Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2021shares | |
Document Information [Line Items] | |
Document Type | 40-F |
Amendment Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Period End Date | Dec. 31, 2021 |
Entity File Number | 001-39766 |
Entity Registrant Name | ORLA MINING LTD. |
Entity Incorporation, State or Country Code | Z4 |
Entity Primary SIC Number | 1040 |
Entity Tax Identification Number | 00-0000000 |
Entity Address, Address Line One | Suite 202, 595 Howe Street |
Entity Address, City or Town | Vancouver |
Entity Address, State or Province | BC |
Entity Address, Postal Zip Code | V6C 2T5 |
Entity Address, Country | CA |
City Area Code | 604 |
Local Phone Number | 564-1852 |
Title of 12(b) Security | Common Shares, no par value |
Trading Symbol | ORLA |
Security Exchange Name | NYSE |
Annual Information Form | true |
Audited Annual Financial Statements | true |
Entity Common Stock, Shares Outstanding | 247,599,954 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Emerging Growth Company | true |
Entity EX Transition Period | false |
Icfr Auditor Attestation Flag | false |
Entity Central Index Key | 0001680056 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2021 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Vancouver, Canada |
Auditor Firm ID | 1263 |
Business Contact [Member] | |
Document Information [Line Items] | |
Entity Address, Address Line One | 28 Liberty Street |
Entity Address, City or Town | New York |
Entity Address, State or Province | NY |
Entity Address, Postal Zip Code | 10005 |
City Area Code | 212 |
Local Phone Number | 894-8940 |
Contact Personnel Name | C T Corporation System |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 20,516 | $ 72,180 |
Trade and other receivables | 306 | 41 |
Value added taxes recoverable (note7) | 16,776 | 163 |
Inventory (note 5) | 9,657 | |
Prepaid expenses | 1,090 | 716 |
Total current assets | 48,345 | 73,100 |
Non-current financial assets (note 22(a)) | ||
Restricted cash (note 6) | 3,680 | 2,783 |
Value added taxes recoverable (note 7) | 7,444 | 8,587 |
Equipment (note 8) | 7,635 | 710 |
Long-term inventory (note 5) | 1,299 | |
Mineral properties and related construction (notes 9 and 12) | 213,749 | 71,272 |
Exploration and evaluation properties (note 10) | 82,743 | 82,743 |
TOTAL ASSETS | 364,895 | 239,195 |
Current liabilities | ||
Trade and other payables (note 11(a)) | 6,816 | 3,383 |
Accrued liabilities (note 11(b)) | 5,659 | 4,343 |
Newmont loan (note 13) | 10,293 | |
Fresnillo obligation (note 14) | 15,000 | |
Total current liabilities | 37,768 | 7,726 |
Non-Current | ||
Lease obligations (note 15) | 1,029 | 142 |
Camino Rojo project loan (note 12) | 113,260 | 60,696 |
Long term borrowings newmont loan | 9,440 | |
Fresnillo obligation (note 14) | 22,800 | |
Accrued liabilities | 161 | 92 |
Site closure provisions (note 16) | 5,460 | 518 |
TOTAL LIABILITIES | 180,478 | 78,614 |
SHAREHOLDERS' EQUITY | ||
Share capital (note 22) | 269,198 | 217,948 |
Reserves | 29,306 | 29,881 |
Accumulated other comprehensive income | 2,441 | 3,002 |
Accumulated deficit | (116,528) | (90,250) |
TOTAL SHAREHOLDERS' EQUITY | 184,417 | 160,581 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 364,895 | $ 239,195 |
Consolidated Statements of Loss
Consolidated Statements of Loss and Comprehensive Loss - USD ($) $ in Thousands, shares in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated Statements of Loss and Comprehensive Loss. | ||
REVENUE (note 17) | $ 4,091 | |
COST OF SALES | ||
Operating costs (note 3(t)(i)) | 1,247 | |
Royalties | 111 | |
Cost of sales | 1,358 | |
OPERATING MARGIN | 2,733 | |
GENERAL AND ADMINISTRATIVE EXPENSES (note 18) | 7,207 | $ 4,330 |
EXPLORATION AND EVALUATION EXPENSES (note 19) | 15,108 | 16,302 |
OTHER EXPENSES (INCOME) | ||
Depreciation (note 8) | 154 | 106 |
Share based payments (note 23) | 2,329 | 2,523 |
Interest income and finance costs (note 20) | 1,296 | 3,895 |
Foreign exchange loss | 3,726 | 1,595 |
Other (gains) and losses (note 21) | (809) | (1,057) |
Other expenses (income) | 6,696 | 7,062 |
LOSS FOR THE YEAR | 26,278 | 27,694 |
Items that may in future periods be reclassified to profit or loss: | ||
Foreign currency differences arising on translation of foreign operations | 547 | (4,577) |
Other | 14 | |
Items that will not be reclassified to profit or loss: | ||
TOTAL COMPREHENSIVE LOSS | $ 26,839 | $ 23,117 |
Weighted average number of common shares outstanding (millions) - basic | 241.4 | 217.1 |
Weighted average number of common shares outstanding (millions) - diluted | 241.4 | 217.1 |
Loss per share - basic | $ 0.11 | $ 0.13 |
Loss per share - diluted | $ 0.11 | $ 0.13 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows $ in Thousands | 12 Months Ended | |
Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
OPERATING ACTIVITIES | ||
Loss for the year | $ (26,278) | $ (27,694) |
Adjustments for items not affecting cash: | ||
Depreciation | 154 | 106 |
Share based payments (note 23) | 2,329 | 2,523 |
Changes in site closure provisions charged to exploration expense | 84 | (202) |
Interest and finance costs (note 20) | 1,296 | 3,895 |
Other gains and losses (note 21) | (211) | (1,057) |
Exploration expense paid via the issuance of common shares (note 22) | 150 | |
Unrealized foreign exchange loss | 3,921 | |
Accounts receivable and prepaid expenses | (604) | (702) |
Inventory | (10,846) | |
Trade and other payables | 3,335 | 2,301 |
Accrued liabilities | 1,470 | 2,411 |
Interest income received | 458 | 293 |
Cash used in operating activities | (24,742) | (18,126) |
FINANCING ACTIVITIES | ||
Proceeds from issuance of common shares (note 22) | 34,442 | 53,368 |
Proceeds from exercise of warrants | 14,279 | 2,858 |
Proceeds from exercise of stock options | 475 | 1,823 |
Share issuance costs (note 22) | (1,000) | (2,034) |
Advances received on the Camino Rojo project loan (note 12) | 50,000 | 50,000 |
Transaction costs related to the Camino Rojo project loan and Fresnillo obligation | (289) | (2,475) |
Interest paid | (11,307) | (2,914) |
Lease payments | (649) | (40) |
Cash provided by financing activities | 85,951 | 100,586 |
INVESTING ACTIVITIES | ||
Purchase of equipment | (3,302) | (287) |
Mineral properties and related construction | (92,939) | (31,014) |
Environmental bonding | (888) | (2,090) |
Restricted cash | (91) | (30) |
Value added taxes paid | (16,046) | (3,474) |
Cash used in investing activities | (113,266) | (36,895) |
Effects of exchange rate changes on cash | 393 | 3,509 |
Net increase (decrease) in cash | (51,664) | 49,074 |
Cash, beginning of year | 72,180 | 23,106 |
CASH, END OF YEAR | $ 20,516 | $ 72,180 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity shares in Thousands, Unit_Standard_pure_HOXPDmIwEkuMLu3I0GlB9w in Thousands, $ in Thousands | Common sharesUSD ($)shares | ReservesUSD ($) | Share based payments reserveUSD ($) | Warrants reserveUSD ($) | Accumulated Other Comprehensive IncomeUSD ($) | Retained earnings (deficit)USD ($) | USD ($)Option |
Equity at beginning of period at Dec. 31, 2019 | $ 159,230 | $ 30,061 | $ 8,160 | $ 21,901 | $ (1,575) | $ (62,556) | $ 125,160 |
Shares at beginning of period at Dec. 31, 2019 | shares | 187,102 | ||||||
Shares issued pursuant to a financing | $ 53,368 | 53,368 | |||||
Shares issued pursuant to a financing (in shares) | shares | 36,600 | ||||||
Share issuance costs (note 22) | $ (2,034) | (2,034) | |||||
Warrants exercised (note 22) | $ 3,364 | (506) | (506) | 2,858 | |||
Warrants exercised (note 22) (in shares) | shares | 2,058 | ||||||
Options exercised (note 23) | $ 3,302 | (1,479) | (1,479) | 1,823 | |||
Options exercised (note 23) (in shares) | 2,112 | ||||||
RSUs redeemed (note 23) | $ 333 | (333) | (333) | ||||
RSUs redeemed (note 23) (in shares) | shares | 414 | ||||||
Bonus shares issued (note 23(d)) | $ 385 | (385) | (385) | ||||
Bonus shares issued (note 23(d)) (in shares) | shares | 1,000 | ||||||
Share based payments (note 23) | 2,523 | 2,523 | 2,523 | ||||
Loss for the year | (27,694) | (27,694) | |||||
Other comprehensive income | 4,577 | 4,577 | |||||
Equity at end of period at Dec. 31, 2020 | $ 217,948 | 29,881 | 8,486 | 21,395 | 3,002 | (90,250) | 160,581 |
Shares at end of period at Dec. 31, 2020 | shares | 229,286 | ||||||
Shares issued pursuant to a financing | $ 34,442 | 34,442 | |||||
Shares issued pursuant to a financing (in shares) | shares | 9,085 | ||||||
Share issued for property payments (note 22) | $ 150 | 150 | |||||
Share issued for property payments (note 22) (in shares) | shares | 33 | ||||||
Share issuance costs (note 22) | $ (1,000) | (1,000) | |||||
Warrants exercised (note 22) | $ 16,419 | (2,140) | (2,140) | 14,279 | |||
Warrants exercised (note 22) (in shares) | shares | 8,060 | ||||||
Options exercised (note 23) | $ 752 | (277) | (277) | $ 475 | |||
Options exercised (note 23) (in shares) | 687 | 122,500 | |||||
RSUs redeemed (note 23) | $ 487 | (487) | (487) | ||||
RSUs redeemed (note 23) (in shares) | shares | 449 | ||||||
Share based payments (note 23) | 2,329 | 2,329 | $ 2,329 | ||||
Loss for the year | (26,278) | (26,278) | |||||
Other comprehensive income | (561) | (561) | |||||
Equity at end of period at Dec. 31, 2021 | $ 269,198 | $ 29,306 | $ 10,051 | $ 19,255 | $ 2,441 | $ (116,528) | $ 184,417 |
Shares at end of period at Dec. 31, 2021 | shares | 247,600 |
CORPORATE INFORMATION AND NATUR
CORPORATE INFORMATION AND NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2021 | |
CORPORATE INFORMATION AND NATURE OF OPERATIONS | |
CORPORATE INFORMATION AND NATURE OF OPERATIONS | 1. Orla Mining Ltd. was incorporated in Alberta in 2007 and was continued into British Columbia in 2010 and subsequently into Ontario under the Business Corporations Act (Ontario) in 2014. In 2016, the Company was continued as a federal company under the Canada Business Corporations Act. The “Company”, “Orla”, “we”, and “our” refer to Orla Mining Ltd. and its subsidiaries. The registered office of the Company is located at Suite 202, 595 Howe Street, Vancouver, Canada. The Company is engaged in the acquisition, exploration, development, and exploitation of mineral properties, and holds the Camino Rojo gold and silver project in Zacatecas State, Mexico, and the Cerro Quema gold project in Panama. These consolidated financial statements have been prepared on the assumption that the Company will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company is not expected to continue operations for the foreseeable future. As at December 31, 2021, the Company was constructing the Camino Rojo Oxide Project and had not advanced any of its properties to commercial production. Historically the Company’s primary source of funding has been the issuance of equity securities for cash through prospectus offerings and private placements to sophisticated investors and institutions. We have successfully raised equity and debt financing in many of the past few years, in the form of private placement financings, the exercise of warrants and options, and debt. While we believe that this success will continue our access to exploration and construction financing is always uncertain, and there can be no assurance of continued access to sources of significant equity or debt funding until we can generate cash from operations. We expect to fund operating costs of the Company over the next twelve months with (1) cash on hand and (2) cash generated from operations. After considering its plans to mitigate the going concern risk, management has concluded that there are no material uncertainties related to events or conditions that may cast significant doubt upon the Company’s ability to continue as a going concern for a period of twelve months from the balance sheet date Since the beginning of 2020, there has been a global outbreak of the novel coronavirus (“COVID-19”), which has had an impact on businesses through the restrictions put in place by the governments in the various jurisdictions where the Company conducts its activities. In common with all businesses in the jurisdictions in which we operate, our activities are restricted by government orders related to, among others, travel, business operations, and stay-at-home orders. As at December 31, 2021 and as of the date of these financial statements, mining and construction are permitted economic activities in the respective jurisdictions and the sites are operating in compliance with the country specific and Company requirements. We are monitoring the potential impacts from the pandemic on areas including equipment delivery and logistics, materials for construction and operation, other necessities, as well as construction costs and schedule, and community and government relations. Delays to construction, permit amendments and exploration programs may occur due to COVID-19 and its variants, notwithstanding the Company having taken steps to minimize potential impacts to the projects including additional costs related to COVID-19 safety measures. |
BASIS OF PREPARATION
BASIS OF PREPARATION | 12 Months Ended |
Dec. 31, 2021 | |
BASIS OF PREPARATION | |
BASIS OF PREPARATION | 2. (a) Statement of compliance and basis of presentation We have prepared these consolidated financial statements of the Company in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The consolidated financial statements have been prepared on the historical cost basis, except for certain financial instruments that are measured at fair values at the end of each reporting period, as explained in the accounting policies below. The consolidated financial statements are presented in United States dollars. On March 17, 2022, the Board of Directors approved these consolidated financial statements for issuance. (b) Basis of consolidation These consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly owned. Where necessary, we have made adjustments to the financial statements of subsidiaries to bring their accounting policies in line with the accounting policies of the consolidated group. We have eliminated all material intercompany transactions, balances, revenues, and expenses upon consolidation. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition or control and up to the effective date of disposition or loss of control. Control is achieved when the Company has power over the investee, is exposed to or has rights to variable returns from its involvement with an investee and has the ability to affect those returns through its power over the investee. Orla Mining Ltd. is the ultimate parent entity of the group. At December 31, 2021 and 2020, the principal subsidiaries of the Company, their geographic locations, and the ownership interests held by the Company, were as follows: Ownership Name Principal activity Dec 31, 2021 Dec 31, 2020 Location Minerometalúrgica San Miguel S de RL de CV Exploration 100 % 100 % Mexico Minera Camino Rojo SA de CV Development 100 % 100 % Mexico Minera Cerro Quema SA Exploration 100 % 100 % Panama Monitor Gold Corporation Exploration 100 % 100 % USA |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
SIGNIFICANT ACCOUNTING POLICIES | 3. We have applied the accounting policies set out below consistently to all periods presented in these financial statements. The significant judgements we made in applying the Company’s accounting policies and the key sources of estimation uncertainty arising in the preparation of these consolidated financial statements are discussed in note 4. (a) (i) Foreign currency transactions Transactions in foreign currencies are translated into the respective functional currencies of each entity at the exchange rates in effect on the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured at historical cost in a foreign currency are translated at the exchange rate in effect at the date of the transaction. Foreign currency differences are generally recognized in profit or loss. (ii) Translation to presentation currency Since January 1, 2020, the Company’s presentation currency has been the United States dollar (“US dollar”, or “USD”). The presentation currency differs from the functional currency of the parent company and some of its subsidiaries (note 3(a)(iii)). We translate the assets and liabilities of entities with functional currencies other than the US dollar into US dollars at the official central bank exchange rates in effect on the reporting date. The results of operations of those entities are translated into US dollars at the average exchange rates in effect during the reporting period. We recognize the foreign currency differences which arise from translation in other comprehensive loss (income). When we dispose of an entity in its entirety, or partially such that we have lost control, we reclassify the cumulative amount in the translation reserve related to that operation to profit or loss as part of the gain or loss on disposal. (iii) The functional currencies of the Company and its subsidiaries, all of which are wholly owned, are as follows: Orla Mining Ltd. Canadian dollars Minerometalúrgica San Miguel S de RL de CV Mexican pesos Minera Camino Rojo SA de CV Mexican pesos Minera Cerro Quema SA United States dollars Monitor Gold Corporation United States dollars (b) Cash and cash equivalents Cash and cash equivalents include cash on hand, demand deposits, and money market instruments, with maturities from the date of acquisition of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant changes in value. (c) Restricted cash Restricted cash consist of amounts lodged with government bodies or their designated banking institutions in support of mandated environmental, permitting, or employee retirement obligations. (d) Inventories include production inventory, and materials and supplies inventory. All inventories are valued at the lower of average cost or net realizable market value (“NRV”). NRV is calculated using the estimated price at the time of sale based on prevailing and forecast metal prices less estimated future production costs to convert the inventory into saleable form and associated selling costs. Any write-downs of inventory to its NRV are included in cost of sales in the period. If there is a subsequent increase in the value of inventory, the previous write-downs to NRV are reversed to the extent that the related inventory has not yet been sold. We classify inventory we do not expect to use within one year as non-current. (i) Production inventory consists of stockpiled ore, in-process inventory, and finished goods. These