SSR Mining Reports Fourth Quarter and Full Year 2021 Results Highlights
News Release
February 23, 2022
SSR MINING REPORTS FOURTH QUARTER AND FULL YEAR 2021 RESULTS
HIGHLIGHTS
- ATTRIBUTABLE & ADJUSTED ATTRIBUTABLE FOURTH QUARTER EPS OF $0.60 AND $0.46 PER SHARE, RESPECTIVELY
- 2021 OPERATING CASH FLOW OF $609 MILLION, FREE CASH FLOW OF $444 MILLION
- 2021 CAPITAL RETURNS OF $191 MILLION
- 2022 DIVIDEND INCREASED BY 40%
- INCREASED GOLD MINERAL RESERVES BY 14% OR 1.1 MILLION OUNCES
- UPDATED RESERVE CASE TECHNICAL REPORTS FOR ALL FOUR PRODUCING ASSETS
- INITIAL ASSESSMENT CASE OUTLINING C2 DEVELOPMENT FOR TOTAL CAPITAL OF $218 MILLION AND A ~60% IRR
DENVER - SSR Mining Inc. (NASDAQ/TSX: SSRM, ASX:SSR) ("SSR Mining" or the “Company") reports consolidated financial results in accordance with U.S. GAAP for the full year ended December 31, 2021. In addition, the Board of Directors declared a quarterly cash dividend of US$0.07 per common share, an increase of 40% over the third quarter dividend, payable on April 4, 2022 to holders of record at the close of business on March 7, 2022. This dividend qualifies as an 'eligible dividend' for Canadian tax purposes.
Rod Antal, President and CEO said, "SSR Mining ended 2021 with another strong quarter, rounding out a year of operational outperformance, strong free cash flow generation and peer-leading capital returns. We delivered full-year gold equivalent production at the top-end of our 2021 guidance range and full-year AISC * below our previously lowered guidance range despite pervasive inflationary pressures across the industry. Subsequently, last month we announced our inaugural three-year operating outlook and increased our base dividend by 40%.
Accompanying today’s strong fourth quarter and full year financial results, we announced our updated Mineral Reserves and Resources for year-end 2021, including a 14% or 1.1 million ounce increase in total gold Mineral Reserves as compared to year-end 2020. Additionally, we have filed SK1300 Technical Report Summaries (“TRS”) for all four of our producing assets. The Çöpler District Master Plan TRS (“CDMP21”) includes a Mineral Reserve Case incorporating maiden Mineral Reserves from Çakmaktepe Extension (Ardich), and an Initial Assessment Case (“IAC”) which contemplates the construction of a copper concentrator to process Çöpler Copper-Gold (“C2”) sulfide ore beginning in 2025 at an IRR of ~60%.
Together, the four TRS reports outline an improved production platform and reaffirm our ability to sustain a +700koz production profile through the end of the decade. This is further supported by the consideration that Seabee and Marigold TRS do not yet fully incorporate the ongoing exploration efforts including the recent positive drill results issued late last year, and are based exclusively on existing Mineral Reserves. Overall, the new TRS reports provide refreshed base case production scenarios with no significant capital requirements that we will continue to improve into the future.”
- AISC is a non-GAAP metric which is customary in the mining industry, but for which there is no standardized definition or comparable financial measure
under U.S. GAAP. As a result, we have not identified a comparable financial measure calculated under U.S. GAAP. See. "Cautionary Note Regarding Non-GAAP Financial Measures".
