Thor Explorations Announces Financial and Operating Results for the Three and Six Months Ending June 30, 2023

2023-08-24

TSXV - TSX Venture Exchange · Gold · Lithium · Canada

Vancouver, British Columbia--(Newsfile Corp. - August 24, 2023) - Thor Explorations Ltd. (TSXV: THX) (AIM: THX) ("Thor Explorations", "Thor" or the "Company") is pleased to provide an operational and financial review for its Segilola Gold mine, located in Nigeria ("Segilola"), and for the Company's mineral exploration properties located in Nigeria, Senegal and Burkina Faso for three ("Q2 2023" or the "Period") and six months to June 30, 2023 ("H1 2023").

The Company's Consolidated Condensed Interim Financial Statements together with the notes related thereto, as well as the Management's Discussion and Analysis for the three and six months ended June 30, 2023, are available on Thor Explorations' website at https://thorexpl.com/investors/financials/.

All figures are in US dollars ("US$") unless otherwise stated.

Operational Highlights for Q2 2023 and H1 2023

Production

Gold production for the Period totaled 23,078 ounces ("oz") (H1 2023: 43,707 oz) All main operating units of the process plant continue to perform better than expected, with the plant operating above nameplate capacity Several improvement projects at the process plant are being undertaken through the remainder of 2023

Three Loss Time Injuries ("LTIs") occurred in H1 2023, which triggered an increase in training and workplace inspections to improve working conditions

Exploration

The Company has prioritized exploration within a 25-kilometre ("km") radius of Segilola with the key objective being to extend the life of mine Four main advanced exploration targets that have been defined are the Kola Prospect, Igila, Aye-Ile Western Prospects and Ijarigbe The Kola Prospect is located 23km south of Segilola and is a new high-grade greenfield exploration discovery: Reverse Circulation drilling ("RC") was carried out at a low-level stream sediment zone and showed initial positive results, which included 7 metres ("m") grading at 25.98 g/t gold in the near-surface weathered horizon and 4 m at 30.17 g/t gold in the primary horizon Exploration testing of the general area is continuing and drilling activities will continue through the remainder of the year

The Igila Prospect is located 15km west of Segilola Exploration activities are ongoing and focused on delineating additional strike length and identifying additional lodes

The Aye-Ile Prospect is located 1.2km south-east from Igila Drill testing has focused on the anomalous auger geochemistry located a north-east dipping vein-system that is developed on the same structural orientation as Igila

In Senegal, exploration activities at the Douta Project ("Douta") have progressed throughout Q2 2023

Thor Lithium - Newstar Minerals Limited

Thor, through its fully owned subsidiary Newstar Minerals Ltd, acquired a significant tenure in south-west Nigeria that covers both known lithium bearing, pegmatite deposits and a large, unexplored, prospective, pegmatite-rich belt An initial drilling program is being undertaken on one of the Company's prospects located in the West Oyo Project Area to confirm and delineate lithium-bearing mineralisation, such as spodumene and lepidolite at depth Post Period, the Company announced its initial results with the below key highlights: 11m at 2.61% lithium oxide ("Li2O") from 15m 9m at 2.42% Li2O from 35m 11m at 1.53% Li2O from 14m, including 9m at 1.70% Li2O from 15m Spodumene is confirmed as the main lithium-bearing mineral, with minor lepidolite and shallow mineralisation

Financial Highlights of the Period and H1 2023

Q2 2023 revenue of US$41.3 million (Q2 2022: US$41.3 million) and H1 2023 of US$81.7 million (H1 2022: US$66.2 million) Q2 2023 operating cost of US$942 per oz sold (Q2 2022: US$983 per oz) and an all-in sustaining cost ("AISC") of US$1,230 per oz sold (Q2 2022: US$1,236 per oz) Q2 2023 EBITDA of US$19 million (Q2 2022: US$17.7 million) and H1 2023 of US$35.1 million (H1 2022: US$31,1 million) Q2 2023 net profit of US$7.9 million (Q2 2022: US$6.7 million) and H1 2023 of US$12.2 million (H1 2022: US$10.2 million) As of June 2023, the Company had cash of US$11.1 million (Q1 2023: US$4.5 million) Q2 2023 net debt of US$16.8 million (Q1 2023: US$24.9 million)

