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Monday, August 21, 2017 Derek Macpherson

AGLD’s Regional Trenching Program Yields Positive Results

Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) reported initial trenching results from its Amancaya project in Chile. Results were highlighted 2.5m at 9.7 g/t Au and 6.9 g/t Ag at the newly discovered Nueva Vein and 2.3m at 8.1 g/t Au and 6.1 g/t Ag from the Nueva Sur Vein (Figure 1). The company believes that these newly discovered veins have the ability to yield a similar resource to the Central Vein which hosts 497k oz at 8.96 g/t AuEq (1.8 million tonnes). These new veins were discovered as part of the company’s regional trenching program on previously identified targets. The company plans to follow-up these results with a drill program, once the overall exploration program is complete. While these results highlight the longer-term potential of Amancaya, investors are likely to remain focused on the near-term as the company’s production profile is poised to increase with Amancaya ore starting to be processed. In our view, Austral is poised to re-rate towards similar scale peers, as it demonstrates its increased production potential.  read more


Tuesday, August 01, 2017 Derek Macpherson

New Plant Delays Impact ALGD’s Q2; Ops Expected to Improve in Q3

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) reported Q2 2017 production and financial results from its operations in Chile and Argentina. Total production for the quarter was 11,764 Au oz and 390,234 Ag oz (16,898 AuEq), the decrease in overall production QoQ was due to delays in the commissioning of the new agitation leach plant (Figure 1). The plant is expected to come online next quarter, which should result in higher production for the remainder of the year. Overall, it appears the company has the potential to meet its guidance of 115k AuEq oz for CY2017; however, the processing of higher grade ore from Amancaya is key. In our view, Austral is poised to re-rate towards similar scale peers, as it demonstrates its increased production potential. read more


Tuesday, July 18, 2017 Derek Macpherson

AGLD Consolidates Land Position Around Amancaya

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) announced it will acquire 100% interest in the San Guillermo and Reprado projects from Revelo Resources Corp. (TSXV:RVL), for 10 million shares of Austral (C$1.5 million) as well as NSRs on future production at both projects (1% NSR Reprado, 0.5% NSR San Guillermo). In February 2016, Austral signed an Option and Sale Agreement on San Guillermo with Revelo, which has now been cancelled. The transaction is beneficial to Austral adding near mine exploration potential from both projects which are located adjacent to Amancaya. We continue to expect improved performance from the company over the course of the year, as the new agitation leach plant comes online and higher-grade stockpiled ore at Amancaya begins being processed. In our view, Austral is poised to re-rate towards similar scale peers. read more


Wednesday, July 12, 2017 Derek Macpherson

AGLD Completes PFS for Guanaco & Amancaya

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) has filed the combined Pre-Feasibility Study for the Guanaco Mine and Amancaya Project in Chile which outlines an average annual production of 53k oz Au and 370k oz Ag over a 5-year mine life. The company is estimating an NPV (5%) of US$71.3 million, AISC of US$892/oz Au and LOM sustaining capital costs of US$66.4 million over the life-of-mine. We note that the production scenario outlined in the PFS may not reflect ramped up operations, as there is only a limited contribution from Guanaco, as most of the resources at the project are in the inferred category; hence, excluded from the study. Based on historical production results, we would expect the combined production profile to exceed what is outlined in the PFS and be between 60-75k oz AuEq per year. We continue to expect improved performance from the company over the course of the year, as the new agitation leach plant comes online and higher-grade stockpiled ore at Amancaya begins being processed. In our view, Austral is poised to re-rate towards similar scale peers. read more


Friday, June 09, 2017 Derek Macpherson

AGLD Reports Maiden Reserve Estimate for Amancaya

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) reported updated resource and reserve estimates for both its Amancaya project and Guanaco mine in Chile. The update included a maiden reserve estimate for Amancaya, emphasizing the project’s important role in the company’s growth strategy. We continue to expect improved performance from the company over the course of the year, as the new agitation leach plant comes online and higher-grade stockpiled ore at Amancaya begins being processed. We expect a PFS for Amancaya and Guanaco (Q2 2017) to be completed shortly and should provide a clear picture of the combined production profile. In our view, Austral is poised to re-rate towards similar scale peers. read more


Monday, June 05, 2017 Derek Macpherson

Austral Takes Important Step for Growth in Chile

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) announced Guanaco will receive electricity connection to the northern Chile National grid on June 6, 2017, pending final approval from the national grid operator. Importantly, the connection allows the company to begin ramp-up testing for the new agitation leach plant, which is expected to be in full operation by the end of the month. In the near-term, this should result in the ore currently being stockpiled at Amancaya to be processed, a significant growth step for Austral. We continue to expect improved performance from the company over the course of the year, as the new agitation leach plant comes online, Amancaya advances towards production and the planned combined PFS for Amancaya and Guanaco (Q2 2017) is complete. In our view, Austral is poised to re-rate towards similar scale peers. read more


Wednesday, May 03, 2017 Derek Macpherson

Austral's Ops Likely to Improve for Balance of 2017

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Austral Gold Ltd. (TSXV:AGLD, ASX:AGD) reported weak Q1 2017 production results from its operations in Chile and Argentina. From Q4 2016 to Q1 2017, AuEq production decreased and cash costs (AuEq/oz) increased at both Casposo and Guanaco (Figure 1). Despite a weak Q1, the company still expects to meet its guidance (115k oz AuEq), suggesting a strong performance for the rest of the year. The planned combined PFS for Amancaya and Guanaco is scheduled to be completed in Q2 2017. With improved performance expected over the course of the year along with the new agitation leach plant coming online and Amancaya advancing towards production, Austral is poised to re-rate towards similar scale peers. read more


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. read more


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