Fourth Quarter and Full Year 2021 Highlights:
(All figures are in U.S. dollars unless otherwise noted)
- Achieved full year production at the top end of guidance while beating AISC guidance: Delivered fourth quarter production of 211,717 gold equivalent ounces at AISC of $961/oz. (1) Full year production of 794,456 gold equivalent ounces approached the top end of the Company’s guidance range of 720,000 to 800,000 gold equivalent ounces. The Company’s 2021 AISC was $955 per gold equivalent ounce, beating the previously lowered AISC guidance range of $1,000 to $1,040 per ounce. (1) (2)
- Announced 2022 guidance and inaugural three-year operating outlook: Three-year production guidance of 700,000 to 780,000 gold equivalent ounces annually reflects a strong and stable production profile without requirements for material capital investment. The Company’s 2022 guidance included AISC guidance of $1,120 to $1,180 per ounce, reflecting a cost profile that ensures strong free cash flow and capital returns going forward. (1)
- Generated continued peer leading cash flow: Cash flows from operating activities of $184.6 million and free cash flow of $148.7 million in the fourth quarter, contributing to full year operating cash flow of $609.0 million and free cash flow of $444.2 million. (1) Attributable net income in the fourth quarter was $127.4 million, or $0.60 per share, and adjusted attributable net income was $98.3 million, or $0.46 per share. (1) For the full year period, attributable net income was $368.1 million, or $1.70 per share, while adjusted attributable net income was $401.8 million or $1.86 per share. (1)
- Delivered $191 million in capital returns and increased dividend by 40%: The Board declared a quarterly cash dividend of $0.07 per share on February 22, 2022, a 40% increase over the third quarter dividend of $0.05. In 2021, SSR Mining returned $191.3 million to shareholders through dividend payments and the purchase of 8,800,700 shares at an average share price of $16.82 per share under the Normal Course Issuer Bid (“NCIB”) program announced on April 19, 2021.
- Balance sheet remains a key strength: At the end of 2021, the Company had a cash and cash equivalent balance of $1,017.6 million, after the aforementioned $191.3 million in capital returns to shareholders and $70 million in scheduled debt repayments. Non-GAAP net cash now totals $681.4 million. (1)
- Increased gold Mineral Reserves by 14% or 1.1 million ounces to 9.2 million ounces: Resource to Reserve conversion at Çakmaktepe Extension (Ardich) and Gap Hangingwall drove an increase to Mineral Reserves and offset depletion at Marigold and Puna. Total gold equivalent Mineral Reserves increased by 11%, or 1.0 million ounces, to 10.0 million ounces.
- Positive results at the Çöpler District Master Plan TRS (“CDMP21”) add upside: CDMP21 builds on Ҫӧpler’s 2020 technical report, including a Mineral Reserve case with a 21 year mine life and total production of 4.4 million ounces of gold. An Initial Assessment Case (IAC) production plan includes a 22 year mine plan with total gold production 5.4 million ounces of gold through the development of the Çöpler Copper-Gold (C2) project for incremental capex of $218 million and a ~60% IRR.
- Updated Technical Report Summaries at all producing assets reiterate quality of longer-term platform: The TRS doubled the life of Seabee and demonstrated solid base case mine plans at Marigold and Puna. These reports include refreshed operating and economic assumptions for each asset and provide a base line for further growth and optimization to support the Company’s long-term production base.
- Delivered strong near-mine and greenfield exploration results across the portfolio: In the fourth quarter, SSR Mining delivered positive exploration updates from the Marigold, Copper Hill, and Amisk properties. The Company also increased its ownership in the Copper Hill joint venture to 70%. The exploration updates in the fourth quarter build on the positive results from Çakmaktepe Extension (Ardich) and Seabee earlier in the year, showcasing SSR Mining’s robust exploration platform.
- Expanded land position in Saskatchewan with proposed acquisition of Taiga Gold Corp. On December 2, 2021, SSR Mining announced the proposed acquisition of Taiga Gold Corp. (“Taiga”) for C$0.265 per Taiga share, implying an equity value of $21 million. The transaction consolidated a 100% interest in the Fisher property contiguous to the Seabee mine, eliminated an existing 2.5% net smelter return (“NSR”) royalty on the Fisher property, and added five new properties covering 30,480 hectares to complement the Company’s existing exploration platform in the underexplored and highly geologically prospective Province of Saskatchewan. The transaction, which is subject to Taiga shareholder approval, court and regulatory approvals and customary closing conditions, is expected to close in the first half of 2022.
- Announced the sale of the Pitarrilla project: On January 13, 2022, the Company announced it had entered into a definitive agreement to sell its Pitarrilla silver project in Durango, Mexico to Endeavour Silver Corp. (“EXK”) for total consideration of up to $127 million. This consideration includes $35 million in cash, $35 million in EXK shares, and a 1.25% Net Smelter Return (“NSR”) royalty on the Pitarrilla property (3). The transaction, which is subject to TSX and NYSE regulatory approvals, the approval of the Mexican Federal Economic Competition Commission and customary closing conditions, is expected to close in the first half of 2022.
