…Explains various environmental and intervention impacts
… sets achievable targets for the Q4 operations and beyond
Thor Exploration Ltd (TSXV/AIM:THX) has provided its financial and operating results for its mineral
properties located in Nigeria, Senegal and Burkina Faso for the three (the “Quarter” or Q3”) and nine
months to September 30, 2022.
The Company’s Condensed Consolidated Interim Financial Statements together with the notes related
thereto, as well as the Management's Discussion and Analysis for the three and nine months ended
September 30, 2022, are available on Thor Explorations’ website:
https://thorexpl.com/investors/financials/
In its operational highlights of the quarter and the period, gold production was put at 26,523 ounces
(“oz”) for the Quarter and of 71,651oz for the Period at the Segilola Gold mine, located in Nigeria
(“Segilola”) o Average mill feed grade during the Quarter was 3.58 grammes per tonne (“g/t”) and
recovery was 95.5% .
“28,787oz of gold and 1,931oz of silver sold in the quarter, and 67,617oz of gold and 4,204oz of silver
sold in the Period o Gold dore inventory of 2,226oz at the end of the quarter”, the company said.
According to the report, acquisition of additional exploration licences in Osun State and Kwara State,
Nigeria was recorded in addition to entering into a Joint Venture (“JV”) agreement over a further
exploration licence in Kwara State, Nigeria.
In terms of exploration during the Quarter: an initial 1,280 metres of reverse circulation (“RC") and
diamond drilling was carried out at Segilola.
At Douta, a RC drilling programme together with a target-generation termite geochemistry programme
occurred to test the Makosa East soil geochemistry anomaly.
A total of 824 metres of RC drilling at the Sambara prospect at Douta was completed.
Other highlights of the report include:
“Gold mineralisation was discovered over approximately 500m of strike.
“13 corporate governance policies were either implemented or updated during the quarter.
“The Company continues to fund a range of livelihood restoration programmes, including preparing sites
for fish farms and for vegetable nursery farms.
“Community development programmes included youth initiative and women’s initiative programmes
focusing on practical skill-based courses and annual school scholarship awards”.
In terms of financial highlights of the quarter and the period gold sales generated revenue for the
Quarter of US$55.7 million and US$121.9 million for the period
“Net profit of US$4.1 million for the quarter and US$10.4 million for the period; all in sustaining cost
(“AISC”) of US$986 per oz for the Quarter and US$909 per oz for the period; Allof September 30, 2022
the Company had cash of US$2.4 million; as of September 30, 2022 the Company had Net Debt of
US$40.7 million (Q2 2022: US$47.4 million); US$10.3 million of senior debt facility repaid reducing
senior debt facility to US$28.9 million and EBITDA of US$14.1 million for the Quarter and US$41.2
million for the Period”.
The post period highlights shows that a full transition from diesel to six megawatt (“MW”) compressed
natural gas generators was completed, reducing Greenhouse Gas Emissions (“GHG”) by 53% .
In terms of outlook, the company’s report shows production guidance for 2022 of 90,000 to 100,000oz
of gold; drilling programmes to resume in Q1 2023 at the Segilola Open Pit; continuing to advance the
Douta project towards a preliminary feasibility study (“PFS”) as well as a continued exploration
programmes across Segilola and Douta projects.
Mr. Segun Lawson, President and CEO have stated that:
“This has been another outstanding Quarter for the Company. Over the Period the Segilola mine has
continued to produce at a steady rate, with the Company increasing production guidance twice over the
last nine months. I am grateful for the dedication and hard work shown by the team at site during this
Quarter and across the rainy season to keep production steady.
“Proudly and notably, the Company repaid another large sum of its Senior Debt Facility in the Period,
having now reduced the facility by almost half since commercial production commenced.
“The exploration programmes upcoming across our portfolio provide great potential for the Company
and I am positive that we have the teams, both managerial and on the ground, to realise the full
potential of each project.
