exhibit_99-1
January 18,
2021
|
News Release
21-02
|
Pretivm Achieves Above Mid-Point of 2020 Production Guidance;
Significantly Reduces Debt with a Discretionary Payment of $160M;
and Provides 2021 Production, Cost and Free Cash Flow
Outlook
Fourth Quarter (“Q4”) and Full Year
(“2020”) 2020 Highlights:
●
Gold
production – Q4: 88,299 ounces; 2020: 347,743
ounces
●
Discretionary
debt payment of $160.0 million made prior to the end of
Q4
●
End
of year cash balance: $174.8 million
All amounts are in US dollars unless otherwise noted.
Vancouver,
British Columbia, January 18, 2021; Pretium Resources Inc.
(TSX/NYSE:PVG) (“Pretivm” or the “Company”)
announces fourth quarter and full year 2020 production results and
a $160 million discretionary payment against its credit facility.
Pretivm also provides production and financial guidance for
2021.
The
Company produced 347,743 ounces of gold in 2020, slightly above the
midpoint of its guidance range of 325,000 ounces to 365,000 ounces.
For 2021, the Company expects gold production to be in the range of
325,000 to 365,000 ounces, with a midpoint of 345,000
ounces.
“For the first time in the Company’s history we have
achieved our annual production guidance, demonstrating the
hard-work and perseverance of our team in light of the exceptional
challenges we faced this year. We would like to thank all of
our employees and contractors and the local communities for their
continued support over the course of 2020. At Pretivm, no year is
considered a success unless it is accomplished safely, and in the
third quarter we were given a tragic reminder of the importance of
keeping safety at the forefront of everything we do,” said
Jacques Perron, President and Chief Executive Officer of
Pretivm.
“Our
gold production along with the value captured from the sale of the
Snowfield Property has allowed us to significantly reduce our
long-term debt and maintain a robust cash balance. We are now in a
position to focus on further improving the safety, predictability
and stability of production, while also prioritizing resource
expansion and investing in the future of
Brucejack.”
2020 Annual and Fourth Quarter Production
In
2020, 347,743 ounces of gold were produced at the Brucejack Mine at
an average grade of 8.5 grams per tonne and an average gold
recovery of 97%. In the fourth quarter of 2020, Brucejack produced
88,299 ounces of gold at an average grade of 8.9 grams per tonne
and average gold recovery of 97%. The Company successfully
ramped-up to an average processing rate of 3,800 tonnes per day in
the month of December.
Prior
to the end of 2020, a discretionary debt payment of $160.0 million
was applied to the revolving portion of the Company’s credit
facility, reducing the outstanding amount of the revolving portion
to $38.0 million as of year end. In total, the company repaid
$226.7 million of its credit facility in 2020. Even with the
discretionary debt payment, the year-end cash and cash equivalents
was $174.8 million, as compared to $175.0 million at September 30,
2020.
2021 Guidance
Gold Production
|
325,000 – 365,000 oz
|
Average Grade
|
7.5 – 8.5 g/t
|
Recovery Rate
|
~ 97%
|
Cash Cost
|
$820 – 920 / oz sold
|
Sustaining Capital
|
$50 - $55 million
|
All-in Sustaining Cost
|
$1,060 - $1,190 / oz sold
|
Expansion Capital
|
$55 - $65 million
|
Free Cash Flow1
|
$120 – $170 million
|
Abbreviations: g/t (grams per tonne) and oz (ounces).
1 Based on a gold price of $1,700 per ounce of
gold
2021 Production Guidance
Gold
production at the Brucejack Mine for 2021 is expected to be in the
range of 325,000 to 365,000 ounces. The processing rate is expected
to average 3,800 tonnes per day with average annual gold grade
ranging between 7.5 grams per tonne to 8.5 grams per tonne at a
targeted gold recovery of 97%.
2021 Financial Guidance
All-in
sustaining cost1 (“AISC”)
for 2021 is expected to range from $1,060 to $1,190 per ounce of
gold sold with cash costs1 expected to range
from $820 to $920 per ounce of gold sold. The cash cost and AISC
estimates in 2021 as compared to the actual costs for the nine
months ending September 30, 2020 reflect the investments in the
accelerated rate of underground development, comprehensive drill
programs and improvement‐oriented capital
expenditures.
Continuing
to advance underground development at an accelerated rate of 1,000
meters per month and potentially increasing to 1,100 meters per
month through 2021 will expand access underground. The expanded
access will provide more flexibility to build drilled-off stope
inventory, allow mining operations to optimize production and
provide additional platforms for resource expansion
drilling.
The
2021 Brucejack definition, sustaining and resource expansion drill
programs are anticipated to total approximately 195,000 meters of
diamond drilling at a cost of approximately $23 million, comprised
of in-resource definition drilling (40%), in-resource and
sustaining drilling (20%) and resource expansion drilling (40%). An
extensive in-fill definition drill program is planned to increase
the volume of grade information and geological understanding to
enhance mine planning. Resource expansion drilling will target
adjacent and near-mine zones with the potential to extend
mineralization underground towards the West Zone, Galena Hill Zone,
Gossan Hill Zone, and Bridge Zone, all less than one kilometer from
current underground development. Initially, six drills are planned
to be deployed underground, with an additional two surface drills
to be added during the summer.
Sustaining
capital expenditures, a component of AISC, are forecasted to be
between approximately $50 million to $55 million, and include the
capitalised portion of underground development and drill programs
as well as improvement-oriented expenses, such as electric
underground haul trucks to reduce costs related to ventilation and
maintenance and increase productivity.
AISC
and cash cost estimates also include costs associated with enhanced
COVID-19 protocols continuing throughout 2021, which are estimated
to be approximately $5 million.
1 Refer to the “Non-IFRS Financial
Performance Measures” section at the end of this news
release.
Corporate
administrative costs, a component of AISC, are forecasted to be
between approximately $18 to $22 million, including share-based
compensation.
2021 Free Cash Flow Forecast
Free
cash flow1
for 2021 is expected in the range of $120 million to $170 million
at a gold price of $1,700 per ounce. The 2021 free cash flow
forecast includes expansion-oriented capital expenditures which
total approximately $55 million to $65 million. Expansion capital
expenditures include expansion of permanent Brucejack camps and
projects to support growth and to improve the efficiency of
operations. The free cash flow forecast also includes expenditures
related to 2021 near-mine exploration program. The near-mine
exploration program will focus on the new discovery at Hanging
Glacier (see news release dated
December 16, 2020), which is just four kilometers north of
the Brucejack Mine and is easily accessible using existing
exploration trails.
Management
believes that 2021 guidance is achievable assuming there is no new
significant impact on operations at the Brucejack Mine, including
due to the novel coronavirus (“COVID-19”) pandemic. We
have taken precautions to mitigate the risk of COVID-19. However,
the COVID-19 pandemic and any future emergence and spread of
similar pathogens could have a material adverse impact on
Pretivm’s business, operations and operating results,
financial condition, liquidity and market for our
securities.
Impact of COVID-19
The
Company’s primary commitment is the safety and health of its
workforce and neighbouring communities in northwest British
Columbia.
Throughout the COVID-19 pandemic, the Brucejack
Mine has operated continuously under the guidance and directives
provided by Ministry of Energy,
Mines and Low Carbon Innovation Guidance to Mining and Smelting
Operations during COVID-19; BC Ministry of Health, BC Centre for Disease
Control: Protecting Industrial Camp Workers, Contractors, and
Employers Working in the Agricultural, Forestry, and Natural
Resource Sectors During the COVID-19 Pandemic (July 28,
2020); and all applicable orders issued by the Provincial Health
Officer. The Company has developed management plans to mitigate the
spread of COVID-19 and protect the well-being of its employees,
communities and other stakeholders.
Qualified Persons
Patrick
Godin, P.Eng., Vice President and Chief Operating Officer, Pretium
Resources Inc. is a Qualified Person (“QP”) as defined
in National Instrument 43-101 Standards of Disclosure for Mineral
Projects, and has reviewed and approved the scientific and
technical information contained in this news release.