(1) The Company reports non-GAAP financial measures including adjusted attributable net income, adjusted basic attributable net income per share, free cash flow, net cash, cash costs and AISC per ounce sold to manage and evaluate its operating performance at its mines. See "Cautionary Note Regarding Non-GAAP Financial Measures" for an explanation of these financial measures and a reconciliation of these financial measures to net income and production costs, which are the comparable GAAP financial measures.
(2) SSR Mining’s 2021 AISC guidance was issued in accordance with IFRS.
(3) The estimated value of the net smelter return royalty is based on the present value of net smelter returns of the Pitarrilla property from the “NI 43-101 Technical Report on the Pitarrilla Project, Durango State, Mexico”, dated December 14, 2012, which is available on Company’s website at www.ssrmining.com, discounted at a rate of 5%. The estimated value assumes a silver price of US$25/oz, a lead price of US$0.90/lb, and a zinc price of US$0.95/lb. The assumptions underlying the estimated value of the Pitarrilla project net smelter return royalty, including those supporting the Technical Report on the Pitarrilla Project and future metal prices, represent estimates and actual royalties received by SSR Mining in connection with the Transaction may differ from projected amounts.
Financial and Operating Highlights
A summary of the Company's consolidated financial and operating results for the three and twelve months ended December 31, 2021 and 2020 are presented below:
(in thousands of US dollars, except per share data) Three months ended December 31, Twelve months ended December 31, 2021 2020 2021 2020
| Financial Results | ||||||||
|---|---|---|---|---|---|---|---|---|
| Revenue | $ | 407,919 | $ | 370,729 | $ | 1,474,199 | $ | 853,089 |
| Income from mine operations | $ | 153,647 | $ | 151,592 | $ | 574,866 | $ | 299,293 |
| Gross margin (2) | 38 % | 41 % | 39 % | 35 % | ||||
| Operating income | $ | 118,816 | $ | 123,902 | $ | 444,375 | $ | 188,275 |
| Net income | $ | 156,499 | $ | 86,863 | $ | 425,922 | $ | 157,162 |
| Net income attributable to equity holders of SSR Mining | $ | 127,435 | $ | 83,178 | $ | 368,076 | $ | 151,535 |
| Basic attributable net income per share | $ | 0.60 | $ | 0.38 | $ | 1.70 | $ | 1.00 |
| Adjusted attributable net income (1) | $ | 98,259 | $ | 109,666 | $ | 401,757 | $ | 193,401 |
| Adjusted basic attributable net income per share (1) | $ | 0.46 | $ | 0.50 | $ | 1.86 | $ | 1.28 |
| Cash generated by operating activities | $ | 184,606 | $ | 211,336 | $ | 608,986 | $ | 307,098 |
| Cash used in investing activities | $ | 1,362 | $ | (53,245) | $ | (129,137) | $ | 240,423 |
| Cash used in financing activities | $ | (29,380) | $ | (31,255) | $ | (319,769) | $ | (158,374) |
| Operating Results | ||||||||
| Gold produced (oz) | 185,042 | 191,885 | 683,446 | 418,745 | ||||
| Gold sold (oz) | 186,159 | 182,259 | 689,354 | 413,775 | ||||
| Silver produced ('000 oz) | 2,043 | 2,165 | 8,010 | 5,581 | ||||
| Silver sold ('000 oz) | 2,461 | 956 | 7,810 | 4,411 | ||||
| Lead produced ('000 lb) (4) | 11,319 | 6,529 | 37,695 | 17,193 | ||||
| Lead sold ('000 lb) (4) | 11,653 | 3,005 | 33,378 | 14,179 | ||||
| Zinc produced ('000 lb) (4) | 3,208 | 2,932 | 13,642 | 6,988 | ||||
| Zinc sold ('000 lb) (4) | 3,803 | 1,608 | 10,751 | 5,111 | ||||
| Gold equivalent produced (oz) (5) | 211,717 | 220,431 | 794,456 | 484,153 | ||||
| Gold equivalent sold (oz) (5) | 218,282 | 194,862 | 797,602 | 465,471 | ||||
| Average realized gold price ($/oz sold) | $ | 1,798 | $ | 1,880 | $ | 1,802 | $ | 1,812 |
| Average realized silver price ($/oz sold) | $ | 23.48 | $ | 24.78 | $ | 24.98 | $ | 21.23 |
| Cash cost per gold equivalent ounce sold (1, 5) | $ | 697 | $ | 688 | $ | 698 | $ | 814 |
| AISC per gold equivalent ounce sold (1, 5) | $ | 961 | $ | 951 | $ | 955 | $ | 1,193 |
| Financial Position | December 31, 2021 | December 31, 2020 | ||||||
