REG - Condor Gold PLC - Interim Report & Accounts - 6 Months to 30 June 23
07/09/2023 07:00
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RNS Number : 6063L Condor Gold PLC 07 September 2023
Condor Gold plc
7/8 Innovation Place
Douglas Drive,
Godalming,
Surrey
GU7 1JX
07 September 2023
Condor Gold Plc
("Condor" or "the Company")
Interim Report and Accounts for the Six Months Ended 30 June 2023
Condor Gold plc ("Condor Gold", "Condor", the "Group" or the "Company"), (AIM:
CNR; TSX: COG) presents its unaudited interim financial report for the
six-month periods to 30 June 2023. It has been posted on the Company's
websites www.condorgold.com (http://www.condorgold.com) and ca.condorgold.com
(http://www.ca.condorgold.com) . It is also available on SEDAR at
www.sedar.com (http://www.sedar.com) .
Highlights for six months to 30 June 2023
· There continues to be significant interest in the sale of the
Company's assets
· The Company hosted 2 site visits in connection with the sale of
the assets in Nicaragua during the first half of the year. There are currently
5 non-binding offers.
· Land acquisition continued at the La India open pit and
associated mine site infrastructure. To date, 99.6% of the core areas have
been purchased.
· Site clearance of 14 hectares has been completed for the
processing plant location, including areas for offices, warehouses, a
stockpile, and a buffer zone.
· 0.66 g/t gold from an isolated high-level chalcedonic rock chip
sample 400 m west of Cacao deposit indicates continuity of the hidden,
deep-seated high-grade mineralised Cacao deposit to the west.
· Up to 6.29 g/t gold from a 0.5 m thick quartz breccia in
artisanal mine workings at the Twin Hills (Dos Gemelos) prospect confirm
mineralisation along the Cacao trend some 2 km east of the Cacao deposit.
· 26.1 g/t gold and 200 g/t silver from new artisanal mine working
at the southern end of the main El Paraiso vein trend on the Rio Luna
Concession extends the strike length of medium to high-grade mineralisation on
the El Paraiso structure from 3.5 to over 4 km.
Post Period Highlights
· 4 July 2023 the Company announced it had raised £1 million by
way of the exercise of warrants by Galloway Limited, a company wholly owned by
Burnbrae Group Limited, which is, in turn, wholly owned by Jim Mellon,
Condor's Chairman, increasing Galloway's shareholding to 23% of Condor Gold.
· 21 July 2023 the Company provide an update on the sales process.
Company number: 05587987
CONDOR GOLD PLC
Interim Report and Accounts
For the Six Months Ended 30 June 2023
CONDOR GOLD PLC
CONTENTS OF THE INTERIM REPORT
FOR THE SIX MONTHS TO 30 JUNE 2023
TABLE OF CONTENTS Page
Highlights [4
Chairman's Statement 5-8
Review of Operations & Project Overview 9 - 20
Statement Regarding Forward Looking and Technical Information 21 - 23
Condensed Consolidated Statement of Comprehensive Income 24
Condensed Consolidated Statement of Financial Position 25
Condensed Company Statement of Financial Position 26
Condensed Consolidated Statement of Changes in Equity 27
Condensed Company Statement of Changes in Equity 28
Condensed Consolidated Cash Flow Statement 29
Condensed Company Cash Flow Statement 30
Notes to the Condensed Financial Statements 31 - 36]
CONDOR GOLD PLC
HIGHLIGHTS
FOR THE SIX MONTHS TO 30 JUNE 2023
Condor Gold plc ("Condor Gold", "Condor", the "Group" or the "Company"), (AIM:
CNR; TSX: COG) presents its unaudited interim financial report for the
six-month period to 30 June 2023. It has been posted on the Company's website
www.condorgold.com (http://www.condorgold.com) and ca.condorgold.com
(http://www.ca.condorgold.com) . It is also available on SEDAR at
www.sedar.com (http://www.sedar.com) .
Highlights for six months to 30 June 2023
· There continues to be significant interest in the sale of the
Company's assets.
· The Company hosted 2 site visits in connection with the sale of
the assets in Nicaragua during the first half of the year. There are currently
5 non-binding offers.
· Land acquisition continued at the La India open pit and
associated mine site infrastructure. To date, 99.6% of the core areas have
been purchased.
· Site clearance of 14 hectares has been completed for the
processing plant location, including areas for offices, warehouses, a
stockpile, and a buffer zone.
· 0.66 g/t gold from an isolated high-level chalcedonic rock chip
sample 400 m west of Cacao deposit indicates continuity of the hidden,
deep-seated high-grade mineralised Cacao deposit to the west.
· Up to 6.29 g/t gold from a 0.5 m thick quartz breccia in
artisanal mine workings at the Twin Hills (Dos Gemelos) prospect confirm
mineralisation along the Cacao trend some 2 km east of the Cacao deposit.
· 26.1 g/t gold and 200 g/t silver from new artisanal mine working
at the southern end of the main El Paraiso vein trend on the Rio Luna
Concession extends the strike length of medium to high-grade mineralisation on
the El Paraiso structure from 3.5 to over 4 km.
POST PERIOD HIGHLIGHTS
· 4 July 2023 the Company announced it had raised £1 million by
way of the exercise of warrants by Galloway Limited, a company wholly owned by
Burnbrae Group Limited, which is, in turn, wholly owned by Jim Mellon,
Condor's Chairman, increasing Galloway's shareholding to 23% of Condor Gold.
· 21 July 2023 the Company provide an update on the sales process.
CONDOR GOLD PLC
CHAIRMAN'S STATEMENT and CEO'S REPORT
FOR THE SIX MONTHS TO 30 JUNE 2023
Dear Shareholder,
I continue to be impressed by the executive team' dedication to getting our
project shovel ready, which is eliciting good interest in the current sales
process.
We are very aware of the value of our assets and will not allow them to go at
anything other than a fair price.
Jim Mellon
Chairman
Date: X September 2023
CEO'S Report
Dear Shareholder,
I am pleased to present Condor Gold Plc's ("Condor", the "Company" or the
"Group") interim report for the 6-month financial period to 30 June 2023
www.condorgold.com (http://www.condorgold.com) or, if you are viewing from
Canada, ca.condorgold.com (http://www.ca.condorgold.com) .
The focus during the 6 month period to 30 June 2023 has been on the sale of
the Company's assets in Nicaragua. On 22 November 2022, the Company announced
a strategy update and informed the market that it had appointed an advisor to
sell its assets. The Board carefully reviewed the Company's options as the
Project is "construction ready" with an18 month construction timeline. The
options included going through a financing and construction phase as a single
asset, single jurisdiction company with no existing gold production
experience. The Board concluded that it is in the best interests of the
Company and all stakeholders to sell the assets of the Company to a gold
producer with mine building expertise, thus ensuring a new mine at La India, a
significant investment made in the local area, which will regenerate the local
communities. As a result of this strategy, the Board has reclassified the
Nicaraguan assets as held for sale within the Group and Company Statements of
Financial Position. The focus for 2023 is to execute on a successful sale of
the assets while maintaining a social license to operate at the fully
permitted La India Project.
The last update on the sales process was on 21 July 2023, my quote in the RNS:
"There remains substantial interest from gold producers to acquire the
Company's assets. Wholly owned, fully permitted, construction ready gold mines
with potential production of 150,000 oz gold per annum, in major Gold
Districts, with the land and a new SAG Mill package purchased and a
construction period of only 18 months are rare. There are currently eight
companies under NDAs, five non-binding offers received and three site visits
completed. Companies under NDAs have access to a virtual data room, which
includes all drill data, technical studies to Feasibility Study level, details
of permits to construct and operate a mine and financial models. While the
sales process is taking longer than anticipated, new enquires continue to be
received and the Board is confident that a binding agreement will be reached.
Investors will be updated in due course."
The Company's strategy has been to develop the fully permitted La India
Project in two stages using the new SAG Mill that has already been purchased.
The delivery of a Feasibility Study Technical Report ("2022 FS") on 26 October
2022 on La India open pit, with an average of 81,524 oz gold per annum for the
initial six years for a relatively low total upfront capital cost of US$106
million is a landmark and significantly de-risks the Project. At US$1,600 oz
gold, the La India open pit Mineral Reserve produces total revenues of US$888
million, the total operating costs of mining, processing and G&A are
US$480 million, leading to an operating profit of US$408 million or a 46%
operating margin. After government and other royalties, but before sustaining
capital, the operating profit is US$355 million, which in Condor's opinion is
ample to repay any project debt on the relatively low upfront capex. At
US$2,000 oz gold after paying royalties, but before sustaining capital the
operating profit is US$563 million. In reality, two permitted high grade
feeder pits will be added during the early years of production thus increasing
production ounces of gold. Early production is targeted at 100,000 oz gold
p.a.
