December 15, 2021

Adumbi PEA

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Loncor controls 5.1M ozs of high grade resources within various projects, but it is Adumbi that holds the immediate prospect for transformational growth. Loncor holds 84.68% of the 3.66M ozs of indicated and inferred resources within the pit shell, with the potential to pass 5M ozs of resources through ongoing delineation of the underground potential.

Download: NI 43-101 Preliminary economic assessment of the adumbi deposit in the Democratic Republic of the Congo

Completed in mid December 2021, the Adumbi PEA highlights the potential value available within the likely pit shell at Adumbi. As part of the process, Loncor investigated various alternatives to generating power, with a focus on the use of hydroelectric schemes within the local river systems. Such a source should prove to reduce unit costs significantly while helping to reduce the impact on the environment. Additionally, the company is investigating a number of alternatives to project finance the hydroelectric facilities, a potential positive for capital costs. The PEA detailed below highlights two schemes for generating power; one utilising hydro (plus other forms of generation as back up); and a second system using the more traditional diesel generators to supply the 34MW required to run such a project.

Key points from December 2021 Adumbi PEA

  • Pre-tax NPV (5% discount) of US$895 million and post-tax NPV of US$624 million for HEP Hybrid case at a US$1,600 gold price
  • Using a US$1,760 gold price, post-tax NPV (5% discount) of US$879 million for HEP Hybrid case
  • Average annual production of 303,000 ounces of gold over a 10.3 year life of mine within proposed pit shell
  • Average total cash costs of US$852 per ounce over life of mine and AISC of US$950 per ounce for HEP Hybrid case

The various summary tables that follow clearly illustrate the potential that Adumbi offers, with further upside possible should the underground resource grow significantly.

Here follows a summary of the key project parameters, followed by the December 15, 2021 press release offering detailed background on the PEA.

Key Financial Results - Hydro Hybrid Case

Gold PricePre-Tax NPVPost-Tax NPVPost-Tax IRR
(US$/oz) (US$M - 5% discount) (US$M - 5% discount) (%)
1440 547 368 14.7
1600 895 624 20.7
1760 1,243 879 26.4
1840 1,417 1,006 29.1

Key Production Estimates - Hydro Hybrid Case*

Average Tons Produced 4.8M tpa
LOM Feed Grade 2.17 g/t
Average Gold Produced 303,000 ozs p.a.
Production Period 10.3 years
L.O.M. AISC US$950/oz
Pre-Production Capex US$530 M
Payback Period (Post tax) 3.76 years @ US$1760/oz

*Includes a 20% contingency. Various options are being investigated to project finance the hydro capex

Other Key Data - Hydro Hybrid Case*

Open Pit Resources Utilised in the PEA* 3.66 M ozs
Indicated Resources – (28.185M t @ 2.08g/t) 1.883M ozs
Inferred Resources – (20.828M t @ 2.65g/t) 1.777M ozs
Average Plant Recovery 89%
Strip Ratio 10 :1

*Potential of Additional Underground Resources At Adumbi Currently Being Investigated

Adumbi PEA Background Detail.

For a more detailed breakdown of all the various options considered within the December 2021 PEA i.e. costs, capex, metallurgy, plant and site layout, financial sensitivities etc please refer to the press release dated December 15, 2021 entitled “Loncor Gold Announces Adumbi PEA with 303,000 ozs/year over a 10.3 year LOM”.

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