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Tuesday, March 07, 2017 Derek Macpherson

Austral Increases Interest in Casposo to 70%


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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) announced it has acquired an additional 19% stake in the Casposo gold-silver mine in Argentina for US$1.0 million. By way of the transaction, the company has brought its total interest in the mine to 70%. Austral acquired a 51% interest in Casposo in 2016 and has options to acquire the outstanding 30% for US$7.0 million by 2020. Austral has commenced various operational improvement initiatives at the mine and spent US$5.8 million to date on development and re-commissioning. The mine was re-commissioned in Q3 2016 and Austral’s attributable share in Q4, the mine’s full operational quarter, amounted to ~5,500 oz AuEq. We view Austral’s ownership increase in Casposo positively. Based on Austral’s 2017 guidance of 50,000 oz AuEq, the company’s annualized attributable share would amount to ~35,000 oz AuEq. We expect that the ongoing ramp-up of the Casposo project, a resource update, pre-feasibility study (Q1 2017) and initial production from Amancaya, in addition to the completion of the mill expansion at Guanaco are likely to be key catalysts in the near-term.



Derek Macpherson | VP Mining Analysis
Sunneva Bernhardsdottir | Associate, Mining Analysis
Victoria Ellis Hayes | Associate
 
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Austral Gold Ltd. - TSXV:AGLD, ASX:AGD - 1,2,7

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