G Mining Ventures (GMIN) - 3rd Largest Gold Producer in Brazil, Soon

G Mining Ventures Corp. (“GMIN” or the “Company”) (TSXV: GMIN) (OTCQB: GMINF) is a young and driven mining company established in 2020 with a goal of building the third largest gold mine in Brazil, and on a mission to build the next intermediate gold producer within the next five years. The Company was established by principals of G Mining Services group, one of the most successful mine construction and execution companies globally. G Mining Ventures was created to fill the void for management teams with proven project execution track record and to capitalize on the value upliftment that successful mine development offers.

The Company has the advantage of strong access to capital through its supportive shareholder base, coupled with full access to the vast technical expertise of G Mining Services through a master service agreement. GMIN aims to develop its flagship Tocantinzinho gold project into the third-largest gold mine in Brazil.

Matthew Gordon spoke with Louis-Pierre Gignac the president and CEO of G Mining Ventures to discuss the company’s construction-ready and fully permitted Tocantinzinho gold project in Para State, Brazil.

Management Team

At the helm of this ambitious company, is Louis-Pierre Gignac, who serves as president and CEO. Gignac has over 20 years of experience in the mining industry, which includes the management of project development studies, open-pit operations, financial modelling and project economic evaluation. Gignac has coordinated many mandates with numerous major mining companies, which range from early exploration, project evaluations to operations optimization.

He holds a bachelor’s degree in Mining Engineering from McGill University as well as a master’s degree of applied science in Industrial Engineering from the École Polytechnique de Montréal. Gignac is a member of the Ordre des Ingénieurs du Québec (OIQ)and the Canadian Institute of Mining (CIM). Gignac also serves as a director of Major Drilling Group International, one of the world’s largest drilling services companies.

Louis Gignac Sr. is the founder of GMIN and serves as Non-Executive Chairman. Mr. Gignac Sr. has more than 50 years of experience in the mining industry. He has been involved in the development and operations of some 20 mines throughout the Americas and West Africa. For 20 years, he served as President and CEO of Cambior Inc., built the Omai mine in Guyana and the Rosebel mine in Suriname, leading to Cambior’s acquisition in 2006 by IAMGOLD for US$1.3B.

Under Mr. Gignac Sr.’s leadership, G Mining Services, the family-owned engineering and consulting firm, has delivered $2 billion of mining projects over 15 years at or below budget, and on schedule. Mr. Gignac Sr. is also a member of the Canadian Institute of Corporate Directors (“ICD”), the OIQ and the CIM. He holds a Doctorate of Engineering in Mining Engineering from the University of Missouri Rolla, a Master’s degree in Mineral Engineering from the University of Minnesota, and a Bachelor of Science degree in Mining Engineering from Laval University. He has previously served as a director to many public companies (Canada, USA and Australia) over the last 25 years and currently serves as a director of Franco-Nevada Corp. Mr. Gignac was inducted into the Canadian Mining Hall of Fame in 2016.

Rounding out the executive management team are Julie Lafleur as Vice President of Finance and Chief Financial Officer (CFO), Dušan Petković as Vice President of Corporate Development and Investor Relations, and Marc Dagenais as Vice President of Legal Affairs and Corporate Secretary.

The esteemed management team is tasked with developing and executing the Tocantinzinho gold project, anchoring the Company’s ambitious growth plan into the next intermediate gold producer.

The Tocantinzinho gold project

The Tocantinzinho gold project in Para State, Brazil is a fully permitted, open-pittable gold deposit that hosts 2 million ounces of gold near surface and is open at depth. G Mining Ventures acquired the Tocantinzinho gold project from Eldorado Gold Corp. in late 2021. Eldorado acquired the project for $120M in 2010 and subsequently invested over USD$ 90 million into the project before the acquisition by GMIN. The project boasts a high-grade gold  reserve supporting a 10-year mine life and an estimated annual production of 175,000 ounces, with an average 196,000 ounces annual production over the first 5 years.

