About Farafina Gold Group
Farafina Gold Group S.A. (“FGG” or “Company”) is a holding company registered and operating in the Republic of Guinea. FGG encompasses five gold exploration enterprises, covering a total area of nearly 350 square kilometers.
The FGG properties are located at the heart of an ancient gold mining empire, believed to have comprised a part of the Mandingo Empire since the 13th century. A number of significant gold deposits and mines are operating in the neighboring area, including AshantiGold’s Siguiri project, Volcanic Gold Mine’s Mandiana project, as well as others.
Since 2013, FGG exploration activities have revealed four exceptionally promising areas within a fault zone with mineralization potential graded up to 5 grams per ton and more. The Group has secured a mining license for one of the properties, Kanguela East. The application for a second license (Nzima) has secured the requisite regulatory clearance and is awaiting the President’s approval.
Active mining operations on the Kanguela East and Nzima licensed properties are scheduled to commence no later than the third quarter of 2019. According to management projections, the annual yield from the two licensed mining properties will reach approximately 0.7 – 1 ton by FY2021.
Preliminary assessments indicate that the total recoverable reserves of FGG member companies will exceed 3 – 3.5 million ounces (100 ton) of gold. By commencing production on all of its properties by the end of FY2020, FGG management projects the annual production of the Group will exceed 100,000 ounces (3 tons) by FY2022.
Following the completion of exploration studies and commencement of production on all properties, the total enterprise value as of FY2022 is projected to exceed $200 – $300 mm, with assets over $1 bln (based on management’s conservative estimate of $300 per one ounce of recoverable gold reserves) and a 3x assets-to-equity multiplier.
To fund the commencement of production on its two flagship mining sites, Farafina intends to raise at least $10 million in debt and equity funding in 2019, funded in gold and equivalents.