Thor Explorations Ltd (TSX-V:THX, AIM:THX, OTC:THXPF) CEO Segun Lawson joined Proactive this week to discuss the company’s impressive performance during the second quarter, which saw it pour nearly 22,000 ounces of gold at its Segilola mine in Nigeria.
Other notable achievements from the quarter were plant upgrades that boosted efficiency and gold recoveries to 94% and Thor Explorations reducing its outstanding debt with AFC to $7.9 million.
Segun also highlighted the company’s entrance into lithium exploration in Nigeria, which includes expanding its land holdings and kicking off a new drill campaign.
Proactive: You're out with the second quarter operating updates, and it looks like good progress on all fronts. Can you start by taking us through some of the highlights at your Segilola mine in Nigeria?
Segun Lawson: It was a good quarter for us, so we're very happy with it. We poured just under 22,000 ounces of gold this quarter. And I think looking at the background as to how we produce that gold is what's most encouraging for us as a team. You know, after upgrading the plants through Q4 last year and Q1 this year and implementing the upgrades, we reduced the plant throughput to see if these upgrades had worked. And that has resulted in a much more efficient production of gold, recoveries at 94%. And during the upgrade, we did build up a lot of gold in circuit.
We had mentioned at the beginning of the year that we were looking to start drawing down on that gold in circuit through the course of the rest of the year and we managed to do that at these high recoveries. So we're very happy with that. What this means now is that we're confident with how these upgrades are working. We're now looking to run the plant at a higher throughput rate, you know, just above 120 tons per hour through the course of the rest of the year. Should we achieve that, which we think we will, we continue to reiterate our guidance at 95,000 to 100,000 ounces for the year.
And, of course, all of this has enabled you to halve your outstanding debt with AFC. So that's down to $7.9 million now. I presume you can continue paying that down?
Yes. You know, we have two more payments left. You know, the initial facility was just over $54 million. We're down to our last, you know, $8 million. We'll do $4 million at the end of September, $4 million at the end of the year, which we think, you know, at the current prevailing high gold prices, we should be able to do without any issues. In parallel to that, we continue to strengthen our balance sheet. You know, we had big accounts payables, which we've been making significant progress with and then stop strengthening our balance sheet in terms of cash buildup as well. So, you know, we're very happy with how the first half of the year has gone.
You acquired more exploration tenure around Segilola. Have you started exploring in that tenure?
We've done low-cost regional exploration. The focus of our exploration right now is the extension of the mine life. So, you know, we've had some successes in that within striking distance. Now we've been able to accelerate and put a lot more effort into the underground exploration. We don't believe there are resources close down at depth. We've put a lot of effort into studying what is controlling the gold and where we think the gold is, what we think the gold is associated with. We've done a lot of structural studies through the quarter as well, and we've kicked off our deeper drilling program.
So, we're looking to get these results out as well, hopefully through the course of this Q3, and success for us would be finding enough gold to extend the mine life in terms of years. Every year we extend the mine life, especially now that our debt is gone this year, it's hugely value-accretive to us as a company. And given the fact that the pit in some areas now is just well over 100 meters deep, that deeper exploration and the knowledge we've built up over the last two and a half years, mining with the open pit, is really going to be a lot more efficient than it ever has been.
Moving to Senegal, you announced the first set of results from a drilling program over there that was at Douta West and Sofita project last month. So good progress in Senegal, too.
Yes. We budgeted a 15,000-meter drill program for this year. The whole point of this program was to target the shallow areas of this resource where we already have 1.78 million ounces in the oxide, which is an easy-to-extract material. We're very happy with that progress. At the end of June, we announced our first set of results, which were very encouraging, including some very wide intersects, you know, over 30 meters wide ranging at 3.5 grams per ton, 12 meters at 1.4. So we have got those results coming in as well, and this is all going to be put into a preliminary feasibility study, which we're releasing before the end of this year. Hopefully, this is all going to be put into a larger global resource than we already have. So this would be a first chance to get some real economics and commercials on this project. We're very happy with how that's progressing.
You also recently announced you were starting lithium exploration in Nigeria. Tell us what's happening there.
So, we've been exploring for lithium for just over a year now. That's ongoing as well. There's a drilling campaign budgeted for this year, which we've started now. It's a scouting program on the tenure we have. We've also increased our landholding there. This is a space that provides optionality for our shareholders. We look forward to updating investors with our progress here as well.
You said you're on track to meet your full-year targets. So what are the catalysts that investors should be looking out for then?
Well, we're on track to pour north of 95,000 ounces this year and all-in sustaining cost that we're reiterating between $1,100 to $1,200 per ounce. So today's gold price has a healthy margin. That underpins the value proposition we have. But we also have significant exploration upside in Nigeria and in Senegal, where we believe we have a material project that's going to have some valuation. So we have those economics coming out in the PFS later on this year. And then lastly, we do have optionality. We're a first mover in Nigeria. So, we have a lot of growth coming from different jurisdictions, diversified by stage of development and this is all underpinned by strong cash flows coming from Segilola.
Quotes have been edited for clarity and style