CONDOR GOLD PLC
CHAIRMAN'S STATEMENT and CEO'S REPORT
FOR THE SIX MONTHS TO 30 JUNE 2023
The plan would be to materially expand production by converting existing
Mineral Resources into Mineral Reserves and an associated integrated mine
plan. On 25 October 2021, the Company announced the results of a Preliminary
Economic Assessment and filed on SEDAR a technical report entitled "Condor
Gold Technical Report on the La Indian Gold Project, Nicaragua, 2021"
detailing average annual production of 150,000 oz of gold over the initial
nine years of production from open pit and underground Mineral Resources and
providing an indication of production targets.
The 2022 MRE update was prepared by SRK Consulting (UK) Limited ("SRK") and
uses the terminology, definitions and guidelines given in the Canadian
Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on Mineral
Resources and Mineral Reserves (May 2014).
The updated Mineral Resource Estimate is 9,672 kt at 3.5g/t gold for 1,088,000
oz gold in the indicated mineral resource category and 8,642 kt at 4.3g/t gold
for 1,190,000 oz gold in the inferred mineral resource category. The 2022 FS
was conducted on La India Open Pit which has a Mineral Resource Estimate of
8,487 kt at 3.0g/t gold in for 827,000 oz gold in the indicated mineral
resource category and 893 Kt at 2.4 g/t gold for 69,000 oz gold in the
inferred mineral resource category. The La India Open Pit Mineral resource is
inclusive of a Probable Mineral Reserve of 7.3Mt at 2.56g/t gold for 602,000
oz gold.
Outside the main La India open pit Mineral Reserve (the subject of the 2022
FS), there is a historical estimate, outlined in the 2021 Preliminary Economic
Assessment, of additional open pit Mineral Resources on four deposits
(America, Mestiza, Central breccia and Cacao) which represent an aggregate 206
Kt at 9.9 g/t gold for 66,000 oz in the indicated Mineral Resource category
and 2.1Mt at 3.3 g/t gold for 223,000 oz gold in the inferred Mineral Resource
category. In addition, there is an aggregate underground Mineral Resource
(La India, America, Mestiza, Central Breccia San Lucas,
Cristalito-Tatescame, and Cacao) of 979Kt at 6.2 g/t for 194,000 oz gold in
the indicated mineral resource category and 5.6Mt at 5.0 g/t gold for 898,000
oz gold in the inferred mineral resource category.
Highlights: Feasibility Study La India Open Pit only
The 2022 FS demonstrates a robust and economically viable base case for the La
India open pit:
· Probable Mineral Reserve of 7.3Mt at 2.56g/t gold for 602,000 oz
gold
· Production averages 81,545 oz gold per annum for the first six
years of an 8.4 year mine life
· An Internal Rate of Return ("IRR") of 23% and a post-tax, post
upfront capital cost NPV of US$86.9 million using a discount rate of 5% and
price of US$1,600 oz gold (Mineral Reserve Case).
· An Internal Rate of Return ("IRR") of 43% and a post-tax, post
upfront capital cost NPV of US$205.2 million using a discount rate of 5% and
price of US$2,000 oz gold.
· Low initial capital requirement of US$105.5 million (including
contingency and EPCM contract)
· Low average Life of Mine All-in Sustaining cash costs US$1,039
per oz gold.
The Company's strategy of a two-stage approach to production is supported by a
technical study released in October 2021, when Condor Gold announced the key
findings of a technical report on the La India Gold Project prepared by SRK.
This technical report (the "Technical Report") presented the results of a
strategic mining study to Preliminary Economic Assessment ("PEA") standards.
The strategic study covers two scenarios: Scenario A, in which the mining is
undertaken from four open pits, termed La India, America, Mestiza and Central
Breccia Zone ("CBZ"), which targets a plant feed rate of 1.225 million tonnes
per annum ("Mtpa"); and Scenario B, where the mining is extended to include
three underground operations at La India, America and Mestiza, in which the
processing rate is increased to 1.4 Mtpa. The 2021 Technical Report was
issued in October 2021 and filed on SEDAR and the Company's websites for
public disclosure to NI 43-101 standards.
CONDOR GOLD PLC
CHAIRMAN'S STATEMENT and CEO'S REPORT
FOR THE SIX MONTHS TO 30 JUNE 2023
Highlights 1.225 Mtpa PEA La India Open Pit + Feeder Pits:
· IRR of 58% and a post-tax Net Present Value ("NPV") of US$302
million, at a discount rate of 5% and gold price of US$1,700/oz.
· Average annual production of ~120,000 oz of gold over the initial
6 years of production.
· 862,000 oz of gold produced over 9-year Life of Mine.
· Initial capital requirement of US$153 million (including
contingency).
· Payback period 12 months.
· All-in Sustaining Costs ("AISC") of US$813 per oz gold.
· Robust Base Case presents an IRR of 48% and a post-tax NPV of
US$236 million at a discount rate of 5% and gold price of US$1,550/oz.
Highlights: 1.4Mtpa PEA Open Pit + Underground Operations
· IRR of 54% and a post-tax NPV of US$418 million, after deducting
upfront capex, at a discount rate of 5% and gold price of US$1,700/oz.
· Average annual production of ~150,000 oz of gold over the initial
9 years of production.
· 1,469,000 oz of gold produced over 12-year Life Of Mine.
· Initial capital requirement of US$160 million (including
contingency), where the underground development is funded through cash flow.
· Payback period 12 months.
· All-in Sustaining Costs of US$958 per oz gold over Life Of Mine.
The Company remains convinced that the 587 sq km La India Project is a major
gold district with the potential for significant future discoveries. Condor's
geologists have identified two major north-northwest-striking mineralised
basement feeder zones traversing the Project, the "La India Corridor", which
hosts 90% of Condor's gold mineral resource and the "Andrea Los Limones
Corridor". Numerous geophysics, soil geochemistry and surface rock chips
indicate the possibility for further mineralisation along strike. The updated
MRE 2022 for the Cacao deposit increased the MRE in the inferred mineral
resource category by 69% to 101,000 oz gold at 2.5 g/t gold, the
interpretation is that drilling has clipped the top of a fully preserved
epithermal vein system with a strike length of at least 1km with the potential
to host over 1 million oz gold.
The Company continues to enhance its social engagement and activities in the
community, thereby maintaining its social licence to operate. Condor has
strengthened its community team and stepped-up social activities and
engagement programmes. The main local focus is the drinking water programme,
implemented in April 2017. A total of 740 families are currently benefiting
from the program and currently receive five-gallon water dispensers each week.
In May 2021, the Company installed a water purification plant at a cost of
approximately US$250,000 to provide drinking water to the local communities.
In January 2018 Condor initiated 'Involvement Programmes', which now extend to
six groups in the local village to benefit communities which may be affected
by the mine. Taking the Elderly Group as an example, a committee of six people
has been formed. The Company allocates monthly support to the Elderly Group,
which decides how this money is spent to benefit the elderly in the Community.
Projects include a garden for medicinal herbs which are made into products
which are used by group members and sold to others in the community.
Condor continues to have very constructive meetings with key Ministries that
granted the Environment Permit (EP) for the La India, La Mestiza and America
open pits. The Company has been operating in Nicaragua since 2006 and, as a
responsible gold exploration and development company, continues to add value
to the local communities and environment by generating sustainable
socio-economic and environmental benefits. This includes skills training. The
new mine would potentially create approximately 1,000 jobs during the
construction period, with priority to be given to suitably skilled members of
the local community. The upfront capital cost of approximately US$106 million
as detailed in the 2022 FS will have a significant positive impact on the
economy. The Government and local communities will benefit significantly from
future royalties and taxes.
On 4 July 2023 the Company announced it had raised £1 million by way of the
exercise of warrants by Galloway Limited, a company wholly owned by Burnbrae
Group Limited, which is, in turn, wholly owned by Jim Mellon, Condor's
Chairman, increasing Galloway's shareholding to 23% of Condor Gold (See RNS
for details).
CONDOR GOLD PLC
CHAIRMAN'S STATEMENT and CEO'S REPORT
FOR THE SIX MONTHS TO 30 JUNE 2023
Turning to the financial results for the 2023 interims, the Group's loss for
the period was £565,8159 (2022: £1,372,390). The Company raised a total of
£73,438 after expenses during the financial period (2022: £3,304,002). The
net cash balance of the Group at 30 June 2023 was £584,837 (2022:
£2,453,607). During the period, there was a £2,294,117 foreign exchange loss
(2022 £3,270,705 gain). This is as a result of significant changes in USD
against GBP. The Board is aware of currency fluctuations and is working to
mitigate any further losses.