are valued at the lower of weighted average cost and estimated net realizable value. The value of all production inventories includes direct production costs and attributable overhead and depreciation incurred to bring the materials to their current point in the processing cycle. Stockpiled ore represents unprocessed ore that has been extracted from the mine but not yet processed. The value of stockpiled ore is based on the costs incurred, including depreciation, in bringing the ore to the stockpiles. Costs are added to the stockpiled ore based on current mining costs per recoverable ounce and are removed at the average cost per recoverable ounce in the stockpile. We classify stockpiled ore that we do not expect to process within the next twelve months as non-current. In-process inventory represents ore that is being treated on the leach pads and in the processing plant to extract the contained metals and to convert them to a saleable form. Estimates of recoverable metal in the leach pads are calculated based on the quantities of ore placed on the leach pads (measured tonnes added to the leach pads), the grades of ore placed on the leach pads (based on assays), and estimated recovery percentages (based on estimated recovery assumptions). The nature of the leaching process inherently limits the ability to precisely monitor leach pad inventory levels. Accordingly, we refine estimates based on engineering studies or actual results achieved over time. The ultimate recovery of metals from the leach pads will not be known until the leaching process is concluded at the end of the mine life. The cost of in-process inventory is derived from current mining, crushing, stacking, leaching and plant costs, less the cost of metals transferred to finished goods inventory during the period at the weighted average cost per recoverable ounce. Finished goods inventory is metal in the form of doré bars that have been poured and are ready to be shipped to a refiner. Costs are transferred from finished goods inventory and recorded as cost of sales when the refined metal is sold. (ii) Materials and supplies inventories consist primarily of parts and consumables required in the mining and ore processing activities. Materials and supplies inventories are measured at the lower of weighted average cost and NRV. Cost includes purchase price, freight, and other directly attributable costs. We record provisions to reduce the carrying value of materials and supplies inventories when we determine such materials and supplies are obsolete or unusable. (e) We capitalize costs directly related to development or construction projects until the asset is available for use in the manner intended by us (“commercial production”), after which we move these costs to “producing mineral properties”. We assess the stage of a mine under development and construction to determine when the mine is substantially complete and ready for its intended use. The criteria we use to assess when the mine is ready for its intended use are determined based on the unique nature of each mine construction project, such as the complexity of the project and its location. We consider various technical and physical performance criteria to assess when the production phase is considered to have commenced. Refer to note 4(a)(i) for the factors we consider. When we conclude that a mine under development and construction has commenced commercial production, we reclassify all balance sheet amounts from “Mineral properties and related construction” to balance sheet captions “Producing mineral properties” and “Plant and equipment”. We do not record depreciation until the mine is substantially complete and available for its intended use. When a mine development project moves into the production phase, we: ● stop capitalizing certain mine development costs, and we treat such costs as either (i) part of the cost of inventory or (ii) we expense them, ● stop capitalizing borrowing costs, ● commence depreciation of the producing mineral property, ● continue to capitalize costs relating to mining asset additions or improvements, and costs related to the development of mineable reserves. (i) During the year ended December 31, 2021, we early adopted the “Amendments to IAS 16 Property, Plant and Equipment: Proceeds before Intended Use” (note 3(t)(i)). Under the amendments, proceeds from selling items before the mine under construction reaches commercial production should be recognized in profit or loss, together with the costs of producing those items. Consequently, revenue and cost of sales for “mineral properties and related construction” is presented. (f) Producing mineral properties consist of costs transferred from “Mineral properties and related construction” when a mining property reaches commercial production, the costs of subsequent mine and exploration development, and acquired mining properties in the production stage. (i) In open pit mining operations, it is necessary to incur costs to remove waste material in order to access the ore body, which is known as stripping. Stripping costs incurred prior to the production stage of a mineral property (pre-stripping costs) are capitalized as part of the carrying amount of the related mineral property. During the production phase of an open pit mine, stripping costs incurred that provide improved access to ore that will be produced in future periods and that would not have otherwise been accessible are capitalized (“deferred stripping asset”). The costs qualifying for capitalization are those costs directly incurred to perform the stripping activity that provides or improves access to the identified component of ore, plus an allocation of directly attributable overhead costs, which are determined using a strip ratio methodology. The strip ratio represents the ratio of the estimated total volume of waste material to the estimated total quantity of economically recoverable ore of the mineral reserves for which access has been provided or improved. The deferred stripping asset is capitalized as part of the carrying amount of the mineral property. Capitalized stripping costs are amortized based on the estimated recoverable ounces contained in mineral reserves that directly benefit from the stripping activities. Costs for waste removal that do not give rise to future economic benefits are included in cost of sales. (ii) Depletion commences once the mineral property is capable of operating in the manner intended by management. Producing mineral properties are depleted on a units-of-production basis over the estimated useful life of the mine. This depletion is calculated using the ratio of (i) gold ounces extracted from the mine in the period, over (ii) the total gold ounces expected to be extracted in current and future periods. Major capital works projects conducted after the mine commences commercial production are not depreciated until such works are completed and put into use in a manner intended by management. We review depreciation methods, remaining useful lives and residual values at least annually and we account for changes in estimates prospectively. (iii) At the end of each reporting period, we review our mineral properties, and related plant and equipment to determine whether there is any indication that these assets are impaired. If any such indication exists, we estimate the recoverable amount. If the asset’s carrying amount exceeds its recoverable amount, we recognize an impairment loss in profit or loss. We assess impairment at the cash-generating unit (“CGU”) level, which is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets. Each individual mining interest that is an operating mine is typically a CGU. The recoverable amount of a mine site is the greater of an asset’s fair value less costs to dispose (“FVLCD”) and value in use (“VIU”). FVLCD is defined as the amount that would be obtained from the sale of the asset in an orderly transaction between market participants at the measurement date. VIU is determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset in its present form and from its ultimate disposal. Mineral properties, and plant and equipment that have been impaired are tested for possible reversal of the impairment when events or changes in circumstances indicate that the recoverable amount of the associated CGU has increased. When an impairment loss reverses in a subsequent period, the revised carrying amount shall not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset previously, less subsequent depletion and depreciation. Reversals of impairment losses are recognized in profit or loss in the period in which the reversal occurs. (g) Exploration and evaluation (“E&E”) expenditures Exploration and evaluation expenditures include the search for mineral resources, and the determination of technical feasibility, and assessment of the commercial viability of, an identified mineral resource. Activities include acquisition of rights to explore; topographical, geological, geochemical and geophysical studies; exploratory drilling; trenching; sampling; and evaluation of the technical feasibility and commercial viability of extracting a mineral resource. We capitalize as “exploration and evaluation properties” those E&E assets that we have acquired in a business combination, and also the initial acquisition costs of an E&E asset that does not represent a business. We expense all other E&E expenditures, including non-refundable advance royalty payments. Exploration and evaluation properties are subsequently measured at cost less accumulated impairment. When the technical feasibility and economic viability of a project are demonstrable, funding is in place, and a positive development decision is made, we test the mineral property for impairment and transfer the costs to “Mineral properties and related construction”. We capitalize subsequent expenditures on the project. We assess exploration and evaluation properties for impairment when indicators and circumstances suggest that the carrying amount may exceed its recoverable amount. Typical indicators of impairment include: ● the period for which we have the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed; ● substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned; ● exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and we have decided to discontinue such activities in the specific area; ● sufficient data exists to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full via successful development or by sale. If any such indication exists, we estimate the recoverable amount of the asset to determine the extent of the impairment. Where it is not possible to estimate the recoverable amount of an individual asset, we estimate the recoverable amount of the cash generating unit to which the asset belongs. The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, we discount the estimated future cash flows to their present value using a pre‐tax discount rate that reflects current market assessments of the time value of money and the risks specific to the E&E asset. If we estimate the recoverable amount of an asset to be less than its carrying amount, we recognize an impairment loss in profit or loss for the period. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit) is increased to the revised estimate of its recoverable amount, but to an amount that does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash generating unit) in prior years. We recognize reversals of impairment immediately in profit or loss. (h) Equipment Equipment is initially recognized at cost. Cost includes purchase price, directly attributable costs, and the estimated present value of any future costs of decommissioning and removal. Equipment is carried at cost, net of accumulated depreciation and impairments. We depreciate equipment to their residual values over their estimated useful lives, as follows: Mine equipment Units-of-production over mineral reserves Plant equipment Units-of-production over mineral reserves Other equipment and office equipment Straight line over useful life Vehicles Straight line over useful life, typically 4 years Computer hardware and software Straight line over useful life, typically 3 years (i) Borrowing costs We capitalize interest and other costs that we incur in connection with the borrowing of funds (“borrowing costs”) that are directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale (“a qualifying asset”) as part of the cost of that asset. We expense other borrowing costs in the period in which they occur. When we borrow funds specifically for the purpose of constructing or obtaining a qualifying asset, we capitalize the actual borrowing costs specifically incurred including the amortization of loan initiation costs, less any investment income earned on the temporary investment of those funds. To the extent we borrow funds generally and use them for the purpose of constructing or obtaining a qualifying asset, we use a weighted average interest rate of the borrowing costs applicable to all our general borrowings that are outstanding during the period. We stop capitalizing borrowing costs when substantially all the activities necessary to prepare the qualifying asset for its intended use are complete. We expense borrowing costs related to exploration and evaluation. (j) Leases At the inception of a contract, we assess whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, we consider whether: ● the contract involves the use of an identified asset, either explicitly or implicitly, including consideration of supplier substitution rights; ● we have the right to obtain substantially all the economic benefits from the use of the asset throughout the period of use; and ● we have the right to direct the use of the asset. We recognize a right-of-use (“ROU”) asset, which is initially measured based on the initial amount of the lease liability plus any initial direct costs incurred less any lease incentives received. We depreciate the ROU asset to the earlier of the end of the useful life or the lease term using either the straight-line or units-of-production method, depending on which method more accurately reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if we determine the Company is reasonably likely to exercise the option. We initially measure the lease liability at the present value of the lease payments that are not yet paid as of the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. We then measure the lease liability at amortized cost using the effective interest method and remeasure it when there is a change in future lease payments. We apply the short-term lease (defined as leases with an initial lease term of 12 months or less) and low-value asset recognition exemptions. For these leases, we recognize the lease payments an expense over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed. (k) Asset retirement and site closure obligations We record an asset retirement and site closure obligation when a legal or constructive obligation exists as a result of past events and we can make a reliable estimate of the undiscounted future cash flows required to satisfy the asset retirement and site closure obligation. Such costs include decommissioning or dismantling plant and equipment, and reclamation, closure, and post-closure monitoring of the property. The estimated future cash flows are discounted to a net present value using an applicable risk-free interest rate. We accrete the provision for asset retirement and site closure obligations over time to reflect the unwinding of the discount and charge the accretion expense to profit or loss for the period. We remeasure the asset retirement and site closure obligation at the end of each reporting period for changes in estimates or circumstances, such as changes in legal or regulatory requirements, increased obligations arising from additional disturbance due to mining and exploration activities, changes to cost estimates, and changes to risk-free interest rates. Asset retirement and site closure obligations related to exploration and evaluation activities are expensed. Asset retirement and site closure obligations relating to “mineral properties and related construction”, and to exploration and evaluation properties, are initially capitalized with a charge to the related mineral property. Changes to the obligation which arise as a result of changes in estimates and assumptions are also accounted for as changes in the carrying amounts of related mining property. (l) Provisions We recognize provisions when (i) the Company has a present legal or constructive obligation as a result of a past event, (ii) it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and (iii) we can make a reliable estimate of the amount of the obligation. Where we expect some or all of a provision to be reimbursed (for example, under an insurance contract), we recognize the reimbursement as a separate asset, but only when the reimbursement is virtually certain. We present the expense relating to each provision in profit or loss net of any reimbursements. If the effect of the time value of money is material, we discount the provision using a pre-tax discount rate that reflects the risks specific to the liability. The increase in the provision due to the passage of time is recognized as accretion expense in profit or loss. (m) The Company’s primary source of revenue is the sale of refined gold and silver. The Company’s performance obligations relate primarily to the delivery of refined gold and silver to its customers. Revenue related to the sale of metal is recognized when the customer obtains control of the metal. In determining whether the Company has satisfied a performance obligation, we consider whether (i) the Company has a present right to payment, (ii) the Company has transferred physical possession of the metal to the customer; (iii) the customer has the significant risks and rewards of ownership of the metal; and (iv) the customer has legal title to the metal. We sell refined gold and silver primarily to refiners, bullion banks or members of the London Bullion Market Association (“LBMA”). The sales price is fixed on the date of sale based on spot price or by mutual agreement. We recognize revenue from sales of gold and silver at the time when risk and rewards of ownership and title transfers to the customer, which typically coincides with the date that the customer remits payment. Under certain contracts with customers the transfer of