth quarter of 2013. Presently, an access road to the portal is being constructed and pre-development work for the portal box-cut is underway. The size of this ramp will be 3.5-metres x 3.5-metres at a -13% gradient and, in similar fashion to the other two working fronts presently advancing, will provide vital underground drill-access locations. Drilling is expected to commence from this ramp in early 2014. The Yaraguá ramp is the third and final access point from surface required to prepare Buriticá for eventual production subject to a positive PFS in 2014 (see Figures 1 and 2).
The Company successfully integrated 12 individual licences at Buriticá into one new exploitation licence. This 1,894-hectare licence is valid for 30 years, expiring on March 30, 2043, and covers essentially all of the Yaraguá and Veta Sur vein deposits and their potential exploration extensions.
In addition, the Company has purchased approximately 90% of the land required for future infrastructure and remains on track and within budget to complete the remaining land purchases ahead of construction.
The Company is preparing to begin the construction of a six-kilometre paved road connecting the existing two-lane paved road that traverses Buriticá to the Higabra Valley, where future infrastructure is planned. Construction is expected to begin in October 2013 and is estimated to take 12-18 months to complete (see Figure 2).