Lionsgold Limited Indian Gold Portfolio Valuation and Project Update (7407G)
31 5월 2017 - 11:38PM
UK Regulatory
TIDMLION
RNS Number : 7407G
Lionsgold Limited
31 May 2017
Lionsgold Limited
Indian Gold Portfolio Valuation and
Project Update
Lionsgold Limited ("Lionsgold", "LION" or the "Company"), the
gold-focused exploration company with assets in India and Finland
and a significant shareholder of a physical gold ownership online
exchange, is pleased to announce the results of the Independent
Valuation Report (the "Valuation Report") by Golder Associates Pty
Ltd ("Golder") of the Indian gold exploration assets, excluding
those at Jonnagiri, held by Geomysore Services India Pvt Ltd
("Geomysore") in which Lionsgold holds a 20.5% interest.
The Valuation Report undertaken by Golder comprises gold
exploration areas held by Geomysore through either approved
Prospecting Licence ("PL"), Prospecting Licence in Application
("PLA") or Mining Licences in Application ("MLA"), but excludes the
value attributable to the Jonnagiri Project ("Jonnagiri"). As
previously announced, Jonnagiri has a JORC-compliant resource of
361,000 ounces of gold and Geoymysore is conducting an economic
feasibility study ("EFS") in respect of a 'decision to mine' and
the building of an open pit gold mine at Jonnagiri in India, for
which Geomysore has been granted a 30-year mining licence ("ML") to
mine 365,000 tonnes of gold ore per annum. An update in relation to
Jonnagiri Project and the EFS is set out below.
Golder has assessed Geomysore's gold exploration assets
(excluding Jonnagiri) covering a total area in excess of 900km(2) .
They comprise 36 PLs, PLAs and MLAs that predominantly cover
greenstone belt areas in southern and central parts of India, with
the main groupings of the licences and applications found in the
Kolar and Jagular regions in the states of Andhra Pradesh and
Karnataka respectively. Golder determined the total value of the
gold exploration assets, excluding Jonnagiri, as follows:
Low Value (US$) High Value (US$) Expected Value
(US$)
6.54 million 9.45 million 7.95 million
In reaching its conclusions, Golder has relied on two specific
valuation methodologies, namely a multiple of previous expenditure
and comparable recent transactions on similar tenements. Golder
applied a discount of between 20% and 30% to tenements under
application (as opposed to granted Prospecting Licence) and an
additional 20% to 30% discount was applied to those projects where
resource delineation solely relied upon Geological Survey of India
("GSI") and other government exploration agencies and these
resources are not JORC compliant.
Jonnagiri Update
The economic feasibility study in respect of Jonnagiri continues
to make progress and the updated timing for completion of the EFS
is late June. Whilst the study is being finalised, Geomysore has
invited Expressions of Interest (EOI) for the appointment of a
contracted Mine Developer and Operator (MDO) for the development
and operation of the Jonnagiri Gold Project. The scope of the
intended MDO will include: the design, development and operation of
the Mine in accordance with the relevant Acts and Rules; the
installation, commissioning, operation and maintenance of the gold
ore processing plant and all related project infrastructures and
site facilities; the management of over burden and tailing dumps
and the delivery of processed gold to Geomysore; and assisting
Geomysore in land acquisition and management (including community
engagement), together with obtaining statutory clearances and the
development of mine infrastructure including water and power
structures as required for effective operation of the mines.
In light of the financial commitment of bringing Jonnagiri into
production should the decision be taken to develop a mine,
Geomysore considers it the most pragmatic path forward to becoming
a gold producer whilst concurrently developing their other
exploration projects. In doing so, it will prove its business model
at Jonnagiri and start generating cash flow to then be deployed in
the additional target areas within the Jonnagiri ML as well as
development of the other gold prospects in the portfolio as
described above.
India produces approximately 3 tonnes of gold per annum and
consumes approximately 800 tonnes per annum. Jonnagiri has the
potential to be India's first privately owned gold producing mine.
To date, Geomysore has received four EOIs by contractors looking to
provide the MDO services.
Cameron Parry, CEO of Lionsgold, commented: "We are pleased to
announce the results of the independent valuation report conducted
by Golder Associates on Geomysore's gold exploration assets,
excluding Jonnagiri. Although Jonnagiri is the most advanced gold
project and attracts the most attention from the market, it is
important shareholders are also aware of the size and significant
potential of other highly prospective areas within Geomysore's
portfolio of assets. Based on the expected value determined by the
Valuation Report prepared by Golder and Lionsgold's 20.5% equity
ownership of Geomysore, this valuation gives an implied
attributable value to Lionsgold of US$1.63 million. Against
Lionsgold's current market capitalisation of GBP2.25 million this
is a material amount.
"As stated, this figure excludes the value of Geomysore's most
advanced project, Jonnagiri, and as well as our Finnish gold Joint
Venture and the latent value of IndexGold, we believe this provides
another element of distinct and significant value from which
Lionsgold is able to benefit.
"The feasibility study on Jonnagiri is nearing completion and
Geomysore is currently assessing third parties interested in
contracting as the mine developer/operator, being one way to
potentially address the CAPEX required should the EFS result in a
decision to proceed to mine."
The information in this statement which relates to the Valuation
is based on information compiled by Mr Peter Onley who is a
part-time employee of Golder Associates Pty Ltd, and Fellow of the
Australasian Institute of Mining and Metallurgy. Mr Onley consents
to the publishing of the Valuation in the form and context in which
it appears.
For further information, please contact:
Lionsgold Limited Tel: +44 (0) 20 7397 2880
Cameron Parry (Chief Executive Officer)
Luke Cairns (Executive Director)
WH Ireland Limited (Nominated Adviser) Tel: +44 (0) 113 394 6600
Tim Feather
Ed Allsopp
Smaller Company Capital Limited (Joint Broker) Tel: +44 (0) 20 3651 2911
Rupert Williams
Jeremy Woodgate
Beaufort Securities Limited (Joint Broker) Tel: +44 (0) 20 7382 8300
Elliot Hance
Tavistock (Financial PR) Tel: +44 (0) 20 7920 3150
Emily Fenton
Edward Lee
About LIONSGOLD
Lionsgold is a London Stock Exchange AIM market quoted,
gold-focused exploration company, with gold assets in India and
Finland and a significantholding in aphysical gold and silver
online vaulting and trading platform.
Lionsgold's three core focuses are:
-- Strategic partnership with leading India gold exploration and
mine development company, Geomysore, in which Lionsgold owns
20.5%;
-- Physical gold holding and trading fintech platform for the
UK, India and other jurisdictions; and
-- Gold exploration and production in Finland.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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