“Our relationship with the communities surrounding Segilola remains strong, whilst we continue to
develop the project and explore the surrounding areas it is important to also develop the local
communities and bring equal benefit to the region.
“I look forward to provide more updates in the future on Thor’s exciting portfolio.”
Part of the report reads:
Segilola Project, Nigeria
During the Period, there continued to be global supply chain issues resulting in shortages and increased
prices for a number of essential consumables and supplies such as ammonium nitrate, diesel and spare
parts. The Company has mitigated these risks through the bulk purchase of most supply chain items and
anticipates that its production guidance and costs for the year remain in line.
Gold Production
During the three months ended September 30, 2022 the Segilola Mine produced 26,523 ounces of gold
(Q2 2022: 23,785 ounces).
The Company exported the gold regularly throughout the Quarter selling 28,787 ounces of gold and
1,913 ounces of silver and had a further gold dore inventory of 2,226 ounces on hand. These ounces
have all been sold in the fourth quarter of 2022.
Mining
During the three months ended September 30, 2022, 4,018,431 tonnes of material was mined,
equivalent to mining rates of 44,649 tonnes of material per day. In this period, 225,182 tonnes of ore
were mined, equivalent to mining rates of 2,475 tonnes of ore per day, at an average grade of 4.43g/t.
The stockpile balance at the end of the period was 229,909 tonnes of ore at an average of 1.19g/t. This
comprised 406 tonnes (5.80g/t) at high grade, 2,028 tonnes (2.87g/t) at medium grade, and 227,475
tonnes (1.12g/t) at low grade.
Processing
During the three months ended September 30, 2022, a total of 241,434 tonnes of ore, equivalent to a
throughput rate of 2,682 tonnes per day, was processed.
The mill feed grade was 3.58g/t gold and recovery was 95.5% for a total of 26,523 ounces of gold
produced. The Company continues to review the process plant to optimize throughput and recoveries.
All of the main operating units of the process plant are performing as expected, and the plant is
consistently operating above nameplate capacity. The Company continues to carry out further
optimization activities for the gold recovery process.
Part of the report is reproduced as below:
Production Metrics
Ore Processed Tonnes 241,434 211,582 221,900
Ore Stockpiled Tonnes 229,909 249,281 179,758
Waste Mined Tonnes 3,793,249 3,747,504 3,533,610
Total Mined Tonnes 4,018,431 4,031,584 3,759,524
Total Ore Mined Gold Grade g/t Au 4.43 3.63 2.68
Ore Processed g/t Au 3.58 3.66 3.18
Environment and Social Summary Q3 2022
The main focus with respect to the Company’s environment and social activities for Q3 2022 was
implementing its new governance policies (13 new and/or updated policies) which included finalising
the contract for an independent and free whistle blower hotline. Thor’s 2021 Sustainability Report was
further progressed, and metrics devised for measuring implementation of key sustainability parameters
across the material topics of Corporate Governance, People, Health and Safety, Social and Community
Development, Cultural Governance and Environment. The report will be completed in Q4 2022. The
Company has agreed to use the Global Reporting Initiative’s (GRI) ESG reporting standards including the
recently released Mining and Metals Sector disclosure standards for Thor’s 2022 Sustainability and ESG
Report.
During Q3 2022, significant progress has been made for the Company’s wholly owned operating
subsidiary, Segilola Resources Operating Limited (“SROL”) to attain its’ ISO 45001 Health and Safety
accreditation with a site audit completed and agreement on actions to close out over the next 12
months. Accreditation is expected in Q4 2023. SROL’s General Manager, Mike Kelly, received the Safety
Ambassador Award from the Institute of Safety Professionals Nigeria (August 2022). This award from
health and safety peers is a professional acknowledgement of the high safety standards implemented at
the Segilola project.
A full transition from diesel to 6 MW compressed natural gas (“CNG”) generators will reduce GHG by
53% over that generated by diesel generators. This is a key step in SROL’s reduction of its carbon
footprint. This transition was completed post the period.