control may occur when the gold or silver is in transit from the mine to the refinery. At this point in time, the customer has legal title to and the risk and rewards of ownership of the gold or silver; therefore, the customer is able to direct the use of and obtain substantially all of the remaining benefits from the gold or silver. Revenue from refined sales is recognized net of treatment and refining charges. (n) The Company provides a defined benefit retirement plan for certain eligible employees that provides a lump-sum payment upon retirement. Benefits under the plan are influenced by length of service and estimates of future salary increases. The defined benefit plan is not funded. The cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurements comprising actuarial gains and losses, the effect of the asset ceiling (if applicable) and the return on plan assets (excluding interest) are recognized immediately in the statement of financial position with a charge or credit to other comprehensive income in the period in which they occur. Remeasurements recognized in other comprehensive income are not reclassified. Service costs, which include current service cost, past service cost and gains and losses on curtailments and settlements, are recognized within profit or loss. Net interest expense or income is recognized within interest and finance costs. (o) Share based payments (i) Stock options, restricted share units ( “ ” “ ” The Company grants stock options, and awards RSUs and DSUs to employees, officers and directors from time to time. At the date of grant or award, we estimate the fair values of the stock options, RSUs and DSUs which will eventually vest. These estimated fair values are recognized as share-based compensation expense over the specific vesting periods, with a corresponding increase to reserves, a component of equity. We determine the fair value of stock options using a Black-Scholes option pricing model with market-related inputs as of the date of grant. The fair value of RSUs and DSUs is the market value of the underlying shares as of the date of award. Stock option grants and RSU awards with several tranches of vesting are accounted for as separate awards with different vesting periods and fair values. We account for changes to the estimated number of awards that will eventually vest prospectively. (ii) Bonus shares The Company has issued bonus shares, which have vested upon the completion of a specified period of service. The fair value of the bonus shares is determined on the date of award; this fair value has been recognized in share-based compensation expense over the service period. (p) Income taxes Income tax expense comprises current and deferred tax. It is recognized in profit or loss except to the extent that it relates to a business combination or items recognized directly in equity or OCI. (i) Current tax Current tax expense comprises the expected tax payable on taxable income for the year and any adjustment to income tax payable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any withholding tax arising from interest and dividends. (ii) Deferred tax Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for: ● temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination, and at the time of the transaction, affects neither the accounting profit nor taxable profit (tax loss); ● temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that we are able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and ● taxable temporary differences arising on the initial recognition of goodwill. We recognize deferred tax assets for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. If the amount of taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future taxable profits are considered based on the business plans for the individual taxable entity. We review deferred tax assets at each reporting date and reduce them when we consider it no longer probable that the related tax benefit will be realized. Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used. Deferred tax is measured at the tax rates that are expected to apply to the temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset only when there are sufficient taxable temporary differences relating to the same taxation authority and the same taxable entity which are expected to reverse in the same period or in the carried back/forward period as the expected reversal of the deductible temporary difference. (q) Loss per share Basic earnings (loss) per share is based on profit (loss) attributable to common shareholders, divided by the weighted average number of common shares outstanding during the reporting period. Diluted earnings (loss) per share is based on profit (loss) attributable to common shareholders, divided by the weighted average number of common shares outstanding during the reporting period after adjusting for the effects of all dilutive potential ordinary shares. (r) We account for business combinations using the acquisition method when the acquired set of activities and assets meets the definition of a business and when control is transferred to the Company. In determining whether a particular set of activities and assets is a business, we assess whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognized in profit or loss immediately. We expense transaction costs as incurred, except if they are related to the issuance of debt or equity securities. The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognized in profit or loss. Any contingent consideration is measured at estimated fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in profit or loss. If share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards), then all or a portion of the acquirer’s replacement awards is included in measuring the consideration transferred in the business combination. This determination is based on the market-based measure of the replacement awards compared with the market-based measure of the acquiree’s awards and the portion to which the replacement awards relate to pre-combination service. The results of businesses acquired during a reporting period are included in the consolidated financial statements starting from the date of acquisition. (s) (i) Financial assets We initially recognize financial assets when the Company becomes party to the contractual provisions of the instrument. Subsequent to initial recognition, we classify financial assets as measured at amortized cost, fair value through other comprehensive income (“FVOCI”) or fair value through profit or loss (“FVTPL”) after considering both our business model for managing the financial asset and the contractual cash flow characteristics of the financial asset. A financial asset is measured at amortized cost if both of the following conditions are met: a. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows, and b. the contractual terms of the f |
SIGNIFICANT ACCOUNTING JUDGEMEN
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES | |
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES | 4 . (a) In preparing the consolidated financial statements, we make judgments when applying our accounting policies. The judgments that have the most significant effect on the amounts recognized in the consolidated financial statements are outlined below. (i) Determination of when a mine under construction is substantially complete and ready for its intended use The determination of when a mine under construction is substantially complete and ready for its intended use requires significant judgement. Some of the criteria we use to identify when the assets are available for their intended use include, but are not limited to: ● the completion of all major capital expenditures to bring the mine to the condition necessary for it to be capable of operating in the manner intended by management, ● the completion of a reasonable period of testing of the mine plant and equipment, ● the ability to produce saleable product (ie, the ability to produce metal within specifications), ● the mine has been transferred to operating personnel from the construction group, ● the mine and plant have reached a pre-determined percentage of design capacity, ● the metal content (the grade) of ore being mined is sufficiently consistent with the mine plan, ● mineral recoveries are at or near the expected production level, ● the ability to sustain ongoing production of metal. No one factor is more important than any other factor; consequently, we consider these collectively to determine the date of commencement of commercial production. (ii) Determination of when the development phase of an exploration project commences We must use significant judgment to assess when an exploration and evaluation project is technically feasible and commercially viable. Timing of the work required to conclude the assessment work might change depending on various factors. We use multiple sources of information, including: ● a positive development decision to proceed with the project, ● geologic and metallurgic information, ● existence of mineral reserves, ● current and forecasted commodity prices, ● estimated future cash flows, ● our ability to finance the development phase, general market conditions, and ● other factors which may limit our access to the mineral deposit, such as the ability to obtain necessary permits. All of these factors have an impact on the timing of commencement of the development phase. Upon commencement of the development phase for a project, we estimate the recoverable amount of the cash-generating unit, which is the higher of its fair value less cost of disposal and its value in use. The recoverable amount is based primarily on estimates of mineral reserves (described in note 4(b)(i) below), future commodity prices, capital costs, operating costs, and income and other taxes, discounted by an estimated discount rate incorporating the time value of money and the risks specific to the cash generating unit. All impairment assessments require significant estimation. Changes to these estimates could have an impact on the recognition and measurement of impairments. (iii) We apply judgement in assessing whether indicators of impairment exist for our exploration and evaluation (“E&E”) properties and for our mineral properties which could result in a test for impairment. For our E&E properties, we consider internal and external factors, such as our rights to explore, planned expenditures on E&E activities, the changes in mineral resources and mineral reserves, the potential for viable operations, significant decline in the market value of the Company, changes in metal prices and costs and changes in interest rates to determine whether there are any indicators of impairment or reversal of a previous impairment. For our mineral properties, we consider external factors such as changes in technology, the market, the economy, or the legal environment, interest rates, and the market capitalization of the Company compared to the book value of the asset. We also consider internal factors such as economic performance of the asset, idle properties and plans to discontinue operations, useful life of the property, our ability to repatriate or use profits from the property, restrictions on access, environmental restrictions, and political instability. Although the Company has taken steps to verify title to exploration and evaluation properties in which it has an interest, these procedures do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects. Further, we make judgements for properties where concessions terms have expired, and a renewal application has been made and is awaiting approval. We use judgement as to whether the concession renewal application is probable to be received, but ultimately this is beyond our control. If a renewal application is not approved, we could lose rights to those concessions. We consider other factors such as typical practice in foreign jurisdictions related permit renewals, our continued ability to operate as usual while awaiting renewals, our continued performance under regulatory requirements, and the ongoing acceptance by authorities of our annual fees. (iv) VAT receivables are generated on the purchase of supplies and services by our companies. The timing and collection of VAT receivables is uncertain as VAT refund procedures in certain jurisdictions require a significant amount of documentation and follow-up. We are exposed to liquidity risk, credit risk and currency risk with respect to our VAT recoverable balances if tax authorities are unwilling to make payments in a timely manner pursuant to our refund filings. The timing of receipt of Mexican VAT is uncertain. We have used judgement in classifying the current and non-current portions of our Mexican VAT receivables based on history of refunds and thoughtful consideration of the contents of each VAT claim. (v) At each reporting period, we assess whether it is probable that the Company is able to benefit from tax loss carryforwards and other temporary differences. We consider the recoverability of deferred tax assets based on future taxable income to determine the deferred tax asset to be recognized. Significant assumptions used to determine future taxable income include estimates for commodity prices, reserves and resources, operating costs, financing costs, development capital, and scheduling and mine design. Revisions to these estimates could result in material adjustments to the financial statements. The determination of the ability of the Company to utilize tax losses carried forward to offset income taxes payable in the future and to utilize temporary differences which will reverse in the future requires management to exercise judgement and make assumptions about the Company’s future performance. (vi) To determine the functional currency of an entity we consider various factors, which IAS 21 splits into 2 categories, namely, primary and the secondary factors. The primary factors that we consider are the following: 1. 2. 3. If our analysis of the primary factors is not definitive in determining the functional currency for the entity, we carry out an assessment which considers the following secondary factors: 1. 2. (b) The preparation of financial statements in conformity with IFRS requires the use of estimates that affect the amounts reported and disclosed. These estimates are based on our knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ materially from the amounts included in the consolidated financial statements. Information about assumptions and other sources of estimation uncertainty as at December 31, 2021 that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next 12 months are outlined below. (i) Mineral resource and mineral resource estimates are estimates of the amount of ore that can be economically extracted from the Company’s mining properties. Such estimates impact the financial statements in the following ways: ● Mineral resource and mineral reserve estimates are key factors considered in determining whether technical feasibility and commercial viability of extracting a mineral resource are demonstrable which influences the classification of expenditure, ● The carrying value of assets may be affected due to changes in estimated mineral reserves and resources if the change is considered an indicator of impairment, ● Depreciation of producing mineral properties is affected by changes in reserve estimates, ● Site closure provisions may change where reserve estimate changes affect expectations about when such activities will occur and the associated cost of these activities. The mineral resource and mineral reserve estimates are based on information compiled by qualified persons within the meaning of Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”). Such information includes geological and technical data on the size, depth, shape and grade of the ore body and suitable production techniques and recovery rates. Such an analysis requires complex geological judgements to interpret the data. The estimation of recoverable reserves is based upon factors such as estimates of foreign exchange rates, commodity prices, future capital requirements and production costs, along with geological assumptions and judgements made in estimating the size and grade of the ore body As the economic assumptions used may change and as additional geological information is produced during the operation of a mine, estimates of mineral resources and mineral reserves may change. (ii) The measurement of inventory, including the determination of its NRV, especially as it relates to metal production inventory involves the use of estimates. NRV is calculated as the estimated price at the time of sale based on prevailing metal prices, less estimated future production costs to convert the inventory into saleable form and associated selling costs, discounted where applicable. In determining the value of metal on the leach pads, we make estimates of tonnages, grades, and the recoverability of ore stacked on leach pads to estimate its value. Changes in these estimates can result in a change in carrying amounts of inventory, which could result in charges to cost of sales. The determination of forecast sales prices, recovery rates, grade, assumed contained metal in stockpiles, work-in-process and leach pad inventory and production and selling costs all requires significant assumptions that impact the carrying value of production inventories. (iii) We make estimates and assumptions in determining the provisions for asset retirement and site closure. The estimates and assumptions include determining the amount and timing of future cash flows, inflation rates, and discount rates. The ultimate rehabilitation costs are uncertain, and cost estimates can vary in response to many factors, including judgements of the extent of rehabilitation activities, technological changes, and regulatory changes. Consequently, there could be significant adjustments to the provisions established, which would affect future financial position, results of operations, and changes in financial position. The provision is management’s best estimate of the present value of the future asset retirement and site closure obligation. Actual future expenditures may differ from the amounts currently provided. (iv) Management uses valuation techniques in measuring the fair value of share options granted and restricted share units, deferred share units, and bonus shares awarded. Such valuation techniques are also used for estimating the fair value upon initial recognition of the Newmont loan, which is interest free. We determine the fair value of share-based payments awarded using the Black Scholes option pricing model which requires us to make certain estimates, judgements, and assumptions in relation to the expected life of the share options, expected volatility, expected risk‐free rate, and expected forfeiture rate. Changes to these assumptions could have a material impact on the Company’s financial statements. |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORY | |
