Announcement • Jul 02
Tiernan Gold Corp. Reports Phase 1 Metallurgical Results for Volcan Gold Project Tiernan Gold Corp. announced results from Phase 1 diagnostic leach and gold deportment results from 36 variability samples from the Volcan Gold Project, located in the Maricunga Gold Belt, Atacama Region, Chile. The Phase 1 program was designed to characterize gold deportment and cyanide solubility across multiple grade ranges and sample groups. The work provides an initial metallurgical dataset that will guide the next phase of testwork supporting the permit engineering and Pre-Feasibility Study workstream. Combined Stage 1 and Stage 2 cyanide-soluble gold distribution averaged 75.1% across the 36 samples, with a median of 78.3% and a range of 42.3% to 92.8%. The higher-grade sample groups returned average combined cyanide-soluble gold distributions of 77.8% and 81.0%, respectively. These results are diagnostic test results and should not be interpreted as projected heap leach recoveries. 36 variability samples were tested across a number of grade profiles, with assay head grades ranging from 0.30 g/t Au to 3.23 g/t Au. Combined Stage 1 and Stage 2 cyanide-soluble gold distribution averaged 75.1% and returned a median of 78.3% across all samples. Higher-grade samples averaged 77.8% and 81.0% combined cyanide-soluble gold distribution. Stage 1 cyanide leaching accounted for an average of 64.0% gold distribution, while Stage 2 added an average of 11.1%. A minority of samples returned lower cyanide-soluble gold distributions. These samples are being reviewed against geological, alteration and mineralogical data to determine whether they represent discrete metallurgical domains requiring specific treatment in Phase 2 testwork and Pre-Feasibility Study recovery modelling. The Phase 1 diagnostic leach testing was completed by SGS Canada Inc. as part of Tiernan's current metallurgical program for Volcan. The diagnostic leach tests were conducted on 36 variability samples at a nominal P80 of 75 microns. The test sequence included acid leaching followed by two stages of cyanide leaching to assess gold and copper deportment, cyanide solubility and residual gold across the sample set. The results are summarized below: Sample Group Number of Samples Assay Head Grade Range (g/t Au) Average Stage 1 + Stage 2 Cyanide-Soluble Gold Distribution Recovery Range Low grade 7 0.54 - 0.70 75.5% 50.5% - 86.4% Medium grade 7 0.78 - 1.23 71.8% 42.3% - 81.0% High grade 8 1.32 - 1.90 77.8% 47.3% - 90.7% Super-high grade 6 2.00 - 3.23 81.0% 60.7% - 92.8% Stockpile-designated 8 0.30 - 0.46 70.5% 50.9% - 84.1% Total 36 0.30 - 3.23 75.1% 42.3% - 92.8%. The Phase 1 results will be used to refine the design of Phase 2 metallurgical testwork. Key workstreams are expected to include: follow-up review of lower-response samples against geological, alteration and mineralogical data; evaluation of gold response by metallurgical domain and grade range; coarse-ore leach testing at varying crush sizes; comparison of high-pressure grinding rolls and conventional crushing products; further assessment of cyanide consumption, acid-soluble copper and copper management parameters; and process-design support for carbon-in-column and SART considerations. The Phase 1 diagnostic leach tests were completed at a nominal P80 of 75 microns, with mild sulphuric acid leaching conducted for 24 hours to quantify acid soluble copper, followed by Stage 1 cyanide leaching conducted for 24 hours at approximately 1 kg/t sodium cyanide, and Stage 2 cyanide leaching conducted for a further 24 hours at approximately 2 kg/t sodium cyanide. The tests were conducted at 33% solids and pH 10.5 to 11.0. These are diagnostic test conditions designed to characterize gold deportment and cyanide solubility and are not intended to simulate final heap leach or agitated leach operating conditions. Valuation Update With 7 Day Price Move • Jun 24
Investor sentiment deteriorates as stock falls 16% After last week's 16% share price decline to CA$6.45, the stock trades at a trailing P/E ratio of 17.6x. Average forward P/E is 5x in the Metals and Mining industry in Canada. Total returns to shareholders of 468% over the past three years. New Risk • May 22
New major risk - Earnings quality The company has a high level of non-cash earnings. Accrual ratio: 30% This is considered a major risk. Non-cash earnings can arise from many different things. However, if a company consistently has a high level of non-cash earnings, it may be a sign that they are recognizing revenue from customers before the full value of the sales are received as cash or they are not depreciating the value of their assets appropriately. These are practices that inflate earnings, while not providing a similar increase to cash flows. Companies in some select industries naturally have a high level of non-cash earnings and it is not a major concern. However, in the worst case scenario it can be an early sign of performance manipulation by management. Currently, the following risks have been identified for the company: Major Risks High level of non-cash earnings (30% accrual ratio). Revenue is less than US$1m. 
