2013-02-20 23:16:44 -
TORONTO, ONTARIO -- (Marketwire) -- 02/20/13 -- YAMANA GOLD INC. (TSX:YRI)(NYSE:AUY)(LSE:YAU) ("Yamana" or "the Company") today announced its mineral reserves and mineral resources for the year ended December 31, 2012.
-- Total gold equivalent(1) mineral reserves increased to 19.3 million
ounces, a 4% increase from 2011, with a 3% increase in grade
-- Gold equivalent mineral reserves at existing operations increased to
14.2 million ounces, a 6% increase from 2011
-- Gold equivalent mineral reserves at existing operations and projects in
development increased to 17.9 million ounces, a 5% increase from 2011
-- Total measured and indicated gold equivalent mineral resources of 15.6
million ounces, an increase of 15%, with a 14% increase in grade
-- Total inferred gold equivalent mineral resources increased to 11.4
million ounces, a 10% increase, with a 119% increase in grade
(All amounts are expressed in United States dollars unless otherwise
1. Silver is treated as a gold equivalent at a ratio of 50:1 except at
Mercedes where silver is treated as a gold equivalent at a ratio of 140:1
On a gold equivalent basis, mineral reserves are 19.3 million ounces for the year ending December 31, 2012, an increase of over 4% from 2011. This is comprised of 17.7 million ounces of gold mineral reserves and 89.2 million ounces of silver mineral reserves. On a gold equivalent basis the average grade of mineral reserves increased 3% to 0.96 grams per tonne (g/t).
A priority in 2012 was to increase mineral reserves at existing operations. At the Company's existing operations mineral reserves increased 6% to 14.2 million gold equivalent ounces (GEO) with an average gold equivalent grade of 0.82g/t.
Copper mineral reserves were 2.7 billion pounds of copper at an average grade of 0.31% copper including Alumbrera. Copper mineral reserves at Chapada increased by 7%.
For 2012, measured and indicated mineral resources increased 15% to 15.6 million GEO with an average gold equivalent grade of 0.89 g/t, which is a 14% increase from 2011. This is comprised of 14.1 million ounces of gold mineral resources, an increase of 7%, and 78.8 million ounces of silver, an increase of 237%.
Total inferred mineral resources increased 10% to 11.4 million GEO while the grade increased significantly to 1.51 g/t, a 119% increase from 2011. This is comprised of 10.1 million ounces of gold mineral resources, an increase of 10%, and 67.7 million ounces of silver, an increase of 7%.
Assumption of metal prices used in the estimate of mineral reserves and mineral resources remained unchanged from 2011: gold price of $950 per ounce, silver price of $20 per ounce and copper price of $2.50 per pound (except where noted).
The increases are net of 2012 depletion due to production.
CONSOLIDATED MINERAL RESERVES AND MINERAL RESOURCES
AS AT DECEMBER 31, 2012
Contained Contained Contained
Gold Silver Copper
(000's (000's (Millions
ounces) ounces) of lbs)
Total Proven and Probable Mineral
Reserves 17,676 89,191 2,687
Total Measured and Indicated
Mineral Resources 14,095 78,846 1,097
Total Inferred Mineral Resources 10,068 67,703 565
Detailed mineral reserve and mineral resource tables follow at the end of this press release and are available online at www.yamana.com/operations/reservesandresources.
The most notable changes are detailed below:
El Penon, Chile
The Company has increased gold equivalent mineral reserves for three consecutive years at El Penon, building on a long track record of replacing and increasing mineral reserves at the operation. In 2012, the focus was on converting, upgrading and increasing mineral resources. The increase in gold equivalent mineral reserves replaced reserves depleted from production and increased by an additional 6% over 2011 levels. Mineral reserve tonnage increased by 14%, which now includes a portion of the Pampa Augusta Victoria ("PAV") vein system which is 'open pittable' as it is near surface and is easily accessible. The decrease in mineral reserve grade is due to the inclusion of lower grade materials from Dorada Sur, Providncia and other zones that are lower grade. These results continue to indicate the potential of an increased mine life and a higher sustainable production level of approximately 440,000 GEO per year.
The 2013 exploration program at El Penon will focus on the extension of PAV and areas within the North Block as well as new discoveries; Dorada Sur and Dorada Oeste, Fortuna Este, and Bonanza West. This effort is expected to result in continued increases in mineral resources in 2013 and a target to develop the new discoveries into minable mineral reserves in the near term.