| Cash and cash equivalents | $ | 1,017,562 | $ | 860,633 | ||||
| Current assets | $ | 1,600,314 | $ | 1,423,795 | ||||
| Total assets | $ | 5,211,438 | $ | 5,177,344 | ||||
| Current liabilities | $ | 283,882 | $ | 249,297 | ||||
| Total liabilities | $ | 1,158,921 | $ | 1,326,856 | ||||
| Working capital (3) | $ | 1,316,432 | $ | 1,174,498 |
(1) The Company reports non-GAAP financial measures including adjusted attributable net income, adjusted basic attributable net income per share, cash costs and AISC per ounce sold to manage and evaluate its operating performance at its mines. See "Non-GAAP Financial Measures" for an explanation of these financial measures and a reconciliation of these financial measures to net income and production costs, which are the comparable GAAP financial measures.
(2) Gross margin is defined as income from mine operations divided by revenue.
(3) Working capital is defined as current assets less current liabilities.
(4) Data for lead production and sales relate only to lead in lead concentrate. Data for zinc production and sales relate only to zinc in zinc concentrate.
(5) Gold equivalent ounces have been established using the average realized metal prices per ounce of precious metals sold in the period and applied to the recovered silver metal content produced by the mines. Zinc and lead production are not included in gold equivalent ounces produced.
Updated Mineral Reserves and Resources for Year-End 2021
SSR Mining reports its updated Mineral Reserves and Mineral Resources as of December 31, 2021. For a detailed summary by asset, please refer to Item 2 Properties in SSR Mining’s 2021 10-K filing associated with this release.
- Continued delivery of Mineral Reserve replacement: Gold Mineral Reserves increased 14% or 1.1 million ounces to 9.2 million ounces as compared to year-end 2020 Mineral Reserves. Total gold equivalent Mineral Reserves increased 11% or 1.0 million ounces to 10.0 million ounces. The additions were driven primarily by the initial Mineral Reserve at Çöpler’s Çakmaktepe Extension, along with the Gap Hangingwall at Seabee.
- Measured and Indicated Mineral Resources of nearly 18 million gold equivalent ounces (exclusive of Mineral Reserves): Gold Measured and Indicated Mineral Resources of 6.5 million ounces decreased by 0.4 million ounces as compared to year-end 2020 Measured and Indicated Mineral resources, reflecting depletion. Gold equivalent Measured and Indicated Mineral Resources decreased by 1% to 17.8 million ounces as compared to year-end 2020.
- Inferred Mineral Resources highlight targets for future conversion: Gold Inferred Mineral Resources of 5.5 million ounces increased by 15% or 0.7 million ounces as compared to year-end 2020 Inferred Mineral Resources. Gold equivalent Inferred Mineral Resources of 7.3 million ounces increased by 7% or 0.5 million ounces as compared to year-end 2020 Inferred Mineral Resources.
- Çakmaktepe Extension and C2 drive Çöpler District Mineral Reserve and Resource growth, respectively: Çöpler Mineral Reserves increased 34% to 5.2 million ounces of gold with the successful conversion at Çakmaktepe Extension. Total gold contained in Measured and Indicated Mineral Resources plus the Mineral Reserves increased 15% to 8.3 million gold ounces. Çöpler also hosts 299 million pounds of Measured and Indicated copper resources in Çöpler, which the Çöpler Copper-Gold project aims to leverage value from.
- Commodity price assumptions largely unchanged from 2020: Commodity prices used in the calculation of Mineral Reserves remain at $1,350/oz gold, $18.50/oz silver, $0.90/lb of lead, $1.05/lb of zinc, while the copper price was increased to $3.30/lb from $3.00/lb previously. At Seabee, a $1,600/oz gold price was used in the calculation of Mineral Reserves to better align with site-level mine plans. Mineral Resource prices of $1,750/oz gold, $22.00/oz silver, $0.95/lb lead, $1.15/lb zinc were unchanged from 2020, while the copper price assumption increased to $3.95/lb from $3.25/lb previously.