Environment, Social and Governance

The Segilola HSE team commissioned a team of standby emergency responders in Q2 2023, with 28 personnel specifically trained to respond to emergency related, medical and operational situations at the SROL site The Company progressed its livelihood restoration programs for the local communities Vegetable farms were completed in Q1 2023 and produced their first crops and improved tomato species in Q2 2023, with commercial off-takers purchasing the produce Fish farms in the local community neared completion in Q2 2023 with farming to commence in Q3 2023 Improved cocoa species seedlings were issued to the local community in Q2 2023 and training provided to the farmers to improve yields and commercial returns In Senegal, community projects undertaken included upgrading a local school's facilities block, clearing land at a local cemetery and providing a generator for the local police station

Outlook

Segilola production for the full year expected to be 85,000 oz with AISC expectations maintained at US$1,150 - US$1,350 per oz Q3 2023 production is expected to be below original expectations at the beginning of the financial year. However, Q4 gold production forecast remains in-line with original expectations, with potential upside as mining conditions continue to improve with the west wall push back nearing completion

Continue to advance exploration programs across the portfolio, including: Continuation of step-out drilling at Douta gold project in Senegal Continuation of drilling at Segilola gold regional targets Continuation of drilling at L06 lithium prospect in Nigeria

Completion of the Douta preliminary feasibility study ("PFS") in Q4 2023

Segun Lawson, President & CEO, stated:

"The second quarter of 2023 has seen good developments across Thor's project portfolio. Operations are performing well, with the processing plant still operating above nameplate design. The Company posted strong revenues for H1 of US$81 million, with an EBITDA of US$35.1 million and a net profit of US$12 million for the same period.

"The Company expects to achieve its total material mined forecast for H2, however grade control drilling for Q3 indicates a lower than forecast recovered gold production for the period. While the Q4 gold production forecast remains in-line with our original target, with potential upside as mining conditions continue to improve as the west wall push back nears completion, the Company considers it prudent to update guidance for 2023 to 85,000oz of recovered gold - the lower end of the previously announced range for the full financial year.

"As we look to extend the life of mine at Segilola, Thor has located several exploration targets within close proximity to the project. These exploration targets are encouraging so far have demonstrated positive results from initial exploration drilling activities. We plan to follow up with further drilling activities in Q3 and Q4 2023. At Douta, Thor is making great progress towards completing the PFS, which is scheduled to be completed in Q4 this year.

"With our strategy to identify high-value resource opportunities, Thor acquired a significant tenure in south-west Nigeria, which is known for lithium-bearing pegmatite deposits. An initial drilling program is being undertaken on the West Oyo Project area, with the objective to confirm and delineate lithium bearing mineralization. I am pleased to confirm that, post period, the program confirmed spodumene as the main lithium-bearing mineral, together with minor lepidolite. We will continue to explore the area and believe this poses a great opportunity to increase shareholder value.

"We take the working conditions at our operations very seriously, and as such, Thor has increased training and workplace inspections to improve working conditions. The Segilola HSE team has also commissioned a team of standby emergency responders during the Quarter, with 28 personnel specifically trained to respond to emergency related, medical and operational situations at the SROL site. The program comprised classroom and practical sessions on how to respond to first aid cases, administering basic life support to unconscious victims and emergency response planning and activation processes to ensure there are fewer lost time injuries.

"The Company is in a good position to advance its projects in the next quarter, with further developments made at its exploration prospects as well as improvements in processing capabilities which should result in improved production. I look forward to updating the shareholders on the developments made in the next quarter."

About Thor Explorations

Thor Explorations Ltd. is a mineral exploration company engaged in the acquisition, exploration, development and production of mineral properties located in Nigeria, Senegal and Burkina Faso. Thor Explorations holds a 100% interest in the Segilola Gold Project located in Osun State, Nigeria and has a 70% economic interest in the Douta Gold Project located in south-eastern Senegal. Thor Explorations trades on AIM and the TSX Venture Exchange under the symbol "THX".

