Overview
The following is a time progression of development of the Balabag Gold Project from January 2020 through to November 21, 2020:
Aerial view of Mill Plant Site of the Balabag Gold Project in August 2019.
Aerial view of Mill Plant Site of the Balabag Gold Project on January 27, 2020.
Aerial view of Mill Plant Site of the Balabag Gold Project on May 31, 2020.
Aerial view of Mill Plant Site of the Balabag Gold Project on November 15, 2020.
TVIRD owns 100% of the Balabag project. The project covers a 4,779-hectare Mineral Processing Sharing Agreement (“MPSA”) located in the municipalities of Bayog, Zamboanga Del Sur and Zamboanga Sibugay Province, Island of Mindanao, Philippines. The project is situated approximately 75 kilometers (47 miles) east-northeast of TVIRD’s Canatuan mine.
TVI Pacific announced on November 22, 2019 that TVIRD had officially determined to advance its Balabag gold and silver mining project towards commercial production and is progressing with various development works. The production decision followed the closing and first drawdown by TVIRD, announced on October 22 and October 24, 2019, respectively, of a US$28.5 million term loan facility (the “Facility”) with China Banking Corporation. The Facility has been provided specifically to finance construction of infrastructure at the Balabag project and is expected to be sufficient to enable Balabag to become operational while the remaining capex until the end of mine life will be funded by the Balabag operations. Prior to the first drawdown, TVIRD funded development works with internally generated funds which equate to approximately US $14.5 million, including the cost of Canatuan equipment that has been decommissioned and fully rehabilitated for use at Balabag to reduce overall capital expenditures.
On May 12, 2020, TVI Pacific announced that TVIRD had completed its seventh and final drawdown under the Facility provided by China Banking Corporation to bring the total drawn to date equal to the total of the available Facility at US $28.5 million. The remaining balance of the drawn funds are now held within the accounts of TVIRD and are managed directly to fund contractor and equipment suppliers as commitments come due. TVI Pacific does not currently have any spending commitments with respect to Balabag whatsoever. TVIRD is not funded by new shareholder capital or shareholder loans and TVIRD does not have the contractual right to compel TVI Pacific to provide any funding. As mentioned previously, it is expected that the Facility described above to finance construction of infrastructure at the Balabag project will be sufficient to enable Balabag to become operational while the remaining capex until the end of mine life will be funded by the Balabag operations.
Resources
Based on results of drilling completed to the end of June 2011 and as included in the Balabag NI 43-101 technical report dated June 23, 2012, the current indicated mineral resource is estimated to be 1.78 million tonnes averaging 2.34 g/t gold and 72.3 g/t silver, containing 134,262 ounces of gold and 4,148,196 ounces of silver.
TVI Pacific released on October 18, 2019 an updated NI 43-101 entitled “NI 43-101 Technical Report: Balabag Gold and Silver Project, Balabag, Depore, Zamboanga del Sur, Philippines” but at the request of the Investment Industry Regulatory Organization of Canada (“IIROC”) issued an announcement on November 22, 2019 to clarify and retract certain disclosure contained in the related press release as well as the updated Technical Report itself. The press release referenced this updated Technical Report and stated that certain scientific and technical information noted in the press release was based on information provided by technical personnel of TVIRD, as supported by a mine visit in April 2019 by the Company's nominated Qualified Person who had authored the Report. As stated in the Company’s press release of November 22, 2019, the updated Technical Report filed on SEDAR on October 18, 2019 was not prepared in compliance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Specifically, certain components of the updated Technical Report, including the mineral resource estimate on which it is based, were not prepared independently of TVIRD and therefore were not prepared in accordance with the requirements of NI 43-101. The Company has therefore withdrawn the scientific and technical disclosure set out in the press release and readers are cautioned that the scientific and technical disclosure set out in that press release, and the Report itself, should not be relied upon to the extent the disclosure was not in compliance with NI 43-101 criteria.
The Company is continuing to evaluate steps that it may take to establish a NI 43-101-compliant basis for future scientific and technical disclosure concerning Balabag. In the interim, the Company, as a minority shareholder of TVIRD, expects to continue to support TVIRD in its efforts to construct required infrastructure for the Balabag project.
The Company wishes to clarify also that in making the decision to put Balabag into production, TVIRD, a Philippine corporation that the Company does not control, relied exclusively on technical and economic analysis prepared under Philippine regulations and did not rely on TVI's updated Technical Report of October 18th, 2019 or any feasibility study classifying mineral reserves prepared in accordance with NI 43-101. Historically such projects have a much higher risk of economic and technical failure.