HSE statistics to end Q3 2022
Safety topic for the week: MANUAL
HANDLING TECHNIQUES 29-Sep M-T-D Y-T-D P-T-D
HSE Statistics – Reactive (Lagging) Indicators
Number of Man Shifts Worked (Total) 1020 29091 221,591 509,261
Man Hours 9423 265,077 2,009,003 4678406
Lost Time Injury (LTI) recorded 0 0 2 2
Fatality (FAT) recorded 0 0 0 1
Medical Treatment Case(MTC) reported 0 1 9 20
Near Miss (NM) reported 0 1 19 38
First Aid Case (FAC) reported 0 2 9 44
Property Damage (PD) reported 0 1 27 29
HSE Statistics – Proactive (Leading) Indicators
Number of Safety Inductions conducted 0 26 385 760
Tool Box Meeting conducted 14 353 2448 3,815
HSE Meetings conducted 0 10 82 128
HSE Inspections conducted 0 16 130 244
HSE Trainings conducted 0 7 73 382
Number of Unsafe Conditions reported 1 43 290 3,819
Number of Unsafe acts reported 3 61 531 3,519
LTI Free Days 1 29 63
An Environmental Impact Assessment for a helipad within the existing Segilola Mine site has been
submitted to Federal Ministry of Environment and is expected to be approved in Q1 2023.
Social and community development parameters for the Segilola Project were also progressed in Q3
2022.
Focus has been on establishing livelihood restoration projects by preparing sites for the fish farms
(construction expected in Q1 2023) and site clearance for the vegetable farms’ nursery. Contracts have
been awarded to local companies for the construction of both livelihood projects. Specialist agricultural
assistance from Nigerian experts has been contracted in by SROL to assist with implementation during
the next 12 month period to enable the projects’ community operators to become self-sufficient and
financially viable within the next 12 to 18 months.
Through funding agreed via Community Development Agreements (“CDA”) signed with the three
communities surrounding the Segilola Mine, community programmes were progressed in Q3 2022.
These included Youth Initiative and Women’s Initiative programmes focusing on practical skill-based
courses – truck driver training, mobile phone repairs and value-added production equipment. Annual
school scholarship awards to enable children from vulnerable backgrounds to remain in school, are
progressing with testing and interviews completed. Recipients will be selected in Q4 2022.
Compensation for temporary loss of assets and lands impacted by exploration activities (at 13
explorations sites across three states in Nigeria) stands at $354,000 for 585 asset owners and 15
landowners (as of end of Q3 2022).
Social listening continues (monitoring SROL and Thor mentions in Nigerian media) across electronic, TV
and printed media and findings are shared with key departments in SROL. Most media coverage has
been positive.
In Senegal, exploration activities at the Douta Project have progressed throughout Q3 2022. The project
has now appointed a HSE officer with HSE leading and lagging indicators being recorded. A site waste
plan has been implemented and waste generated from the drill site and camp is stored in separate bins
of biodegradable and non-biodegradable. Biodegradable such as paper, sample bags and food are
burned. Non-biodegradable such as cans, and empty water bottles are given to the local population for
recovery or recycling. Used oils are stored in a well-defined place pending delivery to specialised
companies for disposal. The HSE officer has formalized the sale of metal waste and the money from this
sale is paid into the company's social fund for community projects, the report stated.
On exploration activity summary Q3 2022 Thor Exploration said, in Nigeria, the high grade Segilola gold deposit is located on the major regional shear zone that extends for several hundred kilometres through the gold-bearing Ilesha schist belt (structural corridor) of Nigeria.
Thor’s exploration tenure comprises 11 wholly owned explorations licences and four joint ventures.
Together with the mining lease over the Segilola Gold Deposit, Thor’s total exploration tenure amounts
to over 1,400 km2.
