KAROUNI (TROY 100% THROUGH TROY RESOURCES GUYANA INC.)

OCCUPATIONAL HEALTH AND SAFETY


During the year the Company remained strongly committed to the long-term health and safety of its employees. In April 2017, safety efforts were increased, including the introduction of the SLAM (Stop. Look. Analyse. Manage) program. After initiation of the program, the Company saw an immediate decrease in both the Lost Time Incidents Frequency Rate (“LTIFR”) and the Total Recordable Injury Frequency Rate (“TRIFR”). During this year the Company also rolled out the “Big Five” program to all its employees. The “Big Five” is a safety program involving people to list the five most important things in their lives to keep thinking about this before starting any task at work or at home. As a result of these initiatives, both the number of Lost Time Injuries (“LTI”) and First Aid Injuries (“FAI”) continued to fall dramatically during the year ended June 2019.

Unfortunately, in October 2019, the Company suffered its first fatality, and is profoundly saddened by the death of an employee at Karouni.  

The Karouni operation recorded 1.4 million-man hours during the year.

The LTIFR (measured in recordable incidents per 1,000,000-man hours) decreased by 28% to 5.5 at the end of the year.  

The TRIFR and (measured as recordable incidents per 1,000,000-man hours) decreased by 54% to 9.2.  

LTI’s continued to decrease year on year and were down 25% from 4 to 3 from the previous year. First Aid Injuries (“FAI”) fell by 41% from 56 to 33.

OPERATIONS SUMMARY

Permitting and Environment

All permits and licenses are up to date and the Company is in full compliance with its ongoing environmental and operational requirements. In the third quarter, the Company received all necessary permits and authorisations for mining of the Spearpoint and Larkin deposits with mining at Larkin commencing shortly thereafter.

The Company’s trial rehabilitation programs on selects areas continued with excellent results. In addition, the University of Guyana and the Company completed a trial reforestation program on a selected site. The purpose of the program was to determine the differences between certain species of trees and vegetation planted in different types of growth mediums. The results of the study are encouraging, and the Company intends to renew its partnership with the University of Guyana during the upcoming year.

During the year the Company commenced background environmental studies for the Ohio Creek satellite deposit. In addition, geotechnical and hydrological consultants were engaged to perform technical analyses of the project. 

During the year the Company was inspected on two (2) occasions by the EPA and on five (5) occasions by the GGMC. No material deficiencies were identified as a result of these inspections.

There were no reportable environmental incidents during the year.

OPERATIONAL REVIEW

During the year both the mine and processing plant continued to perform at budget levels. Total production from the mill was 888,198 tonnes processed at an average grade of 2.11 g/t Au. Average metallurgical recovery for the year was 96.2% which resulting in gold production of 59,188 ounces. A summary of the mill statistics for the year is presented in Figure 3 below.

Mill production was generally on budget for the first three quarters. Production in the fourth quarter was below budget due to the wet season combined with planned lower ore tonnes.

A total 5,624,221 tonnes were mined for the year. Of this amount, ore represented 811,664 tonnes at an average grade of 2.06 g/t Au and the overall stripping ratio was 6.92:1. Of the total ore, the percentage mined from Hicks, Smarts and Larkin were 66.1%, 31.8% and 2.1%, respectively. Total tonnes mined is summarised in Figure 4 below.

Mining production was lower in the third quarter due to decreased material movements in the Hicks 1 pit. Total movements in the fourth quarter were impacted early on by the Smarts 3 Phase 1 pushback taking longer to ramp up. In addition, mining production was decreased during the quarter due a failure in the north wall of the pushback.

Total tonnes of ore mined are shown in Figure 5 below.

Ore tonnes during the year were generally above budget. The decreased ore budget is a result of depletion of Hicks 1 and Hicks 2 orebodies offset by an increase in ore from the Smarts 3 Phase 1 cutback. The balance of the ore processed came from the ROM stockpiles.

As at 30 June 2019, stockpiles of ROM and crushed ore stockpiles amounted to 39,261 tonnes at an average grade of 1.41 g/t Au for 1,786 ounces. In addition, the Mineralised Waste stockpile was 341,912 tonnes at an average grade of 0.57 g/t Au for 6,211 ounces. Mineralised waste is scheduled to be processed when the ROM is fully depleted.