The focus for 2023 is to execute on a successful sale of the assets while
maintaining a social license to operate at the fully permitted La India
Project.
Mark Child
CEO
Date: X September 2023
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
LA INDIA PROJECT
Mining Studies
Following completion of the La India open pit Feasibility Study (FS) in the
Autumn of 2022, technical investigations on La India have been completed,
reducing the level of engineering activity on the project. Follow-up work
has focused on support for the sales process and responding to inquiries from
interested parties. Key areas of effort have included:
· Alternative production scenario evaluations examining
possibilities for either earlier production from La India, or considering
differing production rates employing the updated information present in the
designs underpinning the FS.
· Research into potential partner companies within Nicaragua,
including limited due diligence of other operations.
· Conducting site visits with interested parties and presenting FS
findings
· Maintenance of the data room
Condor expects that further engineering efforts will be limited in scope,
unless otherwise requested by potential investors.
Plant design
As a reminder, the design of the plant and infrastructure was conducted by
Hanlon Engineering of Tucson, Arizona, a division of GR Engineering Services
of Australia. The work included the plant, support infrastructure, access
roads from the pit exit to the mill. The level of design for the plant was
sufficient to provide cost estimates for capital and operating costs.
The Hanlon deliverables included over 100 drawings covering Civil, Electrical,
Process flow diagrams and general arrangements, along with the reports
detailing the capital cost sections of the FS and the operating costs for the
plant area.
Figure 1: View of Planned 2800 TPD Plant
Dave Crawford
Chief Technical Officer
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Geology: exploration and mining studies
The Company has focused on conserving cash during the asset sale process in
the first half of 2023 and so only limited exploration and mining studies have
been undertaken during the period. The sale process itself has provided some
useful feedback from three site visits by interested parties.
Prospecting along the Cacao trend revealed further gold showings that support
the theory that there is a major, fully preserved epithermal system running
underneath the plains of Sebaco. The plains of Sebaco are a wide valley formed
by a downthrown block, or graben, adjacent to the mineralised hills that host
the core La India open-pit gold resources. Unlike the La India open pit mine
area, the Sebaco graben has been subject to very little erosion since the
period of gold mineralisation, and much of the area has been covered by
alluvium. As a result of this protected geological situation the epithermal
gold mineralisation in the Sebaco graben is almost fully preserved, in places
several hundred metres below surface, and locally further hidden under
alluvium.
The Cacao deposit is at the centre of a string of prospects lying along a 4 km
long structure that appears to link the centre of the core La India
mineralisation with the more northerly, 20 km long, Andrea gold trend. A
near-surface gold-mineralised phreatic breccia; the Central Breccia prospect
occurs at the western end of the trend, whilst isolated mineralisation at the
Twin Hills (Dos Gemelos) and Santa Barbara prospects to the west of Cacao
delineate the eastern end.
Deep exploratory drilling in 2021 demonstrated that the main body of the Cacao
deposit extends for at least 400 m to the east of the previously defined
strike extent, into an area where there is no surface expression, extending
the total strike length of Cacao to at least 800 m. The prospecting carried
out in the first half of 2023 has identified a new occurrence of high-level
chalcedonic quartz, with a low but positively anomalous gold value of 0.66 g/t
on a new farm track some 400 m in the opposite direction, to the west of the
main Cacao resource. This is significant in that it demonstrates that the
deep-seated mineralisation may well extend to the west of Cacao where there is
little surface expression, as well as to the east, potentially extending the
strike length to a 1200 m plus long ore body.
Further away from Cacao at the eastern end of the trend, rock chip samples of
up to 6.29 g/t gold from artisanal workings at the Twin Hills (Dos Gemelos)
prospect confirms gold mineralisation and confirms the prospect as another
target for exploration for deep-seated epithermal mineralisation.
Elsewhere, assay results from on the Rio Luna Concession in Central Nicaragua
returned an assay of 26.1 g/t gold and 200 g/t silver from a 0.45 m wide
quartz-poor stockwork exposed in a small new artisanal mine working on the
principal El Paraiso vein trend, some 600 m further south along strike from
the southernmost drill-tested prospect. This extends the medium to high-grade
area of interest along the El Paraiso structure from 3.5 to over 4 km strike
length.
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Mineral resource estimation update in 2022
The mineral resource estimation was updated to include all the previous year's
infill and RC replacement drilling on the principal La India open pit and the
deep exploration drilling at Cacao. Secondary mineral resources were also
updated to reflect the latest mining costs.
Figure 2: Plan showing the current open pit and underground mineral resources
and fully permitted planned mine site infrastructure on La India Project. The
principal La India, America and Mestiza vein set mineral resources all fall
within the mine permit area. The San Lucas, Central Breccia,
Cristalito-Tatescame and Cacao mineral resources represent potential
additional satellite mines, all within 6 km of the planned processing plant.
Luc English
Resident Geologist
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Permitting
Land Acquisition
During first half of 2023, the land acquisition team focused on the
legalization and transfer of possessory rights to real rights, an improved
legal status, which means that the 55 properties purchased by Condor continued
with a registration process in the name of Condor's two wholly owned
Nicaraguan subsidiaries, La India Gold S.A. and Condor S.A.
The La India mining project has acquired a total area of 1,014.54 Ha, of which
353.87 Ha have been successfully legalized through agrarian reform titles and
registered in the Property Registry of Leon; 100% of the properties acquired
as possessory rights are now in the process of being transferred as real
rights in favor of La India Gold S.A. and Condor S.A. As of 30(th) June
2023, Condor owns or controls 99.6% of the required land for the La India
Mine.
Work to complete registration of properties in the Espinito Mendoza concession
(La Mestiza project) is ongoing: 70.50 Ha has been registered and the
remaining 203.04 Ha is in process.
Land Registered: 776.07 Manzanas -
547.14 Ha
Land in process to registered: 501.94 Manzanas - 353.87 Ha
Land in possession: 288.66 Manzanas - 203.51
Ha
Total: 1,566.67
Manzanas - 1,014.54 Ha
Dianer Escobar
Legal Manager
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Environmental
The collection of environment baseline and permit compliance data continued
throughout the first half of 2023 from the following data points:
· An analogue and digital weather monitoring station located within
the mine permit area;
· Surface water flow monitoring with daily readings of water levels
and determination of flows in the two main catchments at La Simona and at the
San Lucas tunnel, including a daily photographic record of the six weirs
within the La India and America concession areas. This feeds into the site
wide water management system for a future mine;
· Groundwater level monitoring of forty-four piezometers located in
the concession areas. The data is important for de-watering of the main la
India open pit, final geotechnical pit angels and managing the water supply
for the processing plant;
· Groundwater and environmental monitoring including sampling and
analysis of water quality at 13 strategic monitoring sites distributed in the
La India concession.
Reforestation efforts included contribution of plants to local INAFOR and
MARENA offices as part of our commitment established in the Environmental and
Social Impact Plan (ESIP) for the delivery of 200,000 plants for the
reforestation plan. Condor maintains 9.3 hectares of reforestation in eight
areas. In the first half of the year 2,944 plants were planted and the
Condor-run Oro Verde nursery held an inventory over 5,852 plants at the close
of the period which will be used for reforestation.
Long-term test-work of selected samples for their potential for acid rock
drainage started in 2020 continued on-site through 2022. The analysis of these
samples is scheduled for completion in the second quarter of 2023. Due to the
low amount of precipitation in the project area, the collection and
preservation of leachate samples have been rescheduled for the second half of
2023. Condor maintains 9 leachate samples from each reactor for a total of 27
corresponding samples.
The process for extending the environmental permit for the America open pit,
and renewal of the tree-cutting permits were initiated with the renewed
permits expected in the second half of the year.
Jamil Robleto Molina
Environment and Hydrology Manager
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Social
Social licence
The social team continued to work with the community and artisanal miners to
maintain acceptance and support, and to prepare the local stakeholders for the
changes that will come with the construction and operation of a significant
new gold mine of national importance. The Company has long recognised the
importance of gaining and maintaining a social licence to operate. A new gold
mine will have a huge positive impact on the local economy and it is in the
interest of both the Company and the local communities to maximise the
potential mutual benefits. There are ten communities within a 10 km radius of
the project, three of which lie adjacent to the planned mine infrastructure
and will be directly impacted, and seven that will have opportunities to
indirectly benefit.
A key stage in the creation of a local workforce for the construction and
operation of the mine was concluded with 113 local members of the community
graduating from Company-sponsored training courses. The courses covered both
trades such as heavy equipment operators, electricians, mechanics, as well as
clerical positions such as warehouse management, accounting, customs
management and basic computer skills.
The Company has continued to build working relations and communicate with the
communities via eight local programs created by the Company and that involve
almost 80% of the local population: seniors, local businessmen, cooperative
artisanal miners, independent artisanal miners, APROSAIC (local association of
development initiatives), the projects "Water is life", "Youth in Action" and
"Happy Childhood". These groups have been encouraged to develop
self-sustaining projects as well as undertake voluntary community work
including:
· Medicinal Garden (medicinal plant nursery, with production and
sale of natural medicine),
· Production and sale of piñatas,
· Village bank (providing loans to members),
· Savings Programme (where 24 businessmen participated),
· Litter clean-ups and recycling.
· Bed and breakfast homestay (nine rooms in five houses).
· Supporting and providing medical care 'home base' in five small
remote communities in alliance with the Ministry of Health.
In 2021, the Company invested approximately US$250,000 in a water purification
plant, which provides drinking water for the local community. The Company's
drinking water project continues to provide 358 homes and 433 families with
clean, affordable drinking water. The deliveries provide an excellent informal
point of contact with a broad spectrum of community members.
As part of Condor's Health, Safety, Environmental and Community (HSEC) policy,
which is aligned with international standards, the Company also implemented
quarterly community assemblies in the three villages within La India's direct
area of influence in order to present the activities carried out as part of
the project and the exploration activities.
Levinia Sequeira
Social Manager
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
CURRENT CONCESSION HOLDINGS
Nicaragua Projects
Project Concession Ownership Expiry Date Area (km²)
La India Project La India 100% Owned January 2027 68.50
Espinito Mendoza 100% Owned November 2026 2.00
Cacao 100% Owned January 2032 11.90
Santa Barbara 100% Owned April 2034 16.20
Real de la Cruz 100% Owned January 2035 7.66
Rodeo 100% Owned January 2035 60.40
La Mojarra 100% Owned June 2029 27.00
La Cuchilla 100% Owned August 2035 86.39
El Zacatoso 100% Owned October 2039 1.00
Tierra Blanca 100% Owned June 2040 32.21
Las Cruces 100% Owned December 2043 142.3
Cerro Los Cerritos 100% Owned June 2044 132.1
Subtotal 587.66
Boaco Rio Luna 100% Owned June 2035 43.00
RAAN Estrella 100% Owned April 2035 18.00
Nueva Segovia Potrerillos 100% Owned December 2031 12.00
TOTAL 660.66
All concessions in Nicaragua are combined exploration and exploitation
concessions.
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
CURRENT MINERAL RESOURCES AND RESERVES
The following Mineral Resource estimations set out Condor's Mineral Resource
Statement as at 28 February 2022 for the La India Project:
Table showing SRK CIM Compliant Mineral Resource Statement effective 28
February 2022 for La India Project
MINERAL RESOURCE STATEMENT SPLIT PER VEIN as of February 28, 2022
((7),(8),(9),(10),(11))
Category Area Name Vein Name Cut-Off gold silver
Tonnes (kt) Au Grade (g/t) Au (Koz) Ag Grade (g/t) Ag (Koz)
Indicated La India Vein Set La India/ California((1)(6)) 0.65 g/t (OP) 8,487 3.0 827 6.1 1,669
La India/ California((2)) 2.0 g/t (UG) 391 5.0 63 10.6 134
America Vein Set America Mine((3)) 0.5 g/t (OP) 114 8.1 30 4.9 18
America Mine((4)) 2.0 g/t (UG) 470 7.3 110 4.7 71
Mestiza Vein Set Tatiana ((3)) 0.5 g/t (OP) 92 12.1 36 19.5 57
Tatiana ((4)) 2.0 g/t (UG) 118 5.5 21 11.3 43
Inferred La India Vein Set La India/ California((1)(6)) 0.65 g/t (OP) 893 2.4 69 4.7 134
Teresa((1)) 0.65 g/t (OP) 5 6.4 1
La India/ California((2)) 2.0 g/t (UG) 1,142 5.6 206 12.2 446
Teresa((2)) 2.0 g/t (UG) 85 10.9 30
Arizona((5)) 2.0 g/t (UG) 399 4.3 56
Agua Caliente((5)) 2.0 g/t (UG) 43 9.0 13
America Vein Set America Mine((3)) 0.5 g/t (OP) 677 3.1 67 5.5 120
America Mine((4)) 2.0 g/t (UG) 1,008 4.8 156 6.8 221
Guapinol((5)) 2.0 g/t (UG) 497 5.9 94
Mestiza Vein Set ((9)) Tatiana((3)) 0.5 g/t (OP) 220 6.6 47 13.6 97
Tatiana((4)) 2.0 g/t (UG) 615 3.9 77 8.8 174
Buenos Aires((3)) 0.5 g/t (OP) 120 9.8 38
Buenos Aires((4)) 2.0 g/t (UG) 188 7.1 43
Espenito((4)) 2.0 g/t (UG) 181 8.4 49
Central Breccia Central Breccia((3)) 0.5 g/t (OP) 922 1.9 56
San Lucas San Lucas((5)) 2.0 g/t (UG) 298 5.9 56
Cristalito-Tatescame Cristalito-Tatescame((5)) 2.0 g/t (UG) 185 5.5 33
Cacao Cacao((1)) 0.65 g/t (OP) 190 2.4 15
Cacao((2)) 2.0 g/t (UG) 975 2.8 86
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
(1) The La India and Cacao pits are amenable to open pit mining and the
Mineral Resource Estimates are constrained within Whittle optimised pits,
which SRK based on the following parameters: A Gold price of USD1,800 per
ounce of gold with no adjustments. Prices are based on experience gained from
other SRK Projects. Slope angles defined by the Company Geotechnical study
which range from angle 42 - 48°. Metallurgical recovery assumptions are set
at 90.2% for gold, based on test work conducted to date. Marginal costs of
USD24.32/t for processing, USD7.50/t G&A and USD2.33/t for mining, with
consideration for mining royalties, but without considering revenues from
other metals.
(2) Underground Mineral Resources beneath the open pit are reported at a
cut-off grade of 2.0 g/t Au over a minimum width of 1.0 m. Cut-off grades
are based on a price of USD1,800 per ounce of gold and gold recoveries of
90.2%, costs of USD24.32/t for processing, USD7.5/t G&A and USD51.0/t for
mining, with consideration for mining royalties, but without considering
revenues from other metals.
(3) The America, Central Breccia, La Mestiza pits are amenable to open pit
mining and the Mineral Resource Estimates are constrained within Whittle
optimised pits. No new work has been completed on the Mineral Resources
estimates for these projects since the previous estimates (2019) which SRK
based on the following parameters: A Gold price of USD1,500 per ounce of gold
with no adjustments. Prices are based on experience gained from other SRK
Projects. Slope angles defined by the Company Geotechnical study which range
from angle 40 - 48°. Metallurgical recovery assumptions are between 91-96%
for gold, based on test work conducted to date. Marginal costs of USD19.36/t
for processing, USD5.69/t G&A and USD2.35/t for mining, a haul cost of
USD1.25/t was added to the Mestiza ore tonnes to consider transportation to
the processing plant, with consideration for mining royalties, but without
considering revenues from other metals.
(4) Underground Mineral Resources beneath the America, Central Breccia, La
Mestiza open pits are reported at a cut-off grade of 2.0 g/t Au over a
minimum width of 1.0 m. Cut-off grades are based on a price of USD1,500 per
ounce of gold and gold recoveries of 91% for resources, costs of USD19.36/t
for processing, USD4.55/t G&A and USD50.0/t for mining, without
considering revenues from other metals.
(5) Mineral Resources as previously estimated by SRK (22 December 2011),
cut-off grade updated to reflect current price and cost assumptions and using
a 2.0 g/t Au over a minimum width of 1.0 m. Cut-off grades are based on a
price of USD1,800 per ounce of gold and gold recoveries of 90.2% for
resources, costs of USD24.32/t for processing, USD7.5/t G&A and USD51.0/t
for mining, with consideration for mining royalties, but without considering
revenues from other metals.
(6) The La India deposit Mineral Resource as reported considers the current
maximum limits for potential extraction. The current operating permits
consider a limitation from the current village boundaries, which have been
applied to the Mineral Reserves. It is the QP's opinion there remains a
reasonable prospect that this may be revisited at a future date once mining
commences, and relocation of the La India village may be required. Further
work will be required on the costs associated to such relocation efforts,
along with the potential timelines to achieve the relocation. In order to
achieve this outcome Condor will need to submit an updated EIA and receive
environmental approval, where this will need to take account stakeholder
interests and concerns, and complete a resettlement process. Such exercises
require careful stakeholder engagement.
(7) Back calculated Inferred silver grade based on a total tonnage of 4,569 Kt
as no silver estimates for Teresa, Central Breccia, Arizona, Agua Caliente,
Guapinol, San Lucas, Cristalito-Tatescame or Cacao inherently involve a degree
of rounding and consequently introduce a margin of error. Where these occur,
SRK does not consider them to be material. All composites have been capped
where appropriate. The Concessions are wholly owned by and exploration is
operated by Condor Gold plc.
(8) Mineral Resources that are not Mineral Reserves do not have demonstrated
economic viability. All figures are rounded to reflect the relative accuracy
of the estimate and have been used to derive sub-totals, totals and weighted
averages. Such calculations inherently involve a degree of rounding and
consequently introduce a margin of error. Where these occur, SRK does not
consider them to be material. All composites have been capped where
appropriate. The Concessions are wholly owned by and exploration is operated
by Condor Gold plc.
(9) Mineral Resources presented do not include any updated Mineral Resource
Estimates on the 2021 Mestiza drilling program completed and reported on March
10, 2022, as it post-dates the effective date for the current study. Updated
Mineral Resources will be disclosed in future updates.
(10) The reporting standard adopted for the reporting of the MRE uses the
terminology, definitions and guidelines given in the Canadian Institute of
Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and
Mineral Reserves (May 2014) as required by NI 43-101.
(11) SRK has completed a site inspection to the deposit by Mr Benjamin
Parsons, MSc (MAusIMM(CP), Membership Number 222568, an appropriate
"independent qualified person" as this term is defined in National Instrument
43-101.
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
Table showing SRK CIM Compliant Mineral Resource Statement effective 28
February 2022 for the La India Project
SRK MINERAL RESOURCE STATEMENT as of 28 February 2022 ((7),(8),(9),(10), (11))
Category Area Name Vein Name Cut-Off gold silver
Tonnes (kt) Au Grade (g/t) Au (koz) Ag Grade (g/t) Ag (koz) (7)
Indicated Grand total All veins 0.5g/t (OP) ((3)) 206 9.9 66 11.4 75
0.65 g/t (OP) ((1,6)) 8,487 3 827 6.1 1,669
2.0 g/t (UG) ((2,4,5)) 979 6.2 194 7.9 248
Subtotal Indicated 9,672 3.5 1,088 6.4 1,992
Inferred Grand total All veins 0.5g/t (OP) ((3)) 1,939 3.3 208 3.5 217
0.65 g/t (OP) ((1,6)) 1,087 2.4 84 4.7 134
2.0 g/t (UG) ((2,4,5)) 5,616 5 898 9.5 841
Subtotal Inferred 8,642 4.3 1,190 8.1((7)) 1,193
(1) The La India and Cacao pits are amenable to open pit mining and the
Mineral Resource Estimates are constrained within Whittle optimised pits,
which SRK based on the following parameters: A Gold price of USD1,800 per
ounce of gold with no adjustments. Prices are based on experience gained from
other SRK Projects. Slope angles defined by the Company Geotechnical study
which range from angle 42 - 48°. Metallurgical recovery assumptions are set
at 90.2% for gold, based on test work conducted to date. Marginal costs of
USD24.32/t for processing, USD7.50/t G&A and USD2.33/t for mining, with
consideration for mining royalties, but without considering revenues from
other metals.
(2) Underground Mineral Resources beneath the open pit are reported at a
cut-off grade of 2.0 g/t Au over a minimum width of 1.0 m. Cut-off grades
are based on a price of USD1,800 per ounce of gold and gold recoveries of
90.2%, costs of USD24.32/t for processing, USD7.5/t G&A and USD51.0/t for
mining, with consideration for mining royalties, but without considering
revenues from other metals.
(3) The America, Central Breccia, La Mestiza pits are amenable to open pit
mining and the Mineral Resource Estimates are constrained within Whittle
optimised pits. No new work has been completed on the Mineral Resources
estimates for these projects since the previous estimates (2019) which SRK
based on the following parameters: A Gold price of USD1,500 per ounce of gold
with no adjustments. Prices are based on experience gained from other SRK
Projects. Slope angles defined by the Company Geotechnical study which range
from angle 40 - 48°. Metallurgical recovery assumptions are between 91-96%
for gold, based on test work conducted to date. Marginal costs of USD19.36/t
for processing, USD5.69/t G&A and USD2.35/t for mining, a haul cost of
USD1.25/t was added to the Mestiza ore tonnes to consider transportation to
the processing plant, with consideration for mining royalties, but without
considering revenues from other metals.
(4) Underground Mineral Resources beneath the America, Central Breccia, La
Mestiza open pits are reported at a cut-off grade of 2.0 g/t Au over a
minimum width of 1.0 m. Cut-off grades are based on a price of USD1,500 per
ounce of gold and gold recoveries of 91% for resources, costs of USD19.36/t
for processing, USD4.55/t G&A and USD50.0/t for mining, without
considering revenues from other metals.
(5) Mineral Resources as previously estimated by SRK (22 December 2011),
cut-off grade updated to reflect current price and cost assumptions and using
a 2.0 g/t Au over a minimum width of 1.0 m. Cut-off grades are based on a
price of USD1,800 per ounce of gold and gold recoveries of 90.2% for
resources, costs of USD24.32/t for processing, USD7.5/t G&A and USD51.0/t
for mining, with consideration for mining royalties, but without considering
revenues from other metals.
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
(6) The La India deposit Mineral Resource as reported considers the current
maximum limits for potential extraction. The current operating permits
consider a limitation from the current village boundaries, which have been
applied to the Mineral Reserves. It is the QP's opinion there remains a
reasonable prospect that this may be revisited at a future date once mining
commences, and relocation of the La India village may be required. Further
work will be required on the costs associated to such relocation efforts,
along with the potential timelines to achieve the relocation. In order to
achieve this outcome Condor will need to submit an updated EIA and receive
environmental approval, where this will need to take account stakeholder
interests and concerns and complete a resettlement process. Such exercises
require careful stakeholder engagement.
(7) Back calculated Inferred silver grade based on a total tonnage of 4,555 Kt
as no silver estimates for Teresa, Central Breccia, Arizona, Agua Caliente,
Guapinol, San Lucas, Cristalito-Tatescame or Cacao. inherently involve a
degree of rounding and consequently introduce a margin of error. Where these
occur, SRK does not consider them to be material. All composites have been
capped where appropriate. The Concessions are wholly owned by and exploration
is operated by Condor Gold plc
(8) Mineral Resources that are not Mineral Reserves do not have demonstrated
economic viability. All figures are rounded to reflect the relative accuracy
of the estimate and have been used to derive sub-totals, totals and weighted
averages. Such calculations inherently involve a degree of rounding and
consequently introduce a margin of error. Where these occur, SRK does not
consider them to be material. All composites have been capped where
appropriate. The Concessions are wholly owned by and exploration is operated
by Condor Gold plc.
(9) Mineral Resources presented do not include any updated Mineral Resource
estimates on the 2022 Mestiza drilling program completed and reported on March
10, 2022, as it post-dates the effective date for the current study. Updated
Mineral Resources will be disclosed in future updates.
(10) The reporting standard adopted for the reporting of the MRE uses the
terminology, definitions and guidelines given in the Canadian Institute of
Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and
Mineral Reserves (May 2014) as required by NI 43-101.
(11) SRK has completed a site inspection to the deposit by Mr Benjamin
Parsons, MSc (MAusIMM(CP), Membership Number 222568, an appropriate
"independent qualified person" as this term is defined in National Instrument
43-101.
Table showing CIM Compliant Mineral Reserve Statement effective 31 March 2022
for the La India Open Pit Project.
Mineral Reserve Classification Tonnage Au Grade Ag Grade Contained Au Contained Ag
(Mt dry) (g/t) (g/t) (koz) (koz)
Proven
Probable 7.32 2.56 5.31 602 1,250
Proven + Probable 7.32 2.56 5.31 602 1,250
1. Based on a cut-off grade of 0.6 g/t Au, gold price of US$1,600/oz and Ag
price of US$20/oz.,
2. Average ore loss and dilution are estimated at 3% and 8%, respectively,
3. 91% Au and 56% Ag metallurgical recovery,
4. Waste tonnes within the open pit is 96 Mt at a strip ratio of 13.2:1 (waste
to ore);
5. The open pit Mineral Reserves assume complete mine recovery;
6. Topography as of March 31, 2022;
7. The Mineral Reserve estimate has been completed under the supervision of Mr
Fernando P Rodrigues of SRK, BSc, MBA MMSAQP #01405QP of SRK Consulting, Inc.
in accordance with NI 43-101 and generally accepted Canadian Institute of
Mining, Metallurgical and Petroleum "Estimation of Mineral Resource and
Mineral Reserves Best Practices" guidelines ("CIM Guidelines"). Mr Rodrigues
has sufficient experience to act as an independent qualified person in
accordance with NI 43-101. Mr Rodrigues has not been to site.