INVENTORY | 5. December 31, December 31, 2021 2020 Stockpiled ore $ 2,458 $ — In-process inventory 6,513 — Materials and supplies 686 — Inventory – current $ 9,657 $ — Long term Stockpiled ore 1,299 — Inventory – long term $ 1,299 $ — Non-current inventory consists of stockpiled ore that is not expected to be processed within 12 months. There were no write downs to reduce the carrying value of inventories to net realizable value during the year ended December 31, 2021. |
RESTRICTED CASH
RESTRICTED CASH | 12 Months Ended |
Dec. 31, 2021 | |
RESTRICTED CASH | |
RESTRICTED CASH | 6. December 31, December 31, 2021 2020 Environmental bonds $ 3,243 $ 2,392 Severance funds 297 323 Other 140 68 $ 3,680 $ 2,783 |
VALUE ADDED TAXES RECOVERABLE
VALUE ADDED TAXES RECOVERABLE | 12 Months Ended |
Dec. 31, 2021 | |
VALUE ADDED TAXES RECOVERABLE | |
VALUE ADDED TAXES RECOVERABLE | 7. VALUE ADDED TAXES RECOVERABLE Our Mexican entities pay value added taxes (called “IVA” in Mexico) on certain goods and services we purchase. Value added taxes paid in Mexico are fully recoverable. However, IVA recovery returns in Mexico are subject to complex filing requirements and detailed audit or review by the fiscal authorities. Consequently, the timing of receipt of refunds is uncertain. The Mexican tax authorities began issuing payments on these IVA claims to the Company in November 2021. To December 31, 2021, a total of 48.9 million pesos ($2.4 million) in IVA refunds had been received. We have used judgement in classifying the current and non-current portions of our Mexican VAT receivables. Factors considered include the regularity of payments received since receiving the first payment, communication from the Mexican tax authorities with respect to specific claims and the expected length of time for refunds in accordance with Mexico’s regulations. Of the long term portion, $3.4 million (December 31, 2020 - $nil) was under dispute with the taxation authorities. December 31, December 31, 2021 2020 Current portion $ 16,776 $ 163 Long term portion 7,444 8,587 $ 24,220 $ 8,750 |
EQUIPMENT
EQUIPMENT | 12 Months Ended |
Dec. 31, 2021 | |
EQUIPMENT | |
EQUIPMENT | 8. Machinery Computers and and Other Right of use Buildings equipment software assets assets Total Cost At January 1, 2020 $ — $ 324 $ 150 $ 57 $ 89 $ 620 Additions — 72 160 55 233 520 Due to changes in exchange rates — (4) 10 3 16 25 At December 31, 2020 $ — $ 392 $ 320 $ 115 $ 338 $ 1,165 Additions 67 2,437 527 318 1,769 5,118 Transfers from construction (note 9) — 2,484 — — — 2,484 Due to changes in exchange rates (1) (75) (13) (6) 12 (83) At December 31, 2021 $ 66 $ 5,238 $ 834 $ 427 $ 2,119 $ 8,684 Accumulated depreciation At January 1, 2020 $ — $ 205 $ 96 $ 17 $ 18 $ 336 Depreciation — 26 30 11 39 106 Due to changes in exchange rates — 4 7 1 1 13 At December 31, 2020 $ — $ 235 $ 133 $ 29 $ 58 $ 455 Depreciation 6 115 86 41 352 600 Due to changes in exchange rates — — (1) — (5) (6) At December 31, 2021 $ 6 $ 350 $ 218 $ 70 $ 405 $ 1,049 Net book value At December 31, 2020 $ — $ 157 $ 187 $ 86 $ 280 $ 710 At December 31, 2021 $ 60 $ 4,888 $ 616 $ 357 $ 1,714 $ 7,635 Other assets include office equipment and vehicles. Right of use assets include leases of mining equipment, vehicles and buildings. The total depreciation for the year ended December 31, 2021, amounted to $0.6 million, of which $0.2 million was included in in inventories, $0.2 million in other expenses and $0.2 million was capitalized as part of the carrying amount of construction in progress. |
MINERAL PROPERTIES AND RELATED
MINERAL PROPERTIES AND RELATED CONSTRUCTION | 12 Months Ended |
Dec. 31, 2021 | |
MINERAL PROPERTIES AND RELATED CONSTRUCTION | |
MINERAL PROPERTIES AND RELATED CONSTRUCTION | 9. MINERAL PROPERTIES AND RELATED CONSTRUCTION (a) Camino Rojo Project The Camino Rojo Project lies 190 km NE of the city of Zacatecas, 48 km S-SW of the town of Concepcion del Oro, and 54 km S-SE of Newmont Corporation’s (“Newmont”) Peñasquito Mine. (i) In November 2017, we acquired the Camino Rojo Project, a gold and silver oxide heap leach project located in Zacatecas State, Mexico, from Goldcorp Inc. (now called Newmont Corporation). A 2% net smelter return royalty (the “Royalty”) on the sale of all metal production from the oxide material at Camino Rojo is payable. The Company and Newmont also entered into an option agreement regarding the potential development of sulphide operations at Camino Rojo. Pursuant to the option agreement, Newmont will, subject to the applicable sulphide project meeting certain thresholds, have an option to acquire a 60% or 70% interest in the applicable sulphide project (“Sulphide Option”). The Royalty excludes revenue on the sale of metals produced from a sulphide project. However, should Newmont decide not to elect to acquire an interest in an applicable sulphide project, Newmont would be entitled to a 2% net smelter return royalty on metals produced from the sulphide material. The Company has received all permits and satisfied all conditions for the construction of a mine at Camino Rojo. Effective November 30, 2020, we reclassified this project to “mineral properties and related construction”. Upon reclassification, we tested the project for impairment, and concluded no impairment was necessary. Subsequent to November 30, 2020, we undertook construction of the oxide gold and silver mine at Camino Rojo. In common with all mining companies in Mexico, the Camino Rojo Project is subject to a Special Mining Duty of 7.5% of taxable mining profits and an Extraordinary Mining Duty of 0.5% of revenues from precious metals. (ii) In February 2021, the Company completed a Layback Agreement with Fresnillo plc (“Fresnillo”) and certain of its subsidiaries, pursuant to which (a) the Company agreed to pay Fresnillo total cash consideration of US$62.8 million in staged payments until December 2023 (note 14) and (b) allows Orla to expand the Camino Rojo Project oxide pit onto part of Fresnillo’s mineral concession located immediately north of Orla’s property. The following table summarizes the initial cost capitalized at closing: Consideration comprised: Cash paid $ 25,000 Fair value of future cash consideration (note 14) 37,800 $ 62,800 (b) Development and Construction Orla commenced construction activities at the Camino Rojo Project in December 2020. At historical cost Accumulated Deposits to foreign Mineral construction Construction in Other costs exchange on Carrying properties vendors progress capitalized translation value At January 1, 2020 $ — $ — $ — $ — $ — $ — Transferred from exploration and evaluation properties 39,272 — — — (2,129) 37,143 Additions — 28,079 4,845 — — 32,924 Borrowing costs capitalized (note 9(c)) — — — 672 — 672 Change in site closure provision (note 16) — — — 164 — 164 Due to changes in exchange rates — — — — 369 369 At December 31, 2020 $ 39,272 $ 28,079 $ 4,845 $ 836 $ (1,760) $ 71,272 Additions 62,800 11,411 56,528 — — 130,739 Transfers within categories — (37,832) 37,832 — — — Transfers to Equipment (note 8) — — (2,484) — — (2,484) Borrowing costs capitalized (note 9(c)) — — — 13,967 — 13,967 Change in site closure provision (note 16) — — — 4,653 — 4,653 Due to changes in exchange rates — — — — (4,398) (4,398) At December 31, 2021 $ 102,072 $ 1,658 $ 96,721 $ 19,456 $ (6,158) $ 213,749 (c) Borrowing costs capitalized Year ended Year ended December 31, December 31, 2021 2020 Capitalized borrowing costs, beginning of the year $ 672 $ $ — Capitalized during the year: Borrowing costs – Camino Rojo project loan (note 12) 12,430 $ 700 Borrowing costs – Fresnillo obligation (note 14) 1,654 — Interest earned on borrowed funds (117) (28) Capitalized borrowing costs, end of the year $ 14,639 $ 672 |
EXPLORATION AND EVALUATION PROP
EXPLORATION AND EVALUATION PROPERTIES | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of detailed information about property, plant and equipment [line items] | |
EXPLORATION AND EVALUATION PROPERITES | 10. EXPLORATION AND EVALUATION PROPERTIES The Company’s exploration and evaluation properties consist of the Cerro Quema Project and the Monitor Gold Project. The Camino Rojo Project is classified under “Mineral properties and related construction” (see note 9). Camino Cerro Monitor Rojo Quema Gold Total Acquisition costs At January 1, 2020 $ 42,615 $ 82,429 $ 314 $ 125,358 Additions — — — — Transferred to “mineral properties and related construction” (39,272) — — (39,272) Transferred to value added taxes recoverable (3,343) — — (3,343) At December 31, 2020 $ — $ 82,429 $ 314 $ 82,743 Additions — — — — At December 31, 2021 $ — $ 82,429 $ 314 $ 82,743 Accumulated foreign exchange on translation At January 1, 2020 $ 285 $ — $ — $ 285 Due to changes in exchange rates (2,414) — — (2,414) Transferred to “mineral properties and related construction” 2,129 — — 2,129 At December 31, 2020 $ — $ — $ — $ — Due to changes in exchange rates — — — — At December 31, 2021 $ — $ — $ — $ — Acquisition costs At December 31, 2020 $ — $ 82,429 $ 314 $ 82,743 At December 31, 2021 $ — $ 82,429 $ 314 $ 82,743 (a) The Cerro Quema Project is located on the Azuero Peninsula in Los Santos Province, Panama. The project is at the exploration and development stage for a proposed open pit mine with process by heap leaching. We own the mineral rights as well as the surface rights over the current mineral resource areas, proposed mine development areas, and priority drill target areas. The original 20-year terms for the exploitation concessions expired in February and March of 2017. The Company has applied for the prescribed ten-year extension to these concessions as it is entitled to under Panamanian mineral law. In March 2017, the Ministry of Commerce and Industry provided written confirmation to the Company that the extension applications had been received and that exploration work could continue while the Company awaits renewal of the concessions. As of the date of these financial statements, final concession renewals have not been received and are still under review. However, we continue to receive ongoing drilling, water use, environmental and other permits, and have paid concession taxes, and issued the annual reports in the normal course. The Company published the results of a Pre-Feasibility Study on the Cerro Quema Project entitled “Project Pre-Feasibility Updated NI 43-101 Technical Report on the Cerro Quema Project Province of Los Santos, Panama” dated January 18, 2022. (b) The Monitor Gold Project consists of three separate option agreements consisting of 422 claims covering 3,416 hectares in Nye County, Nevada, USA. In 2020, the payments required under the option agreements consisted of $40,000 in advance royalty payments, and $75,000 in work commitments, all of which requirements were met by the Company. In 2021, the payments required under the option agreements consist of $150,000 in share issuance (issued), $60,000 in advance royalty payments (paid), and $125,000 in work commitment (completed). To maintain the option agreements in good standing, minimum payments and work commitments are required each year until 2038. |
TRADE AND OTHER PAYABLES AND AC
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES | |
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES | 11. (a) Trade and other payables December 31, December 31, 2021 2020 Trade payables $ 5,966 $ 2,583 Payroll related liabilities 339 658 Royalties payable 113 — Lease obligations (note 15) 372 131 Other 26 11 $ 6,816 $ 3,383 (b) Accrued liabilities December 31, December 31, 2021 2020 Construction-related $ 2,045 $ 1,082 Land and water fees 1,795 1,852 Payroll related 1,244 725 Other 575 684 $ 5,659 $ 4,343 |
CAMINO ROJO PROJECT LOAN
CAMINO ROJO PROJECT LOAN | 12 Months Ended |
Dec. 31, 2021 | |
CAMINO ROJO PROJECT LOAN | |
CAMINO ROJO PROJECT LOAN | 12. In December 2019, the Company entered into a loan agreement with Trinity Capital Partners Corporation (“Trinity Capital”) and certain other lenders with respect to a credit debt facility of $125 million for the development of the Camino Rojo Oxide Gold Project (the “Project Loan”). The Project Loan provides a total of $125 million to the Company, available in three tranches, to be used for the development of the Camino Rojo Project, funding a portion of the Layback Agreement (note 9(a)), and normal course corporate purposes. The Company drew down the first tranche of $25 million in December 2019, the second tranche of $50 million in October 2020, and the third tranche of $50 million in April 2021. The Project Loan is denominated in US dollars, and bears interest at 8.80% per annum, payable quarterly, and is secured by all the assets of the Camino Rojo Project and the fixed assets of the Cerro Quema Project. The principal amount is due upon maturity at December 18, 2024, with no scheduled principal repayments prior to maturity. The Company may prepay the loan, in full or in part, at any time during the term without penalty, by using cash flow from operations. Upon draw down of the first tranche, in December 2019, the Company issued 32.5 million common share purchase warrants (with an exercise price of C$3.00 per warrant and expiry date of December 18, 2026) to the lenders in connection with the closing. Including these warrants, a total of $12,039,000 was considered transaction costs and was charged against the carrying value of the Project Loan. On December 1, 2020, we commenced capitalizing the interest on this loan to “mineral properties and related construction”. During the year ended December 31, 2021, we capitalized $12.4 million (2020 – $0.7 million) (note 9(c)). Transaction Loan advances costs Net At January 1, 2020 $ 25,000 $ (12,039) $ 12,961 Advances during the year 50,000 — 50,000 Cash transaction costs — (2,475) (2,475) Amortization of the transaction costs — 632 632 Foreign exchange — (422) (422) At December 31, 2020 $ 75,000 $ (14,304) $ 60,696 Advances during the year 50,000 — 50,000 Cash transaction costs — (165) (165) Accretion during the period, capitalized (note 9(c)) 9,613 2,817 12,430 Cash interest paid (9,613) — (9,613) Foreign exchange — (88) (88) At December 31, 2021 $ 125,000 $ (11,740) $ 113,260 |
NEWMONT LOAN
NEWMONT LOAN | 12 Months Ended |
Dec. 31, 2021 | |
NEWMONT LOAN | |
NEWMONT LOAN | 13. As part of the Company’s acquisition of the Camino Rojo project from Newmont, Newmont agreed to provide interest-free loans to the Company for all the annual landholding costs on the Camino Rojo project from November 7, 2017, until December 31, 2019. The loans are to be repaid upon declaration of commencement of commercial production of a heap leach operation at the Camino Rojo Project. To the date of these financial statements, approximately 219 million Mexican pesos (approximately $10.6 million) had been advanced by Newmont under this agreement. No further advances in respect of this loan are expected. During the year ended December 31, 2020, the Company agreed with Newmont that the repayment would be made in cash. We expect this payment to occur during the first half of 2022. Because the loan is non-interest bearing, for accounting purposes at the date of each advance, we discount the expected payments using a risk-adjusted discount rate and an estimated repayment date. A rate of 14.6% was used for the advance received during 2019 (2018 – 15.4%). Mexican pesos Mexican pesos US dollars (thousands) (thousands) (thousands) Undiscounted Discounted At January 1, 2020 219,466 182,700 $ 9,647 Accretion during the year — 27,713 1,295 Modification gains arising from changes in estimates — (22,093) (1,032) Foreign exchange — — (470) At December 31, 2020 219,466 188,320 $ 9,440 Accretion during the year — 28,031 1,382 Modification gains arising from changes in estimates — (4,470) (220) Foreign exchange — — (309) At December 31, 2021 219,466 211,881 $ 10,293 |
FRESNILLO OBLIGATION
FRESNILLO OBLIGATION | 12 Months Ended |
Dec. 31, 2021 | |
FRESNILLO OBLIGATION | |
FRESNILLO OBLIGATION | 14. FRESNILLO OBLIGATION Pursuant to the terms of the Layback Agreement (note 9(a)), we agreed to pay Fresnillo total cash consideration of US$62.8 million through a staged payment schedule: i. US$ 25 million upon closing of the transaction (paid February 22, 2021); ii. US$ 15 million upon the earlier of December 1, 2022, and 12 months following the commencement of commercial production at the Camino Rojo Project; and iii. US$ 22.8 million upon the earlier of December 1, 2023, and 24 months following the commencement of commercial production at the Camino Rojo Project. The amounts payable after February 22, 2021, bear interest at 5% per annum, payable quarterly. We capitalize the interest on this loan to “Mineral properties and related construction”. During the year ended December 31, 2021, we capitalized $1.7 million (year ended December 31, 2020 – nil) (note 9(c)). Total At January 1, 2021 $ — Initial recognition 37,800 Accretion during the period, capitalized (note 9(c)) 1,654 Cash interest paid (1,654) At December 31, 2021 $ 37,800 Current 15,000 Non-current 22,800 $ 37,800 |
LEASE OBLIGATIONS
LEASE OBLIGATIONS | 12 Months Ended |
Dec. 31, 2021 | |
LEASE OBLIGATIONS | |
