e5242fcc-8152-4510-951c-3aade960d33c.pdf
ASX Release Thursday 26 November 2015
Cannon Mine Update
Gold Price Fixed at $1500/oz for first 10koz
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First 10,000oz. of gold production has price fixed at $1500/oz
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Metallurgical recovery averaging 91.3% on production to date
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Production now totals 3,836oz Au
Shares
ASX Code: SAU
Issued: 35.42M
Directors
Greg Boulton AM (Chairman) Simon Mitchell (MD) Michael Billing
David Turvey
Head Office Southern Gold Ltd Level 1, 8 Beulah Rd
Norwood SA 5067
Telephone: (08) 8368 8888
Facsimile: (08) 8431 5619 info@southerngold.com.au www.southerngold.com.auABN: 30 107 424 519
Gold Price Fixed at A$1500/oz
In accordance with provisions under the Contracting and Financing Agreement for Cannon Resources and its subsequent Supplementary Deed, Southern Gold Ltd (Southern Gold, ASX Code 'SAU') and Metals X Ltd have agreed to fix the price of the first 10,000 troy ounces of production from the Cannon Mine.
The price has been set at A$1500 per troy ounce.
Processing Update
Cannon ore continues to be processed through Metals X's 'Jubilee Mill' at their South Kalgoorlie Operations, approximately 35km from Cannon by haul road. The third gold pour was completed producing another 1,170 oz. Au at a 92.0% recovery rate.
Processing statistics for the entire campaign to date are summarised below:
Units
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Total To-date
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Tonnes of Ore Treated
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Dry tonnes (dt)
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56,547
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Head Grade
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Au g/t
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2.58
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Estimated contained Ounces
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Au Ozs.
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4,282
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Overall average plant recovery
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%
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91.3
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Recovered Ounces
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Au Ozs.
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3,836
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As of the 24 November, a total of 85,927 wet tonnes have been crushed and processing is continuing.
Southern Gold Ltd Managing Director, Simon Mitchell, commented: 'we are extremely pleased with the operating performance of the Cannon Mine to date and it is nice to see very good metallurgical recovery factors above 91%. Southern Gold is also pleased with the $1500/oz fixed price on the initial production from Cannon and appreciates Metals X's accommodation in this regard.'
Southern Gold Limited: Company Profile
Southern Gold Ltd is a successful gold explorer and producer listed on the Australian Securities Exchange (under ASX ticker 'SAU'). The Company's main focus is its Bulong Gold Project located 30 km east of the world renowned gold district of Kalgoorlie (WA) with the flagship Cannon Gold Mine having 846kt @ 3.6g/t Au or 97koz gold defined in accordance with the JORC code, 94% of which is in the Measured and Indicated categories.
Mining at Cannon has commenced with Metals X Ltd financing and developing the deposit under a 50/50 profit share arrangement. Metals X is responsible for all mining, haulage and processing activities (ASX announcement 11/11/2014) with this mandate recently expanded to incorporate the commercial terms of a larger open pit development (ASX announcement 3/11/2015).
By monetising the Cannon Gold resource, the company will look to accelerate project development opportunities within its broader tenement holdings to ensure continuity of cash flow into the medium term.
Competent Person's Statements
The information in this report that relates to Exploration Results has been compiled under the supervision of Mr. Ian Blucher (MAusIMM). Mr Blucher, who is an employee of Southern Gold Limited and a Member of the Australian Institute of Mining and Metallurgy, has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he has undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves. Mr Blucher consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.
The information in this report that relates to Cannon Mineral Resources is based on information compiled by Mr Ian Blucher (MAusIMM). Mr Blucher is an employee of Southern Gold Limited and has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC, 2012). Mr Blucher consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.
Forward-looking statements
Some statements in this release regarding estimates or future events are forward looking statements. These may include, without limitation:
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Estimates of future cash flows, the sensitivity of cash flows to metal prices and foreign exchange rate movements;
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Estimates of future metal production; and
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Estimates of the resource base and statements regarding future exploration results.
Such forward looking statements are based on a number of estimates and assumptions made by the Company and its consultants in light of experience, current conditions and expectations of future developments which the Company believes are appropriate in the current circumstances. Such statements are expressed in good faith and believed to have a reasonable basis. However the estimates are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from estimated results.
All reasonable efforts have been made to provide accurate information, but the Company does not undertake any obligation to release publicly any revisions to any 'forward-looking statement' to reflect events or circumstances after the date of this presentation, except as may be required under applicable laws. Recipients should make their own enquiries in relation to any investment decisions from a licensed investment advisor.
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