Total gold mineral reserves increased by 11% with an increase of 7% in grade from 2011 levels. These increases are in addition to the replaced reserves depleted by production and are largely attributed to the inclusion of portions of the Corpo Sul mineral resources upgrading to mineral reserves. Gold mineral reserves have increased cumulatively by 70% since 2009. Total copper mineral reserves increased by 7% with a 2% increase in grade over 2011 in addition to replacing those copper reserves depleted by production. Increases in measured and indicated gold mineral resources replaced what was upgraded to mineral reserves and increased marginally from 2011 levels. This was expected given the exploration focus in 2012 was to upgrade mineral resources to mineral reserves and further exploration of Corpo Sul. Also expected was the decline in inferred gold mineral resources given that the emphasis at Chapada has been on improving the quality of the entire mineral resource base. With discovery of a new area of mineralization that is predominantly copper the focus in 2013 will be to increase copper mineral resources to supplement new gold discoveries.
A pre-feasibility study was completed for Corpo Sul in late 2012 based on mineral reserves of 573,000 ounces of gold and 401 million pounds of copper in 55 million tonnes of ore. This represents an increase of 182% from 2011 in gold mineral reserves. Additional work further increased the mineral reserves at Corpo Sul, which have been included in Chapada's mineral reserves estimate. The feasibility study will include these additional ounces. It is expected that further work at Corpo Sul will significantly contribute to 2013 growth of mineral reserves.
Gold mineral reserves increased by 21% over 2011, in addition to replacing reserves depleted by production during the year. Since the acquisition of the mine, the Company has increased gold mineral reserves cumulatively more than 98% representing the sixth consecutive increase. Mineral reserve grade increased by 10%, a significant increase which is attributed to the higher grade Canavieiras and Morro do Vento mineral resources being upgraded to mineral reserves. The mineral reserve grade at Canavieras is 16% higher than existing reserve grade; the Company is looking at accelerating development into the high grade areas. Since 2009, mineral reserve grade has increased by 41% from 2.14 g/t to 3.02 g/t. The focus in 2012 was on quality and grade, specifically of the mineral reserves, as a result, measured and indicated mineral resources declined. This was more than offset by the significant improvements to the number of mineral reserve ounces and grade. These results warrant the Company's continuing evaluation of higher production levels at Jacobina related to the higher grade mineral reserves.
The focus in 2012 at Gualcamayo was on the definition and expansion of the Rodado breccia, a new zone discovered in 2011 southwest of QDD Lower West (QDDLW). As a result, measured and indicated mineral resources increased by 5% with a 6% increase in grade and the Rodado breccia mineralization was extended by 500 metres along strike. A significant amount of mineral resources at Gualcamayo are within the Rodado breccia and QDDLW, and given the current size of the sulphide portion of the mineral resources in these zones and the expectation of further mineral resource increases in these areas, the Company has initiated an evaluation of milling options which is expected to be competed in first half of 2013. There is approximately 1.6 million ounces cumulatively from all zones and all resource categories, some of which is also heap leachable, that will be considered in the evaluation of the milling option. Mineral reserves declined which can be attributed to depletion from production of the current ore bodies.
Exploration in 2013 will continue to focus on the south west of the QDDLW deposit where sulfide bearing carbonate breccias have been outlined. These breccias are an extension of QDDLW mineralization and occur as sub-parallel bodies or feeders to QDDLW. This mineralization remains open to the south west and down dip.
Minera Florida, Chile
Gold equivalent mineral reserves, and measured and indicated mineral resources remained essentially the same as 2011. Mineral reserves depleted through production were replaced, which was one of the goals of the 2012 program. After significant increases in 2011, in part attributed to the upgrade from mineral resources to reserves of the historic tailings, the processing of which started in the third quarter of 2012, the focus of last year was on replacing reserves depleted and identifying new resources. The program was successful and resulted in the discovery of Aguas Frias East and a 10% increase in inferred mineral resources. In 2013, further drilling at Aguas Frias East is expected to further delineate and expand this new zone.
In 2012, the exploration focus was on the replacement of mineral reserves and increasing mineral resources through further delineation of Diluvio, Lupita, Marianas (Barrancas Norte) and Rey de Oro. While grades in some of these zones are below historic ore grades the ore bodies are considerably wider. Gold equivalent mineral reserves remained essentially the same as in 2011. The replacement of mineral reserves depleted through production was mainly attributable to additions from the Lupita and Marianas zones. This resulted in a 25% increase in tonnage and a 21% decline in grade, the majority of these lower grade ounces came from Lupita. Measured and indicated mineral resources increased significantly, by 53% with a 8% increase in grade, through contributions from Rey de Oro and Diluvio. Inferred mineral resources decreased by 28% as most of the inferred resources at Lupita, Marianas and part of Diluvio were converted into indicated mineral resources. In the fourth quarter, high grade mineralization was intersected at depth in Rey de Oro. This mineralization is on strike with and may zone the Klondike deposit located one kilometre to the north-northwest. The 2013 program will focus on the expansion of this zone to determine continuity between the zones in addition to replacing and increasing mineral reserves and mineral resources.