LEASE OBLIGATIONS | 15. LEASE OBLIGATIONS The Company has lease contracts for mining equipment, vehicles and buildings. Leases of mining equipment have lease terms of five years, while vehicles and buildings generally have lease terms three In July 2021, we entered into a new lease agreement for the use of mining equipment in relation to contract mining at Camino Rojo for a period of five years. The Company makes fixed payments and additional variable lease payments depending on the usage of the assets during the contract period. On commencement of the lease, the Company recognized a $0.9 million right-of-use asset and lease liability. During 2021, we made variable lease payments totalling $4.6 million based on the usage of the mining equipment. We have elected not to separate the lease component from the non-lease component. (a) Lease liabilities December 31, December 31, 2021 2020 Beginning of year $ 273 $ 67 Additions 1,769 233 Interest expense 32 7 Lease payments (681) (47) Due to changes in exchange rates 8 13 End of year $ 1,401 $ 273 Current $ 372 $ 131 Non-current 1,029 142 $ 1,401 $ 273 (b) Lease expenses recognized December 31, December 31, 2021 2020 Interest on lease liabilities $ 32 $ 7 Variable lease payments not included in the measurement of lease liabilities 4,579 141 Expenses relating to short-term leases 131 48 Expenses relating to leases of low-value assets, excluding short-term leases 155 121 $ 4,897 $ 317 The maturity analysis of lease liabilities is disclosed in note 28(b)(ii). |
SITE CLOSURE PROVISIONS
SITE CLOSURE PROVISIONS | 12 Months Ended |
Dec. 31, 2021 | |
SITE CLOSURE PROVISIONS | |
SITE CLOSURE PROVISIONS | 16. SITE CLOSURE PROVISIONS Camino Rojo Cerro Quema Project Project Total At December 1, 2020 $ 232 $ 343 $ 575 Decrease in estimated cash flows (57) — (57) At December 31, 2020 $ 175 $ 343 $ 518 Increase in estimated cash flows resulting from current activities 4,738 — 4,738 Accretion during the period 223 — 223 Foreign exchange (19) — (19) At December 31, 2021 $ 5,117 $ 343 $ 5,460 Camino Rojo Cerro Quema Year ended December 31, 2021 Project Project Estimated settlement dates 2029 to 2041 2022 Undiscounted risk-adjusted cash flows $ 6,091 $ — Inflation rate 5.55 % — Discount rate 7.43 % — |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE | |
REVENUE | 17. REVENUE As at December 31, 2021, the mine at the Camino Rojo Project was under construction. We have chosen to early adopt the amendments in IFRS 16 “Property, Plant, and Equipment”, pursuant to which proceeds from metal sales occurring before the mine comes in commercial production and is available for use should be recognized in profit or loss, together with the costs of producing those items. We measured the costs of producing this metal, while the mine was under construction, in accordance with IAS 2 “Inventories”. Revenue by significant product type: 2021 2020 Gold $ 4,094 $ — Silver 30 — Subtotal 4,124 — Refining and transportation (33) — $ 4,091 $ — Revenue recognized during the year ended December 31, 2021 is from one external customer. |
GENERAL AND ADMINISTRATIVE EXPE
GENERAL AND ADMINISTRATIVE EXPENSES | 12 Months Ended |
Dec. 31, 2021 | |
GENERAL AND ADMINISTRATIVE EXPENSES | |
GENERAL AND ADMINISTRATIVE EXPENSES | 18. GENERAL AND ADMINISTRATIVE EXPENSES 2021 2020 Office and administrative $ 1,911 $ 643 Professional fees 1,702 1,389 Regulatory and transfer agent 662 142 Salaries and benefits 2,932 2,156 $ 7,207 $ 4,330 |
EXPLORATION AND EVALUATION EXPE
EXPLORATION AND EVALUATION EXPENSES | 12 Months Ended |
Dec. 31, 2021 | |
EXPLORATION AND EVALUATION EXPENSES | |
EXPLORATION AND EVALUATION EXPENSES | 19. 2021 2020 Camino Rojo Project $ 9,908 $ 12,658 Cerro Quema Project 4,771 3,465 Monitor Gold Project 366 136 Other 63 43 $ 15,108 $ 16,302 |
INTEREST AND FINANCE COSTS
INTEREST AND FINANCE COSTS | 12 Months Ended |
Dec. 31, 2021 | |
INTEREST AND FINANCE COSTS | |
INTEREST AND FINANCE COSTS | 20. 2021 2020 Accretion on Camino Rojo project loan (note 12) $ — $ 2,860 Accretion on Newmont loan (note 13) 1,382 1,295 Accretion on site closure provisions (note 16) 223 — Interest expense on leases (note 15) 32 7 Interest income (140) (267) Interest on IVA refunds (203) — Other 2 — $ 1,296 $ 3,895 On December 1, 2020, we ceased expensing and commenced capitalizing the accretion on the Camino Rojo project loan. |
OTHER (GAINS) AND LOSSES
OTHER (GAINS) AND LOSSES | 12 Months Ended |
Dec. 31, 2021 | |
OTHER (GAINS) AND LOSSES | |
OTHER (GAINS) AND LOSSES | 21. OTHER (GAINS) AND LOSSES 2021 2020 Realized gains on foreign currency transactions $ (598) $ — Modification gains arising from changes in estimates (note 13) (220) (1,032) Other 9 (25) $ (809) $ (1,057) |
SHARE CAPITAL
SHARE CAPITAL | 12 Months Ended |
Dec. 31, 2021 | |
SHARE CAPITAL | |
SHARE CAPITAL | 22. (a) Authorized share capital The Company’s authorized share capital consists of an unlimited number of common shares without par value and an unlimited number of preferred shares without par value. (b) Issued share capital On July 14, 2021, the Company issued 9,085,263 common shares at a price of C$4.75 per common share for gross proceeds of C$43.2 million ($34.4 million). The Company incurred transaction costs of C$1.3 million ($1.0 million) On February 5, 2021, the Company issued 33,000 common shares at a total fair value of $150,000 in respect of the annual share consideration in connection with the Company ’ Refer to the Consolidated Statements of Changes in Equity for details of other share issuances during the years ended December 31, 2021, and 2020. (c) Warrants The following summarizes information about warrants outstanding during 2021: Exercise December 31 December 31 Expiry date price 2020 Exercised Expired 2021 February 15, 2021 C$ 2.35 7,782,994 (7,439,744) (343,250) — July 8, 2021 C$ 0.62 370,000 (370,000) — — June 12,2022 C$ 1.65 4,992,500 (250,000) — 4,742,500 November 7, 2022 C$ 1.40 3,000,000 — — 3,000,000 December 18, 2026 C$ 3.00 32,500,000 — — 32,500,000 Total number of warrants 48,645,494 (8,059,744) (343,250) 40,242,500 Weighted average exercise price C$ 2.64 C$ 2.25 C$ 2.35 C$ 2.72 The following summarizes information about warrants outstanding during 2020: Exercise December 31 December 31 Expiry date price 2019 Exercised Expired 2020 February 15, 2021 C$ 2.35 8,790,600 (1,007,606) — 7,782,994 July 8, 2021 C$ 0.62 570,000 (200,000) — 370,000 June 12, 2022 C$ 1.65 5,842,500 (850,000) — 4,992,500 November 7, 2022 C$ 1.40 3,000,000 — — 3,000,000 December 18, 2026 C$ 3.00 32,500,000 — — 32,500,000 Total number of warrants 50,703,100 (2,057,606) — 48,645,494 Weighted average exercise price C$ 2.61 C$ 1.89 C$ — C$ 2.64 Subsequent to the reporting period, the Company issued 100,000 common shares for proceeds of C$300,000 ($234,000) pursuant to the exercise of warrants (note 31(a)). |
SHARE-BASED PAYMENTS
SHARE-BASED PAYMENTS | 12 Months Ended |
Dec. 31, 2021 | |
SHARE-BASED PAYMENTS | |
SHARE-BASED PAYMENTS | 23. The Company has four different forms of share-based payments for eligible recipients – stock options, restricted share units (“RSUs”), deferred share units (“DSUs”), and bonus shares. Year ended December 31 Share based payments expense 2021 2020 Stock options (note 23(a)) $ 1,350 $ 1,635 Restricted share units (note 23(b)) 738 545 Deferred share units (note 23(c)) 241 213 Bonus shares (note 23(d)) — 130 Share based payments expense $ 2,329 $ 2,523 (a) Stock options Stock options granted by the Company typically have a five-year life, with one third each vesting 2021 2020 Weighted Weighted average average Stock options outstanding Number exercise price Number exercise price Beginning of year 9,959,927 C$ 1.60 9,917,336 C$ 1.20 Granted 678,347 4.74 2,233,438 2.91 Exercised (687,400) 0.87 (2,112,103) 1.15 Expired, forfeited or cancelled (50,000) 1.39 (78,744) 1.17 End of year 9,900,874 C$ 1.86 9,959,927 C$ 1.60 Vested, end of year 8,704,157 C$ 1.63 7,774,007 C$ 1.39 2021 2020 Number granted 678,347 2,233,438 Grant date fair value C$ 1,294 C$ 2,729 Weighted average of assumptions used: Share price at grant date C$ 4.74 C$ 2.91 Expected volatility 45 % 48 % Expected life 5 years 5 years Canadian dollar risk free interest rate 1.0 % 0.5 % Dividends nil nil The stock options outstanding at December 31, 2021, were as follows: Exercise Remaining life Number Expiry date price (C$) (years) Number vested June 23, 2022 1.39 0.5 2,200,000 2,200,000 May 31, 2023 1.25 1.4 700,000 700,000 June 27, 2023 1.25 1.5 944,514 944,514 September 10, 2023 1.25 1.7 100,000 100,000 November 13, 2023 1.30 1.9 1,000,000 1,000,000 March 29, 2024 1.06 2.2 1,835,227 1,835,227 May 15, 2024 1.00 2.4 117,450 117,450 August 13, 2024 1.65 2.6 103,212 103,212 March 25, 2025 2.21 3.2 1,022,124 677,646 April 16, 2025 2.39 3.3 600,000 400,000 April 20, 2025 2.58 3.3 50,000 33,334 July 1, 2025 3.82 3.5 300,000 200,000 August 24, 2025 6.03 3.6 200,000 133,334 September 1, 2025 5.80 3.7 50,000 33,334 March 24,2026 4.80 4.2 578,347 192,774 April 19,2026 4.76 4.3 50,000 16,666 October 4,2026 4.04 4.8 50,000 16,666 Total number of stock options 9,900,874 8,704,157 The stock options outstanding at December 31, 2020, were as follows: Exercise Remaining life Number Expiry date price (C$) (years) Number vested January 27, 2021 0.15 0.1 225,000 225,000 January 27, 2021 0.81 0.1 39,900 39,900 June 23, 2022 1.39 1.5 2,310,000 2,310,000 May 31, 2023 1.25 2.4 980,000 980,000 June 27, 2023 1.25 2.5 1,012,014 1,012,014 September 10, 2023 1.25 2.7 100,000 100,000 November 13, 2023 1.30 2.9 1,000,000 1,000,000 March 29, 2024 1.06 3.2 1,850,227 1,226,818 May 15, 2024 1.00 3.4 117,450 78,300 August 13, 2024 1.65 3.6 103,212 68,808 March 25, 2025 2.21 4.2 1,022,124 333,166 April 16, 2025 2.39 4.3 600,000 200,000 April 20, 2025 2.58 4.3 50,000 16,667 July 1, 2025 3.82 4.5 300,000 100,000 August 24, 2025 6.03 4.6 200,000 66,667 September 1, 2025 5.80 4.7 50,000 16,667 Total number of stock options 9,959,927 7,774,007 Subsequent to the reporting period, the Company granted 250,000 stock options with an exercise price of C$5.37, and a term of five years. One one third Subsequent to the reporting period, 122,500 stock options were exercised, for gross proceeds to the Company of C$158,700 ($125,000) (note 31(a)). (b) Restricted Share Units Restricted Share Units (“RSU’s) awarded by the Company typically vest one-third two three Number of RSUs outstanding: 2021 2020 Outstanding, January 1 921,356 1,014,972 Awarded 235,091 320,447 Vested and settled (448,607) (414,063) Outstanding, December 31 707,840 921,356 Number of RSUs outstanding: Number vesting in the year Total 2021 2022 2023 2024 Outstanding, December 31, 2020 921,356 448,607 365,935 106,814 — Outstanding, December 31, 2021 707,840 — 444,301 185,179 78,360 Restricted Share Units (“RSUs”) are valued based on the closing price of the Company’s common shares on the trading day immediately prior to award. Certain RSUs may be settled in cash at the option of the Company. (c) Deferred Share Units The Deferred Share Units ( “ ” ’ Number of DSUs outstanding: 2021 2020 Outstanding, January 1 644,525 508,780 Awarded and vested immediately 62,503 135,745 Outstanding, December 31 707,028 644,525 Of which, number of DSUs vested at December 31 707,028 644,525 DSUs are valued based on the closing price of the Company’s common shares immediately prior to award. (d) Bonus shares During 2017, the Board of Directors awarded 500,000 common shares to the non‐executive Chairman of the Company as bonus shares. The bonus shares are subject to a vesting period from June 19, 2017, to June 18, 2020 (the “Eligibility Period”). The bonus shares will become issuable (1) after the Eligibility Period on the date that the non‐executive Chairman ceases to act as a director of the Company, or (2) upon a change of control of the Company. We estimated the fair value of the bonus shares ($1.31 each) based on the market price of the common shares at the date of the grant. The amount of $655,000 was recognized on a straight-line basis over the Eligibility Period. On November 13, 2018, the Board of Directors awarded 1,000,000 bonus shares to an officer of the Company. The bonus shares were structured in four tranches of 250,000 bonus shares each, vesting and issuable upon the achievement of certain share price thresholds particular to each tranche. Upon initial recognition we estimated the dates that each of these market condition tranches would vest, such dates ranging from December 2019 to March 2022. The award date fair value ($537,000, or $0.537 per bonus share) was recognized on a straight-line basis over the estimated vesting periods. All four tranches vested during the year ended December 31, 2020. Consequently, the total fair value has been recognized as at December 31, 2020. Number of bonus shares outstanding: 2021 2020 Outstanding, January 1 500,000 1,500,000 Vested and issued during the year — (1,000,000) Outstanding, December 31 500,000 500,000 Vested, end of year 500,000 500,000 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 24. The Company’s related parties include: Related party Nature of the relationship Key management personnel Key management personnel are the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer, the Senior Vice President Exploration, and members of the Board of Directors of the Company. (a) Key Management Personnel Compensation to key management personnel was as follows: Year ended December 31 2021 2020 Short term incentive plans Salaries $ 1,580 $ 1,361 Directors’ fees 183 171 1,763 1,532 Share based payments 1,750 1,859 Total $ 3,513 $ 3,391 (b) Transactions The Company had no other material transactions with related parties other than key management personnel during the years ended December 31, 2021, and 2020. (c) Outstanding balances at the Reporting Date At December 31, 2021, estimated accrued short term incentive compensation totaled $783,000 and was included in accrued liabilities (December 31, 2020 – $773,000). |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
SUPPLEMENTAL CASH FLOW INFORMATION | |
SUPPLEMENTAL CASH FLOW INFORMATION | 25. (a) Cash and cash equivalents Cash consists of the following: December 31, December 31, 2021 2020 Bank current accounts and cash on hand $ 20,516 $ 72,180 (b) Non-cash investing and financing activities The non-cash investing and financing activities of the Company, excluded from the consolidated statements of cash flows, include the following: 2021 2020 Financing activities Stock options exercised, credited to share capital with an offset to reserves 277 1,479 Common shares issued upon maturity of RSUs, credited to share capital with an offset to reserves 487 333 Warrants exercised, credited to share capital with an offset to reserves 2,140 506 Fresnillo obligation credited, with an offset to “mineral properties and related construction” 37,800 — Investing activities Initial recognition of right of use asset with an offset to lease obligation 1,769 233 Marketable securities adjustment included in account receivable with an offset to other gains — 25 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 26. (a) Reportable segments The operating and reportable segments of the Company are based on the reports which are reviewed by the chief operating decision maker (“CODM”) in making strategic resource allocation decisions. These operating segments are the Mexican project, the Panamanian project, and the corporate office. The projects are each managed by a dedicated General Manager and management team. Additionally, the corporate office oversees the plans and activities of early stage exploration projects, such as the Monitor Gold Project. The Camino Rojo Project in Mexico is currently in construction and generated pre-commercial production revenue in December 2021, while the Cerro Quema Project in Panama is focused on the exploration and evaluation of its mineral properties. (b) Geographic segments We conduct our activities in four geographic areas: Mexico, Panama, the United States, and Canada. (i) Mexico Panama USA Canada Total Year ended December 31, 2021 Revenue (note 17) $ (4,091) $ — $ — $ — $ (4,091) Cost of sales 1,358 — — — 1,358 Gross profit (2,733) — — — (2,733) Exploration and evaluation expenses (note 19) 9,908 4,771 366 63 15,108 General and administrative expenses (note 18) — — — 7,207 7,207 Depreciation — 36 — 118 154 Share based payments (note 23) 89 51 — 2,189 2,329 Interest and finance costs (note 20) 1,406 — — (110) 1,296 Foreign exchange loss 3,956 — — (230) 3,726 Other (gains) and losses (note 21) (220) — — (589) (809) Loss for the year $ 12,406 $ 4,858 $ 366 $ 8,648 $ 26,278 Mexico Panama USA Canada Total Year ended December 31, 2020 Exploration and evaluation expenses (note 19) $ 12,658 $ 3,465 $ 136 $ 43 $ 16,302 General and administrative expenses (note 18) — — — 4,330 4,330 Depreciation 34 22 — 50 106 Share based payments (note 23) — — — 2,523 2,523 Interest and finance costs (note 20) 1,294 — — 2,601 3,895 Foreign exchange loss 481 — — 1,114 1,595 Other (gains) and losses (note 21) (1,032) — — (25) (1,057) Loss for the year $ 13,435 $ 3,487 $ 136 $ 10,636 $ 27,694 (ii) Mexico Panama USA Canada Total At December 31, 2021 Equipment $ 7,466 $ 37 $ — $ 132 $ 7,635 Mineral properties and related construction 213,749 — — — 213,749 Exploration and evaluation properties — 82,429 314 — 82,743 Total assets 267,403 83,162 314 14,016 364,895 Mexico Panama USA Canada Total At December 31, 2020 Equipment $ 463 $ 73 $ — $ 174 $ 710 Mineral properties and related construction 71,272 — — — 71,272 Exploration and evaluation properties — 82,429 314 — 82,743 Total assets 82,781 83,260 314 72,840 239,195 |
CAPITAL MANAGEMENT
CAPITAL MANAGEMENT | 12 Months Ended |
Dec. 31, 2021 | |
CAPITAL MANAGEMENT | |
CAPITAL MANAGEMENT | 27. (a) Objectives Our objectives when managing capital are to safeguard the Company’s ability to continue as a going concern to pursue the exploration, evaluation, development, and exploitation of our mineral properties and to maintain a flexible capital structure. We manage our capital structure and adjust it considering changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the Company’s capital structure, we may issue new shares, take on additional debt or repay outstanding debt, or acquire or dispose of assets. To preserve cash, we currently do not pay regular dividends. Our ability to carry out our long-range strategic objectives in future periods depends on our ability to generate positive cash flows from our mining operations and to raise financing from lenders, shareholders, and new investors. We regularly review and consider financing alternatives to fund the Company’s ongoing exploration and development activities until these activities can be funded from ongoing cash flow from our mining operations. (b) Investment policy Our investment policy is to invest the Company’s excess cash in low-risk financial instruments such as demand deposits and savings accounts with major Canadian banks. By using this strategy, the Company preserves its cash resources and can marginally increase these resources with low risk through the yields on these investments. Our financial instruments are exposed to certain financial risks, which include currency risk, credit risk, and liquidity risk. (c) Project loan At the end of 2019, we entered into a $125 million project loan (note 12) in respect of the Camino Rojo Project pursuant to which we had drawn $125 million as of December 31, 2021 (December 31, 2020- $75 million). The project loan requires us to maintain a minimum working capital (adjusted for certain items) of $5 million. The Company is in compliance with the minimum working capital requirement. (d) Decrease exposure to adverse movements in the Mexican peso During the year ended December 31, 2021, we entered into participating forward contracts for the purchase of Mexican pesos for the construction of the Camino Rojo Mine in order to decrease our exposure to adverse movements in the peso during construction. All contracts had been closed out by December 31, 2021. Other than entering into these peso forward contracts, there were no changes to our policy for capital management during the period ended December 31, 2021. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL INSTRUMENTS | |
