Prior to the acquisition by TVIRD, GRC was the Philippines affiliate of Red 5
Limited (“Red 5”) (ASX: RED), a Perth, Western
Australian-based gold company, the shares of which are listed on the
Australian Securities Exchange.
TVIRD completed its acquisition of 100% of the outstanding equity in GRC on
November 4, 2021. The
acquisition included:
- The Siana Gold Mine, as covered by Philippines MPSA No. 184-2002-XIII covering 3,289 hectares, which includes
the following project infrastructure:
- A modern 1.1mtpa Outotec mill, gravity and CIL mill facility commissioned in 2012 at a capital cost of U.S.
$54 million that includes a single stage SAG mill and 6 CIL tanks.
- Grid power with backup 8MW diesel fired power station.
- Administration building, warehouse, mess hall, camp facilities and accommodation, engineering building and
maintenance facilities.
- Mapawa Project, as covered by MPSA No. 280-2009-XIII covering 1,482 hectares.
- The Ferrer Claim, as covered by the Application for Mineral Production Sharing Agreement No. A000046 and
comprising of one Block of 595 hectares.
- Established government approvals and relationships with key stakeholders.
GRC acquired Siana in 2003 and commenced exploration work in 2004. A project feasibility study was subsequently completed by GRC in 2009 and all
necessary permits to construct and operate Siana were received in the same
year. Construction at the
mine site commenced in 2010 and the inaugural gold pour was achieved by GRC in
February 2012. TVIRD
understands that, to date, Siana has produced 149,203 ounces of gold and
199,669 ounces of silver while under the control of GRC, in addition to nearly
one million ounces of gold prior to its acquisition in 2003 by GRC.
Uncertainty surrounding the mining policy in the Philippines and difficulty
obtaining environmental permit approvals led Red 5 to suspend mining and
processing activities at Siana and to place the site on temporary standby in
April 2017. Ongoing
activities through suspension included dewatering of the open pit,
infrastructure maintenance and the monitoring of geotechnical issues.
Red 5 has advised TVIRD that GRC spent over US $200 million in its efforts to
develop Siana. TVIRD has also
been advised that all of the mining and processing facilities and required
permits are in place for re-commencement of operations. Siana has the only modern gold plant in the region with the potential to
establish Siana as a processing center for other nearby prospects/gold
deposits.
RESOURCES
Red 5 has previously published underground and open pit mineral resource and
mineral reserve estimates for Siana and mineral resource estimates for Mapawa.
These estimates, detailed below, were prepared using the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (the
"JORC Code" or "JORC 2012"). No estimates
for either Siana or Mapawa have been prepared using the 2014 definition
standards published by the Canadian Institute of Mining Metallurgy and
Petroleum ("CIM 2014 Standard") and no technical report
supporting this estimate has been prepared in accordance with NI 43-101. A
"qualified person" (as defined in NI 43-101) has not done sufficient work to
classify any of these mineral resource or mineral reserve estimates as
current. As a result, the Company is treating the following estimates as
historical in nature and not current mineral resources or mineral reserves,
and they should not be relied upon. There are certain differences between the
JORC Code and the CIM 2014 Standard described further below.
Red 5 announced on February 23, 2016 that Mining One Pty Ltd had completed a
JORC 2012 underground mineral resource and reserves estimate using a 2.4 g/t
gold cut-off that has been subsequently reviewed annually by Red 5 and most
recently confirmed in their Annual Report at June 30, 2020. Further to the ASX
announcement released by Red 5 on January 11, 2016, the database for the Siana
resource estimate included 109 holes and approximately 47,300 meters in
addition to 79 historic holes drilled by Suricon between 1980 and 1990 for
approximately 10,600 meters. The database also includes a further 10,417 grade
control channel samples conducted by GRC prior to April 2013.
The Red 5 2020 Annual Report at June 30, 2020 reports the JORC 2012
underground mineral resource and reserves estimate to be:
In the Red 5 Annual Report at June 30, 2020, and due to what Red 5 has
reported as pending construction of additional tailings storage capacity, no
updated JORC 2012 reserve estimate is reported for the Siana open pit as at
that date. As such, Red 5 has reported the open pit mineral resource and
reserve estimate at June 30, 2020 to be:
In summary, and further to the above tables as included in the Red 5 2020
Annual Report, the Siana open pit and underground mine have at June 30, 2020,
a combined Indicated JORC 2012 mineral resource estimate of 4.3Mt @ 4.6 g/t Au
and 6.8 g/t Ag and combined Inferred JORC 2012 mineral resource estimate of
0.5Mt @ 8.9 g/t Au and 10.6 g/t Ag. TVI is not treating this as a current
mineral resource under NI 43-101 as a qualified person has not done sufficient
work to classify the historical estimate as current, and the estimates should
not be relied upon.