Table 1. SSR Mining Mineral Reserves and Resources as of December 31, 2021.
| Mineral Reserves and Resources as of December 31, 2021 | Gold | Silver | Lead | Zinc | Copper | AuEq (7) | GEO Y/Y | |
|---|---|---|---|---|---|---|---|---|
| Change | ||||||||
| koz | koz | Mlb | Mlb | Mlb | koz | % | ||
| Total P+P Reserves | 9,154 | 47,906 | 219 | 48 | 9 | 10,016 | 11% | |
| Total M&I Resource (6) | 6,483 | 596,069 | 1,430 | 3,584 | 299 | 17,782 | (1%) | |
| Total Inferred Resource | 5,495 | 71,819 | 59 | 320 | 286 | 7,285 | 7% |
(6) Measured and Indicated Mineral Resources are shown exclusive of Mineral Reserves.
(7) All gold equivalent ounce (GEO) figures are based on the above-mentioned commodity prices. Metal equivalence is calculated for the respective and applicable metals as follows: AuEq = Au koz + ((Ag koz * Ag price per ounce) + (Pb klb * Pb price per pound) + (Zn klb * Zn price per pound) + (Cu klb
- Cu price per pound)) / (Au price per ounce).
SK1300 Technical Report Summary Highlights:
As required under SEC regulations, SSR Mining has published updated TRS for its four producing assets. At Ҫӧpler, the updated CDMP21 includes a Mineral Reserve Case incorporating the maiden Mineral Reserve from Çakmaktepe Extension (Ardich), and an Initial Assessment Case (IAC) which contemplates the production and value upside possible through the construction of a copper concentrator to process Çöpler Copper-Gold Resources. Both the Reserve Case and the Initial Assessment Case extend the operating life for the Ҫӧpler mine and expand the production profile against the November 2020 Ҫӧpler District Master Plan (“CDMP20”).
The Seabee TRS reflects a doubling of the mine life with the inclusion of the Gap Hangingwall Mineral Reserves and includes recently demonstrated improved operating performance. The accelerated filing of the Marigold TRS means that recent drilling work was not yet developed to a stage ready for Mineral Reserve declaration, which is targeted for subsequent filings. With respect to Puna, the TRS includes the improved operating performance that the mine has demonstrated over the last year.
The updated life of mine plans are aligned with the Company’s three-year production guidance of 700,000 to 780,000 gold equivalent ounces annually, and provide a robust production base for SSR Mining to complement with future resource conversion and growth projects. In aggregate, the combined Net Asset Value of the four assets is aligned with consensus analyst estimates, without incorporating future growth opportunities at each mine. The company has a pipeline of highly prospective near mine targets at all of its producing mines, a history of near mine exploration success/mine life extension and has substantially increased spending on near mine exploration and project development in 2022.
Table 2. Key Metrics From 2021 SK1300 Technical Report Summaries (8)
| Asset | Mine Life | LOM Production | 5-Year Avg. Annual Production | After-Tax NPV5% | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reserve Case | IAC | Reserve Case | IAC | Reserve Case | IAC | Reserve Case | IAC | ||||||||||
| (yrs.) | (yrs.) | (koz Au) | (koz Au) | (koz Au) | (koz Au) | ($M) | ($M) | ||||||||||
| Ҫӧpler | 21 | 22 | 4,369 | 5,368 | 278 | 300 | $1,732 | $2,004 | |||||||||
| Marigold | 11 | 2,536 | 215 | $860 | |||||||||||||
| Seabee | 6 | 565 | 96 | $249 | |||||||||||||
| Subtotal | 16 | 18 | 7,470 | 8,469 | 589 | 611 | $2,841 | $3,113 | |||||||||
| Moz Ag | Moz Ag | ||||||||||||||||
| Puna | 5 | 35.1 | 7.0 | $228 | |||||||||||||
| Weighted Average Mine Life (yrs.) | koz AuEq | koz AuEq | Total Producing Asset NPV 5% ($M) | ||||||||||||||
| Total | 16 | 17 | 7,958 | 8,957 | 686 | 708 | $3,068 | $3,341 |
(8) Gold equivalent calculated using a 72:1 gold to silver ratio in accordance with 2022 SSR Mining guidance.