FINANCIAL INSTRUMENTS | 28. (a) Fair value hierarchy To provide an indication of the reliability of the inputs used in determining fair value, we classify our financial instruments into the three levels prescribed by the accounting standards. Level 1 The fair value of financial instruments traded in active markets (such as publicly traded equity securities) is based on quoted (unadjusted) market prices as at the reporting date. The quoted market price used for financial assets held by the Company is the closing trading price on the reporting date. Such instruments are included in Level 1. Level 2 The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, we include that instrument in Level 2. Level 3 If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. We have no financial assets or liabilities included in Level 3 of the hierarchy. The carrying value of cash and cash equivalents, accounts receivable, restricted cash, trade payables and accrued liabilities approximates the fair value due to the short-term nature of the instruments. The fair value of the Camino Rojo project loan, Newmont loan and Fresnillo obligation is determined using discounted cash flows based on the expected amounts and timing of the cash flows discounted using a market rate of interest adjusted for appropriate credit risk. The fair value of the Camino project loan at December 31, 2021 was estimated at $137.7 million (December 31, 2020 – $66.4 million) using a discount rate of 5.0% (December 31, 2020 – 10.8%). The fair value of the Newmont loan at December 31, 2021 was estimated at $10.5 million (December 31, 2020 – $9.9 million) using an exchange rate of 20.58 MXN/USD (December 31, 2020 – 19.95 MXN/USD) and a discount rate of 5.0% (December 31, 2020 – 10.5%). The carrying value of the Fresnillo obligation approximates the fair value as the discount rates on this instrument approximate the Company’s credit risk. At December 31, 2021, the carrying values and fair values of our financial instruments by category were as follows: Fair Quoted prices Approximate active Significant fair market other Significant due identical observable unobservable term Carrying assets inputs inputs of Total Classification value (Level (Level (Level instrument Fair V Financial assets Cash and cash equivalents FVTPL $ 20,516 $ 20,516 $ — $ — $ — $ 20,516 Accounts receivable Amortized cost 299 16 — — 283 299 Restricted cash Amortized cost 3,680 — 3,680 — — 3,680 $ 24,495 20,532 $ 3,680 $ — $ 283 $ 24,495 Financial liabilities Trade payables Amortized cost $ 5,966 $ — $ — $ — $ 5,966 $ 5,966 Accrued liabilities Amortized cost 5,659 — — — 5,659 5,659 Lease obligation Amortized cost 1,401 — 1,401 — — 1,401 Camino Rojo project loan Amortized cost 113,260 — 137,746 — — 137,746 Newmont loan Amortized cost 10,293 — 10,533 — — 10,533 Fresnillo obligation Amortized cost 37,800 — 37,800 — — 37,800 $ 174,379 $ — $ 187,480 $ — $ 11,625 $ 199,105 At December 31, 2020, the carrying values and fair values of our financial instruments by category were as follows: Fair Quoted prices in Approximate active Significant fair value market for other Significant due to short identical observable unobservable term nature Carrying assets inputs inputs of the Total Classification value (Level (Level (Level Fair Value Financial assets Cash and cash equivalents FVTPL $ 72,180 $ 72,180 $ — $ — $ — $ 72,180 Accounts receivable Amortized cost 39 25 — — 14 39 Restricted cash Amortized cost 2,783 — 2,783 — — 2,783 $ 75,002 72,205 $ 2,783 $ — $ 14 $ 75,002 Financial liabilities Trade payables Amortized cost $ 2,583 $ — $ — $ — $ 2,583 $ 2,583 Lease obligation Amortized cost 274 — 274 — — 274 Camino Rojo project loan Amortized cost 60,696 — 66,443 — — 66,443 Newmont loan Amortized cost 9,440 — 9,875 — — 9,875 $ 72,993 $ — $ 76,592 $ — $ 2,583 $ 79,175 Our policy is to determine whether transfers have occurred between levels in the hierarchy by re-assessing categorization at the end of the reporting period. (b) Financial Risk Management (i) Credit risk Credit risk is the risk of an unexpected loss if a customer or third party to financial instruments fails to meet its contractual obligations. The Company’s exposure to credit risk is limited to cash and environmental bonding. Our cash is held at large Canadian financial institutions in interest bearing accounts. Our reclamation deposits are held with large banks in the countries where they have been lodged. We believe that the credit risk related to our cash and reclamation deposits is low. The Company’s maximum exposure to credit risk is the carrying value of cash and restricted funds. (ii) Liquidity risk Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with its financial liabilities. At December 31, 2021, our financial liabilities had expected maturity dates as follows: Between Between Less than 3 months and 1 year and More than 3 months 1 year 3 years 3 years Total Financial liabilities Trade payables $ 5,966 $ — $ — $ — $ 5,966 Accrued liabilities 5,659 — — — 5,659 Lease obligation 114 289 494 520 1,417 Camino Rojo project loan 2,750 8,250 146,083 — 157,083 Newmont loan — 10,662 — — 10,662 Fresnillo obligation 473 16,357 23,848 — 40,678 $ 14,962 $ 35,558 $ 170,425 $ 520 $ 221,465 At December 31, 2020, our financial liabilities had expected maturity dates as follows: Between Between Less 3 1 More 3 1 3 3 Total Financial liabilities Trade payables $ 2,583 $ — $ — $ — $ 2,583 Lease obligation 32 117 145 — 294 Camino Rojo project loan 1,650 4,950 13,200 81,050 100,850 Newmont loan — — 11,002 — 11,002 $ 4,265 $ 5,067 $ 24,347 $ 81,050 $ 114,729 We manage liquidity by anticipating and maintaining adequate cash balances to meet liabilities as they become due. We review cash forecasts on a regular basis to determine whether the Company will have sufficient cash to meet future working capital needs. (iii) Market risk Market risk is the risk that the fair value of the Company’s financial instruments will fluctuate due to changes in market prices. The market risks to which the Company’s financial instruments are exposed are currency risk and interest rate risk. (A) Currency risk The Company is exposed to currency risk to the extent that monetary assets and liabilities held by the Company are not denominated in United States dollars. During this year, we entered into participating forward contracts for the purchase of Mexican pesos to mitigate this risk (note 27(d)) with respect to the construction of the mine at Camino Rojo. Our financial instruments are held in Canadian dollars, US dollars, and Mexican pesos. As such, our Canadian- and Mexican-currency denominated accounts and balances are subject to fluctuations against the US dollar. Our financial instruments were denominated in the following currencies as at December 31, 2021: Canadian dollars US Mexican (thousands) (thousands) (thousands) Cash $ 7,583 $ 12,061 $ 50,923 Accounts receivable 20 4 5,733 Restricted funds 155 509 62,745 Trade payables (128) (2,642) (66,350) Accrued liabilities (1,637) (2,226) (44,070) Lease obligations (74) (520) (16,935) Camino Rojo project loan — (113,260) — Newmont loan — — (211,881) Fresnillo obligation — (37,800) — Total foreign currency 5,919 (143,874) (219,835) Exchange rate 1.2678 1.0000 20.5835 Equivalent US dollars $ 4,669 $ (143,874) $ (10,680) Our financial instruments were denominated in the following currencies as at December 31, 2020: Canadian dollars US Mexican (thousands) (thousands) (thousands) Cash $ 11,752 $ 62,809 $ 2,804 Accounts receivable 32 4 245 Restricted funds 86 473 44,726 Trade payables (73) (2,074) (9,022) Lease obligations (194) — (2,471) Camino Rojo project loan — (60,696) — Newmont loan — — (188,319) Total foreign currency 11,603 516 (152,037) Exchange rate 1.2732 1.0000 19.9487 Equivalent US dollars $ 9,113 $ 516 $ (7,621) Based on the above net exposures as at December 31, 2021, and assuming that all other variables remain constant: ● a 10% appreciation of the US dollar against the Canadian dollar would increase loss by $12.2 million (December 31, 2020 – $0.8 million) and ● a 10% appreciation of the US dollar against the Mexican peso would increase loss by $4.2 million (December 31, 2020 – $0.7 million) (B) Interest rate risk Interest rate risk is the risk that the fair value or the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Our cash and our reclamation deposits are held mainly in saving accounts and term deposits and therefore there is currently minimal interest rate risk. Because of the short-term nature of these financial instruments, fluctuations in market rates do not have a significant impact on estimated fair values compared to carrying value. The Company’s interest rate risk arises principally from the changes in interest rates related to term deposits where our cash and reclamation deposits are held, as the Camino Rojo project loan and Fresnillo obligation have fixed interest rates of 8.80% and 5.00%, respectively, and the Newmont loan bears no interest. A one percent increase in interest rates would result in a decrease of approximately $520,000 (December 31, 2020 - $427,000) to the Company’s loss for the year ended December 31, 2021. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
INCOME TAXES | 29. (a) Tax amounts recognized in profit or loss 2021 2020 Current tax expense $ — $ — Deferred tax expense — — Tax expense $ — $ — (b) Reconciliation of effective tax rate Income tax expense differs from the amount that would be computed by applying the applicable Canadian statutory income tax rate to income before income taxes. The significant reasons for the differences are as follows: 2021 2020 Income (loss) before tax $ (26,278) $ (27,694) Statutory income tax rate 26.8 % 26.6 % Expected income tax $ (7,042) $ (7,367) Differences between Canadian and foreign tax rates (744) (488) Items not deductible for tax purposes 2,850 736 Share based compensation 587 671 Change in unrecognized deductible temporary differences 6,208 6,190 True ups (1,913) 64 Effect of changes in tax rates from prior years (71) — Effect of changes in foreign exchange rates 393 202 Other (268) (8) Total income taxes — — Effective tax rate n/a n/a In 2021, the statutory income tax rate applicable to the Canadian parent entity was 26.8% (2020 – 26.6%). (c) Unrecognized deductible temporary differences We recognize tax benefits on losses or other deductible amounts generated in countries where the probable criteria for the recognition of deferred tax assets has been met. The Company’s unrecognized deductible temporary differences for which no deferred tax asset is recognized consist of the following amounts. December 31 2021 2020 Mineral properties and exploration expenditures $ 55,548 $ 43,807 Equipment 1,814 1,700 Site closure provisions 5,460 518 Long term debt — 282 Share issue costs 5,724 2,428 Non capital losses 41,343 46,073 Intercompany debt 413 — Other 5,202 — Unrecognized deductible temporary differences $ 115,504 $ 94,808 (d) Recognized deferred tax assets and liabilities Recognized deferred tax assets and liabilities are comprised of the following: December 31 2021 2020 Mineral properties and exploration expenditures (8,173) — Long term debt (1,786) (322) Non-capital losses 10,447 867 Other (488) (545) Recognized deferred tax assets (liabilities) $ — $ — (e) Temporary difference on investment in subsidiaries The temporary differences associated with investments in subsidiaries for which a deferred income tax liability has not been recognized, aggregate to $4,653,000 (December 31, 2020 - $3,328,000). The Company has determined that the taxable temporary difference will not reverse in the foreseeable future. (f) Tax loss carryforwards Our tax losses have the following expiry dates. Tax December 31 expire 2021 2020 Canada 2026 to 2041 $ 46,354 $ 39,108 Mexico 2027 to 2031 29,851 5,317 Panama 2022 to 2026 655 4,678 United States indefinite 16 — |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 30. (a) Commitments The Company has issued purchase orders for construction, equipment purchases, materials and supplies, and other services at the Camino Rojo mine. At December 31, 2021, these outstanding purchase orders and contracts totaled approximately $8,560,000 (December 31, 2020 – $49,050,000), which we expect will be filled within the next 12 months. The Company is committed to making severance payments amounting to approximately $3,220,000 (December 31, 2020 – $3,000,000) to certain officers and management in the event of a change in control. As the likelihood of these events occurring is not determinable, such amounts are not reflected in these consolidated financial statements. (b) Litigation We may, from time to time, be a party to legal proceedings, which arise in the ordinary course of our business. We are not aware of any pending or threatened litigation that, if resolved against us, would have a material adverse effect on our consolidated financial position, results of operations or cash flows. |
EVENTS AFTER THE REPORTING PERI
EVENTS AFTER THE REPORTING PERIOD | 12 Months Ended |
Dec. 31, 2021 | |
EVENTS AFTER THE REPORTING PERIOD | |
EVENTS AFTER THE REPORTING PERIOD | 31. (a) Share issuances Subsequent to the reporting period, the Company granted stock options and issued common shares pursuant to the exercise of stock options (note 23(a)) and exercise of warrants (note 22(c)). |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Foreign currencies | (a) (i) Foreign currency transactions Transactions in foreign currencies are translated into the respective functional currencies of each entity at the exchange rates in effect on the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured at historical cost in a foreign currency are translated at the exchange rate in effect at the date of the transaction. Foreign currency differences are generally recognized in profit or loss. (ii) Translation to presentation currency Since January 1, 2020, the Company’s presentation currency has been the United States dollar (“US dollar”, or “USD”). The presentation currency differs from the functional currency of the parent company and some of its subsidiaries (note 3(a)(iii)). We translate the assets and liabilities of entities with functional currencies other than the US dollar into US dollars at the official central bank exchange rates in effect on the reporting date. The results of operations of those entities are translated into US dollars at the average exchange rates in effect during the reporting period. We recognize the foreign currency differences which arise from translation in other comprehensive loss (income). When we dispose of an entity in its entirety, or partially such that we have lost control, we reclassify the cumulative amount in the translation reserve related to that operation to profit or loss as part of the gain or loss on disposal. (iii) The functional currencies of the Company and its subsidiaries, all of which are wholly owned, are as follows: Orla Mining Ltd. Canadian dollars Minerometalúrgica San Miguel S de RL de CV Mexican pesos Minera Camino Rojo SA de CV Mexican pesos Minera Cerro Quema SA United States dollars Monitor Gold Corporation United States dollars |
Cash and cash equivalents | (b) Cash and cash equivalents Cash and cash equivalents include cash on hand, demand deposits, and money market instruments, with maturities from the date of acquisition of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant changes in value. |
Restricted cash | (c) Restricted cash Restricted cash consist of amounts lodged with government bodies or their designated banking institutions in support of mandated environmental, permitting, or employee retirement obligations. |
Inventories | (d) Inventories include production inventory, and materials and supplies inventory. All inventories are valued at the lower of average cost or net realizable market value (“NRV”). NRV is calculated using the estimated price at the time of sale based on prevailing and forecast metal prices less estimated future production costs to convert the inventory into saleable form and associated selling costs. Any write-downs of inventory to its NRV are included in cost of sales in the period. If there is a subsequent increase in the value of inventory, the previous write-downs to NRV are reversed to the extent that the related inventory has not yet been sold. We classify inventory we do not expect to use within one year as non-current. (i) Production inventory consists of stockpiled ore, in-process inventory, and finished goods. These are valued at the lower of weighted average cost and estimated net realizable value. The value of all production inventories includes direct production costs and attributable overhead and depreciation incurred to bring the materials to their current point in the processing cycle. Stockpiled ore represents unprocessed ore that has been extracted from the mine but not yet processed. The value of stockpiled ore is based on the costs incurred, including depreciation, in bringing the ore to the stockpiles. Costs are added to the stockpiled ore based on current mining costs per recoverable ounce and are removed at the average cost per recoverable ounce in the stockpile. We classify stockpiled ore that we do not expect to process within the next twelve months as non-current. In-process inventory represents ore that is being treated on the leach pads and in the processing plant to extract the contained metals and to convert them to a saleable form. Estimates of recoverable metal in the leach pads are calculated based on the quantities of ore placed on the leach pads (measured tonnes added to the leach pads), the grades of ore placed on the leach pads (based on assays), and estimated recovery percentages (based on estimated recovery assumptions). The nature of the leaching process inherently limits the ability to precisely monitor leach pad inventory levels. Accordingly, we refine estimates based on engineering studies or actual results achieved over time. The ultimate recovery of metals from the leach pads will not be known until the leaching process is concluded at the end of the mine life. The cost of in-process inventory is derived from current mining, crushing, stacking, leaching and plant costs, less the cost of metals transferred to finished goods inventory during the period at the weighted average cost per recoverable ounce. Finished goods inventory is metal in the form of doré bars that have been poured and are ready to be shipped to a refiner. Costs are transferred from finished goods inventory and recorded as cost of sales when the refined metal is sold. (ii) Materials and supplies inventories consist primarily of parts and consumables required in the mining and ore processing activities. Materials and supplies inventories are measured at the lower of weighted average cost and NRV. Cost includes purchase price, freight, and other directly attributable costs. We record provisions to reduce the carrying value of materials and supplies inventories when we determine such materials and supplies are obsolete or unusable. |