CONDOR GOLD PLC
REVIEW OF OPERATIONS AND PROJECT OVERVIEW
FOR THE SIX MONTHS TO 30 JUNE 2023
SUMMARY OF CURRENT PERMITTED OPEN PITS - LA INDIA PROJECT(1)
Category Area Name Cut-Off Gold
Tonnes (Kt) Au Grade (g/t) Au (Koz)
Indicated La India 0.5 g/t (OP) 8,377 3.1 837
America 0.5 g/t (OP) 114 8.1 30
Mestiza 0.5 g/t (OP) 92 12.1 36
Total 8,583 3.3 903
Inferred La India 0.5 g/t (OP) 883 2.4 68
America 0.5 g/t (OP) 667 3.1 67
Mestiza 0.5 g/t (OP) 341 7.7 85
Total 1,901 3.6 220
Total La India 0.5 g/t (OP) 9,260 3.0 905
America 0.5 g/t (OP) 791 3.8 97
Mestiza 0.5 g/t (OP) 433 8.6 121
Total 10,484 3.3 1,123
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(1)See Company RNS dated 6 May, 2020
CONDOR GOLD PLC
STATEMENT REGARDING FORWARD-LOOKING AND TECHNICAL INFORMATION
FOR THE SIX MONTHS TO 30 JUNE 2023
Certain statements contained in this document constitute forward-looking
information under applicable Canadian securities laws. These statements relate
to future events or future performance. All statements other than statements
of historical fact may be forward-looking statements. Forward-looking
statements are often, but not always, identified by the use of words such as
"seek", "anticipate", "plan", "continue", "objectives", "strategies",
"estimate", "expect", "may", "will", "project", "predict", "potential",
"targeting", "intend", "could", "might", "should", "believe" and similar
expressions. These statements involve known and unknown risks, uncertainties
and other factors that may cause actual results or events to differ materially
from those anticipated in such forward-looking statements. The Company
believes the expectations reflected in those forward-looking statements are
reasonable but no assurance can be given that these expectations will prove to
be correct and such forward-looking statements included in its document should
not be unduly relied upon.
In particular, this document contains forward-looking statements pertaining to
the following:
· mineral resource and mineral reserve estimates;
· targeting additional mineral resources and expansion of deposits;
· the impact of the redesigned La India open pit on the technical
viability, economic attractiveness and anticipated gold production of the La
India Project;
· the Company's expectations, strategies and plans for the La India
Project, including the Company's planned exploration and development
activities;
· the results of future exploration and drilling and estimated
completion dates for certain milestones;
· successfully adding or upgrading mineral resources and
successfully developing new deposits;
· production and processing estimates;
· future financial or operating performance and condition of the
Company and its business, operations and properties; and
· any other statement that may predict, forecast, indicate or imply
future plans, intentions, levels of activity, results, performance or
achievements.
The actual results could differ materially from those anticipated in these
forward-looking statements or information as a result of the risk factors set
forth below and elsewhere in this document:
· mineral exploration, development and operating risks;
· estimation of mineralisation, mineral resources and mineral
reserves;
· environmental, health and safety regulations of the resource
industry;
· competitive conditions;
· permitting and licencing risks;
· operational risks;
· negative cash flow;
· liquidity and financing risks;
· funding risk;
· material contract risks;
· exploration costs;
· uninsurable risks;
· conflicts of interest;
· exercise of statutory rights and remedies;
· risks of operating in Nicaragua;
· government policy changes;
· ownership risks;
· artisanal miners and community relations;
· difficulty in enforcement of judgments;
· the Company's staggered board of directors;
· market conditions;
· stress in the global economy;
· current global financial condition;
· exchange rate and currency risks;
· commodity prices;
· reliance on key personnel;
CONDOR GOLD PLC
STATEMENT REGARDING FORWARD-LOOKING AND TECHNICAL INFORMATION
FOR THE SIX MONTHS JUNE 30, 2023 (CONTD.)
· dilution risk; and
· payment of dividends; and
· other risks and uncertainties described under the heading "Risk
Factors" in the Company's annual information form for the fiscal year ended
December 31, 2022, dated March 27, 2023 and available under the Company's
profile at www.sedar.com (http://www.sedar.com) .
Statements relating to "mineral reserves" or "mineral resources" are deemed to
be forward-looking statements or information, as they involve the implied
assessment, based on certain estimates and assumptions, that the reserves and
resources described can be profitably produced in the future. Readers are
cautioned that the foregoing lists of factors are not exhaustive. The
forward-looking statements contained in this document are expressly qualified
by this cautionary statement.
Although the forward-looking statements contained in this document are based
upon assumptions which the Company believes to be reasonable, the Company
cannot assure holders of ordinary shares of the Company that actual results
will be consistent with these forward-looking statements. With respect to
forward-looking statements contained in this document, the Company has made
assumptions regarding: future commodity prices and royalty regimes;
availability of skilled labour; timing and amount of capital expenditures;
future currency exchange and interest rates; the impact of increasing
competition; general conditions in economic and financial markets;
availability of drilling and related equipment; effects of regulation by
governmental agencies; the receipt of required permits; royalty rates; future
tax rates; future operating costs; availability of future sources of funding;
ability to obtain financing and assumptions underlying estimates related to
adjusted funds from operations. The Company has included the above summary of
assumptions and risks related to forward-looking information provided in this
document in order to provide holders of ordinary shares of the Company with a
more complete perspective on the Company's future operations and such
information may not be appropriate for other purposes. The Company's actual
results, performance or achievement could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any of the events anticipated by
the forward-looking statements will transpire or occur, or if any of them do
so, what benefits the Company will derive therefrom. These forward-looking
statements are made as of the date of this document and the Company disclaims
any intent or obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or results or otherwise,
other than as required by applicable securities laws.
TECHNICAL INFORMATION
Certain disclosure contained in this document relating to the La India Project
of a scientific or technical nature has been summarized or extracted from the
technical report entitled "Condor Gold Technical Report on the La India Gold
Project, Nicaragua", dated October 2022 (the "Technical Report"), prepared in
accordance with NI 43-101. The Technical Report was prepared by or under the
supervision of Tim Lucks, Principal Consultant (Geology & Project
Management), Fernando Rodrigues, Principal Consultant (Mining), Eric Olin,
Principal Consultant (Metallurgy) Benjamin Parsons, Principal Consultant
(Resource Geology), each of SRK Consulting (UK) Limited, each of whom is an
independent Qualified Person as such term is defined in NI 43-101.
On 25 February 2022 the Company announced an updated Mineral Resource Estimate
("MRE") at La India. The MRE as at 25 February 2022 is 9.67 million tonnes ("M
tonnes" or "Mt") at 3.5 g/t gold for 1,088,000 oz gold in the Indicated
category and 8.6M tonnes at 4.3g/t gold for 1,190,000 oz gold in the Inferred
category. The MRE did not show a material change in the number of ounces of
gold reported in the Indicated Category or Inferred Category. The methods
applied to conducting the geological modelling and estimation for the MRE have
not changed from those described in the Technical Report. Given that there has
been no material change to the MRE, the Mineral Resource Estimate as disclosed
in the Technical Report was not materially impacted by this update. More
information relating to the updated MRE is supported by the press release
titled "Mineral Resource Update on La India Project, Nicaragua, including
initial declaration of new open pit mineral resource at Mestiza" dated 17
August 2022 which is available on SEDAR under the Company's issuer profile.
The MRE was prepared by SRK Consulting (UK) Limited ("SRK") and uses the
terminology, definitions and guidelines given in the Canadian Institute of
Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and
Mineral Reserves (May 2014). The MRE update was reviewed and approved by
Andrew Cheatle, P. GEP, a qualified person within the meaning of NI 43-101.
CONDOR GOLD PLC
STATEMENT REGARDING FORWARD-LOOKING AND TECHNICAL INFORMATION
FOR THE SIX MONTHS JUNE 30, 2023 (CONTD.)
David Crawford, Chief Technical Officer of the Company, and Andrew Cheatle, a
non-executive Director of the Company, each of whom is a Qualified Person as
defined by NI 43-101, have approved the written disclosure in this document.