Exploration Activity
In the Quarter, the Company increased its exploration footprint in Nigeria via the acquisition of
additional exploration licences in Osun State and Kwara State and also entered into a joint venture
agreement over a further exploration licence in Kwara state.
The Company’s licence portfolio now consists of 17 exploration licences and the Segilola mining licence.
Exploration during the Quarter consisted of an initial 1,280 metres of reverse circulation (“RC") and
diamond drilling. In addition to the drilling programme, the Company prioritised the generation of
drilling targets, with a focus on targets within trucking distance of the Segilola plant. Exploration
activities comprised of soil and stream geochemical surveys, auger drilling, trenching and ground
magnetic programmes.
The areas drilled were north of the Segilola Open Pit and at the “Ijana” and “Esteedan” targets which are
located 14km to the west of Segilola. The main objectives of this programme are:
1. To test the geochemical and structural targets generated by auger soil sampling and trenching in
EL 20776 and EL23573 also the drilling was targeting the occurrence of gold mined in shallow pits mined
by artisanal.
2. To test the gold-in soil anomalies generated by auger soil and trench sampling at Odo within
EL19066, 3km north of Segilola deposit.
The drilling programmes are scheduled to resume in January following the receipt of all assay results
and completion of drill target generation work.
For Senegal, it provides as follows:
“The Douta Gold Project is a gold exploration permit, E02038, which covers an area of 58km2 and is
located within the Kéniéba inlier, eastern Senegal. The northeast-trending licence has an area of 58 km2.
Thor, through its wholly owned subsidiary African Star Resources Incorporated (“African Star”), has a
70% economic interest in partnership with the permit holder International Mining Company SARL
(“IMC”). IMC has a 30% free carried interest in its development until the announcement by Thor of a
Probable Reserve.
“The Douta licence is strategically positioned 4km east of Massawa North and Massawa Central deposits,
which form part of the world-class Sabadola-Massawa Project owned by Endeavour Mining (Figure 4).
The Makabingui deposit, belonging to Bassari Resources Ltd, is immediately located east of the northern
portion of E02038.
“There is an initial resource estimate of 15 million tonnes (“Mt”) grading 1.53g/t Au for 730,000oz gold in
the Inferred category. The resource encompasses the Makosa, Makosa North and Makosa Tail zones,
which are collectively named the Makosa Resource.
Exploration Activity
During the Quarter, the main exploration work comprised the RC drilling programme together with a
targetgeneration termite geochemistry programme occurred to test the Makosa East soil geochemistry
anomaly. Tables 5 and 6 summarise the exploration statistics for the Quarter.
Sambara
The Sambara Prospect is located 15km north-east along strike from the Makosa resource.
Drilling targeted an anomalous zone defined by auger geochemical sampling. The area is located 2km
directly north of the Makabingui group gold deposits and which collectively contain approximately
340,000oz gold in the indicated category and 670,000oz gold in the inferred category.
Drill testing of the geochemical anomaly was carried out over nine sections that were spaced at either
100m or 200m apart (Figure 5). This wide spacing was considered to be appropriate for the first phase of
drill testing. Based on the positive results received, additional, closer-spaced (infill) drilling will be
undertaken.
A total of 824m of RC drilling at the Sambara prospect was completed. Gold mineralisation was
discovered over approximately 500m of strike. The host rock is deformed greywacke associated with
smoky quartz, disseminated pyrite, sericite, and silica stockworks.
Makosa
The Makosa resource is currently classified as inferred. In August 2022, Thor commenced a programme
of follow up RC and diamond drilling with the objective of upgrading the higher-grade portions of the
resource, that fall within the optimised pit shell, to indicated classification.
Initial results from drillholes completed at the southern extremity of the deposit include 8m at 4.77g/t
gold from 62m in drillhole DTRC504 (Figure 6). The significant intersections from Makosa are listed in
Table 8. In addition to upgrading this part of the resource, the intersection suggests that gold
mineralisation may extend to depth. Two additional drillholes (DTRC561 and DTRC562) have
subsequently been drilled to test for depth extensions to this higher grade zone. Assays for these two
holes are pending.