Webcast and Conference Call
Pretivm
plans to release its fourth quarter and year-end 2020 operational
and financial results after market close on Thursday, February 25,
2021. The webcast and conference call to discuss these results will
take place Friday, February 26,
2021 at 8:00 am PT (11:00 am ET).
Webcast
and conference call details:
Friday, February 26, 2021 at 8:00 am PT (11:00 am ET)
|
Webcast
|
www.pretivm.com
|
Toll
Free (North America)
|
1-800-319-4610
|
International
and Vancouver
|
604-638-5340
|
About Pretivm
Pretivm
is an intermediate gold producer and owns 100% of the high-grade
underground Brucejack Mine in northern British Columbia,
Canada.
For
further information contact:
Troy
Shultz
Manager,
Investor Relations &
Corporate
Communications
Pretium
Resources Inc.
Suite
2300, Four Bentall Centre, 1055 Dunsmuir Street
PO Box
49334 Vancouver, BC V7X 1L4
(604)
558-1784
invest@pretivm.com
(SEDAR
filings: Pretium Resources Inc.)
Non-IFRS Financial Performance Measures
The
Company has included certain non-IFRS measures in this new release.
Refer to the Company’s management’s discussion and
analysis for an explanation, discussion and reconciliation of
non-IFRS measures. The Company believes that these measures, in
addition to measures prepared in accordance with International
Financial Reporting Standards (“IFRS”), provide readers
with an improved ability to evaluate the underlying performance of
the Company and to compare it to information reported by other
companies. The non-IFRS 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. These measures do not have any standardized meaning
prescribed under IFRS, and therefore may not be comparable to
similar measures presented by other issuers.
Forward-Looking Information
This
news release contains “forward-looking information”,
“forward looking statements”, “future oriented
financial information” and “financial outlook”
within the meaning of applicable Canadian and United States
securities legislation (collectively herein referred to as
“forward-looking information”), including the
“safe harbour” provisions of Canadian provincial
securities legislation and the U.S. Private Securities Litigation
Reform Act of 1995, Section 21E of the U.S. Securities Exchange Act
of 1934, as amended, and Section 27A of the U.S. Securities Act of
1933, as amended. The purpose of disclosing future oriented
financial information and financial outlook is to provide a general
overview of management’s expectations regarding the
anticipated results of operations including cash generated
therefrom and costs thereof and readers are cautioned that future
oriented financial information and financial outlook may not be
appropriate for other purposes.
Wherever
possible, words such as “plans”, “expects”,
“guidance”, “projects”,
“assumes”, “budget”,
“strategy”, “scheduled”,
“estimates”, “forecasts”,
“anticipates”, “believes”,
“intends”, “modeled”, “targets”
and similar expressions or statements that certain actions, events
or results “may”, “could”,
“would”, “might” or “will” be
taken, occur or be achieved, or the negative forms of any of these
terms and similar expressions, have been used to identify
forward-looking information. Forward-looking information may
include, but is not limited to, statements with respect to: the
effects of the COVID-19 outbreak as a global pandemic, including
anticipated operational and financial impacts and our response and
contingency plans; production and financial guidance, and our
expectations around achieving such guidance; our future operational
and financial results, including estimated cash flows (including
free cash flow forecasts) and the timing thereof; expectations
around grade of gold and silver production; the Brucejack Mine
processing rate and gold recovery rate; capital modifications and
upgrades, and underground development, and the anticipated benefits
thereof, and estimated expenditures and timelines in connection
therewith; our mining (including mining methods), expansion,
exploration and development activities, including the reverse
circulation drill program, and our definition, sustaining,
expansion and underground exploration drill programs and our
grassroots exploration program, and the results, benefits, costs
and timing thereof; our operational grade control program,
including plans with respect to our infill drill program and our
local grade control model; grade reconciliation, updated geological
interpretation and mining initiatives with respect to the Brucejack
Mine; our management, operational plans and strategy; capital,
sustaining, operating and general and administrative cost estimates
and timing and anticipated benefits thereof; the future price of
gold and silver; our liquidity and the adequacy of our financial
resources (including capital resources); our intentions with
respect to our capital resources; capital allocation plans;
production and processing estimates and estimated rates; estimated
economic results of the Brucejack Mine, including net cash flow and
net present value; predicted metallurgical recoveries for gold and
silver; geological and mineralization interpretations; development
of our Brucejack Mine and timing thereof; results, analyses and
interpretations of exploration and drilling programs; payment of
taxes, our effective tax rate and the recognition of our previously
unrecognized income tax attributes; and the fatal incident at the
Brucejack Mine, the investigation(s) of such incident and the
findings and outcomes of such investigation(s). Any statements that
express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions
or future events or performance are not statements of historical
fact and may be forward-looking information.
