Compass Gold signs SMAT agreement

SMAT agreement

Compass Gold Corporation made a press release informing about the recent signing of a joint production and toll-treating agreement with SMAT, a local Malian partner, to utilize SMAT’s small mining facility near Compass’s Massala and Tarabala gold prospects in Mali. The facility is undergoing final processing optimizations, with an operational target of Q1 2025, pending the issuance of a Small Mining Permit.

Under this arrangement, Compass can process ore from the Tarabala trend at up to 50 tonnes per hour, aligning with the 2024 Malian Mining Code’s annual maximum of 200,000 tonnes, capped at 160,000 ounces over four years.

Proceeds from gold production will fund operational needs, repay convertible debenture holders, and support expanded exploration and production activities along the Tarabala trend. Further cost-sharing details will be established after the plant is fully commissioned.

In upcoming steps Compass’s Malian team has initiated permit renewals for the Sikasso Project area (1,173 sq. km), including an application for a Small Mining Permit for Massala and Tarabala (5 sq. km), allowing up to 200,000 tonnes of ore annually for four years.

Moreover, Compass has reconstituted its Audit Committee to include Larry Phillips, following the passing of director Bill Pugliese. The Audit Committee now consists of three directors: James Henderson, Joseph Conway, and Larry Phillips, with Henderson and Conway being independent members under TSX Venture Exchange and NI 52-110 guidelines.

Key points

• Joint Production Agreement: Compass has partnered with SMAT, a Malian business group, to utilize SMAT’s nearby Small Mining Facility for toll-treating Compass ore. The updated processing components are slated for completion in Q1 2025.
• Permit & Production Capacity: A Small Mining Permit will authorize Compass to process up to 50 tonnes of ore per hour within the Malian Mining Code’s annual limit of 200,000 tonnes, aiming for total production of up to 160,000 ounces over four years.
• Strategic Cash Flow: Revenue will fund operations, repay convertible debentures, and support further exploration and production along the Tarabala trend.

Executive statement

This new agreement brings Compass closer to achieving near-term gold production, leveraging partnerships and local resources to drive growth along the promising Tarabala trend. Larry Phillips, CEO of Compass Gold, highlights the agreement’s role in supporting Compass’s commitment. He stated: “This initial joint-production arrangement represents an important new stride forward for Compass’s plan to achieve our near-term objective to expedite profitable, near surface gold production with minimal capital investment. The ability to generate free cash flow, while retaining 100% control of our permit areas and the tremendous potential they contain, sets Compass apart from the vast majority of exploration companies.”

Dr. Madani Diallo focused on the collaboration with SMAT. He stated: “We are very pleased to be partnering with SMAT, owned by a successful Malian business group who can be a strong strategic partner with Compass. (…) We are very excited to be seeing this first small mine coming into production as we continue to explore the opportunities for additional production scenarios along the highly prospective Tarabala trend.”