TSX: KOR OTCQX: CORVF
Oct. 21, 2013
/PRNewswire/ - Corvus Gold Inc. ("Corvus" or the "Company") - (TSX: KOR) (OTCQX: CORVF) announces that, as a result of a recent review by the British Columbia Securities Commission ("BCSC"), the Company is issuing the following news release to clarify its technical disclosure.
Failure to File NI 43-101 Compliant Technical Report for the North Bullfrog Project
The Company filed a technical report (the "Report") for the North Bullfrog Project ("NBP"), dated
June 4, 2013
, in support of a preliminary economic assessment ("PEA") disclosed on
June 4, 2013
. The BCSC review has identified a number of examples where the technical report does not comply with the requirements of NI 43-101 and Form 43-101F1 (the "Form"). These include the following:
- Section 22, "Economic Analysis" of the Report does not include all the information required by Item 22 (d) of the Form, specifically taxes and royalties
- Section 3 "Reliance on Other Relevant Experts" of the Report contains disclaimers not permitted by item 3 of the Form
- The Report contains appendices containing detailed lists of information. As the objective of the Report is to provide summary of all material scientific and technical information as outlined in the Form, comprehensive appendices are not generally necessary in technical reports.
To correct the current situation going forward, the Company is working with the relevant Qualified Persons to prepare a revised technical report ("Revised Report"), with an effective date of
June 4, 2013
, incorporating a revised preliminary economic analysis, which addresses the foregoing issues and anticipates that the Revised Report will be filed on SEDAR on or about
Monday, October 28, 2013.
In the meantime, investors should not rely upon the Report.
Technical Disclosure Issues
The Company has previously disclosed results of the PEA in a news release, financials and investor materials on its website that appears misleading and unbalanced. For example:
- The Company's 2013 Annual Information Form ("AIF") dated August 27, 2013, Management Discussion & Analysis ("MD&A") for the three months ending August 31, 2013 and news release dated July 4, 2013 ("News Release") appear misleading as the disclosure only included the pre-tax and pre-royalty economics NPV and IRR for its North Bullfrog Project in Nevada ("NBP") without disclosing the comparative post-tax and post-royalty values, which may substantially overstate the value of the project. This also occurs in the Precious Metals Summit video (the "Video"), the PEA page of its website and slide 18 of its October 2013 corporate presentation (the "Presentation"). The Company has removed the Video and Presentation from its website, and cautions that such disclosure is hereby retracted and should not be relied upon. Upon the completion of the Revised Report, the Company will issue a news release summarizing the revised PEA, which will include a revised NPV and IRR for the NBP based upon post-tax and post-royalty values.
- The disclosure of its PEA in the AIF, MD&A, Video, PEA page of the website and slide 18 of its Presentation appears unbalanced because the Company discloses upside sensitivity without providing equal downside sensitivity. Upon the completion of the Revised Report, the Company will issue a news release summarizing the Revised PEA, which will include disclosure of the downside sensitivity which will be contained in the Revised Report.
- In the news release dated June 6, 2013 and on the PEA page of its website, the Company refers to its PEA as an "optimized" PEA. This appears to be potentially misleading because it appears to imply a level of confidence that contradicts the definition of a PEA and the cautionary language required by s2.3 (3)(a) and s. 3.4(e) on NI 43-101. The Company notes that did not mean to imply, by the use of the term "optimized", that the PEA had any level of confidence greater than that implied by the use of the term "PEA". The use of the term "optimized" was an indication by the Company that, based on previous work and previous PEA's on the NBP, the Report presented a PEA based on a potential scenario that the Company believed would be the optimum way to approach the project (i.e. on the basis of an overall development rather that the previously considered two stage approach). However, to avoid any confusion, the Company will not use the term "optimized" in connection with any PEA on the NBP.
- In the BNN interview (the "Interview") posted on the Company's Media page of its website from October 2012, the Company states the project is a "2 stage development that should come on-line in late 2014 to start producing gold at 40,000 ounces a year then ramp up in phase 2 adding 60,000 ounces a year for 100,000 ounces a year in 2016". The BCSC is concerned that these statements are misleading because they fail to include any cautionary language stating that the Company has not established the economic viability of the proposed operation or any mineral reserves that would support the same and also does not disclose the higher risk of failure of this production decision in the circumstances. The Company notes that these references were intended only to suggest one potential approach to a possible development of the NBP (a two-stage process, based on its then current PEA for NBP), and should not be taken in any manner to suggest that the Company has established the economic viability of the NBP, that the Company had determined to proceed to production on the basis solely of the PEA, or that the Company had in any way made a production decision. For clarity, the Company confirms that it has not established the economic viability of the NBP, it has not identified any reserves at the NBP, it has not made any determination to proceed to production without the preparation of a feasibility study and it has not made any decision at all to proceed with production at the NBP. The current basis of project information is not sufficient to convert the estimated mineral resources to mineral reserves, and mineral resources that are not mineral reserves do not have demonstrated economic viability.
The Video, Presentation and Interview have been removed from the Company's website, and such disclosure is hereby retracted and investors are cautioned that such disclosure should not be relied upon. The Company will post revised 43-101 compliant disclosure on its website with respect to the PEA upon completion and filing of the Revised Report.