Mineral properties and related construction | (e) We capitalize costs directly related to development or construction projects until the asset is available for use in the manner intended by us (“commercial production”), after which we move these costs to “producing mineral properties”. We assess the stage of a mine under development and construction to determine when the mine is substantially complete and ready for its intended use. The criteria we use to assess when the mine is ready for its intended use are determined based on the unique nature of each mine construction project, such as the complexity of the project and its location. We consider various technical and physical performance criteria to assess when the production phase is considered to have commenced. Refer to note 4(a)(i) for the factors we consider. When we conclude that a mine under development and construction has commenced commercial production, we reclassify all balance sheet amounts from “Mineral properties and related construction” to balance sheet captions “Producing mineral properties” and “Plant and equipment”. We do not record depreciation until the mine is substantially complete and available for its intended use. When a mine development project moves into the production phase, we: ● stop capitalizing certain mine development costs, and we treat such costs as either (i) part of the cost of inventory or (ii) we expense them, ● stop capitalizing borrowing costs, ● commence depreciation of the producing mineral property, ● continue to capitalize costs relating to mining asset additions or improvements, and costs related to the development of mineable reserves. (i) During the year ended December 31, 2021, we early adopted the “Amendments to IAS 16 Property, Plant and Equipment: Proceeds before Intended Use” (note 3(t)(i)). Under the amendments, proceeds from selling items before the mine under construction reaches commercial production should be recognized in profit or loss, together with the costs of producing those items. Consequently, revenue and cost of sales for “mineral properties and related construction” is presented. |
Producing mineral properties | (f) Producing mineral properties consist of costs transferred from “Mineral properties and related construction” when a mining property reaches commercial production, the costs of subsequent mine and exploration development, and acquired mining properties in the production stage. (i) In open pit mining operations, it is necessary to incur costs to remove waste material in order to access the ore body, which is known as stripping. Stripping costs incurred prior to the production stage of a mineral property (pre-stripping costs) are capitalized as part of the carrying amount of the related mineral property. During the production phase of an open pit mine, stripping costs incurred that provide improved access to ore that will be produced in future periods and that would not have otherwise been accessible are capitalized (“deferred stripping asset”). The costs qualifying for capitalization are those costs directly incurred to perform the stripping activity that provides or improves access to the identified component of ore, plus an allocation of directly attributable overhead costs, which are determined using a strip ratio methodology. The strip ratio represents the ratio of the estimated total volume of waste material to the estimated total quantity of economically recoverable ore of the mineral reserves for which access has been provided or improved. The deferred stripping asset is capitalized as part of the carrying amount of the mineral property. Capitalized stripping costs are amortized based on the estimated recoverable ounces contained in mineral reserves that directly benefit from the stripping activities. Costs for waste removal that do not give rise to future economic benefits are included in cost of sales. (ii) Depletion commences once the mineral property is capable of operating in the manner intended by management. Producing mineral properties are depleted on a units-of-production basis over the estimated useful life of the mine. This depletion is calculated using the ratio of (i) gold ounces extracted from the mine in the period, over (ii) the total gold ounces expected to be extracted in current and future periods. Major capital works projects conducted after the mine commences commercial production are not depreciated until such works are completed and put into use in a manner intended by management. We review depreciation methods, remaining useful lives and residual values at least annually and we account for changes in estimates prospectively. (iii) At the end of each reporting period, we review our mineral properties, and related plant and equipment to determine whether there is any indication that these assets are impaired. If any such indication exists, we estimate the recoverable amount. If the asset’s carrying amount exceeds its recoverable amount, we recognize an impairment loss in profit or loss. We assess impairment at the cash-generating unit (“CGU”) level, which is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets. Each individual mining interest that is an operating mine is typically a CGU. The recoverable amount of a mine site is the greater of an asset’s fair value less costs to dispose (“FVLCD”) and value in use (“VIU”). FVLCD is defined as the amount that would be obtained from the sale of the asset in an orderly transaction between market participants at the measurement date. VIU is determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset in its present form and from its ultimate disposal. Mineral properties, and plant and equipment that have been impaired are tested for possible reversal of the impairment when events or changes in circumstances indicate that the recoverable amount of the associated CGU has increased. When an impairment loss reverses in a subsequent period, the revised carrying amount shall not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset previously, less subsequent depletion and depreciation. Reversals of impairment losses are recognized in profit or loss in the period in which the reversal occurs. |
Exploration and evaluation ("E&E") expenditures | (g) Exploration and evaluation (“E&E”) expenditures Exploration and evaluation expenditures include the search for mineral resources, and the determination of technical feasibility, and assessment of the commercial viability of, an identified mineral resource. Activities include acquisition of rights to explore; topographical, geological, geochemical and geophysical studies; exploratory drilling; trenching; sampling; and evaluation of the technical feasibility and commercial viability of extracting a mineral resource. We capitalize as “exploration and evaluation properties” those E&E assets that we have acquired in a business combination, and also the initial acquisition costs of an E&E asset that does not represent a business. We expense all other E&E expenditures, including non-refundable advance royalty payments. Exploration and evaluation properties are subsequently measured at cost less accumulated impairment. When the technical feasibility and economic viability of a project are demonstrable, funding is in place, and a positive development decision is made, we test the mineral property for impairment and transfer the costs to “Mineral properties and related construction”. We capitalize subsequent expenditures on the project. We assess exploration and evaluation properties for impairment when indicators and circumstances suggest that the carrying amount may exceed its recoverable amount. Typical indicators of impairment include: ● the period for which we have the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed; ● substantive expenditure on further exploration for and evaluation of mineral resources in the specific area is neither budgeted nor planned; ● exploration for and evaluation of mineral resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and we have decided to discontinue such activities in the specific area; ● sufficient data exists to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full via successful development or by sale. If any such indication exists, we estimate the recoverable amount of the asset to determine the extent of the impairment. Where it is not possible to estimate the recoverable amount of an individual asset, we estimate the recoverable amount of the cash generating unit to which the asset belongs. The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, we discount the estimated future cash flows to their present value using a pre‐tax discount rate that reflects current market assessments of the time value of money and the risks specific to the E&E asset. If we estimate the recoverable amount of an asset to be less than its carrying amount, we recognize an impairment loss in profit or loss for the period. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash generating unit) is increased to the revised estimate of its recoverable amount, but to an amount that does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash generating unit) in prior years. We recognize reversals of impairment immediately in profit or loss. |
Equipment | (h) Equipment Equipment is initially recognized at cost. Cost includes purchase price, directly attributable costs, and the estimated present value of any future costs of decommissioning and removal. Equipment is carried at cost, net of accumulated depreciation and impairments. We depreciate equipment to their residual values over their estimated useful lives, as follows: Mine equipment Units-of-production over mineral reserves Plant equipment Units-of-production over mineral reserves Other equipment and office equipment Straight line over useful life Vehicles Straight line over useful life, typically 4 years Computer hardware and software Straight line over useful life, typically 3 years |
Borrowing costs | (i) Borrowing costs We capitalize interest and other costs that we incur in connection with the borrowing of funds (“borrowing costs”) that are directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale (“a qualifying asset”) as part of the cost of that asset. We expense other borrowing costs in the period in which they occur. When we borrow funds specifically for the purpose of constructing or obtaining a qualifying asset, we capitalize the actual borrowing costs specifically incurred including the amortization of loan initiation costs, less any investment income earned on the temporary investment of those funds. To the extent we borrow funds generally and use them for the purpose of constructing or obtaining a qualifying asset, we use a weighted average interest rate of the borrowing costs applicable to all our general borrowings that are outstanding during the period. We stop capitalizing borrowing costs when substantially all the activities necessary to prepare the qualifying asset for its intended use are complete. We expense borrowing costs related to exploration and evaluation. |
Leases | (j) Leases At the inception of a contract, we assess whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, we consider whether: ● the contract involves the use of an identified asset, either explicitly or implicitly, including consideration of supplier substitution rights; ● we have the right to obtain substantially all the economic benefits from the use of the asset throughout the period of use; and ● we have the right to direct the use of the asset. We recognize a right-of-use (“ROU”) asset, which is initially measured based on the initial amount of the lease liability plus any initial direct costs incurred less any lease incentives received. We depreciate the ROU asset to the earlier of the end of the useful life or the lease term using either the straight-line or units-of-production method, depending on which method more accurately reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if we determine the Company is reasonably likely to exercise the option. We initially measure the lease liability at the present value of the lease payments that are not yet paid as of the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. We then measure the lease liability at amortized cost using the effective interest method and remeasure it when there is a change in future lease payments. We apply the short-term lease (defined as leases with an initial lease term of 12 months or less) and low-value asset recognition exemptions. For these leases, we recognize the lease payments an expense over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed. |
Asset retirement and site closure obligations | (k) Asset retirement and site closure obligations We record an asset retirement and site closure obligation when a legal or constructive obligation exists as a result of past events and we can make a reliable estimate of the undiscounted future cash flows required to satisfy the asset retirement and site closure obligation. Such costs include decommissioning or dismantling plant and equipment, and reclamation, closure, and post-closure monitoring of the property. The estimated future cash flows are discounted to a net present value using an applicable risk-free interest rate. We accrete the provision for asset retirement and site closure obligations over time to reflect the unwinding of the discount and charge the accretion expense to profit or loss for the period. We remeasure the asset retirement and site closure obligation at the end of each reporting period for changes in estimates or circumstances, such as changes in legal or regulatory requirements, increased obligations arising from additional disturbance due to mining and exploration activities, changes to cost estimates, and changes to risk-free interest rates. Asset retirement and site closure obligations related to exploration and evaluation activities are expensed. Asset retirement and site closure obligations relating to “mineral properties and related construction”, and to exploration and evaluation properties, are initially capitalized with a charge to the related mineral property. Changes to the obligation which arise as a result of changes in estimates and assumptions are also accounted for as changes in the carrying amounts of related mining property. |
Provisions | (l) Provisions We recognize provisions when (i) the Company has a present legal or constructive obligation as a result of a past event, (ii) it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and (iii) we can make a reliable estimate of the amount of the obligation. Where we expect some or all of a provision to be reimbursed (for example, under an insurance contract), we recognize the reimbursement as a separate asset, but only when the reimbursement is virtually certain. We present the expense relating to each provision in profit or loss net of any reimbursements. If the effect of the time value of money is material, we discount the provision using a pre-tax discount rate that reflects the risks specific to the liability. The increase in the provision due to the passage of time is recognized as accretion expense in profit or loss. |
Revenue | (m) The Company’s primary source of revenue is the sale of refined gold and silver. The Company’s performance obligations relate primarily to the delivery of refined gold and silver to its customers. Revenue related to the sale of metal is recognized when the customer obtains control of the metal. In determining whether the Company has satisfied a performance obligation, we consider whether (i) the Company has a present right to payment, (ii) the Company has transferred physical possession of the metal to the customer; (iii) the customer has the significant risks and rewards of ownership of the metal; and (iv) the customer has legal title to the metal. We sell refined gold and silver primarily to refiners, bullion banks or members of the London Bullion Market Association (“LBMA”). The sales price is fixed on the date of sale based on spot price or by mutual agreement. We recognize revenue from sales of gold and silver at the time when risk and rewards of ownership and title transfers to the customer, which typically coincides with the date that the customer remits payment. Under certain contracts with customers the transfer of control may occur when the gold or silver is in transit from the mine to the refinery. At this point in time, the customer has legal title to and the risk and rewards of ownership of the gold or silver; therefore, the customer is able to direct the use of and obtain substantially all of the remaining benefits from the gold or silver. Revenue from refined sales is recognized net of treatment and refining charges. |