THOR EXPLORATIONS LTD. Segun Lawson President & CEO

For further information please contact:

Thor Explorations Ltd Email: info@thorexpl.com

Canaccord Genuity (Nominated Adviser & Broker) Henry Fitzgerald-O'Connor / James Asensio

Tel: +44 (0) 20 7523 8000

Hannam & Partners (Broker) Andrew Chubb / Matt Hasson / Jay Ashfield / Franck Nganou

Tel: +44 (0) 20 7907 8500

Fig House Communications (Investor Relations) Tel: +1 416 822 6483 Email: investor.relations@thorexpl.com

Ibu Lawson (Investor Relations) Tel: +447909825446 Email: ibu.lawson@thorexpl.com

BlytheRay (Financial PR) Tim Blythe / Megan Ray / Said Izagaren Tel: +44 207 138 3203

Qualified Person The technical information included in this report has been prepared under the supervision of Alfred Gillman (Fellow, AusIMM, CP Geology), who is designated as a "qualified person" under National Instrument 43-101 and AIM and has reviewed and approves the content of this news release. He has also reviewed QA/QC, sampling, analytical and test data underlying the information.

Management Discussion & Analysis for Q2 2023

HIGHLIGHTS AND ACTIVITIES - SECOND QUARTER 2023

Operating results for the quarter were highlighted by the selling of 20,852 ounces of gold during the period at a cash operating cost1 of $942 per oz sold, with an all-in sustaining cost1of $1,230 per oz sold. AISC guidance for 2023 is maintained at US$1,150 per ounce to US$1,350 per ounce.

Gold recovered for the quarter was 23,078 ounces. The Company has updated its production guidance to 85,000oz for the year.

Key Operating and Financial Statistics

| | | Three Months period ended | | | Six Months period ended | | | | | | | | | | | | | | | June 30, 2023 | | | March 31, 2023 | | | June 30, 2022 | | | June 30, 2023 | | | June 30, 2022 | | | | Operating | | | | | | | | | | | | | | | | | | Gold sold | Au | | 20,852 | | | 21,553 | | | 22,173 | | | 42,405 | | | 35,636 | | | Gold recovered | Au | | 23,078 | | | 20,629 | | | 26,331 | | | 43,707 | | | 45,128 | | | Average realised gold price | $/oz | | 1,990 | | | 1,902 | | | 1,842 | | | 1,945 | | | 1,852 | | | Cash operating cost | $/oz | | 942 | | | 899 | | | 983 | | | 920 | | | 873 | | | AISC | $/oz | | 1,230 | | | 1,346 | | | 1,236 | | | 1,289 | | | 1,189 | | | EBITDA | $/oz | | 913 | | | 745 | | | 802 | | | 828 | | | 873 | | | | | | | | | | | | | | | | | | | | | Financial | | | | | | | | | | | | | | | | | | Revenue | $ | | 41,364,169 | | | 40,287,830 | | | 41,354,747 | | | 81,651,999 | | | 66,220,229 | | | Net Profit | $ | | 7,912,187 | | | 4,331,347 | | | 6,778,954 | | | 12,243,534 | | | 10,210,578 | | | EBITDA | $ | | 19,044,002 | | | 16,065,334 | | | 17,772,616 | | | 35,109,336 | | | 31,127,944 | |

| | | | June 30, 2023 | | | March 31, 2023 | | December 31, 2022 | | | | Cash and cash equivalents | $ | | 11,149,491 | | | 4,505,071 | | | 6,688,037 | | | Deferred Income | $ | | 865,173 | | | - | | | 6,581,743 | | | Net Debt | $ | | 16,807,972 | | | 24,940,762 | | | 31,650,722 | |

Segilola Gold Mine, Nigeria

Mining

During the three months ended June 30, 2023, 5,633,688 tonnes of material were mined, equivalent to a mining rate of 61,909 tonnes of material per day. In this period, 278,583 tonnes of ore were mined, equivalent to a mining rate of 3,061 tonnes of ore per day, at an average grade of 2.43g/t. Mining of the West wall of the pit is progressing well, with most of the more challenging mining for the year completed. Production areas are increasing in width allowing for improved utilization and productivity. Grade was lower than planned due to delays in accessing higher-grade ore zones in the central mine.

The stockpile balance at the end of the period was 297,100 tonnes of ore at an average of 1.06g/t. This comprised 1,961 tonnes (4.42g/t) at high grade, 2,006 tonnes (2.09g/t) at medium grade, 288,401 tonnes (1.00g/t) at low grade and 4,693 tonnes (2.45g/t) on the coarse ore stockpile.

