NEWS

/NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES AND NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES./ 

MELBOURNE, March 31, 2020 /CNW/ – OceanaGold Corporation (TSX: OGC) (ASX: OGC) (the “Company”) is pleased to provide its updated annual Resource and Reserve (“R&R”) statement for the year ended December 31, 2019.

Highlights

• Total Proven and Probable Reserves of 5.3 Moz of gold, 3.5 Moz of silver and 0.16 Mt of copper, with growth in gold reserves offsetting approximately half of 2019 mining depletion.
• Total Measured and Indicated Resources increased by approximately 0.80 Moz of gold year-on-year, net of mining depletion.
• Inferred Resources increased approximately 0.7 Moz of gold year-on-year, net of mining depletion largely due to first-time reporting of an Inferred Resource of 0.6 Moz for the Palomino underground deposit at Haile and an additional 0.3 Moz for the WKP underground deposit near Waihi.

Michael Holmes, acting President and CEO of OceanaGold said, “Since 2015, we have focused on creating value for shareholders by investing in organic growth initiatives including exploration. These investments have yielded strong results, including the growth of Mineral Resources at the Martha Underground at Waihi, the Horseshoe Underground at Haile, and the discovery of additional resources at WKP in New Zealand.”

“Since the acquisition of Waihi in 2015, our exploration team have delivered outstanding results through drilling. We have increased the mine life at the Correnso Underground and added significant Indicated and Inferred Resources at both Martha and WKP underground deposits.”

“WKP is expected to compliment Martha Underground over the long-term; it’s a game-changing prospect that can leverage off our existing infrastructure at Waihi. To-date, we have discovered 0.42 Moz gold in the Indicated Resource category and 0.72 Moz of gold in the Inferred Resource category, at grades of 13 g/t and 12 g/t, respectively.”

As at December 31, 2019, the Company’s Proven and Probable (“P&P”) Reserves stood at 5.3 Moz of gold, 3.5 Moz of silver and 0.16 Mt of copper, representing on a consolidated basis, a 0.25 Moz year-on-year decrease net of mining depletion of 0.51 Moz in 2019. Drilling-related reserve growth, largely for Macraes and Haile open pits, offset over half of 2019 company-wide mining depletion.

As at December 31, 2019, the Company’s Measured and Indicated (“M&I”) Resources stood at 9.4 Moz of gold, 7.7 Moz of silver and 0.17 Mt of copper. On a consolidated basis, the Company increased M&I Resources by 0.80 Moz, year-on-year net of mining depletion (0.51 Moz), mainly due to drilling-related resource upgrades at the Waihi and Macraes operations.

Consolidated Inferred Resources, year-on-year, increased by 0.7 Moz to 4.3 Moz of gold, while silver and copper resources were 3.9 Moz and 0.03 Mt, respectively. Increase to total Inferred Resources include the first-time inclusion of an underground Inferred Resource for Palomino at Haile in the USA and increases due to drilling-related resource upgrades for WKP at Waihi and Round Hill / Golden Point at Macraes in New Zealand. These increases are over and above the successful conversion of Inferred Resources to Indicated Resources.

New Zealand

Waihi

Combined open pit and underground P&P Reserves at Waihi as at December 31, 2019, stood at 0.10 Moz gold after mine depletion.

As at December 31, 2019, the Waihi M&I Resources stood at 1.4 Moz gold, representing a year-on-year increase of 0.6 Moz as drilling at Martha Underground and WKP continued to define and upgrade additional resources. Refer to news releases related to the Martha Underground and WKP resource updates published on February 13, 2020 and February 24, 2020, respectively.

The waterfall chart in Figure 5 illustrates an approximate 0.6 Moz year-on-year increase in Measured and Indicated Resources, most of which was from upgrading Inferred Resources through infill drilling during 2019. As at December 31, 2019, the Waihi Inferred Resources stood at 1.3 Moz gold. This represents a 0.3 Moz increase at the Martha Underground and WKP projects, net of Inferred Resources that were upgraded to Indicated during 2019.

Notwithstanding the current suspension of exploration activities due to the New Zealand Government’s order to temporarily suspend all “non-essential” business, the Company expects continued drilling at the Martha Underground with a focus on resource conversion later in the year. The Company has an additional exploration target of six to eight million tonnes with grades ranging from four to six grams per tonne within the Martha Underground project. This exploration target is based on the assessment of surface and underground drilling data collected by the Company in addition to the significant amount of historical and archived geological and mining data from over a century of mining activity at Waihi. The exploration target is conceptual in nature and exploration completed on this target to date is not sufficient to define an additional Mineral Resource above what has been reported. Drilling of this target is expected to continue for the next several years.

Macraes

As at December 31, 2019, the P&P Reserves for Macraes stood at 1.1 Moz gold, with 1.0 Moz in the open pit and 0.06 Moz of gold in the Frasers Underground. Year-on-year drilling-related reserve growth has offset much of the 2019 mining depletion.

As at December 31, 2019, the Macraes M&I Resources stood at 3.5 Moz of gold, including 0.37 Moz in Frasers Underground. The year-on-year net increase in M&I Resources was due both to drilling-related open pit resource growth as well as lowered open pit cut-off grade, which was lowered from 0.4 g/t to 0.3 g/t Au, reflecting low cost stockpile processing scheduled in the latter years of the operation. Reductions (see adjustments in Figure 8) in Frasers Underground resources reflect the removal of resource in areas deemed too costly to access.