Ҫӧpler District Master Plan – Reserve Case
The first of two development scenarios outlined in the CDMP21, the Reserve Case incorporates the successful Mineral Reserve conversion efforts at Çakmaktepe Extension (Ardich) to extend and expand upon the production profile outlined in the CDMP20. Highlights of the CDMP21 Reserve Case include:
- NPV5% of $1.7 billion;
- 21-year asset life including 13 years of oxide mining;
- Life of mine production of 4.4 million ounces gold, a 37% increase over the CDMP20 Reserve Case;
- Average annual production of 278,000 ounces of gold over the first five years;
- Average AISC of $1,071 per ounce over the first five years;
- Average annual operating cash flow of $205 million and free cash flow of $158 million over the first five years;
- Incorporation of Mineral Reserves at Çakmaktepe Extension (Ardich) that adds an additional 1.2 million ounces of gold production into the life of mine profile beginning in 2023 for total development capital of $69 million
Figure 1. Life of Mine Production Profile from CDMP21 Reserve Case as compared to CDMP20 Reserve Case mine plan
Table 3. Key Metrics From 2021 Ҫӧpler District Master Plan Reserve Case
| 2022 – 2026 | 2022 – 2031 | Life of Mine | |||||
|---|---|---|---|---|---|---|---|
| Average Annual Production | Au koz | 278 | 258 | 208 | |||
| Total Production | Au koz | 1,390 | 2,579 | 4,369 | |||
| Total Cash Costs | $ / Au oz | $880 | $867 | $803 | |||
| AISC | $ / Au oz | $1,071 | $1,049 | $966 | |||
| Operating Cash Flow | $M | $1,024 | $1,818 | $3,144 | |||
| Total Capital Costs * | $M | $233 | $365 | $588 | |||
| Total Free Cash Flow | $M | $791 | $1,453 | $2,555 | |||
| Average Annual Free Cash Flow | $M | $158 | $145 | $122 |
- Total capital costs include working capital.
Ҫӧpler District Master Plan – Initial Assessment Case
The Initial Assessment Case development scenario outlined in the CDMP21 expands on the life of mine production plan highlighted in both the CDMP21 Reserve Case and the 2020 Ҫӧpler District Master Plan (“CDMP20”) PEA Case with the construction of a Copper Concentrator to recover copper from the Sulfide Mineral Resource.
The Initial Assessment Case has been prepared to demonstrate economic potential of the Mineral Resources at the Çöpler Deposit. The Initial Assessment Case is preliminary in nature, it includes Inferred Mineral Resources that are considered too speculative geologically to have modifying factors applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that this economic assessment will be realized.
The copper concentrator would produce a gold-rich copper concentrate for sale to smelters and a high gold content pyrite concentrate to be fed into the autoclaves in the sulfide plant. The pyrite concentrate would increase annual gold production while also providing sulfur as a source of fuel for the autoclaves. In addition, the changes in pit shape driven by the added value attributed by the copper also results in additional ore feed for both the autoclaves and heap leach pads. Highlights of the CDMP21 Initial Assessment Case include:
- NPV5% of $2.0 billion;
- 22-year asset life including 19 years of oxide mining;
- Life of mine production of 5.4 million ounces gold, a 26% increase in LOM production over the CDMP20 PEA Case despite depletion;
- Average annual production of 300,000 ounces of gold over the first five years;
- Average AISC of $938 per ounce over the first five years;
- Average annual operating cash flow of $255 million and free cash flow of $165 million over the first five years;
- Incorporation of the Copper Concentrator adds 1.0Moz gold in life of mine production starting in 2025 for initial capital investment of $218 million;
- Most of the value in the gold-rich copper concentrate is derived from gold with total copper revenue representing ~6% of LOM total revenue in the CDMP21 Initial Assessment Case;
- IRR: ~60%
Figure 2. Life of Mine Production Profile from CDMP21 Initial Assessment Case as compared to CDMP20 PEA Case mine plan Table 4. Key Metrics From 2021 Ҫӧpler District Master Plan Initial Assessment Case
| 2022 – 2026 | 2022 – 2031 | Life of Mine | |||||
|---|---|---|---|---|---|---|---|
| Average Annual Production | Au koz | 300 | 300 | 244 | |||
| Total Production | Au koz | 1,499 | 3,001 | 5,368 | |||
| Total Cash Costs | $ / Au oz | $761 | $750 | $783 | |||
| AISC | $ / Au oz | $938 | $907 | $924 | |||
| Operating Cash Flow | $M | $1,277 | $2,441 | $3,851 | |||
| Total Capital Costs * | $M | $451 | $583 | $893 | |||
| Total Free Cash Flow | $M | $826 | $1,858 | $2,958 | |||
| Average Annual Free Cash Flow | $M | $165 | $186 | $134 |
- Total capital costs include working capital.