Processing

During the three months ended June 30, 2023, a total of 255,231 tonnes of ore, equivalent to a throughput rate of 2,805 tonnes per day, was processed. Throughput was higher than planned, with no significant downtime periods.

The mill feed grade was 2.99g/t gold with recovery at 94.0% for a total of 23,078 ounces of gold recovered. The mill rejected ore bearing material crusher was commissioned during the quarter. Smelting performance was improved with the commissioning of the new smelter.

All of the main operating units of the process plant continue to perform better than expected, with the plant operating above nameplate capacity. Several improvement projects are being undertaken through the remainder of 2023.

Production Metrics

| | Units | Q2 - 2023 | Q1 - 2023 | Q4 - 2022 | Q3 - 2022 | Q2 - 2022 | Q1 - 2022 | | | | | | | | | | | Mining | | | | | | | | | Total Mined | Tonnes | 5,633,688 | 4,194,689 | 4,296,494 | 4,018,431 | 4,031,584 | 3,759,524 | | Waste Mined | Tonnes | 5,355,105 | 3,996,264 | 3,974,073 | 3,793,249 | 3,747,504 | 3,533,610 | | Ore Mined | Tonnes | 278,583 | 198,425 | 322,421 | 225,182 | 284,079 | 226,314 | | Grade | g/t Au | 2.43 | 2.85 | 3.51 | 4.43 | 3.63 | 2.68 | | Daily Total Mining Rate | Tonnes/Day | 61,909 | 46,608 | 46,701 | 43,679 | 44,303 | 41,772 | | Daily Ore Mining Rate | Tonnes/Day | 3,061 | 2,205 | 3,505 | 2,448 | 3,122 | 2,515 | | | | | | | | | | | Stockpile | | | | | | | | | Ore Stockpiled | Tonnes | 297,060 | 270,215 | 300,531 | 229,909 | 249,281 | 179,758 | | Ore Stockpiled | g/t Au | 1.06 | 1.14 | 1.48 | 1.19 | 1.46 | 1.23 | | Ore Stockpiled | oz | 10,124 | 9,904 | 14,300 | 8,796 | 11,701 | 7,109 | | | | | | | | | | | Processing | | | | | | | | | Ore Processed | Tonnes | 255,231 | 231,001 | 254,824 | 241,434 | 211,582 | 221,900 | | Grade | g/t Au | 2.99 | 2.95 | 3.38 | 3.58 | 3.66 | 3.18 | | Recovery | % | 94.0 | 94.1 | 95.0 | 95.5 | 95.5 | 94.1 | | Gold Recovered | oz | 23,078 | 20,629 | 26,331 | 26,523 | 23,785 | 21,343 | | Milling Throughput | Tonnes/Day | 2,805 | 2,567 | 2,770 | 2,624 | 2,325 | 2,466 | | | | | | | | | | | | Units | Q2 - 2023 | Q1 - 2023 | Q4 - 2022 | Q3 - 2022 | Q2 - 2022 | Q1 - 2022 |

Exploration Activity Summary Q2 2023

Nigeria Gold

Exploration remained a priority for the Company in 2023 in both Nigeria and Senegal. In Nigeria, the Company continued to prioritize exploration within a 25 kilometre radius of the Segilola Gold Mine. The Company also expanded and diversified its portfolio through the acquisition of over 600 sq km of lithium exploration licences via the grant of new licences and also entering into joint venture agreements with existing licence holders.

The key objective of the exploration strategy is to extend the life of mine ("LOM") at Segilola. Approximately 80% of the Company's Nigerian gold exploration effort is concentrated within a 25km radius of the Segilola operation such that potential gold-bearing material can be easily trucked to the existing plant. In areas that are further from the mine generative exploration is targeting potential new stand-alone operations.

The majority of the exploration activities carried out on all the Company's licences, consisted of RC drilling, Diamond Drilling, geochemical stream sediment sampling, auger drilling and soil sampling. Amongst other target areas that have been located, a new high-grade target, the Kola target, was discovered and is located about 23km from the Segilola Mine. The Kola target produced an initial significant geochemical signature with follow up drill testing intersecting several mineralized drilling intersections including 11m grading 22g/tAu.

