Steppe Gold – Stepping Up The Construction Pace With First Drawdown Of Phase 2 Project Financing At The ATO Gold Mine
Aneel Waraich, Executive Vice President and Director of Steppe Gold Ltd (TSX: STGO) (OTCQX: STPGF), joins us to highlight the key milestone of drawing down the first tranche of $9.5 Million from the $150 million debt funding package, accelerating the next step of the Phase 2 expansion, at the (AT0) Altan Tsagaan Ovoo Gold Mine in Mongolia.
Aneel highlighted that this was a key step in demonstrating to the market that the funding risk for the next big development and production growth initiative is now secured to continue forward with the Phase 2 sulfide production expansion. He also pointed out that was very important in avoiding the dilution that would have happened if the company tried to raise the capex needed for this mine expansion and next chapter of the company using equity, especially in these tough markets.
The Phase 2 sulfide production is projected to bring on ~103,000 ounces of gold production per annum, for a total of 12-14 years at AISC of US ~$850-$900. For the balance of 2023, the Company is currently in Phase 1 oxide production, and is targeting 25,000-30,000 ounces of production from the heap leach operations.
Next we discussed the potential, through exploration, to expand both the Phase 1 and Phase 2 mine life. Currently the exploration team is targeting drilling for more nearby potential oxide mineralization, which could also extend the Phase 1 mine life an additional 1-4 years, so it would run in tandem with the commissioning of Phase 2. There is also still the potential to keep expanding the Phase 2 mine life, because some recent drill holes have already reported mineralization outside of the current mine plan, and there has been success drilling further at depth under known mineralization that is not yet factored into their reserves or current mine plan.