Mining One Pty Ltd, with offices in Australia, China, Indonesia and Canada,
has extensive experience in the Philippines, Papua New Guinea, Indonesia,
Africa, South America and China and with underground and open pit mines across
a broad range of commodities. They are involved in planning, supervision,
project management, studies, geology, contracts, financing and corporate
assistance and advice and their clients have included, among others, BHP, Rio
Tinto, Glencore. Alcoa, Anglo American, Anglo Gold Ashanti, Barrick.
Siana Open Pit and Underground Feasibility Study Results
Red 5, together with GRC, has engaged various mining engineering firms since
2009 to complete numerous Feasibility Studies that have been publicly
disclosed. These studies were prepared using the JORC Code. Qualified persons
have not done sufficient work under NI 43-101 to verify the results of these
studies or render them current and complete under NI 43-101, and therefore
details of these reports are not included here.
TVIRD is presently assessing GRC's mine development and production plan for
Siana in order to develop its own plan in furtherance of a potential
recommencement of operations.
Mining History at the Mapawa Gold Project:
GRC also holds a 100% interest in Mapawa under MPSA No. 280-2009-XIII covering
1,482 hectares and located as well in Surigao del Norte, Philippines. Mapawa
is located 20 kilometers north of Siana and has the potential to be developed
as a satellite source of ore feed for the Siana processing plant. Red 5
reported in the 2016 Annual Report that Mapawa hosts a known gold porphyry
system with a number of significant gold occurrences throughout the project
area and thereby considered the area to have significant potential.
Red 5 announced on June 14, 2016 that an inaugural JORC 2012 mineral resource
estimate had been completed for Mapawa by Optiro Pty. Ltd., an independent
group of Australian geological consultants who reported the following on a dry
tonne basis based on a 0.7g/t gold cut-off and taking into account historic
mining depletion:
Red 5 reported that the Mapawa JORC 2012 mineral resource estimate was
calculated based on a total of 78 diamond core drill-holes totaling 13,798
meters of drilling, comprising 5,628 meters of historical drilling completed
by Suricon and 8,170 meters of additional diamond drilling completed by
GRC.
Opitro Pty. Ltd. Is an advisory services firm with extensive geological,
mining engineering, metallurgical and financial expertise that provides
strategic, independent advice to mining and exploration companies, their
advisors and investors. Their consultants are recognized competent persons
under JORC and other international standards and have published numerous
reports supporting listings on the ASX, TSX, LSE, NYSE and various other stock
exchanges around the world.
As noted above, TVI is not treating the estimates reported for Siana and
Mapawa as current mineral resources as a qualified person acting in compliance
with NI 43-101 reporting requirements has not done sufficient work to classify
these estimates as current resources, has not verified this information and
these estimates should not be relied upon The historical estimates are
believed to be based on reasonable assumptions, and neither the Company nor
the qualified person responsible for the scientific and technical content of
the summary provided here has any reason to contest their relevance and
reliability.
TVIRD currently does not plan to conduct any work to verify the historical
estimates other than using them to guide its exploration, resource modeling
and possible development work.
TVIRD is presently assessing the GRC resource model, mine development and
production plan for Siana in order to develop its own plan in furtherance of a
potential recommencement of operations. TVIRD is evaluating steps that would
be required to upgrade or verify the foregoing historical estimates as current
under NI 43-101 standards, which would include a review of past drill results
and Quality Assurance/Quality Control procedures applied as well as possibly
resource modeling with the involvement of a qualified person. To that regard,
the TVIRD Exploration team has also commenced a review of past drilling data
of GRC that includes a total of 558 drillholes with an aggregate of 80,705.33
meters total meterage. Of the total drillholes included in the drill database
file, only 504 drillholes have complete log data in the database which equates
to 77,789.71 meters.
Additional information related to Siana and Mapawa may be found on the TVIRD
website at https://tvird.com.ph/.
HISTORICAL OPERATIONS
Siana is located in Tubod, Surigao del Norte, approximately 35 kilometers from
Surigao City, and is covered by MPSA No. 184-2002-XIII that extends over 3,289
hectares of land near Lake Mainit. The MPSA was granted on December 11, 2002
and registered with the Philippine Mines and Geoscience Bureau
("MGB") on December 27, 2002 for a term of 25 years. Siana is
located along the Surigao Valley Fault, a major mineral structure, which is a
part of the major Philippine Fault or Rift Zone. The Rift Zone constitutes
multiple epithermal gold and porphyry-type copper-gold mineral deposits.
Mining operations have been conducted at Siana since the early 1900's, with
major commercial underground mining conducted by the Philippine company,
Suricon Consolidated Mining Company ("Suricon"), from 1938 to
1960 followed by open pit mining from 1980 to 1991.
Siana had produced nearly one million ounces of gold prior to its acquisition
in 2003 by Red 5's Philippine affiliated company, GRC. GRC acquired 100% of
Siana in 2003, commenced exploration work on Siana in 2004, completed a
project feasibility study in 2009 and received all necessary permits to
construct and operate by 2009.