Fazenda Brasileiro, Brazil
Measured and indicated resources at Fazenda Brasiliero increased by 8% and inferred mineral resources increased by 16%. Mineral reserves declined by 15%. These changes in the mineral resource base can partly be attributed to depletion and have also resulted from an economic evaluation which determined a portion of mineral reserves were more appropriately classified within the measured and indicated category pending a definitive mine plan on how these ounces will be mined in later years. The Company acquired the mine in 2003 with a 2.5 year mine life remaining based on known mineral reserves; based on current mineral reserves mine life is slightly less than four years after having been mined by the Company for nine years.
C1 Santa Luz, Brazil
Mineral reserves remained essentially the same as in 2011. Measured and indicated mineral resources increased by 17% due to the addition of new ounces at near surface satellite deposits which also contributed to the 3% increase in inferred mineral resources. In 2013, the focus will be on expanding the highly prospective underground mineralization identified in 2012.
Mineral reserves, and measured and indicated mineral resources were unchanged from 2011, as the Company focused exploration on a new area known as Maria Lazarus. This resulted in a 29% increase in inferred mineral resources. These mineral resources are expected to be upgraded during 2013. The company continues to focus on developing Pilar for production with planned start-up expected mid-2013.
Cerro Moro, Argentina
In 2012, the Company spent $5 million to drill over 100 holes with the goal of upgrading the inferred mineral resources and grow the resource base. These results have been incorporated in the Company's mineral resource update for Cerro Moro.
The 2013 exploration program at Cerro Moro will focus on drill testing eight priority target areas located on the northern La Negrita block, an entirely new zone, and drill testing existing geologic targets, geochemical anomalies and vein extensions within nine priority target areas in the southern Escondida block, which contains the majority of current known mineral resources.
Arco Sul, Brazil
Arco Sul is a new discovery made in late 2010 and is 100% owned by Yamana. It is located in western Goias State, 200 kilometers from Goiania, 370 kilometers from Brasilia and 295 kilometers from the Company's Pilar mine. Gold mineralization is hosted in a stock work system in a contact zone of subvolcanic intrusives and the Neoproterozoic volcano-sedimentary basement. Yamana's closed and reclaimed mine, Fazenda Nova, represents the small, near surface part of the Arco Sul mineralized system. Diamond drilling started in late September 2010 and to date 72 diamond drill holes totaling 29,979 meters have been completed. Mineralization remains open in all directions.
Lahvra Velha, Brazil
Lavra Velha is an early stage exploration target, discovered in 2010, located in Central Bahia State, 550 kilometers from Salvador, 350 kilometers from Jacobina and 480 kilometers from Fazenda Brasileiro Mine.
The project lies within a 400 kilometre northwestern trending sequence of Paleoproterozoic acid volcanics which overlie the Archean Sao Francisco Craton consisting of granitic and mafic intrusions. Four sub-horizontal mineralized levels have been defined at Lavra Velha to date, covering an area of approximately 900 metres by 350 metres. The mineralization is characterized by Iron Oxide / Sulfide rich breccias and remains open in all directions. Drilling started in 2010 and to date, 70 diamond drill holes totaling 18,231 meters have been completed.
2013 Exploration Program
The Company expects to spend approximately $110 - $115 million on exploration in continuation of the successful 2012 program. The 2013 exploration program will continue to focus on increasing mineral reserves and mineral resources with its near-mine and regional exploration programs, as well as continuing to explore identified greenfield targets and generate new targets.
Other than as set forth herein, Evandro Cintra, P.Geo., Senior Vice President, Technical Services for Yamana Gold Inc. has reviewed and confirmed the scientific and technical information contained within this press release and serves as the Qualified Person as defined in National Instrument 43-101.
Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions in Brazil, Argentina, Chile, Mexico and Colombia. Yamana plans to continue to build on this base through existing operating mine expansions, throughput increases, development of new mines, advancement of its exploration properties and by targeting other gold consolidation opportunities with a primary focus in the Americas.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: This news release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Except for statements of historical fact relating to the Company, information contained herein constitutes forward-looking statements, including any information as to the Company's strategy, plans or future financial or operating performance. Forward-looking statements are characterized by words such as "plan," "expect", "budget", "target", "project", "intend," "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made, and are inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ materially from those projected in the forward-looking statements.
These factors include the Company's expectations in connection with the expected production and exploration, development and expansion plans at the Company's projects discussed herein being met, the impact of proposed optimizations at the Company's projects, the impact of the proposed new mining law in Brazil and the impact of general business and economic conditions, global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future conditions, fluctuating metal prices (such as gold, copper, silver and zinc), currency exchange rates (such as the Brazilian Real, the Chilean Peso, the Argentine Peso, and the Mexican Peso versus the United States Dollar), possible variations in ore grade or recovery rates, changes in the Company's hedging program, changes in accounting policies, changes in mineral resources and mineral reserves, risk related to non-core mine dispositions, risks related to acquisitions, changes in project parameters as plans continue to be refined, changes in project development, construction, production and commissioning time frames, risk related to joint venture operations, the possibility of project cost overruns or unanticipated costs and expenses, higher prices for fuel, steel, power, labour and other consumables contributing to higher costs and general risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, unexpected changes in mine life, final pricing for concentrate sales, unanticipated results of future studies, seasonality and unanticipated weather changes, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, government regulation and the risk of government expropriation or nationalization of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims, limitations on insurance coverage and timing and possible outcome of pending litigation and labour disputes, as well as those risk factors discussed or referred to in the Company's current annual Management's Discussion and Analysis and Annual Information Form filed with the securities regulatory authorities in all provinces of Canada and available at www.sedar.com, and the Company's Annual Report on Form 40-F filed with the United States Securities and Exchange Commission. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended.
There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates, assumptions or opinions should change, except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking statements. The forward-looking information contained herein is presented for the purpose of assisting investors in understanding the exploration and development plans and objectives and may not be appropriate for other purposes.
CAUTIONARY NOTE TO UNITED STATES INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED MINERAL RESOURCES
This news release uses the terms "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource" are defined in and required to be disclosed by NI 43-101. However, these terms are not defined terms under Industry Guide 7 and are not permitted to be used in reports and registration statements of United States companies filed with the Commission. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into mineral reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of "contained ounces" in a mineral resource is permitted disclosure under Canadian regulations. In contrast, the Commission only permits U.S. companies to report mineralization that does not constitute "mineral reserves" by Commission standards as in place tonnage and grade without reference to unit measures. Accordingly, information contained in this news release may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations of the Commission thereunder.
Mineral Reserves (Proven and Probable)
The following table sets forth the Mineral Reserve estimates for the Company's mineral projects as at December 31, 2012. See "Interests of Experts" for a listing of the qualified persons responsible for such estimates.
Mineral Resources (Measured, Indicated and Inferred)
The following table set forth the Mineral Resource estimates and for the Company's mineral projects as at December 31, 2012. See "Interests of Experts" for a listing of the qualified persons responsible for such estimates.
Yamana Gold Inc. Mineral Reserve and Mineral Resource Reporting Notes:
1. Metal Prices and Cut-off Grades:
Mine Mineral Reserves Mineral Resources
Alumbrera (12.5%) $1,400 Au, $3.20 Cu, N/A
$17.00 Mo and 0.22% CuEQ
Amancaya N/A 1.0 g/t Aueq OP, 3.4 g/t
Arco Sul N/A 2.5 g/t Aueq cut-off
Caiamar N/A 1.5 g/t Au cut-off
Chapada $950 Au, $2.50 Cu, $4.80 $1,500 Au, $3.5 Cu and
average cut-off for $3.5 NSR cut-off out of
Chapada Mine pit for Chapada Mine 0.2
$900 Au; 0.2 g/t Au cut- g/t Au cut-off for oxides
off for oxide ore and 0.3 and 0.3 g/t Au cut-off
g/t Au cut-off for for sulphide in Suruca
sulphide ore in Suruca Gold Project
C1-Santa Luz $950 Au for C1 and 0.5 g/t Au cut-off for
satellite orebodies C1-Santa Luz Shallow and
except Mansinha and Mari 1.5 g/t Au cut-off for C1
($750 Au), 0.5 g/t Au Downdip Extension
Cerro Moro N/A 1.0 g/t Aueq cut-off
El Penon $950 Au, $20.00 Ag, 3.9 g/t Aueq cut-off
Variable cut-off for