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Galiano Gold Announces Preliminary 2020 Operating Results and 2021 Guidance - Stockwatch

Tuesday, 16 February 2021

(All dollar amounts are United States dollars unless otherwise stated)

VANCOUVER, BC, Feb. 16, 2021 /PRNewswire/ - Galiano Gold Inc. ("Galiano" or the "Company") (TSX: GAU) (NYSE American: GAU) reports preliminary fourth quarter ("Q4") 2020 operating results for the Asanko Gold Mine ("AGM"), located in Ghana, West Africa. The AGM is a 50:50 joint venture ("JV") with Gold Fields Ltd (JSE, NYSE: GFI), which is managed and operated by Galiano.  All financial information contained in this news release are unaudited and reported in US$.

Q4 and full year 2020 Asanko Gold Mine Highlights (100% basis)

Preliminary 2021 Guidance for the Asanko Gold Mine (100% basis)

"Production returned to more usual levels at the Asanko Gold Mine in Q4, as planned, resulting in a strong finish to 2020.  For the second consecutive year, the AGM was able to exceed annual production guidance and maintain stable all-in-sustaining costs despite the impacts of COVID-19." said Greg McCunn, Chief Executive Officer. "It was also a very successful year for exploration at the AGM, with additional resources delineated at the Akwasiso pit allowing mining to continue through 2021 while infill drilling is being completed to support a maiden resource estimate at Miradani North."

Production and Safety
Safety remains a priority at the AGM. In 2020 there were two lost-time injuries ("LTI") and 10 total recordable injuries ("TRI") reported during the year. LTI frequency rate ("LTIFR") and TRI frequency rate ("TRIFR") per million employee hours worked were 0.20 and 1.01, respectively, for the year.

In Q4 2020, the AGM sourced ore from Akwasiso and Esaase as well as run of mine stockpiles.  During the quarter, 2.0Mt of ore was mined at an average grade of 1.4 g/t and 1.4Mt of ore was processed at 1.5 g/t. The processing facility continued to perform well and recovery averaged 95% over the quarter.

AGM Key Production Statistics
(100% basis)
Units Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019
Total Tonnes Mined 000 t 13,737 12,279 9,489 8,962 6,361
Waste Tonnes Mined 000 t 11,773 11,321 8,128 7,051 4,956
Ore Tonnes Mined 000 t 1,964 958 1,361 1,911 1,405
Strip Ratio W:O 6.0:1 11.8:1 6.0:1 3.7:1 3.5:1
Average Gold Grade Mined g/t 1.4 1.4 1.4 1.6 1.6
Ore Processed 000 t 1,438 1,467 1,638 1,400 1,460
Gold Feed Grade g/t 1.5 1.1 1.4 1.6 1.5
Gold Recovery % 95 93 94 94 94
Gold Produced oz 65,571 48,974 69,026 66,333 66,112

Sales and Liquidity
The AGM sold 60,655 ounces of gold in Q4 2020 and had a closing unaudited cash balance of $64.3 million (including $30.0 million fully drawn revolving credit facility), $10.9 million in receivables from gold sales and $8.2 million in gold on hand. As at December 31, 2020, Galiano held unaudited cash and cash equivalents of $62.2 million and $2.9 million in receivables.

Business Plan for 2021

Asanko Gold Mine Guidance
History (100% basis)
Production
Guidance (oz gold)
Production
Actual (oz gold)
Cost Guidance (AISC $/oz) Cost Actual (AISC $/oz)
2019 225,000 – 245,000 251,044 $1,000 – $1,100 $1,112
2020 225,000 – 245,000 249,904 $1,000 – $1,100 $1,115
2021 Preliminary 225,000 – 245,000 $1,100 – $1,300

The Company is currently finalizing the detailed 2021 business plan and expects to have Board and Joint Venture approval of the plan in March 2021 in conjunction with filing of its audited 2020 annual financial statements on or about March 11, 2021. 

Annual mill throughput is expected to range between 5.5Mt and 5.8Mt consisting of contributions from Esaase, Akwasiso and ore stockpiles.  Positive results from 2020 infill drilling at Akwasiso, targeting conversion of inferred resource, suggest an expansion at Akwasiso via a phase 3 pushback is economically viable. Pending requisite Joint Venture approvals, stripping at Akwasiso is expected to commence in late Q1 2021.

AISC are expected to range between $1,100 and $1,300/oz in 2021, including non-cash contributions of $30 to $60/oz as stockpiles are depleted during the year. Additionally, the AISC guidance includes royalties payable to the government of Ghana totalling approximately $80/oz based on a $1,600/oz gold selling price.  Sustaining capital for the full year is expected to be $15 to $20 million including approximately $13 million for a phase VI expansion of the Tailings Storage Facility.

Mineral Resource and Reserve Update
In the second half of 2020, the Company undertook a substantial drilling campaign designed to expand the resources of several of the current known orebodies at the AGM including Akwasiso, Nkran, Abore and Miradani North. In addition, a significant amount of infill drilling, in-pit mapping and geological modelling work has been undertaken at the Esaase deposit in order to improve the understanding of the mineralization as the pit matured during its second year of operations. 

An updated Mineral Resource and Reserve Estimate effective June 30, 2021 is expected to be released in Q3 2021 for the AGM. The Mineral Resource and Reserve Estimate will incorporate the new exploration and infill drilling, updated modifying factors, and updated geological modelling with the goal to improve the reconciliation between the Mineral Resource Estimate and site grade control modelling. The resulting Mineral Resource and Reserve Estimate will reflect the ongoing efforts to achieve the best value from the AGM in the context of the current operating and metal price environment and will be used for mine planning for 2022 onwards.

Corporate Update
Galiano is pleased to announce that it has recently completed a corporate restructuring, centralizing its corporate operations in its Vancouver office.  In 2020 and early 2021, the Company appointed a number of professionals to join Chief Executive Officer, Greg McCunn, Executive Vice President and Chief Financial Officer, Fausto Di Trapani, and Senior Vice President Corporate Development, Markus Felderer,  as follows:

About Galiano Gold Inc.
Galiano is focused on creatinga sustainable business capable of long-term value creation for its stakeholders through exploration and disciplined deployment of its financial resources. The Company currently operates and manages the Asanko Gold Mine, located in Ghana, West Africa which is jointly owned with Gold Fields Ltd.  The Company is strongly committed to the highest standards for environmental management, social responsibility, and health and safety for its employees and neighbouring communities. For more information, please visit www.galianogold.com.

1 Non-GAAP Performance Measures 
The Company has included a non-GAAP performance measure in this press release. This non-GAAP performance measure does not have any standardized meaning. Accordingly, this performance measure is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. 


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