2014-01-13 13:12:24 -
Vancouver, British Columbia CANADA, January 13, 2014 /FSC/ - Sunridge Gold Corp. (SGC: TSX.V/SGCNF: OTCQX),(the "Company" or "Sunridge") is pleased to provide an outlook on some of the Company's activities planned for 2014 which is expected to be an important year for the Company as it anticipates passing a significant number of milestones as it drives its Asmara Project in Eritrea as rapidly as possible towards production. Some of these milestones and other salient points for the year are as follows:
* Mining License: The permitting process for the Asmara mine was initiated last month with the submittal to the Ministry of Energy and Mines of the summary of the Social and Environmental Impact Assessment (SEIA) report for the Asmara
Project. The permitting process to acquire the mining license is expected to take nine to twelve months.
* ENAMCO: Negotiations continue with Eritrean National Mining Corporation ("ENAMCO") to determine the price they will pay to the Company to purchase 30% of the Asmara Project from the Company. Management of the Company is encouraged with progress made in discussions late in 2013 and it is expected that these negotiations will be completed in early 2014. The time taken to negotiate this settlement is consistent with the time it took other companies to negotiate similar settlements with ENAMCO.
* Project Financing: A project information memorandum was disseminated to a group of potential debt financing lenders in late 2013. This group included commercial and development banks, export credit agencies and equipment suppliers, commodity off-take companies and royalty and streaming groups. At this stage several financing options are under consideration including conventional senior secured project related debt facilities and subordinated debt. Sunridge's management will be continuing discussions with potential lending groups during the first quarter of 2014 with expectations of indicative term sheets to be delivered from the groups by the second half 2014 for consideration. The consulting group Micon International Limited has recently completed an independent "due diligence" review of the Asmara Project which is now available to these potential lenders.
* Engineering: Eligible engineering firm candidates for engineering, procurement and construction management (EPCM) of the Asmara mine were identified in late 2013. Tendering on the EPCM is expected in mid 2014 with basic design work beginning soon after the award of a contract to the successful firm.
* Eritrean Mining Update: Over the past year the mining economy of Eritrea has taken great strides with the Bisha mine recently passing its third anniversary of production. After more than 2 years of very successful gold production from the close to surface oxide gold zone, Nevsun has recently reported that the mine has completed the copper expansion project on-time and produced 36 million pounds of copper in Q4 2013. These concentrates are being trucked to the port of Massawa where they are transferred to bulk handling ships in the same way as is planned for the Asmara mine. In addition, construction is underway on what will be the second operating mine in the country - the Koka gold mine, part of the Zara Project located in north central Eritrea. Both projects are fully supported by the government of Eritrea through a 40% interest held by the state mining company ENAMCO who is also responsible for a third of all capital and operating costs.
* Appointment of Financial Advisor: Since publication of the results of the feasibility study in May 2013, Sunridge has been approached by a number of companies interested in acquiring all or part of the Asmara Project or possibly the Company. As a result Sunridge has engaged a Canadian Investment Banker to act as advisor on such potential transactions. The Company continues discussions with a number of interested parties. There can be no assurance that any transaction will occur, or as to the timing, structure or terms of any transaction.
Asmara Project Feasibility Study Summary
The Asmara Project feasibility study (the "Study") was completed last May and demonstrated that the mining of four of the six deposits that make up the Asmara Project (Emba Derho, Adi Nefas, Gupo Gold and Debarwa) and processing of the ore at a central location near the large Emba Derho deposit is economically robust with a pre-tax net present value ("NPV") of $692 million (using a 10% discount rate) and with a pre-tax internal rate of return ("IRR") of 34%. The Study outlines a three-phase start-up mining operation which would initiate production in 2015 starting with high-grade copper and gold direct shipping ore production from the Debarwa deposit and heap-leaching of near surface gold, followed by supergene copper production, then zinc and copper at a full production rate of 4 million tonnes per year. At full production, the mine will produce an average annual production of 65 million lbs (29,000 t) copper, 184 million lbs. (83,000 t) zinc, 42,000 oz gold, and 1 million oz silver over the first 8 years. The life of mine is 17 years.
Important Milestones Achieved
Over the past two years Sunridge has passed a number of important milestones as it moves the Asmara Project through the development stage towards production. These are highlighted as follows:
* April 2012 - Final resource estimates completed on 4 advanced deposits on the Asmara Project
* May 2012 - Prefeasibility Study completed on 4 advanced deposits on the Asmara Project (NPV(10) $555m)
* July 2012 - ENAMCO exercised right to purchase 30% of Asmara Project
* October 2012 - Completed a $10.8m financing
* December 2012 - Initial resource estimate completed at Adi Rassi copper-gold deposit (pipeline project)
* May 2013 - Feasibility Study completed on 4 advanced deposits on the Asmara Project (NPV(10) $692m)
* May 2013 - Initial resource estimate completed at Kodadu Gold deposit (pipeline project)
* October 2013 - Completed a $6.5m financing
* December 2013 - SEIA submitted, permitting process begins
Michael Hopley, President and CEO of Sunridge Gold Corp. is the Company's Qualified Person responsible for the contents of this press release and has reviewed the information in the release and confirmed that it is consistent with that provided by the independent Qualified Person responsible for the Study.
Sunridge is a mineral exploration and development company focused on the acquisition, exploration, discovery and development of base and precious metal projects on the Asmara Project in Eritrea. Sunridge currently has approximately 210 million shares outstanding and trades on the TSX Venture Exchange under the symbol SGC. For additional information on the Company and its projects please view the slide show on our website at www.sunridgegold.com or call Greg Davis at the number listed below.
SUNRIDGE GOLD CORP.
For further information contact:
Michael Hopley, President and Chief Executive Officer
Greg Davis, VP Business Development
Tel: 604-688-1263 (direct)
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.This news release contains forward-looking statements that are based on the Company's current expectations and estimates. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "suggest", "indicate" and other similar words or statements that certain events or conditions "may" or "will" occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Forward looking statements may include the timing and success of any application for a mining license or of debt financing, completion of negotiations with ENAMCO, and the likelihood of receiving acquisition proposals. Risk and uncertain factors include, among others: the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans to continue to be refined; possible variations in ore grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, a mining license, or debt financing, uncertainties in negotiating commercial arrangements with government entities; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
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Source: Sunridge Gold Corp. (TSX-V SGC) www.sunridgegold.com
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