Additional potential for upside at Ҫӧpler
The updated CDMP21 highlights significant growth to the production and free cash flow profile as compared to the Reserve and IAC / PEA production scenarios in the CDMP20. SSR Mining is advancing Ҫӧpler Copper-Gold to the Pre-Feasibility stage. Additionally there are multiple opportunities for possible growth beyond the CDMP21 that are currently being investigated by the SSR Mining team, including:
- 2022 Çakmaktepe Extension drilling plan aims to deliver additional Mineral Reserve and Mineral Resource growth at Çakmaktepe Extension (Ardich);
- Near-pit exploration success at targets like Ҫӧpler Saddle and below the Main Pit that could further complement the Sulfide and/or Oxide production profile;
- Optimization of the blended ore feed to the three plants (sulfide plant, oxide plant and copper concentrator) to increase recoveries and value;
- Regional exploration success at targets across the Ҫӧpler District
SSR Mining has budgeted nearly 45,000 meters of exploration and resource development drilling across the Ҫӧpler District in 2022.
Marigold
The SK1300 Technical Report Summary at Marigold is based exclusively on existing Mineral Reserves and does not yet incorporate any of the Company’s recent exploration success in identifying higher grade oxide material outside of existing Mineral Resources. The target of subsequent filings will be to incorporate additional Mineral Reserves delineated by recent exploration drilling. The mine plan in the TRS expands on the production profile outlined in Marigold’s 2018 Technical Report, including a 72% increase in life of mine production as compared to the remaining production profile in the 2018 Technical Report. Highlights of the Marigold TRS include:
- NPV5% of $860 million;
- 11-year mine life;
- Life of mine production of 2.5 million ounces gold, a 72% increase in LOM production over the remaining period in the prior 2018 technical report;
- Average annual production of 215,000 ounces of gold over the first five years;
- Average AISC of $1,278 per ounce over the first five years;
- Average annual operating cash flow of $123 million and free cash flow of $72 million over the first five years;
Figure 3. Life of Mine Production Profile from the Marigold SK1300 as compared to 2018 Marigold Technical Report mine plan
Table 5. Key Metrics from the Marigold SK1300 Technical Report Summary
| 2022 – 2026 | 2022 – 2031 | Life of Mine | |||||
|---|---|---|---|---|---|---|---|
| Average Annual Production | Au koz | 215 | 222 | 217 | |||
| Total Production | Au koz | 1,075 | 2,224 | 2,536 | |||
| Total Cash Costs | $ / Au oz | $1,042 | $993 | $1,009 | |||
| AISC | $ / Au oz | $1,278 | $1,156 | $1,154 | |||
| Operating Cash Flow | $M | $615 | $1,310 | $1,606 | |||
| Total Capital Costs * | $M | $254 | $364 | $440 | |||
| Total Free Cash Flow | $M | $361 | $946 | $1,166 | |||
| Average Annual Free Cash Flow | $M | $72 | $95 | $97 |
- Total capital costs include working capital.
