General Discussion on AAU, page-804

Evening Sir,

Nice little forward plan put out by the company on the 26th of Oct 2022 is referenced below FYI and I've pulled in a couple of key points for all to digest.

Only change is the slight slippage of the Antimony assessment holding up the revised SS, but the importance to the project metrics are well understood there and hence I'm happy to give a little ground.. But not too much

Also the excising of the Oxide Cap as notified to the ASX on the 15th of Dec as being advanced could mean that the Oxide Cap is being brought forward slightly..

None of the fwd works rely on the Arbitration outcome which is a smart way to run a project & especially if your swingers are on the block.. hehe

Remembering Brian cut his teeth developing projects for Lang Hancock! Do a little research there as to what was demanded by the man and perhaps also have a look at what his lineage is doing/has done with Roy Hill and you'll appreciate the show is well and truly on the road.. !

ANTILLES GOLD LIMITED (ASX:AAU) - Ann: Near Term Development Strategy for Activities in Cuba, page-1 - HotCopper | ASX Share Prices, Stock Market & Share Trading Forum

STRATEGY
LA DEMAJAGUA SULPHIDE GOLD-SILVER MINE
 The proposed La Demajagua open pit mine will be development-ready when its DFS is
completed in March 2023.

 In the interim, a revised Scoping Study is expected to be completed in December 2022 taking
into account metallurgical test work indicating the potential to produce two separate
concentrates:
- ~ 54,000 tpa of a gold-rich concentrate with high arsenic content where samples have
demonstrated good recoveries from smelters, and an off-take agreement is being
negotiated with an international trading group (indicative grades of 38.4 g/t Au, 114 g/t
Ag, 6.6% Sb, and 29% As).

- ~ 11,000 tpa of a silver-rich concentrate with relatively low arsenic content, and high
antimony (Sb) content (indicative grades of 33% Sb, 28 g/t Au, 1540 g/t Ag, and 8.8%
As).

 Additional metallurgical test work will be aimed at potentially increasing the content of the
high value antimony to over 40% in the silver-rich concentrate.

 Negotiations have commenced for off-take with parties that have provided
expressions of interest in purchasing both concentrates, with indicative pricing of
75% for contained precious metals, and 50% for antimony which has a current
price of approximately US$12,000/t.

 It is intended to meet the anticipated US$75 million to US$80 million of capital costs
(including pre-development activities) by a combination of:

 The Company will follow-up on preliminary discussions with financiers after the updated
Scoping Study is completed, and is confident of having financing in place by mid-2023 which
would allow commissioning of the La Demajagua mine by the end of 2024.

 Antilles Gold has to date contributed US$8.0 million of its committed equity to the joint
venture. An additional US$1.0 million will be applied to completing the DFS, and the US$4.0
million balance will be spent primarily on mine infrastructure after project financing has been
arranged.

 An updated revised Scoping Study is expected to be completed in December 2022, and will
take into account increased JORC Resources, potential income from antimony, and a mine life
planned to be extended to 7 years, which should improve the economics of the project.

EL PILAR OXIDE GOLD-COPPER MINE
 The joint venture will also focus on the near-term development potential of what is expected
to be its second project, a shallow, low cap-ex open pit mine on the El Pilar gold-copper oxide
deposit which overlies a large copper-gold porphyry deposit in central Cuba.
 The reasons why this small project is most attractive include the following:
- the development costs for the El Pilar oxide deposit are expected to be in the order of only
US$30 million including pre-development and infrastructure costs.

- the infrastructure costs will be relatively low with the level mine site benefitting from the
existence of near-by HT power lines, highway connection, water supply, an available local
workforce, and a 50km rail link to a port for concentrate export, and the absence of
agricultural activities.

- the clean gold and copper concentrates expected to be produced should attract payables in
the order of 95% of the value of contained metal.

- modelling of 24,000m of historic drilling of the oxide deposit resulted in an Upper
Exploration Target in the gold domain of 1.4Mt of ore containing 221,000 oz Au at a grade
of 4.8 g/t Au, and 1.7Mt of ore in the underlying copper domain containing 52.7Mlb of Cu
at a grade of 1.4% Cu. (reported to ASX on 5 July 2022)

- the current in-ground value of metals may increase based on the extensive activities of
artisanal miners in the surrounding area which will assist in identifying where additional
pits might be developed to feed the concentrator, and extend the anticipated six year mine
life.

 Assay results from a recent 1800m cored drilling program along strike of the oxide deposit are
expected to be received in November 2022 and will provide an indication of the reliability of
the historic drilling. Refer below

Drilling results received..

Near Term Strategy Continued (ref 26 Oct 2022)
 An additional 7000m drilling program on the oxide deposit is planned to commence in January
2023, with JORC Resources, metallurgic test work, and an accurate Scoping Study to be
completed in October 2023.

 Gold concentrate would probably be shipped to a smelter in Canada, and the copper
concentrate to Europe thereby avoiding costly shipping to East Asia through the Panama Canal.

 It is expected the project will be financed internally from the anticipated surplus cash
generated by the La Demajagua mine.

 A preliminary financial analysis of the proposed oxide mine development indicates a payback
of six to nine months at current metal prices with the project having the potential to add to
the joint venture’s profits and cash flow from La Demajagua.

 This project should be ready to commence mine construction in Q2 2024 and be
commissioned 12 months later.

Note:
"Early discussions with international concentrate traders have indicated that buyers will support project financing".

Basically they are setting the project up so that El Pilar Oxide Cap can come online as early as possible and will most likely be funded by offtake agreement fwd payments and/or finance initiatives.

Then free cash flow from both La Demajaguar and El Pilar Oxide Cap can be directed (with the already agreed in principle JV partners permsssion) towards proving up the entire El Pilar, Gaspar, San Nicolas Porphyry concession.

Noting only circa 27000m of drilling was conducted over the oxide cap, the remainder was spread over the wider concession and hence you get the feeling they sorta know what they have in hand, if not completely just how big the "Tiger" is? Yet..

In communication I have had with the company the strategy document which was announced on the 26th of October is still current.. The Antimony assays pending from SGS have been the only push so far from the agreed timeline, but who hasn't ever waited for the elusive assay?

Ergo I believe the aforementioned updated SS is set to be received as an early "welcome to 2023" and look forward to reviewing the findings.

2023 market opens tomorrow so GLTAH... & why the hell not, hey Brian? .. H8tey