June 2022

onlyASX RELEASE

20 July 2022

Issued Capital as at

30 June 2022

1,085.1M shares outstanding

Market Capitalisation as at 30 June 2022

use$89.0M @$0.082 per share

BOARD

Mick Wilkes

Non-Executive Chair

Eduard Eshuys personalNon-Executive Director

Sue-Ann Higgins

Non-Executive Director

SUBSTANTIAL SHAREHOLDERS

as at 30 June 2022

G ld R ad (6.8%)

Paradice (6.7%)

Perennial (6.2%)

Regal Funds (6.7%)

REGISTERED OFFICE

L v l 19, 58 Mounts Bay Road Perth WA 6000

Australia

For

Production up 45% from the March Quarter

Operations & Development

  • Improved safety performance
  • Improved gold production over previous quarter:
    • June quarter production of 34,182 oz at an AISC of $1,522/oz Cash
  • Improved mill performance at 3.1m tonnes on an annualised basis:
    • Record ore milled for the quarter of 776,720t
  • Full year FY22 production was 90,809 oz, (guidance 93,000-97,000oz), at AISC of $1,955/oz (guidance $1,850-$1,950/oz)
  • Redcliffe project deferred

Exploration & Growth

  • Jupiter extension drill program continued to confirm mineralisation of significant width and scale associated with the Syenite intrusive system below the open pits, with key intercepts reported for the quarter included:
  • Drillhole 22JUDD0818W1:
    1. 268.8m @ 0.8g/t from 396m
  • Drillhole 22JUDD0822:
    1. 39.7m @ 3.0g/t from 262m
  • Drillhole 22JUDD0819:
    1. 146.0m @ 0.6g/t from 307m
  1. 22.6m @ 1.3g/t from 173m
    1. 15.2m @ 1.0g/t from 236m
  • Drillhole 22JUDD0808:
    1. 185m @ 0.4g/t from 207m
  • Drillhole 22JUDD0828:
    1. 102.5m @ 0.7g/t from 291m
  1. 44.1m @ 1.1g/t from 471m
  1. 24.3m @ 1.3g/t from 169m

For personal use only

2

  • Drillhole 22JUDD0833:
  1. 14.9m @ 1.2g/t from 305m
  1. 11.1m @ 2.2g/t from 369m
  1. 41.5m @ 2.1g/t from 667m
    1. 55.2m @ 0.9g/t from 548m
  • Drillhole HFRD_inpit_0016:
    1. 73m @ 3.2g/t from 124m
  • Drillhole HFRD_inpit_0017:
    1. 77m @ 1.4g/t from 123m
  • Drillhole HFRD_inpit_0014:
    1. 81m @ 1.3g/t from 92m
  • Drillhole 22JUDD0829
    1. 162.4m @ 1.0g/t from 289.7m
  1. 26.0m @ 2.2g/t from 426.0m
      1. 10.3m @ 2.7g/t from 197.1m
    • Drillhole 22JUDD0836
      1. 92.7m @ 1.2g/t from 452.4m
  • Exploration and growth drilling of 23,987m for the quarter

Corporate & Finance

  • Cash and gold on hand at 30 June 2022 of $21.6M, with debt of $2.0M
  • Post quarter end $12.6M placement proceeds received 12 July 2022
  • Forward hedge position was 10,500oz at an average gold price of $2,667/oz

Dacian Gold Limited (Dacian Gold or the Company) (ASX: DCN) provides its operating and financial results for the quarter ending 30 June 2022.

For personal use only

OPERATIONS & DEVELOPMENT

OVERVIEW

The Company is pleased to advise its 12-month rolling Total Recordable Injury Frequency Rate (TRIFR) has continued to fall, and at 30 June 2022 was 5.4 (31 March 2022: 6.6).

The Mt Morgans Gold Operation (MMGO) recovered 34,182oz during the June quarter, up 45% on March 2022 quarter, at an All in Sustaining Cost (AISC) of $1,522/oz.

The open pit production performed strongly, with the scheduled thick ore zones from the Doublejay 07 reached in late February and providing the majority of processing plant feed for the quarter.

While the Company's management of Covid-19 at its operation has resulted in minimal on-site transmission, with measures put in place to mitigate the risks associated with Covid-19, the ongoing impact on supply chains and skilled labour shortage continues to challenge the Company's operations and cost base. Underground stoping and development continued to suffer from this, with extraction of stopes previously planned for the June quarter now expected in July and August.

As a result, full year production for FY22 was 90,809 oz at AISC of $1,955/oz, being below the bottom end of production guidance of 93,000 to 97,000 oz, and marginally above the top end of AISC guidance of $1,850-$1,950/oz.

On 17 June 2022 the Company announced that the rapid change of the operating environment over the previous 6 months had seen significant inflationary cost pressures, which resulted in an increase in cost base, prompting a review of the operating strategy as follows:

  • Open pit mining operations at Jupiter were suspended at the end of June 22;
  • Underground operations to continue until the previously developed stopes have been mined in Q1, FY23;
  • Hub (Redcliffe) project suspended awaiting mining approvals;
  • Processing of existing stockpiles to commence in Q1, FY23;
  • Drill testing at Jupiter to continue following encouraging results.