Please click here to see the NI43-101 technical report dated June 23, 2012 entitled "NI 43-101 Technical Report on the Balabag Gold Project, Zamboanga Province, Philippines”.
Development
As reported earlier, TVI Pacific announced on November 22, 2019 that TVIRD has officially determined to advance its Balabag gold and silver mining project towards commercial production and is progressing with various development works. This follows receipt in October 2013 of the Environmental Compliance Certificate (“ECC”) and in April 2016 the Declaration of Mining Project Feasibility (“DMPF”) as well as the Special Tree-Cutting and Earth Balling Permit from the Forest Management Bureau (“FMB”) of the Department of Energy and Natural Resources (“DENR”) in May 2018.
TVIRD awarded the contract in 2019 to undertake a design review and to provide construction supervision services for the Balabag Tailings Storage Facility (“TSF”) to GHD Pty Ltd, one of the world's leading professional services companies operating in the global markets of water, energy and resources, environment, property and buildings, and transportation and work is progressing.
Development work is proceeding under the direction of Mr. Yulo Perez, President of TVIRD, who previously led mine development works and operations at TVIRD's successful Canatuan mine Phases 1 (Gold/Silver) and 2 (Copper/Zinc) as Vice-President of Operations and Chief Operations Officer of TVIRD. Mr. Perez helped contribute to the receipt by TVIRD of multiple awards from the Philippine government and leading mining industry associations.
Project development continues to move forward as evidenced in the following photos:
Aerial view of the Mill Plant on November 15, 2020.
As at November 15, 2020, the crushing area is complete while in the grinding area the electrical and rotation testing of semi-autogenous and ball mill motors is proceeding in addition to the relining of ball mills. The primary and secondary cyclone is ready for hydrotesting.
As at November 15, 2020, the flotation area is complete, having completed also hydrotesting and rotor testing.
Views of the Leach Concentrate tank area on November 14, 2020 where hydrotesting has been fully completed. Electrical installation is ongoing.
Views of the Carbon in Leach area on November 14, 2020 where hydrotesting is ongoing with testing of 5 out of 7 tanks and the tails thickener already completed. Electrical installation has been completed while piping works are continuing.
Views of the Merrill Crowe circuit on November 14, 2020 where the roofing structure is being installed and piping and instrumentation work is ongoing. The Merrill Crowe is a separation technique for removing gold from the solution obtained by the cyanide leaching of gold ores.
Views of the Administration building (upper left), warehouse and mechanical shop (center), laboratory and gold room (center right) and cyanide storage building (lower left) on October 17, 2020.
Views of the Gold room on November 21, 2020 where construction of the reinforced concrete wall and roof installation is continuing.
Administration building on November 21, 2020 where painting works are continuing.
Permanent camp facility at November 21, 2020 where the junior staff house, ladies’ dormitory and managers’ quarters have been completed and work on the canteen and superintendent building is continuing.
View of Tailings Storage Facility (“TSF”) on November 23, 2020, where the stripping and removal of waste materials as well as the placement, spreading and compaction of numerous layers continue. Progress has been affected in part by above average rainfall.
Exploration
As of November 2020, 348 holes have been drilled for a total of 37,910 meters under the resource definition drilling program at the Balabag Project. Twenty-five drill holes with a total meterage of 1,884 meters were completed for the Phase 3 drilling program. Lithological logs and assay results from Phase 3 drilling confirm the extent of gold mineralization in the Unao-Unao area with notable presence of sulphide minerals. An updated geological interpretation in Lalab confirms a semi-vertical vein striking northeast, extending toward Unao-Unao. Drill intercepts at the center of the deposit also confirmed vein continuity in Miswi both near surface and at depth. Miswi veins are gently dipping with the occurrence of semi-vertical veins at a deeper level. New data from Phase 3 drilling has resulted in higher confidence in the geometry of the mineralized veins. The true veins were classified into three domain types, depending on the vein texture and geochemical trend. On the other hand, the quartz stockworks were sub-divided into two domains which separate the barren from mineralized stockworks. Refinement of the Balabag orebody model is ongoing with the objective of updating the mineral resource estimate. The resource model shall include the drill hole dataset up through Phase 3 drilling.
Meanwhile, included in the overall drilling statistics are 27 holes with total meterage of 1,725 meters, completed under the Phase 4 drilling program. Portions of Lalab to the south, Miswi and Mossad (north of Balabag Hill) are the main target for this drilling activity. The main objective of the Phase 4 drilling is to further delineate vein extensions at depth and outside the current resource boundary.
For more information, please visit TVIRD’s website at www.tvird.com.ph.