Additional potential for upside at Marigold
The Marigold property hosts significant potential for mine life extension through future Mineral Reserve conversion and growth. Opportunities for possible growth beyond the TRS life of mine plan include:
- M&I Mineral Resources of 1.6 million ounces gold not incorporated in the current Mineral Reserve
- Positive assay results highlighted in SSR Mining’s Marigold exploration updates (9) have not yet been converted to Mineral Resources and present opportunities for possible growth;
- The Company is focused on the delineation of higher-grade oxide material immediately adjacent to current operations at New Millennium, as well as the Buffalo Valley and Trenton Canyon targets;
- The re-assay of historical New Millennium drilling results is continuing, with potential to deliver incremental positive Mineral Reserve growth;
- The Company will evaluate the potential for oxide processing infrastructure (heap leach and gold adsorption) closer to Buffalo Valley and Trenton Canyon which could also significantly reduce costs for the other, more southern, Marigold deposits;
• Systematic exploration of deeper sulfide targets continues
SSR Mining has planned nearly 90,000 meters of exploration and resource development drilling at Marigold in 2022 to continue advancing these brownfield exploration targets.
(9) See December 8, 2021 press release titled “SSR Mining Announces Positive Results at Marigold” and May 14, 2020 press release titled “SSR Mining Provides Exploration Update.”
Seabee
The SK1300 Technical Report Summary at Seabee includes a doubling of the remaining mine life as a result of the Gap Hangingwall maiden Mineral Reserve, and also includes recently demonstrated improved operating performance. Seabee is scheduled to deliver record gold production for at least the next two years, with aggressive exploration efforts underway to extend mine life and improve mill feed grade in the outer years.
The TRS at Seabee is based exclusively on existing Mineral Reserves and does not incorporate any of the 358koz of Measured and Indicated Mineral Resources exclusive to the existing Mineral Reserves, or the 536koz of Inferred Mineral Resources. Seabee has been in continuous operation for 30 years and has demonstrated a track record of continued Mineral Reserve replacement that SSR Mining expects to continue into the future.
The mine plan in the TRS expands on the production profile outlined in Seabee’s 2017 Technical Report, including a 151% increase in life of mine production as compared to the remaining production profile in the 2017 Technical Report mine plan. Highlights of the Seabee TRS include:
- NPV5% of $249 million;
• 6-year mine life;
- Life of mine production of 565 thousand ounces gold;
- Average annual production of 96 thousand ounces of gold over the first five years;
- Average AISC of $1,004 per ounce over the first five years;
- Average annual operating cash flow of $81 million and free cash flow of $51 million over the first five years;
• Production rate increasing from 382 tpa in 2021 to ~425 tpa with potential for further improvement
Figure 4. Life of Mine Production Profile from the Seabee TRS as compared to the 2017 Seabee Technical Report mine plan
Table 6. Key Metrics from the Seabee SK1300 Technical Report Summary
| 2022 – 2024 | 2022 – 2026 | Life of Mine | |||||
|---|---|---|---|---|---|---|---|
| Average Annual Production | Au koz | 114 | 96 | 89 | |||
| Total Production | Au koz | 341 | 480 | 565 | |||
| Total Cash Costs | $ / Au oz | $586 | $690 | $735 | |||
| AISC | $ / Au oz | $913 | $1,004 | $1,021 | |||
| Operating Cash Flow | $M | $324 | $405 | $448 | |||
| Total Capital Costs* | $M | $111 | $150 | $174 | |||
| Total Free Cash Flow | $M | $212 | $254 | $274 | |||
| Average Annual Free Cash Flow | $M | $71 | $51 | $46 |
- Total capital costs include working capital.
Additional potential for upside at Seabee
The Seabee property hosts significant potential for mine life extension through exploration along the mine’s strike and the many more distal mineralization targets. Opportunities for possible growth beyond the SK1300 life of mine plan include:
- Exploration targeting higher grades and tonnes along strike in the Santoy 8 & 9 structures, which represent the current source of production;
- Further exploration and conversion of the Santoy Hangingwall to Mineral Resource;
- Exploration to expand the Gap Hangingwall Resources and convert to Mineral Reserves;
- Continued exploration and definition drilling at targets across the Seabee property, including Shane, Joker and Porky;
- Greenfield exploration work focused on prospective targets from generative exploration work across the Seabee and Fisher properties
Seabee Historical Mineral Reserve & Resource Growth
583 1013 640 550 510 358
129 610 580 500 493 299 239
2013 2014 2015 2016 2017 2018 2019 2020 2021
Reserves (koz Au) M+I Resources (Exclusive) (koz Au)
Inferred Resources (koz Au) Cumulative Production (koz Au)
Figure 5. Year-end gold Mineral Reserves and Resources against annual gold production at Seabee highlighting track record of Mineral Resource and Reserve growth