Fortuna provides update and sets construction milestones for its Lindero gold Project in Argentina - Seite 2

Advanced basic engineering of the SART plant is being completed by Kestrel Engineering, an American firm that will work under the direction of Mr. Mike Botz, a qualified engineer with extensive experience of the SART process.

The construction of the leach pad, a critical path of the project, is in the bidding process. Mass earth moving activities are scheduled to commence in February 2018 and are estimated to conclude with the commissioning of the pad in March 2019. Detailed engineering and construction supervision has been awarded to Anddes Argentina, a company specialized in geotechnical engineering and leach pad design and construction.

Mine Equipment

Mine fleet and other heavy equipment are in the process of being awarded. The principal components of the initial mine fleet include six 100 ton trucks, two 17 cubic yard wheel loaders, two bulldozers and two drill rigs.

The Company is evaluating a non-recourse vendor financing of US$15 million for the purchase of mining equipment.

Initial Site Activities

The project requires the upgrading of the existing exploration camp in order to host the initial workforce who will be responsible for building the temporary construction camp. On site activities commenced in November and the temporary facilities will be ready to host the inflow of construction personnel in January 2018. The construction workforce who will build the permanent facilities is estimated to gradually increase and peak at 600 people. The permanent camp facilities will accommodate 320 people.

The Company is in the process of obtaining municipal approval from the town of Tolar Grande for the start of construction activities on new infrastructure. Formal authorization is expected in January 2018.

Project Funding and Financing

The estimated fully scoped capital cost for the construction of Lindero is US$239 million. Capital expenditures are estimated at US$200 million for 2018, and US$36.5 million for 2019; amounts do not include VAT which is expected to be recovered in the first 24 months from the start of mining operations.

The Company plans to fund the construction from a combination of existing cash reserves, projected cash flow generation and an upsized US$120 million credit facility.

Project Construction Milestones

The Company is providing the following selected milestones from the project construction schedule: