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Endeavour Reports Positive PFS Results For Both Fetekro and Kalana, Confirming Strong Organic Growth Pipeline

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Endeavour Mining has reported positive Pre-Feasibility Study (PFS) results for both the Fetekro and Kalana projects, signaling strong organic growth. The Fetekro project shows potential for over 200,000 ounces per annum with a low all-in sustaining cost (AISC) of $838/oz and an after-tax NPV of $479 million based on a $1,500/oz gold price. Similarly, the Kalana project could yield 150,000 ounces per year at an AISC of $901/oz and an NPV of $331 million. Both projects indicate robust economics and aim to advance to the Definitive Feasibility Study (DFS) phase.

Positive
  • Fetekro project shows potential for production of over 200,000 ounces per year at an AISC of $838/oz.
  • Kalana project has potential annual production of 150,000 ounces with an AISC of $901/oz.
  • Fetekro's after-tax NPV is projected at $479 million and IRR at 33% based on $1,500/oz gold price.
  • Kalana's after-tax NPV is estimated at $331 million with an IRR of 49% at the same gold price.
Negative
  • None.

ENDEAVOUR REPORTS POSITIVE PFS RESULTS FOR BOTH FETEKRO AND KALANA, CONFIRMING STRONG ORGANIC GROWTH PIPELINE

HIGHLIGHTS:

  • Positive PFS results for both Fetekro and Kalana Projects confirm Endeavour’s high quality organic growth pipeline
  • Fetekro PFS shows potential for +200kozpa production at low AISC over long mine life:
    • 10-year mine life based on current reserves of 2.1Moz
    • Average annual production of 209koz at AISC of $838/oz
    • Robust economics with after-tax NPV5% of $479m and IRR of 33%, based on a $1,500/oz gold price
  • Kalana PFS shows potential for 150kozpa production at low AISC over long mine life:
    • 11-year mine life based on current reserves of 1.8Moz
    • Average annual production of 150koz at AISC of $901/oz
    • Robust economics with after-tax NPV5% of $331m with IRR of 49% based on a $1,500/oz gold price
  • DFS on each project will now commence, with further opportunities to optimize and expand the projects through exploration and engineering

George Town, February 23, 2021 – Endeavour Mining (TSX:EDV) (OTCQX:EDVMF) is pleased to announce that it has recently completed a positive Pre-Feasibility Study (“PFS”) for both its Fetekro and Kalana projects as part of its focus on organic growth opportunities. The robust PFS results confirm that both projects justify moving forward to the Definitive Feasibility Study (“DFS”) stage, which will now commence.

Sebastien de Montessus, President and CEO said: “The positive studies announced today confirm the compelling nature of our two most advanced projects and reinforce our focus on organic growth. Together with a number of earlier stage projects, Endeavour now has an attractive pipeline of opportunities, each of which will compete for capital with the goal of generating strong returns across operations, projects and exploration.

At Fetekro, our exploration efforts have resulted in the discovery of a project with the potential to become a cornerstone mine with annual production of +200,000 ounces at low all in sustaining costs over at least 10 years while boasting robust economics. Our $20 million investment in exploration at Fetekro over the past three years has generated significant returns as we now have a project with an NPV5% of approximately $480 million at a gold price of $1,500/oz.

At Kalana, we have outlined a project with annual production of 150,000 ounces over at least 10 years with very attractive economics. Having purchased Kalana for approximately $120 million in 2017, the project now has an NPV5% of approximately $330 million at a gold price of $1,500/oz, despite the overhaul of the geological model which incorporates more conservative assumptions.

From a broader ESG standpoint, in accordance with our aim to reduce our carbon footprint, both projects have low forecast emissions intensity, in line with our current operations, as well as the opportunity to benefit from renewable energy, either in the form of a solar plant at Fetekro, or from the Malian grid for Kalana which has a significant portion powered by renewables. We will now progress the Definitive Feasibility Studies for both projects, which we expect to announce in late 2021 for Fetekro and in early 2022 for Kalana.”

Table 1: Project Highlights

 

  		 

  		FETEKRO

  		KALANA

  		 

  		ENDEAVOUR
STRATEGIC TARGETS
Reserves, Moz 2.1 1.8   >2.0
Mine life, years 9.5 11.0   >10
Average annual production, kozpa

  		First 5 years 220 186   >200

 
Life of mine 209 150  
AISC, $/oz

  		First 5 years 916 679   <900

 
Life of mine 838 901  
NPV5%, $m1 479 331   n.a.
IRR, %1 33 49   >20


 

 1Post-tax, based on a gold price of $1,500/oz

The PFS summary metrics and project economics for the Fetekro and Kalana projects are shown in Tables 2 and 3 below.