Four main advanced exploration targets have been defined within a 25km radius of the Segilola Gold Mine. These comprise the following target areas:

Kola Prospect Igila (Western Prospects) Aye-Ile (Western Prospects) Ijarigbe

New Exploration Prospect - Kola Prospect

The Kola Prospect is a new high-grade greenfield exploration discovery that is located 23km south of the Segilola Gold Mine within a 100% Thor-owned exploration permit The prospect developed from a low-level stream sediment anomaly which was confirmed by follow-up auger-assisted soil geochemistry that returned values of up to 4 g/t Au. Targeting of this anomalous zone was carried out with RC drilling. Initial positive results included 7m grading 25.98 g/t Au in the near-surface weathered horizon. Additional drilling located primary bedrock mineralisation grading 8m at 30.19 g/t Au. Initial data suggest that the geological controls relate to a steeply dipping north-easterly trending zone within a biotite gneiss sequence. Exploration testing of the general area is continuing. Whilst the initial drilling results from the Kola Prospect are encouraging, the Company has not yet identified significant strike length extensions that would add material mine life extensions to Segilola. Drilling activities will continue through Q3 and Q4.

Exploration Results from the Kola Prospect

(0.5g/t Au lower cut off; maximum 1m internal dilution)

| | x | y | Depth | Dip | Azimuth | From (m) | To (m) | Interval (m) | Grade (g/tAu) | True Width (m) | | SGRC168 | 699897 | 807875 | 56 | -60 | 90 | 1.0 | 2.0 | 1.0 | 0.96 | 1.0 | | SGRC188 | 699925 | 807871 | 90 | -60 | 90 | 14.0 | 18.0 | 4.0 | 30.17 | 3.0 | | SGRC189 | 699954 | 807866 | 120 | -60 | 90 | 56.0 | 64.0 | 8.0 | 3.01 | 6.0 | | SGRC190 | 699896 | 807877 | 60 | -60 | 90 | 2.0 | 9.0 | 7.0 | 25.98 | 6.0 | | | | | | -60 | 90 | 58.0 | 59.0 | 1.0 | 0.78 | 0.8 | | SGRC191 | 699924 | 807872 | 55 | -60 | 90 | 1.0 | 6.0 | 5.0 | 5.64 | 4.0 | | SGRC194 | 699961 | 807893 | 105 | -60 | 90 | 49.0 | 57.0 | 8.0 | 30.19 | 7.0 | | SGRC195 | 699980 | 807886 | 110 | -60 | 270 | 76.0 | 78.0 | 2.0 | 0.77 | 1.4 | | SGRC201 | 699926 | 807879 | 29 | -90 | 0 | 31.0 | 32.0 | 1.0 | 0.63 | 1.0 | | | | | | | | 38.0 | 41.0 | 3.0 | 0.55 | 3.0 | | SGRC202 | 699920 | 807870 | 30 | -90 | 0 | 0.0 | 7.0 | 7.0 | 0.86 | 7.0 | | | | | | | | 12.0 | 13.0 | 1.0 | 0.57 | 1.0 | | SGRC203 | 699913 | 807870 | 26 | -90 | 0 | 0.0 | 13.0 | 13.0 | 11.57 | 13.0 | | | | | | | | 14.0 | 17.0 | 3.0 | 0.71 | 3.0 | | | | | | | | 21.0 | 24.0 | 3.0 | 0.97 | 3.0 | | SGRC204 | 699938 | 807889 | 70 | -60 | 270 | 5.0 | 11.0 | 6.0 | 0.73 | 6.0 | | | | | | | | 16.0 | 17.0 | 1.0 | 0.38 | 1.0 |

[](https://images.newsfilecorp.com/files/7003/178306_03cede7e3491c95b_002full.jpg)

Kola Prospect Cross Section

To view an enhanced version of this graphic, please visit: https://images.newsfilecorp.com/files/7003/178306_03cede7e3491c95b_002full.jpg

Western Prospects

Igila

The Western Prospects are located about 15km directly west of the Segilola Gold Mine and are held under a joint venture agreement between Thor's wholly owned subsidiary Segilola Gold Limited ("SGL") and a local mineral exploration company.

Exploration activities at the Western Prospects are now focused on delineating additional strike length and identifying additional lodes such as the Aye-Ile prospect.