Construction at the mine site commenced in 2010 and the inaugural gold pour
was achieved in February 2012.
Siana was subsequently placed voluntarily by GRC on care and maintenance in
April 2013, when a superficial crack was noted in the external wall of one of
the tailings dams ("TSF4"). There was, however, no tailings spill and the
incident was therefore considered environmentally benign. In order to mitigate
any potential environmental risk, the MGB imposed a cease-and-desist order
("CDO") in June 2013, which could not be rescinded until
completion of structural repairs and improvements to tailings storage
facilities. GRC completed the works in January 2015 and the MGB subsequently
lifted the CDO in January 2015, thereby allowing commercial operations to
resume in February 2015.
Uncertainty surrounding the mining policy in the Philippines and difficulty
obtaining environmental permit approvals led Red 5 to again suspend mining and
processing activities at Siana and to place the site on temporary standby in
April 2017. Red 5 stated in an ASX announcement on April 18, 2017 that it
believed the suspension to be the best way to preserve "the significant
inherent value of the large in-situ gold inventory and high-quality
infrastructure" at the site and that the decision was made because of the
operational impact "which the current uncertainty regarding regulatory and
government mining policy in the Philippines has had on the group's
operations." Ongoing activities through suspension have included dewatering of
the open pit, infrastructure maintenance and monitoring of geotechnical
issues.
TVIRD understands that Siana produced 149,203 ounces of gold and 199,669
ounces of silver, in addition to nearly one million ounces of gold prior to
its acquisition in 2003 by GRC.
|
View of the Siana open pit Stage 4 West wall looking north.
Source: Red 5 Limited December 2015 Quarterly Activities Report, dated
Jan.22.2016.
|
|
Mining west wall at Siana Gold Project.
Source: Red 5 Limited September 2015 Quarterly Activities Report.
|
Material mined from the Siana open pit was processed onsite at the Siana CIL
gold processing plant that has a design capacity of 1.1 mtpa. TVIRD
understands that processing recoveries reported by GRC prior to the
acquisition of Siana by TVIRD have been between 75 to 85% for gold and 40 to
45% for silver. The plant comprises single stage crushing, SAG milling,
gravity concentration and high intensity cyanidation, leaching and adsorption
(CIL), followed by carbon elution and electrowinning to produce combined gold
and silver doré. Tailings from the cyanide leach area are treated in a
detoxification circuit to minimize cyanide concentration prior to discharge to
the TSF. Red 5 has advised TVIRD that GRC has spent over US $200 million in
its efforts to develop Siana.
Underground mine development commenced prior to the acquisition of Siana by
TVIRD with 445m of development completed, three portals developed and the
establishment of several critical surface infrastructures for the mining
operations.
|
|
|
|
Construction of main access portal at the Siana Underground Mine.
Source: Red 5 Limited March 2017 Quarterly
Activities Report, dated April 28, 2017.
|
|
|
Current underground portals at Siana, April 2023, including Main Access, Exhaust Way and Return/Escape Way.
|
|
CURRENT ACTIVITIES
With all required permits in place for re-commencement of operations,
rehabilitation of the processing plant at Siana has proceeded and has included
the restoration and repair of the plant equipment. Soft-commissioning of the
plant commenced on December 9, 2022, and is ongoing.
Through to July 31, 2023, the amount of low-grade stockpile mineralized
material milled has been 323,763 tonnes with an average grade of 0.69 g/t Au
and 4.26 g/t Ag, averaging through the same period a plant utilization of 71%
and an average throughput of 1,800 tpd. A total of 592 kilograms of
doré containing 5,870 ounces of Au and 12,806 ounces of Ag have been
smelted and a total of 450 kilograms of doré containing 5,124 ounces of
Au and 8,998 ounces of silver have been shipped through the period of
soft-commissioning as at July 31, 2023.
Key areas of focus continue to be the dewatering of the pit and the
reconditioning and commissioning of the Process Plant. The construction of
TSF-6 continues to make significant progress where permission of the TSF
Engineer has been given to start utilizing the facility for mill tails
deposition while continuing to complete the embankment.
As noted previously also, the TVIRD Exploration team has commenced a review of
past drilling data of GRC that includes a total of 558 drillholes with an
aggregate of 80,705.33 meters total meterage. Of the total drillholes included
in the drill database file, only 504 drillholes have complete log data in the
database which equates to 77,789.71 meters.
TSF6 embankment - October, 2022.
TSF-6, where a piezometer has been installed and emergency spillway construction is proceeding – July 2023
TSF6 embankment works - July, 2023
TSF6 on September 8, 2023
The Siana Gold Processing Plant – April 2023
Visit to Siana Gold Plant by the Canadian Ambassador, Mr. David Hartman, May 29-30, 2023.
The Siana assay lab became operational in July 2022.