Forward-looking
information is subject to a variety of known and unknown risks,
uncertainties and other factors that could cause actual results,
actions, events, conditions, performance or achievements to
materially differ from those expressed or implied by the
forward-looking information, including, without limitation, those
related to: uncertainty as to the outcome of legal proceedings; the
effect of indebtedness on cash flow and business operations; the
effect of a pandemic and particularly the COVID-19 outbreak as a
global pandemic on the Company’s business, financial
condition and results of operations and the impact of the COVID-19
outbreak on our workforce, suppliers and other essential resources
and what effect those impacts, if they occur, would have on our
business, financial condition and results of operations; the effect
of restrictive covenants pursuant to the Company’s credit
facility; assumptions regarding expected capital costs, operating
costs and expenditures, production schedules, economic returns and
other projections; our production, grade of gold, milling recovery,
cash flow and cost estimates, including the accuracy thereof;
commodity price fluctuations, including gold and silver price
volatility; the accuracy of our Mineral Resource and Reserve
estimates (including with respect to size, grade and mining and
milling recoverability) and the geological, operational costs and
price assumptions on which they are based; uncertainties relating
to inferred Mineral Resources being converted into Measured or
Indicated Mineral Resources; our ability to maintain or increase
our annual production of gold at the Brucejack Mine or discover,
develop or acquire Mineral Reserves for production; dependency on
the Brucejack Mine for our future operating revenue; the
development of our properties and expansion of our operations; our
need or ability to raise enough capital to mine, develop, expand or
complete further exploration programs on our mineral properties;
our ability to generate operating revenues and cash flow in the
future; failure of counterparties to perform their contractual
obligations; general economic conditions; the inherent risks in the
mining industry; the commercial viability of our current and any
acquired mineral rights; availability of suitable infrastructure or
damage to existing infrastructure; transportation, processing and
refining risks; maintaining satisfactory labour relations with
employees and contractors; significant governmental regulations,
including environmental regulations; non-compliance with permits
that are obtained or delay in obtaining or renewing, failure to
obtain or renew permits required in the future; increased costs and
restrictions on operations due to compliance with health, safety
and environmental laws and regulations; compliance with emerging
climate change regulation and the detrimental effects of climate
change; adequate internal control over financial reporting; various
tax-related matters; potential opposition from non-governmental
organizations; uncertainty regarding unsettled First Nations rights
and title in British Columbia; maintaining our social license to
operate; uncertainties related to title to our mineral properties
and surface rights; land reclamation and mine closure requirements;
our ability to identify and successfully integrate any material
properties we acquire; currency exchange rate fluctuations;
competition in the mining industry for properties, qualified
personnel and management; our ability to attract and retain
qualified management and personnel; disruption from changes in
management team or failure to successfully transition new hires or
promoted employees into their roles; the ability of our new
executives to successfully transition into their roles; some of our
directors’ and officers’ involvement with other natural
resource companies; potential inability to attract development
partners or our ability to identify attractive acquisitions;
compliance with foreign corrupt practices regulations and
anti-bribery laws; changes to rules and regulations, including
accounting practices; limitations in our insurance coverage and the
ability to insure against certain risks; risks related to ensuring
the security and safety of information systems, including cyber
security risks; our anti-takeover provisions could discourage
potentially beneficial third-party takeover offers; significant
growth could place a strain on our management systems; share
ownership by our significant shareholders and their ability to
influence our operations and governance and, in case of sales of
our shares by such significant shareholders, our share price;
failure to comply with certain terms of the convertible notes;
reputational risks; future sales or issuances of our debt or equity
securities; the trading price of our common shares is subject to
volatility due to market conditions; our ability to pay dividends
in the foreseeable future; and certain actions under United States
federal securities laws may be unenforceable. This list is not
exhaustive of the factors that may affect any of our
forward-looking information. Although we have attempted to identify
important factors that could cause actual results, actions, events,
conditions, performance or achievements to differ materially from
those contained in forward-looking information, there may be other
factors that cause results, actions, events, conditions,
performance or achievements to differ from those anticipated,
estimated or intended.
