Carl Esprey, CEO of Contango Holdings PLC (CGO.L) Interview

Multi-million-ounce resource potential indicated at Garalo Gold Project in Mali

Carl Esprey, Executive Director of Contango Holdings, said: “Garalo was acquired with the intention of bringing into production a small but highly profitable gold mine. The publication of this Report, which included both reinterpretation of historic data as well as information not previously incorporated in the historic 320,000-ounce figure, has made it clear that Garalo is significantly larger than first envisaged, with the potential to be a sizeable, multi-million-ounce standalone mine, rivalling some of our neighbours in this world-class gold producing region.


“The resource quantum now being contemplated at Garalo suggest the Company should bypass the previously reported initial 10,000oz per annum development scenario, instead bringing a larger +30,000oz per annum heap leach operation onstream from the shallow oxides and providing Contango cashflow from Garalo in late 2021. With an estimated profitability of circa US$1,000oz at current gold prices, this would enable not only capital returns to shareholders potentially as early as 2022, but also fund a comprehensive exploration campaign focussed on realising the asset’s multi-million ounce potential.

“The Contango in-country team is continuing with detailed core re-logging and field geological and structural mapping and will shortly initiate further tighter line-spacing airborne and radiometric surveys, ahead of fast-tracking a modest confirmatory drilling programme before progressing with the development. As previously reported, this expanded development case is expected to be funded through non-equity finance either via regional banks and / or royalty providers.

“This is an exceptionally exciting development for Contango, and we are committed to identifying the best development route through which to maximise the value of this asset for all stakeholders, combining the desire for early cashflow with discovering the full potential Garalo offers. Following our recent capital raise, the Company is in a solid financial position to react to this development at Garalo whilst also advancing development of our Lubu Coal Project in Zimbabwe, where we expect to commence mine pit construction in January 2021.

“With coking coal performing strongly over recent weeks and the interest we are seeing in our coking coal and coke product, I am confident that Contango has two high quality near term production assets which will deliver significant returns to shareholders.”


· Independent Technical Report (the ‘Report’) completed on the Garalo Gold Project (‘Garalo’ or the ‘Project’)

· Potential gold resource of 1,800,000 oz at average grade of 1g/t, representing +460% uplift from previous estimate

· Additional untested resource potential below historic 150m drilling depth

· Further resource upside from identified anomalies across 62.5km2 licence area

· Expanded production case targeting first gold in Q4 2021

Further Information

Contango Holdings Plc, the London listed natural resource development company, is pleased to announce the receipt of an Independent Technical Report on the Garalo Gold Project located in the Sikasso region of southern Mali, 200km south-east of the capital Bamako and close to the Guinea border. The permit is surrounded by a number of multi-million ounce gold deposits and the region is home to some of the world’s leading gold miners, including AngloGold Ashanti, IAMGOLD, Barrick, B2 Gold, Endeavour Mining and Hummingbird Resources, which has helped to establish Mali as the third-largest gold producer in Africa.

As announced on 19 October, Garalo is an advanced discovery and has a non-independent resource of 320Koz Au at an average grade of 1.5g/t across three dominant structural trends. Garalo has been subject to the following work to date:

· regolith mapping and interpretation;

· soil geochemistry;

· airborne magnetic and radiometric surveys;

· over 900 drill holes, which have returned grades of up to 43g/t.

To date, drilling has focused on the G1A and G3 targets, which cover a relatively small footprint of the licence and remain open along strike, indicating further resource upside.

The Report

The Report was conducted by Birima Gold Resources Consulting (‘Birima), an international mineral exploration consulting company with significant experience in West Africa, ranging from grassroots to mine-site exploration and mineral deposit expansion. Specialisms include gold exploration and management of all aspects of mineral exploration programmes from data compilation and project design through to all levels of implementation and management. Birima’s principal geologists are members of The Australasian Institute of Mining & Metallurgy (AuSIMM) (Membership Number 316918) and collaborate with other professional geologists with specific expertise to produce 43-101 Mineral Resource Estimates (Azimuth Consulting SARL) and are qualified to write National Instrument 43-101 Technical Reports.

Dr. Serigne Dieng was lead professional geologist on site at the Garalo Gold Project. Dr. Dieng has over 20 years of experience in all aspects of mineral exploration from project generation to deposit definition, with a special interest in West Africa, Canada and Australia. Dr. Dieng has held senior geologist roles with various resource companies including IAMGOLD Corporation in Senegal and Burkina Faso, Wega Mining in Guinea, Waraba Gold Ltd in Mali, Hydromin Guinea Ltd, Nortec Mineral Corp in Guinea, Sengold Mining N.L in Senegal, Mingo Affiliates Services Inc in Senegal, Thor Exploration in Senegal and Alamako Corporation International SARL in Guinea.

The Report compiled by Birima focussed on one area of the Garalo project area, which features two main areas of high potential for economic gold mineralisation in addition to several other clusters of gold anomalies.

Birima reinterpreted the historic data relating to Zone 1 and determined that this mineralised zone, which extends to a length of 700m with an average width of 200m, has the potential to host 1,800,000 ounces of gold at an average grade of 1g/t gold. It should be noted that this was calculated to a depth of 150 metres, the extent of current drilling, however the mineralisation remains open at depth offering the potential for further ounces below this level.

A work programme is ongoing to improve the understanding of the geological and structural framework of the mineralised zone, and a drill programme is expected in H1 2021 to further define mineralised potential of Zone 1 and test other gold anomalies within the project area. Further details relating to the planned work programme will be released in due course.

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