As at December 31, 2019, Macraes Inferred Resources stood at 0.9 Moz of gold, an increase from the previous year, due mainly to lowered cut-off grade which was partially offset by mining depletion and upgrading of Inferred Resources to the Indicated category. The Company will continue to drill multiple targets along the Hyde-Macraes Shear Zone with a focus on Golden Point Underground.

Reefton

In December 2016, the Company announced the closure of the Reefton Mine and as a result, associated resources were removed from the Company’s inventory.

Resources for the nearby Blackwater Project remain on the Company’s inventory and remain unchanged from EOY 2018 reported resources.

United States

Haile

P&P Reserves totalled 2.9 Moz of gold including 0.44 Moz of gold in the Horseshoe Underground. Total Mineral Reserves have reduced by 0.17 Moz net of resource growth, due to open pit mining depletion and to a lesser extent, application of TSF construction costs. The open pit cut-off grade has increased to 0.5 g/t from 0.45 g/t Au and resulted in a small reduction in the size of the reserve pit design.

As at December 31, 2019, total Haile M&I Resources stood at 3.1 Moz of gold, including 0.49 Moz for the Horseshoe underground.  Year-on-year resource growth offset mining depletion.

Year-on-year, Inferred Resources have increased by approximately 0.5 Moz due to the addition of the underground Inferred Resource for the Palomino deposit. For 2020, the Haile exploration program will focus mainly on infill drilling within the open pit operations.

First time reporting of the Palomino Underground Inferred Resource, Haile Gold Mine

Palomino is located on a mineralised trend one kilometre southwest of the Horseshoe reserve (Figure 13). A total of 21 mineralised HQ and NQ diamond core holes have been drilled at the Palomino deposit and have been previously reported (see OceanaGold homepage). Half core samples of 1 to 3 metre lengths were dried, bagged and transported to an independent sample preparation facility, crushed to 2mm, riffle split and pulverised to 90% passing 150 mesh. A 30gm aliquot was then fire assayed with an Atomic Absorption finish.

Drilling to-date defines a mineralised package approximately 300 metres long with a 50-100 metre vertical extent by 100-150 metres wide (Figure 14).  Lozenge-shaped mineralised zones that strike east-northeast, dip moderately northwest and plunge gently northeast are identified within this package. The style of mineralisation is similar to the Horseshoe deposit with thick zones of fine-grain gold hosted by pyritic and silicified siltstone and intrusive rocks. The northeast margin of Palomino is bound by a barren, sub-vertical NNW-striking diabase dike while the southeast margin of Palomino is defined by the 70-750 SSE-dipping siltstone-dacite contact.

The estimate is based on an updated geological interpretation and a gold indicator shell. Grades were estimated by ordinary kriging into 5m x 5m x 5m blocks, rotated to align with the dominant foliation fabric and strike of mineralisation. The Inferred classification is based on an average 40m x 70m drill hole spacing.

High level mine designs and economic and sensitivity analyses were subsequently completed. Recoveries through the Haile processing plant of 85% were assumed. This work has provided the basis for reporting an underground Palomino Inferred Resource of 6.5 Mt @ 2.8 g/t Au for 0.6 Moz at a 1.49 g/t Au cut-off.

Philippines

Didipio

As at December 31, 2019, Didipio P&P Reserves stood at 1.3 Moz of gold, 2.7 Moz of silver and 0.16 Mt of copper, a small year-on-year increase net of mining depletion. The increase is largely due to lowered reserve reporting cut-off grade (0.87 g/t AuEq cut-off) in areas adjacent to development planned to access higher grade stoping areas (1.34 g/t AuEq cut-off). The reserves include 23 Mt of low and medium grade open pit stockpiles, 5.3 Mt of which are based upon a 0.27 g/t AuEq cut-off, the remainder based on an approximate 0.4 g/t AuEq cut-off.

As at December 31, 2019, Didipio M&I Resources stood at 1.4 Moz of gold, 2.9 Moz of silver and 0.17 Mt of copper, a moderate year-on-year increase net of mining depletion. The increase is largely due to lowered resource reporting cut-off grade (0.76 g/t AuEq cut-off) in areas adjacent to development planned to access higher grade stoping areas (1.16 g/t AuEq cut-off). This reporting reflects the revised mine design. The resources include 23 Mt of low and medium grade open pit stockpiles.

Inferred Resources stood at 0.3 Moz of gold, 0.5 Moz of silver and 0.03 Mt of copper, a small year-on-year decrease related largely to infill drilling and upgrading of Inferred Resources to Indicated Resources.

Other

OceanaGold’s interest in the Sam’s Creek project in New Zealand remains unchanged at 20%.

As part of the requirements under the listing rules of the Australian Stock Exchange, the Company has filed a separate document containing the material summaries and JORC Table 1 information related to the resource and reserves. Material summaries and JORC Table 1 are not required under National Instrument 43-101.  Readers are referred to the ASX website at www.asx.com.au or OceanaGold website at http://www.oceanagold.com/investor-centre/filings/ to view material summaries and JORC Table1.

Authorised for release to market by OceanaGold Corporate Company Secretary, Liang Tang.

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