Makosa Significant Results
(0.5g/tAu lower cut off; maximum 2m internal dilution, minimum 2m interval)
At Makosa, zones of gold mineralisation are developed either within a sheared gabbro intrusive or
within a steep north-westerly dipping sequence of meta-sedimentary rocks that are close proximity to
the gabbro (Figure 7). Higher grade zones or shoots are suspected to occur along east-west oriented
structures that cut across the main north-east trend of the mineralisation. The potential to upgrade the
resource will be assessed by ongoing infill drilling along the Makosa mineralised trend.
In Hounde Gold Project, Burkina Faso, no exploration activities took place during the quarter.
SUBSEQUENT EVENTS
There are no material subsequent events to report.
The company reiterated its commitment to remain focused on advancing the Company’s strategic
objectives and near-term milestones which include:
• Maintain our rigorous health and safety protocols
• 2022 Operational Guidance and Outlook
Gold Production oz 90,000-100,000
All-in Sustaining Cost (“AISC”) US$/oz Au sold $850 – $950
Capital Expenditure1 US$ 23,500,000
Exploration Expenditure:
Nigeria2 US$ 4,200,000
Senegal US$ 3,000,000
The increase in guidance from Q2 is due to the additional provision for the EPC contract ($9m), and
purchase of additional mining equipment ($4.5m) not included in previous guidance. 2 This includes
purchase of licenses and near mine exploration
• The critical factors that influence whether Segilola can achieve these targets include:
o Segilola’s ability to maintain an adequate supply of consumables (in particular ammonium
nitrate, flux and cyanide) and equipment, particularly if there is any resurgence in the
COVID-19 pandemic o Fluctuations in the price of key consumables, in particular ammonium nitrate,
and diesel o Segilola’s workforce remaining healthy o Continuing to receive full and on-time
payment for gold sales o Continuing to be able to make local and international payments in the
ordinary course of business
• Continue to advance the Douta project towards preliminary feasibility study (“PFS”)
• Continue to advance exploration programmes across the portfolio:
o Segilola near mine exploration o Segilola underground project o Segilola regional
exploration programme o Douta extension programme o Douta infill programme
o Assess regional potential targets in Nigeria
Another section of the report bothering on net debt said the company considers that in addition to
conventional measures prepared in accordance with IFRS, net debt is useful to evaluate the Company’s
performance.
“Previous quarters contained a provision for outstanding EPC invoices of $5.2 million. Following a full
audit, the EPC contractor presented and the Company has accepted, an additional late invoice of
approximately $4 million. Total EPC Payments due have been confirmed at $16 million.
“@ Net Debt reported at June 30, 2022 and March 31, 2022 have been revised to include the deferred
income component which was omitted from the Net Debt calculations. The revised figures are
presented in the Table below. The figure reported for Net Debt in June 30, 2022 and March 31, 2022
was $37,306,971 and $50,463,920 respectively.
Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA)
EBITDA is calculated as the total earnings before interest, taxes, depreciation and amortisation. This
measure helps management assess the operating performance of each operating unit.
Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA).
The Company reported a net profit of $10,431,167 ($0.016 profit per share) for the nine months to
September 30, 2022, as compared to a net loss of ($4,644,514 ($0.007 loss per share) for the nine
months ended September 30, 2021. The move to profit for the nine months was largely due to:
• Sales to Q3 2022 of $121,923,327 2021 (nil for 2021);
• Foreign exchange gains of $8,043,758 from loss of $967,679 for the same period in 2021
These were offset partially by:
• Amortisation and depreciation of $19,401,644; and
• Interest of $11,351,690
The Company recorded sales revenue of $121,923,327 for the nine months ended September 30, 2022,
and $nil for the nine months to September 30,2021. No interest was earned during the nine months
ended September 30, 2022, and 2021.