Qualified Person: Andrew Cheatle has supervised the preparation of the
geological information in this report. He has circa 30 years of relevant
experience in mineral exploration and development and provides consulting
services in that field to various companies in the gold exploration and/or
development sectors.
Andrew Cheatle is satisfied that the results are verified, based on an
inspection of the results from activities carried out in 2022 as set out in
this document, including of drill core, a review of the sampling procedures,
the credentials of the professionals completing the work and the visual nature
of the geology within a district where he is familiar with the style and type
of mineralization.
Quality Assurance and Control: Samples generated from soil sampling and
drilling activities are shipped directly in security-sealed bags to Bureau
Veritas preparation facility in Managua (ISO 9001). Samples shipped also
include intermittent standards and blanks. Pulp samples are subsequently
shipped to Bureau Veritas Acme Laboratories in Vancouver, Canada for analysis.
For the drilling assays used for Mineral Resource estimations, five percent of
pulp samples are prepared and analysed by ALS Minerals in Vancouver, Canada
(ISO 17025:2017 and ISO 9001:2015) and Bureau Veritas Laboratories (ISO
17025:2005 and ISO 9001:2015). Metallurgical tests were done on quartered core
samples for La India, America and Central Breccia. No systematic mineralogy
analysis has been carried out.
CONDOR GOLD PLC
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS TO 30 JUNE 2023
Six months Six months
to 30.06.23 to 30.06.22
unaudited unaudited
£ £
Revenue - -
Share based payments (162,425) (288,906)
Administrative expenses (810,702) (1,085,069)
Operating loss (973,127) (1,373,975)
Finance income 7,312 1,585
Loss before income tax (965,815) (1,372,390)
Income tax expense - -
Loss for the period (965,815) (1,372,390)
Other comprehensive income/(loss):
Currency translation differences (2,294,117) 3,270,705
Other comprehensive income/(loss) for the period (2,924,117) 3,270,705
Total comprehensive income/(loss) for the period (3,259,932) 1,898,315
Earnings per share expressed in pence per share:
Basic and diluted (in pence) Note 7 (0.61) (0.92)
CONDOR GOLD PLC
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
30.06.23 31.12.22 30.06.22
unaudited audited unaudited
£ £ £
ASSETS:
NON-CURRENT ASSETS
Property, plant and - - 7,818,025
equipment
Intangible assets - - 32,752,758
- - 40,570,783
CURRENT ASSETS
Assets classified as held for sale 41,785,894 42,937,116 -
Trade and other receivables 634,310 916,963 862,775
Cash and cash equivalents 584,837 2,444,093 2,453,607
43,005,041 46,298,172 3,316,382
TOTAL ASSETS 43,005,041 46,298,172 43,887,165
LIABILITIES:
CURRENT LIABILITIES
Trade and other payables 137,145 406,207 221,966
TOTAL LIABILITIES 137,145 406,207 221,966
NET CURRENT ASSETS 42,867,896 45,891,965 3,094,416
42,867,896 45,891,965 43,665,199
NET ASSETS
SHAREHOLDERS' EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT
Called up share capital 31,748,067 31,747,809 31,707,573
Share premium 46,754,815 46,681,635 43,451,199
Exchange difference reserve (1,543,545) 750,572 788,667
Retained earnings (34,091,441) (33,288,051) (32,282,240)
42,867,896 45,891,965 43,665,199
TOTAL EQUITY
CONDOR GOLD PLC
CONDENSED COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
30.06.23 31.12.22 30.06.22
unaudited audited unaudited
£ £ £
ASSETS:
NON-CURRENT ASSETS
Property, plant and - - 4,309,955
equipment
Investments 751,977 751,977 751,977
Other receivables 44,944,687 43,500,630 41,614,215
45,696,664 44,252,607 46,676,147
CURRENT ASSETS
Assets classified as held for sale 4,474,402 4,474,402 -
Trade and other receivables 77,772 333,101 81,971
Cash and cash equivalents 542,713 2,407,187 2,390,197
5,094,887 7,214,690 2,472,168
TOTAL ASSETS 50,791,551 51,467,297 49,148,315
LIABILITIES:
CURRENT LIABILITIES
Trade and other payables 147,626 249,357 343,663
TOTAL LIABILITIES 147,626 249,357 343,663
NET CURRENT ASSETS 4,947,261 6,965,333 2,128,505
50,643,925 51,217,940 48,804,652
NET ASSETS
SHAREHOLDERS' EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT
Called up share capital 31,748,067 31,747,809 31,707,573
Share premium 46,754,815 46,681,635 43,451,199
Retained earnings (27,858,957) (27,211,504) (26,354,120)
50,643,925 51,217,940 48,804,652
TOTAL EQUITY
CONDOR GOLD PLC
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
AS AT 30 JUNE 2023
Share capital Share premium Exchange difference reserve Retained earnings Total equity
£ £ £ £ £
At 1 January 2022 29,326,143 42,528,627 (2,482,038) (31,198,756) 38,173,976
Loss for the period - - - (1,372,390) (1,372,390)
Other comprehensive income: - - - - -
Currency translation differences - - 3,270,705 - 3,270,705
Total comprehensive income - - 3,270,705 (1,372,390) 1,898,315
New shares issued 2,381,430 922,572 - - 3,304,002
Issue costs - - - - -
Share based payment - - - 288,906 288,906
Total contributions by & distributions to owners of the parent, recognised
directly in equity
2,381,430 922,572 - 288,906 3,592,908
At 30 June 2023 31,707,573 43,451,199 788,667 (32,282,240) 43,665,199
At 1 January 2023 31,747,809 46,681,635 750,572 (33,288,051) 45,891,965
Loss for the period - - - (965,815) (965,815)
Other comprehensive income: - - - - -
Currency translation differences - - (2,294,117) - (2,294,117)
Total comprehensive income - - (2,294,117) (965,815) (3,259,932)
New shares issued 258 73,180 - - 73,438
Issue costs - - - - -
Share based payment - - - 162,425 162,425
Total contributions by & distributions to owners of the parent, recognised
directly in equity
258 73,180 - 162,425 235,863
At 30 June 2023 31,748,067 46,754,815 (1,543,545) (34,091,441) 42,867,896
CONDOR GOLD PLC
CONDENSED COMPANY STATEMENT OF CHANGES IN EQUITY
AS AT 30 JUNE 2023
Share capital Share premium Retained earnings Total
£ £ £ £
At 1 January 2022 29,326,143 42,528,627 (25,461,018) 46,393,752
Comprehensive income:
Loss for the period - - (1,182,008) (1,182,008)
Total comprehensive income - - (1,182,008) (1,182,008)
New shares issued 2,381,430 922,572 - 3,354,002
Issue costs - - - -
Share based payment - - 288,906 288,906
Total transactions with owners recognised directly in equity 2,381,430 922,572 288,906 3,592,908
At 30 June 2022 31,707,573 43,451,199 (26,354,120) 48,804,652
At 1 January 2023 31,747,809 46,681,635 (27,211,504) 51,217,940
Comprehensive income:
Loss for the period - - (809,878) (809,878)
Total comprehensive income - - (809,878) (809,878)
New shares issued 258 73,180 - 73,438
Issue costs - - - -
Share based payment - - 162,425 162,425
Total transactions with owners recognised directly in equity 258 73,180 162,425 235,863
At 30 June 2023 31,748,067 46,754,815 (27,858,957) 50,643,925
CONDOR GOLD PLC
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS TO 30 JUNE 2023
Six months Six months
to 30.06.23 to 30.06.22
unaudited unaudited
£ £
Loss before tax (965,815) (1,372,390)
Share based payment 162,425 288,906
Depreciation charges 27,461 34,301
Finance income (7,312) (1,585)
(783,241) (1,050,768)
Increase in trade and other receivables 282,653 (87,082)
(Decrease)/increase in trade and other payables (269,062) (26,210)
Net cash used in operating activities (769,650) (1,164,060)
Cash flows from investing activities
Purchase of intangible fixed assets (1,067,405) (1,805,216)
Purchase of tangible fixed assets (11,014) (62,363)
Interest received 7,312 1,585
Net cash used in investing activities (1,071,107) (1,865,994)
Cash flows from financing activities
Net proceeds from share issue 73,438 3,304,002
Net cash generated from financing activities 73,438 3,304,002
Increase/(decrease) in cash and cash equivalents (1,767,319) 273,948
Cash and cash equivalents at beginning of period 2,444,093 2,072,046
Exchange gains on cash and bank (91,937) 107,613
Cash and cash equivalents at end of period 584,837 2,453,607
CONDOR GOLD PLC
CONDENSED COMPANY STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS TO 30 JUNE 2023
Six months Six months
to 30.06.23 unaudited to 30.06.22 unaudited
£ £
Cash flows from operating activities
Loss before tax (809,878) (1,182,008)
Share based payment 162,425 288,906
Finance income (4,899) (1,585)
(652,352) (894,687)
(Increase) / Decrease in trade and other receivables 255,329 (48,642)
Increase / (Decrease) in trade and other payables (101,731) 174,207
Net cash used in operating activities (498,754) (769,122)
Cash flows from investing activities
Purchase of tangible fixed assets - -
Interest received 4,899 1,585
Loans to subsidiaries (1,444,057) (2,102,735)
Net cash used in investing activities (1,439,158) (2,101,150)
Cash flows from financing activities
Proceeds from share issue
73,438 3,304,002
Net cash from financing activities 73,438 3,304,002
Increase / (Decrease) in cash and cash equivalents (1,864,474) 433,730
Cash and cash equivalents at beginning of year 2,407,187 1,956,467
Cash and cash equivalents at end of year 542,713 2,390,197
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
1. COMPLIANCE WITH ACCOUNTING STANDARDS
Basis of preparation
This condensed set of financial statements has been prepared in accordance
with IAS 34 Interim Financial Reporting as adopted by the European Union and
also as issued by the International Accounting Standards Board ("IASB"). It
has been prepared using accounting policies consistent with International
Financial Reporting Standards ("IFRS") and should be read in conjunction with
the annual financial statements for the year ended 31 December 2022 which have
been prepared in accordance with IFRS as adopted by the EU and as issued by
the IASB.
