ALLIED GOLD ANNOUNCES LONG-TERM POWER PURCHASE AGREEMENT FOR KURMUK GOLD PROJECT
Key Terms of the Agreement:
- Term: The PPA will be in effect for a period of twenty years and may be extended by mutual agreement.
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Energy Charge: The agreement secures a flat energy charge of
US$0.04 per kWh, applicable from the supply commencement date and remaining fixed for the entire term, providing cost certainty for the project. -
Renewable Energy Source:
The Kurmuk Gold Mine will benefit fromEthiopia's predominantly renewable energy sources, aligning with the Company's commitment to sustainable mining practices. -
Transmission Line Construction : Electrical grid power will be supplied to the operation via a 75-kilometer, 132 kV power line, with substations at Asosa, a major city in the country near the project, and at the project site. The government will provide the grid connection, which will increase their equity stake in KGM from 5 percent to 7 percent, as defined in the Kurmuk Development Agreement. On-site power will be distributed via a network of 11 kV power lines.
Securing the terms of the PPA marks a key milestone in advancing the
About the
Key milestones achieved include the mobilization of essential logistics, the construction of the starter camp, and the successful completion of a temporary water dam by a local earthworks contractor under the supervision of DRA. The dam was completed on schedule and is now full. Additionally, the construction of the main 1,600-person camp is well underway, with earthworks, civil works, and module deliveries progressing as planned.
Operational readiness remains a priority, with ongoing recruitment for key positions, including the General Manager. The Company is also in the final stages of awarding the mining contract, focusing on advancing earthworks and preparing for the early mobilization of equipment. This preparation includes developing customs, importation, and logistics systems to ensure seamless operations once mining begins.
The total development capital required for the project is expected to be funded through available cash, cash flows from operations, and a combination of stream and gold pre-pay financing, which is in advanced stages of discussion. The payback period for the project is expected to be less than three years after the start of operations.
The first gold pour is expected in the second quarter of 2026, and the Company has provided a long-term outlook with a production expectation of 175,000 ounces in 2026, which will be a partial year of production.
About
Allied Gold is a Canadian-based gold producer with a significant growth profile and mineral endowment which operates a portfolio of three producing assets and development projects located in Côte d'Ivoire,
Qualified Persons
Except as otherwise disclosed, all scientific and technical information contained in this press release has been reviewed and approved by
END NOTES
(1) |
This is a non-GAAP financial performance measure. Refer to the Non-GAAP Financial Performance Measures section at the end of this news release. |
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION AND STATEMENTS
This press release contains "forward-looking information" under applicable Canadian securities legislation. Except for statements of historical fact relating to the Company, information contained herein constitutes forward-looking information, including, but not limited to, any information as to the Company's strategy, objectives, plans or future financial or operating performance. Forward-looking statements are characterized by words such as "plan", "expect", "budget", "target", "project", "intend", "believe", "anticipate", "estimate" and other similar words or negative versions thereof, or statements that certain events or conditions "may", "will", "should", "would" or "could" occur. In particular, forward-looking information included in this press release includes, without limitation, statements with respect to information concerning the Stream Transaction, conditions precedent and the closing thereof, expectations to be fully financed, expected production, exploration, development and expansion plans discussed herein being met. Forward-looking information is based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made, and is inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ materially from those projected in the forward-looking information. These factors include the Company's dependence on products produced from its key mining assets; fluctuating price of gold; risks relating to the exploration, development and operation of mineral properties, including but not limited to adverse environmental and climatic conditions, unusual and unexpected geologic conditions and equipment failures; risks relating to operating in emerging markets, particularly
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that could cause actions, events or results to not be as anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates, assumptions or opinions should change, except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking information. The forward-looking information contained herein is presented for the purpose of assisting investors in understanding the Company's expected financial and operational performance and the Company's plans and objectives and may not be appropriate for other purposes.
CAUTIONARY STATEMENT REGARDING NON-GAAP MEASURES
The Company has included certain non-GAAP financial performance measures in this press release, which supplement its Consolidated Financial Statements that are presented in accordance with IFRS, including the following:
- AISC per gold ounce sold
The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company.
Non-GAAP financial performance measures do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to similar measures employed by other companies. Non-GAAP financial performance measures are intended to provide additional information, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS and are not necessarily indicative of operating costs, operating earnings or cash flows presented under IFRS.
Management's determination of the components of non-GAAP financial performance measures and other financial measures are evaluated on a periodic basis, influenced by new items and transactions, a review of investor uses and new regulations as applicable. Any changes to the measures are duly noted and retrospectively applied, as applicable. Subtotals and per unit measures may not calculate based on amounts presented in the following tables due to rounding.
The measures of cash costs and AISC, along with revenue from sales, are considered to be key indicators of a company's ability to generate operating earnings and cash flows from its mining operations.
AISC PER GOLD OUNCE SOLD
AISC figures are calculated generally in accordance with a standard developed by the
AISC include cash costs (as defined above), mine sustaining capital expenditures (including stripping), sustaining mine-site exploration and evaluation expensed and capitalized, and accretion and amortization of reclamation and remediation. AISC exclude capital expenditures attributable to projects or mine expansions, exploration and evaluation costs attributable to growth projects, DA, income tax payments, borrowing costs and dividend payments. AISC include only items directly related to each mine site, and do not include any cost associated with the general corporate overhead structure. As a result, Total AISC represent the weighted average of the three operating mines, and not a consolidated total for the Company. Consequently, this measure is not representative of all of the Company's cash expenditures.
Sustaining capital expenditures are expenditures that do not increase annual gold ounce production at a mine site and exclude all expenditures at the Company's development projects as well as certain expenditures at the Company's operating sites that are deemed expansionary in nature, such as the Sadiola Phased Expansion, the construction and development of Kurmuk and the PB5 pushback at Bonikro. Exploration capital expenditures represent exploration spend that has met criteria for capitalization under IFRS.
The Company discloses AISC as it believes that the measure provides useful information and assists investors in understanding total sustaining expenditures of producing and selling gold from current operations, and evaluating the Company's operating performance and its ability to generate cash flow. The most directly comparable IFRS measure is cost of sales, excluding DA. As aforementioned, this non-GAAP measure does not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to similar measures employed by other companies, should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS, and is not necessarily indicative of operating costs, operating earnings or cash flows presented under IFRS.
AISC are computed on a weighted average basis, with the aforementioned costs, net of by-product revenue credits from sales of silver, being the numerator in the calculation, divided by gold ounces sold.
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