Table 2: PFS Summary

  FETEKRO KALANA
OPERATION TYPE    
Mine Type Open Pit Open Pit
Mill Type 3.0Mtpa Gravity / CIP Plant 3.0Mtpa Gravity / CIL Plant
RESERVES & RESOURCES   
P&P Reserves 31.9Mt at 2.0 Au g/t for 2.1Moz 35.6Mt at 1.6 Au g/t for 1.8Moz
M&I Resources (inclusive of reserves) 32.0Mt at 2.4 Au g/t for 2.5Moz 46.0Mt at 1.6 Au g/t for 2.3Moz
Inferred Resources 0.8Mt at 2.5 Au g/t for 0.1Moz 4.6Mt at 1.7 Au g/t for 0.3Moz
LIFE OF MINE PRODUCTION   
Mine life, years 9.5 11.0
Strip ratio, W:O    10.3 6.7
Tonnes processed, Mt 32 36
Grade processed, Au g/t 2.0 1.6
Gold contained processed, Moz 2.1 1.8
Average recovery rate, % 95 90
Gold production, Moz 2.0 1.7
Average annual production, kozpa 209 150
Cash costs, $/oz 684 785
AISC, $/oz1 838 901
AVERAGE FOR YEARS 1 TO 5   
Production, kozpa 220 186
Cash costs, $/oz 751 589
AISC, $/oz1 916 679
CAPITAL COST   
Upfront capital cost, $m 338 297
ENVIRONMENTAL DATA   
GHG Emissions Intensity2, t CO2e/oz 0.36 0.30
Energy Intensity, GJ/oz 6.99  7.65

  1Based ona gold price of $1,500/oz. 2 GHG Emissions Intensity calculated as Scope 1 and 2 emissions.

Table 3: Project Economics

  FEKETRO   KALANA
Gold Price $1,350/oz $1,500/oz $1,650/oz $1,800/oz   $1,350/oz $1,500/oz $1,650/oz $1,800/oz
PRE-TAX                  
NPV5%, $m 439 663 862 1083   310 498 687 875
IRR, % 28 38 46 55   44 59 74 88
Payback years1 3.3 2.6 2.2 1.9   1.4 1.1 0.9 0.8
AFTER-TAX     { "@context": "https://schema.org", "@type": "FAQPage", "name": "Endeavour Reports Positive PFS Results For Both Fetekro and Kalana, Confirming Strong Organic Growth Pipeline FAQs", "mainEntity": [ { "@type": "Question", "name": "What are the PFS results for Endeavour Mining's Fetekro project, symbol EDVMF?", "acceptedAnswer": { "@type": "Answer", "text": "The Fetekro project indicates potential production of over 200,000 ounces annually with an AISC of $838/oz and an after-tax NPV of $479 million." } }, { "@type": "Question", "name": "How much gold production is expected from the Kalana project, EDVMF?", "acceptedAnswer": { "@type": "Answer", "text": "The Kalana project is expected to yield 150,000 ounces per year at an AISC of $901/oz and an after-tax NPV of $331 million." } }, { "@type": "Question", "name": "What is the significance of the PFS results for Endeavour Mining's stock (EDVMF)?", "acceptedAnswer": { "@type": "Answer", "text": "The positive PFS results for both projects confirm strong economic potential, enhancing investor confidence and likely impacting stock performance favorably." } }, { "@type": "Question", "name": "When will the Definitive Feasibility Studies (DFS) for Fetekro and Kalana be released, under EDVMF?", "acceptedAnswer": { "@type": "Answer", "text": "The DFS for Fetekro is expected in late 2021, while the Kalana DFS is anticipated in early 2022." } } ] }

FAQ

What are the PFS results for Endeavour Mining's Fetekro project, symbol EDVMF?

The Fetekro project indicates potential production of over 200,000 ounces annually with an AISC of $838/oz and an after-tax NPV of $479 million.

How much gold production is expected from the Kalana project, EDVMF?

The Kalana project is expected to yield 150,000 ounces per year at an AISC of $901/oz and an after-tax NPV of $331 million.

What is the significance of the PFS results for Endeavour Mining's stock (EDVMF)?

The positive PFS results for both projects confirm strong economic potential, enhancing investor confidence and likely impacting stock performance favorably.

When will the Definitive Feasibility Studies (DFS) for Fetekro and Kalana be released, under EDVMF?

The DFS for Fetekro is expected in late 2021, while the Kalana DFS is anticipated in early 2022.

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