The interim results for the six months to 30 June 2023 are unaudited and the
accounts in this interim report do not therefore constitute statutory accounts
in accordance with Section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2022 have been filed with
the Registrar of Companies and the auditor's report was unqualified and did
not contain any statement under Section 498(2) or 498(3) of the Companies Act
2006. The statutory accounts contained a material uncertainty in respect of
going concern which referred to the Group's need to raise further funding in
order to progress exploration activity. There were no other matters drawn to
the attention of the users of the financial statements in the auditor's
report.
The interim financial information for the six months ended 30 June 2023 was
approved by the Board on X September 2023.
The directors do not propose an interim dividend.
The directors consider the going concern basis to be appropriate based on cash
flow forecasts and projections and current levels of commitments, and cash and
cash equivalents. Additionally, the company raised £1,000,000 as a result of
an exercise in warrants in July 2023. It is expected this will fund future
plans for at least 6 months. The company continues to enjoy the support of its
chairman, Jim Mellon. The comparative period presented is that of the six
months ended 30 June 2022.
The Directors are of the opinion that due to the nature of the Group's
activities and the events during that period these are the most appropriate
comparatives for the current period. Copies of these financial statements
are available on the Company's website and on www.Sedar.com.
2. ACCOUNTING POLICIES
The interim financial information for the six months ended 30 June 2023 has
been prepared on the basis of the accounting policies set out in the most
recently published financial statements for the Group for the year ended 31
December 2022, which are available on the Company's website www.condorgold.com
(http://www.condorgold.com) and on SEDAR at www.sedar.com
(http://www.sedar.com) , as the Company does not anticipate the addition of
new standards to the Group's results for the year ended 31 December 2022 would
materially impact the results.
3. REVENUE AND SEGMENTAL REPORTING
The Group has not generated any revenue during the period. The Group's
operations are located in the United Kingdom and Nicaragua.
The following is an analysis of the carrying amount of segment assets, and
additions to plant and equipment, analysed by geographical area in which the
assets are located.
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
3. REVENUE AND SEGMENTAL REPORTING - continued
The Group's results by reportable segment for the six-month period ended 30
June 2023 are as follows:
UK Nicaragua Consolidation
Six months to 30.06.2023 Six months to 30.06.2023 Six months to 30.06.2023
£ £ £
RESULTS
Operating loss (942,557) (30,570) (973,127)
Finance income 7,312 - 7,312
Income tax - - -
Loss for period (935,245) (30,570) (965,815)
Assets
All transactions between each reportable segment are accounted for using the
same accounting policies as the Group uses.
UK Nicaragua Consolidation
30.06.2023 30.06.2023 30.06.2023
£ £ £
ASSETS
Total assets 5,844,460 37,999,560 43,844,020
UK Nicaragua Consolidation
30.06.2023 30.06.2023 30.06.2023
£ £ £
LIABILITIES
Total liabilities (147,626) 10,481 (137,145)
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
3. REVENUE AND SEGMENTAL REPORTING - continued
The Group's results by reportable segment for the six-month period ended 30
June 2022 are as follows:
UK Nicaragua Consolidation
Six months to 30.06.2022 Six months to 30.06.2022 Six months to 30.06.2022
£ £ £
RESULTS
Operating loss (1,288,746) (85,229) (1,373,975)
Finance income 1,585 - 1,585
Income tax - - -
Loss for period (1,287,161) (85,229) (1,372,390)
Assets and liabilities
All transactions between each reportable segment are accounted for using the
same accounting policies as the Group uses.
UK Nicaragua Consolidation
30.06.2022 30.06.2022 30.06.2022
£ £ £
ASSETS
Total assets 7,531,696 37,025,917 44,557,613
UK Nicaragua Consolidation
30.06.2022 30.06.2022 30.06.2022
£ £ £
LIABILITIES
Total liabilities (343,663) 121,697 (221,966)
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
4. TAXATION
There is no current tax charge/(credit) for the period. The condensed
financial statements do not include a deferred tax asset in respect of unused
tax losses as the Directors are unable to assess that there will be probable
future taxable profits available against which the unused tax losses can be
utilised.
5. INTANGIBLE FIXED ASSETS
During the six months ended 30 June 2023, the Group acquired assets with a
cost of £1,067,405 (six months ended 30 June 2022: £1,805,216).
6. EQUITY-SETTLED SHARE OPTION SCHEME AND WARRANTS
The estimated fair value of the options and warrants granted and charged to
profit or loss in the period was;
Six Six
months months
to 30.06.2023 to 30.06.2022
unaudited unaudited
£ £
Share options charge 162,425 288,906
The fair value of options has been recognised within profit or loss, on a
pro-rata basis over the vesting period. This fair value has been calculated
using the Black-Scholes option pricing model. The latest inputs into the model
were as follows:
2023 2022
Share price 25.5p 25.5p
Exercise price 33p 33p
Expected volatility 35.6% 35.6%
Expected life (yrs.) 5 5
Risk free rate 0.5% 0.5%
Expected dividend yield - -
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
7. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the loss attributable to
ordinary shareholders by the weighted average number of ordinary shares
outstanding during the period.
A reconciliation is set out below:
Six months Six months
to 30.06.23 to 30.06.22
Basic EPS
Loss for the period (965,815) (1,372,390)
Weighted average number of shares 158,739,611 147,667,937
Earnings per share (in pence) (0.61) (0.92)
In accordance with IAS 33, as the Group has reported a loss for the period,
diluted earnings per share are not included.
8. CALLED-UP SHARE CAPITAL
30.06.23 30.06.22
£ £
Allotted and fully paid
180,790,824 Ordinary shares of £0.001p each and 158,629,530 Deferred shares 31,748,067 31,707,573
of £0.199 (30 June 2022: 158,916,429 ordinary shares of 20p each)
CONDOR GOLD PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2023
Share issuances in the six months ended 30 June 2023 were as follows:
Nature of issuance Issue price per Ordinary share Date of share issuance Number of shares issued Total Cumulative number of ordinary shares issued
Opening 1 January 2023 180,532,491
Bonus issue 24 pence 11 April 2023 258,333 180,790,824
During the period, there was a bonus issue of shares issued to the CEO, Mark
Child as part of his remuneration package.
9. RELATED PARTY TRANSACTIONS
During the half year the Company received consultancy advice from the
following related parties:
Company Related party Six Six
months to 30.06.2023 months to 30.06.2022
£ £
Burnbrae Limited Jim Mellon 12,500 12,500
Burnbrae Limited Denham Eke 7,500 -
Promaco Limited Ian Stalker 17,475 20,400
AMC Geological Advisory Andrew Cheatle 10,417 4,167
10. SEASONALITY OF THE GROUPS OPERATIONS
There are no seasonal factors which affect the trade of any company in the
Group.
11. POST BALANCE SHEET EVENTS
In July 2023, £1,000,000 was raised as a result of an exercise in warrants.
The warrants were exercised by the Chairman, Jim Mellon.
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