The project has significant exploration potential with the land package being both large (at 688 km2) as well as historically underexplored. The land package has historically only seen 82,805 m of exploration drilling between 2004-2015. The Tocantinzinho trend is a large intrusive system which already hosts several known deposits, including Cuiu Cuiu (Cabral Gold), Palito Mine (Serabi Gold plc.) and Sao Jorge (GoldMining Inc.).

The Company believes that the underexplored Tocantinzinho Trend holds the potential for additional satellite mineral deposits near the Tocantinzinho project. The company has conducted airborne magnetic and radiometric surveys and IP surveys on the land package. G Mining ventures also collected outcrop and channel samples and launched various extensive grid-based soil sampling programs in the past. The company is currently underway with a 10,000 m drilling program, which is aimed at optimising the mine plan, de-risking initial production and providing additional mineralisation information at depth.

The project is accessible through all-season roads and all the key permits required for the start of construction have been received. A feasibility study was conducted on the project initially in 2015, with an updated technical report published in 2019. The Tocantinzinho gold project does not have any indigenous communities nearby, as such does not require relocation or resettlement resulting in the project being construction ready.

G Mining Ventures recently released a new Feasibility study of the Tocantinzinho gold project, which boasts robust economics.

Economics

The recently published feasibility study of the Tocantinzinho gold project includes updated mineral resource and mineral reserve estimates, a resequenced mine plan as well as refined mill designs and updated capital and operational costs. The company believes that the new feasibility study reflects an optimised development plan with respect to the current gold price environment.

The feasibility study boasts an after-tax NPV5% of USD$ 622 million and an after-tax internal rate of return (IRR) of 24% at a gold price of USD$ 1,600 per ounce of gold. The Tocantinzinho gold project has an initial life of mine (LOM) of 10.5 years with an average annual gold production of 174,700 ounces at an all-in sustaining cost (AISC) of USD$ 681 per ounce of gold.

The first 5 years of the project is estimated to produce the most amount of gold, with its annual production estimated at 196,200 ounces, with the AISC of the first 5 years at USD$ 666 per ounce of gold.

The feasibility study also shows a 12% increase in mineral reserves from its predecessors with the new mineral reserve estimate at 2 million ounces of gold. The capital cost (CAPEX) of the Tocantinzinho gold project is USD$ 458 million with the project’s sustaining capital cost estimated to be USD$ 83 million.

The new 2022 Feasibility study is unique in its high quality and degree of confidence in terms of cost estimates, which captures cost inflation induced by COVID-19 pandemic and supply chain challenges. All mechanical process equipment and major construction bulk material pricing are supported by multiple vendor budgetary quotes obtained in Q4 2021, with firm pricing secured on 44% of capital cost for major mining equipment. Labor costs are fully supported by in-country labor surveys conducted in Q4 2021, with input from multiple mining companies, construction companies, and contractors.

The Company aims to initiate the construction of the Tocantinzinho gold project by mid-2022 and plans to finance the construction of the project through its cash position of USD$ 58 million and by securing additional project financing. The company also has USD$ 27 million of in-the-money warrants which will mature in Q2 2022.

Future

G Mining Ventures is currently evaluating various sources of funding, aiming to finance 60% to 70% of the project with non-equity sources. The current shareholder registry is comprised of 57% institutional and only 12% retail. The Company aims to complete the financing of its Tocantinzinho gold project by mid-2022, leading to the final construction decision.

The Company has recently exercised its right to buy back 1% of the 3.5% net smelter return (NSR) royalty held on its Tocantinzinho gold project from previous agreements ranging as far back as 2003. The buyback is comprised of a USD$ 2 million cash payment to the original royalty holders. The company plans to execute a further 1% buyback of the NSR, as soon as it announces its official construction decision.

The detailed engineering study of the Tocantinzinho gold project as well as project optimisation studies are scheduled to be completed by the end of 2022. The company further plans to accelerate the construction initiation through the procurement of long lead items in 2022 as well as complete any further early works activities possible.

The Tocantinzinho gold project’s construction is scheduled to be initiated by 2H 2022, with the company aiming to be in commercial production by 2H 2024.

To find out more, go to the G Mining Ventures website