Our
forward-looking information is based on the assumptions, beliefs,
expectations and opinions of management on the date the statements
are made, many of which may be difficult to predict and beyond our
control. In connection with the forward-looking information
contained in this news release, we have made certain assumptions
about, among other things: our business and operations and that no
significant event will occur outside of our normal course of
business and operations (other than as expressly set out herein);
planned exploration, development and production activities and the
results, costs and timing thereof; future price of gold and silver
and other metal prices; the accuracy of our Mineral Resource and
Mineral Reserve estimates and related information, analyses and
interpretations (including with respect to any updates or
anticipated updates); the geology and mineralization of the
Brucejack Project; operating conditions; capital and operating cost
estimates; production and processing estimates; the results, costs
and timing of future exploration and drilling; timelines and
similar statements relating to the economic viability of the
Brucejack Mine; timing and receipt of governmental, regulatory and
third party approvals, consents, licenses and permits; obtaining
required renewals for existing approvals, consents, licenses and
permits; the geopolitical, economic, permitting and legal climate
that we operate in; the adequacy of our financial resources, and
our ability to raise any necessary additional capital on reasonable
terms; our ability to satisfy the terms and conditions of our debt
obligations; commodity prices; currency exchange rates and interest
rates; political and regulatory stability; requirements under
applicable laws; market competition; sustained labour stability and
availability of equipment; positive relations with local groups;
favourable equity and debt capital markets; stability in financial
capital markets; and the impact of the COVID-19 outbreak. Although
we believe that the assumptions inherent in forward-looking
information are reasonable as of the date of this news release,
these assumptions are subject to significant business, social,
economic, political, regulatory, competitive and other risks and
uncertainties, contingencies and other factors that could cause
actual actions, events, conditions, results, performance or
achievements to be materially different from those projected in the
forward-looking information. The Company cautions that the
foregoing list of assumptions is not exhaustive. Other events or
circumstances could cause actual results to differ materially from
those estimated or projected and expressed in, or implied by, the
forward-looking information contained in this news
release.
Additional
information about the risks and uncertainties concerning
forward-looking information and material factors or assumptions on
which such forward-looking information is based is provided in our
other disclosure documents as filed in Canada on SEDAR at
www.sedar.com and in the United States through EDGAR at the
Security and Exchange Commission’s (the “SEC”)
website at www.sec.gov (collectively, “the Pretivm Disclosure
Documents”).
Forward-looking
information is not a guarantee of future performance. 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 information.
Forward-looking information involves statements about the future
and is inherently uncertain, and our actual achievements or other
future events or conditions may differ materially from those
reflected in the forward-looking information due to a variety of
risks, uncertainties and other factors, including, without
limitation, those referred to in this news release and the Pretivm
Disclosure Documents. For the reasons set forth above, readers
should not place undue reliance on forward-looking
information.
We do
not assume any obligation to update forward-looking information,
whether as a result of new information, future events or otherwise,
other than as required by applicable law. Neither the TSX nor the
NYSE has approved or disapproved of the information contained
herein.