Given the pivot in production to processing low grade stockpiles, a grade control and metallurgical testwork program has been initiated over the historic heap leach stockpile, representing approximately 3.5Mt of the low grade ore reserves, to identify any opportunities for preferential treatment. A total of 5,600m of grade control drilling was completed in June, with the program continuing in July. This new operating strategy replaces the previously adopted Five Year Mine Plan (refer to Dacian 2021 Annual Report released to ASX on 22 October 2021) as the Company moves forward focussed on exploration, increasing Resources and developing a leaner operating model.

3

OPEN PIT

For personal use only

A total of 822,595t @ 1.25g/t Au containing 33,162oz was mined from the Doublejay open pits at Jupiter during the June quarter, with 726,259t @ 1.34g/t Au containing 31,331oz delivered to the processing plant ROM pad for treatment (see Table 1).

A total of 0.95M bcm of material was mined from open pits during the quarter.

Table 1: Key open pit statistics

Key Open Pit Statistics

Unit

Jun 22 Q

Mar 22 Q

Ore Mined - to ROM

t

726,259

653,541

Mined Grade

g/t Au

1.34

1.13

Contained Gold Mined

oz

31,331

23,677

Ore Mined - to Stockpile

t

96,336

92,199

Mined Grade

g/t Au

0.59

0.57

Contained Gold Mined

oz

1,831

1,701

Ore Mined - Total

t

822,595

745,740

Mined Grade

g/t Au

1.25

1.06

Contained Gold Mined

oz

33,162

25,378

Waste Mined

t

1,723,401

2,920,024

Total Material Mined

t

2,545,996

3,665,764

Total Material Mined

bcm

946,504

1,343,551

Open Pit Mining Cost

$/t

9.88

6.15

A total of 14,170m of RC grade control drilling was completed during the quarter across the open pits.

UNDERGROUND

The Westralia and Craic underground mines produced 48,595t @ 2.9g/t Au for 4,575 contained ounces (see Table 2).

Ore was produced from development and stoping activities at Craic, Beresford, and Allanson mine areas, with stoping contributing approximately 36% of the underground mined ore tonnes in the quarter (March Qtr: 20%).

Table 2: Key underground statistics

Key Underground Statistics

Unit

Jun 22 Q

Mar 22 Q

Stope Ore Mined

t

17,569

6,189

Development Ore Mined

t

31,026

23,904

Total Ore Mined

t

48,595

30,092

Mined Ore Grade

g/t

2.93

3.46

Contained Gold Mined

oz

4,575

3,346

Metres Developed - Capital

m

126.0

533.4

Metres Developed - Operating

m

609.7

472.8

Total Development

m

735.7

1,006.2

4

PROCESSING

For personal use only

A total of 776,720t of ore was milled during the quarter (equivalent to an annualised rate of 3.1M tonnes per annum), at an average feed grade of 1.49g/t Au containing 37,220oz (see Table 3).

A total of 34,182oz was recovered for the quarter at a recovery rate of 91.8%.

Table 3: Key processing statistics

Key Processing Statistics

Unit

Jun 22 Q

Mar 22 Q

Ore Milled

t

776,720

741,991

Processed Grade

g/t Au

1.49

1.08

Contained Gold

oz

37,220

25,645

Gold Recovery

%

91.8

92.1

Processing Cost

$/t

22.99

20.79

G&A Cost

$/t

2.37

2.74

Gold Recovered

oz

34,182

23,608

Gold Sold

oz

34,968

22,410

Gold-on-Hand

oz

1,577

1,839

Average Sale Price

A$/oz

2,555

2,505

REDCLIFFE DEVELOPMENT

The Company progressed the Hub and GTS open pits to a development ready position at 30 June 2022, subject to pending approvals. Grade control drilling was completed for both pits. Given delays in government approvals, coupled with the escalating costs, the Company is re-considering future production options at Hub and GTS which align with the new strategy for the MMGO. Accordingly, no decision has been made in relation to commencement of mining at Redcliffe in the near future and cost mitigation has commenced on pre-development activities.

EXPLORATION & GROWTH

During the quarter, the Company invested $7.3M in exploration and growth activities, up from $6.1M in the March quarter, reflecting an acceleration of inground activity following completion of initial baseload targeting work.

A total of 15,731m was drilled across key targets, principally, the Jupiter extension program (8,244m of diamond drilling) and Cameron Well (1,590m of diamond drilling and 3,141m of RC drilling), with 2,756m of RC drilling at the Southern tenements. A further 8,256m of resource definition drilling was conducted at the MMGO (6,159m underground diamond drilling at Westralia and 2,097m of RC drilling at Doublejay and Marven open pits).

JUPITER EXTENSION

During the quarter the Company continued the extension drilling program at the Jupiter mining complex, intersecting significant mineralisation within the syenite intrusive system (see ASX announcements 17 June and 30 June 2022).

  • Drillhole 22JUDD0818W1:
    1. 268.8m @ 0.8g/t from 396m, including:
      • 22.9m @ 2.2g/t from 642m
  • Drillhole 22JUDD0822:
    1. 39.7m @ 3.0g/t from 262m

5

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Dacian Gold Limited published this content on 19 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 July 2022 22:33:05 UTC.