Defined benefit plan | (n) The Company provides a defined benefit retirement plan for certain eligible employees that provides a lump-sum payment upon retirement. Benefits under the plan are influenced by length of service and estimates of future salary increases. The defined benefit plan is not funded. The cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurements comprising actuarial gains and losses, the effect of the asset ceiling (if applicable) and the return on plan assets (excluding interest) are recognized immediately in the statement of financial position with a charge or credit to other comprehensive income in the period in which they occur. Remeasurements recognized in other comprehensive income are not reclassified. Service costs, which include current service cost, past service cost and gains and losses on curtailments and settlements, are recognized within profit or loss. Net interest expense or income is recognized within interest and finance costs. |
Share based payments | (o) Share based payments (i) Stock options, restricted share units ( “ ” “ ” The Company grants stock options, and awards RSUs and DSUs to employees, officers and directors from time to time. At the date of grant or award, we estimate the fair values of the stock options, RSUs and DSUs which will eventually vest. These estimated fair values are recognized as share-based compensation expense over the specific vesting periods, with a corresponding increase to reserves, a component of equity. We determine the fair value of stock options using a Black-Scholes option pricing model with market-related inputs as of the date of grant. The fair value of RSUs and DSUs is the market value of the underlying shares as of the date of award. Stock option grants and RSU awards with several tranches of vesting are accounted for as separate awards with different vesting periods and fair values. We account for changes to the estimated number of awards that will eventually vest prospectively. (ii) Bonus shares The Company has issued bonus shares, which have vested upon the completion of a specified period of service. The fair value of the bonus shares is determined on the date of award; this fair value has been recognized in share-based compensation expense over the service period. |
Income taxes | (p) Income taxes Income tax expense comprises current and deferred tax. It is recognized in profit or loss except to the extent that it relates to a business combination or items recognized directly in equity or OCI. (i) Current tax Current tax expense comprises the expected tax payable on taxable income for the year and any adjustment to income tax payable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date. Current tax also includes any withholding tax arising from interest and dividends. (ii) Deferred tax Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for: ● temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination, and at the time of the transaction, affects neither the accounting profit nor taxable profit (tax loss); ● temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that we are able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and ● taxable temporary differences arising on the initial recognition of goodwill. We recognize deferred tax assets for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. If the amount of taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future taxable profits are considered based on the business plans for the individual taxable entity. We review deferred tax assets at each reporting date and reduce them when we consider it no longer probable that the related tax benefit will be realized. Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the extent that it has become probable that future taxable profits will be available against which they can be used. Deferred tax is measured at the tax rates that are expected to apply to the temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset only when there are sufficient taxable temporary differences relating to the same taxation authority and the same taxable entity which are expected to reverse in the same period or in the carried back/forward period as the expected reversal of the deductible temporary difference. |
Loss per share | (q) Loss per share Basic earnings (loss) per share is based on profit (loss) attributable to common shareholders, divided by the weighted average number of common shares outstanding during the reporting period. Diluted earnings (loss) per share is based on profit (loss) attributable to common shareholders, divided by the weighted average number of common shares outstanding during the reporting period after adjusting for the effects of all dilutive potential ordinary shares. |
Business combinations | (r) We account for business combinations using the acquisition method when the acquired set of activities and assets meets the definition of a business and when control is transferred to the Company. In determining whether a particular set of activities and assets is a business, we assess whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognized in profit or loss immediately. We expense transaction costs as incurred, except if they are related to the issuance of debt or equity securities. The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognized in profit or loss. Any contingent consideration is measured at estimated fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognized in profit or loss. If share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards), then all or a portion of the acquirer’s replacement awards is included in measuring the consideration transferred in the business combination. This determination is based on the market-based measure of the replacement awards compared with the market-based measure of the acquiree’s awards and the portion to which the replacement awards relate to pre-combination service. The results of businesses acquired during a reporting period are included in the consolidated financial statements starting from the date of acquisition. |
Financial instruments | (s) (i) Financial assets We initially recognize financial assets when the Company becomes party to the contractual provisions of the instrument. Subsequent to initial recognition, we classify financial assets as measured at amortized cost, fair value through other comprehensive income (“FVOCI”) or fair value through profit or loss (“FVTPL”) after considering both our business model for managing the financial asset and the contractual cash flow characteristics of the financial asset. A financial asset is measured at amortized cost if both of the following conditions are met: a. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows, and b. the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. A financial asset is measured at FVOCI if both of the following conditions are met: a. the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and b. the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. We may make an irrevocable election at initial recognition to carry at FVOCI particular investments in equity instruments that would otherwise be measured at FVTPL. A financial asset is required to be measured at FVTPL unless it is measured at amortized cost or at FVOCI. If we change our business model for managing financial assets, we reclassify all affected financial assets on a prospective basis, without restating any previously recognized gains, losses or interest. If the asset is reclassified to fair value, we determine the fair value at the reclassification date, and recognize in profit or loss any gain or loss arising from a difference between the previous carrying amount and fair value. An embedded derivative is a component of a hybrid contract that also includes a non-derivative host, with the effect that some of the cash flows of the combined instrument vary in a way similar to a stand-alone derivative. A derivative that is attached to a financial instrument but is contractually transferable independently of that instrument, or has a different counterparty, is not an embedded derivative, and is treated as a separate financial instrument. Upon initial recognition, we measure a financial asset at its fair value. However, we measure trade receivables that do not have a significant financing component at their transaction price. After initial recognition, we measure financial assets at amortized cost, FVOCI, or FVTPL. Changes in fair value of a financial asset that is carried at FVTPL are recognized in profit or loss, and changes in fair value of a financial asset that is carried at FVOCI are recognized in other comprehensive income, unless it is part of a hedging relationship. Gains or losses on a financial asset that is carried at FVTPL are recognized in profit or loss, and gains or losses on a financial asset that is carried at FVOCI are recognized in other comprehensive income, unless it is part of a hedging relationship. A gain or loss on a financial asset that is measured at amortized cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized, impaired, amortized, or reclassified. (ii) We initially recognize financial liabilities when the Company becomes party to the contractual provisions of the instrument. At initial recognition, we measure each financial liability at its fair value. In the case of a financial liability not at FVTPL, we deduct transaction costs that are directly attributable to the issuance of the financial liability. Subsequent to initial recognition, we classify and measure all financial liabilities at amortized cost using the effective interest method, except for financial liabilities at FVTPL. We may, at initial recognition, irrevocably designate a financial liability as measured at FVTPL. (iii) We recognize a loss allowance for expected credit losses on financial assets, based on lifetime expected credit losses. For the Company’s trade receivables, we determine the lifetime expected losses for all of our trade receivables. The expected lifetime credit loss provision for the Company’s trade receivables is based on historical counterparty default rates and we adjust for relevant forward-looking information if necessary. |
New and amended IFRS Standards that are effective for the current year | (t) New and amended IFRS Standards that are effective for the current The Company applied for the first-time certain standards and amendments, which are effective for annual periods beginning on or after January 1, 2021. We have not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective. Other than the changes described below, the accounting policies adopted are consistent with those of the previous financial year. We do not discuss here certain other amendments and interpretations which applied for the first time in 2021 but had no impact on our consolidated financial statements. (i) Property, Plant and Equipment: Proceeds before Intended Use – In the process of making an item of property, plant and equipment (“PP&E”) available for its intended use, a company may produce and sell products generated by this PP&E. Current standards require that sales proceeds from these products be deducted from the capital cost of this item of PP&E. The amendments to IAS 16 discontinue this practice.Under the amendments, proceeds from selling products before the related item of PPE is available for use should be recognized in profit or loss, together with the costs of producing those items. The entity measures the cost of those products in accordance with IAS 2 Inventories. The amendments are applied retrospectively, but only to items of property, plant and equipment that are made available for on or after the beginning of the earliest period presented in the financial statements in which the entity first applies the amendments. The amendments are effective for annual periods beginning on or after January 1, 2022, with early application permitted. We have early adopted this amendment, effective January 1, 2021. The adoption of this amendment had no effect on comparative figures, as no such proceeds occurred in prior years. Had these amendments not been early adopted: ● the current year figures for revenue and cost of sales would have been nil, ● “mineral properties and related construction” would have been $2,733,000 greater, ● the loss for the year and cash used in operating activities would have been 2,733,000 lower, and ● cash used in investing activities would have been 2,733,000 greater. (ii) In August 2020, the International Accounting Standards Board (Board) issued “Interest Rate Benchmark Reform –Phase 2”. The Phase 2 amendments address issues that might affect financial reporting during the reform of an interest rate benchmark, including the effects of changes to contractual cash flows or hedging relationships arising from the replacement of an interest rate benchmark with an alternative benchmark rate. In Phase 2 of its project, the Board amended requirements in IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and Measurement, IFRS 7 Financial Instruments: Disclosures, IFRS 4 Insurance Contracts, and IFRS 16 Leases relating to: ● changes in the basis for determining contractual cash flows of financial assets, financial liabilities and lease liabilities; ● hedge accounting; and ● disclosures. The Phase 2 amendments apply only to changes required by the interest rate benchmark reform to financial instruments and hedging relationships. The amendments are effective for annual periods beginning on or after January 1, 2021. These amendments have no effect on amounts disclosed. |
Standards issued but not yet effective | (u) Standards issued but not yet effective The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements that we reasonably expect will have an impact on the Company’s disclosures, financial position or performance when applied at a future date, are disclosed below. (i) In May 2021, the IASB issued targeted amendments to IAS 12 Income Taxes to specify how companies should account for deferred tax on transactions such as leases and decommissioning obligations. In specified circumstances, companies are exempt from recognizing deferred tax when they recognize assets or liabilities for the first time. Previously, there had been some uncertainty about whether the exemption applied to transactions such as leases and decommissioning obligations—transactions for which companies recognize both an asset and a liability. The amendments clarify that the exemption does not apply and that companies are required to recognize deferred tax on such transactions. The aim of the amendments is to reduce diversity in the reporting of deferred tax on leases and decommissioning obligations. The amendments are effective for annual reporting periods beginning on or after 1 January 2023, with early application permitted. We have not determined the impact of this new standard. (ii) Classification of Liabilities as Current or Non-current – The amendments to IAS 1 affect only the presentation of liabilities as current or non-current in the statement of financial position and not the amount or timing of recognition of any asset, liability, income or expenses, or the information disclosed about those items. The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of ‘settlement’ to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services. The amendments are applied retrospectively for annual periods beginning on or after January 1, 2023, with early application permitted. We do not expect to early adopt these amendments. We have not determined the impact of this new standard. (iii) Reference to the Conceptual Framework – The amendments update IFRS 3 “Business Combinations” so that it refers to the 2018 Conceptual Framework instead of the 1989 Framework. They also add to IFRS 3 a requirement that, for obligations within the scope of IAS 37, an acquirer applies IAS 37 to determine whether at the acquisition date a present obligation exists as a result of past events. For a levy that would be within the scope of IFRIC 21 Levies, the acquirer applies IFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date. Finally, the amendments add an explicit statement that an acquirer does not recognize contingent assets acquired in a business combination. The Company intends to adopt these amendments, if applicable, when they become effective. The amendments are effective for business combinations for which the date of acquisition is on or after the beginning of the first annual period beginning on or after January 1, 2022. Early application is permitted if an entity also applies all other updated references (published together with the updated Conceptual Framework) at the same time or earlier. We will not early adopt these amendments. We have not determined the impact of these amendments. (iv) Onerous Contracts – – The amendments update IAS 37 “Provisions” to specify which costs an entity needs to include when assessing whether a contract is onerous or loss-making. The amendments apply a “directly related cost approach”. The costs that relate directly to a contract to provide goods or services include both incremental costs and an allocation of costs directly related to contract activities. General and administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract. The amendments are effective for annual reporting periods beginning on or after January 1, 2022, with early application permitted. We will not early adopt these amendments. We have not determined the impact of these amendments. |
BASIS OF PREPARATION (Tables)
BASIS OF PREPARATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
BASIS OF PREPARATION | |
Schedule of basis of consolidation | Ownership Name Principal activity Dec 31, 2021 Dec 31, 2020 Location Minerometalúrgica San Miguel S de RL de CV Exploration 100 % 100 % Mexico Minera Camino Rojo SA de CV Development 100 % 100 % Mexico Minera Cerro Quema SA Exploration 100 % 100 % Panama Monitor Gold Corporation Exploration 100 % 100 % USA |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of estimated useful lives | Mine equipment Units-of-production over mineral reserves Plant equipment Units-of-production over mineral reserves Other equipment and office equipment Straight line over useful life Vehicles Straight line over useful life, typically 4 years Computer hardware and software Straight line over useful life, typically 3 years |
Schedule of functional currencies of the Company's subsidiaries | Orla Mining Ltd. Canadian dollars Minerometalúrgica San Miguel S de RL de CV Mexican pesos Minera Camino Rojo SA de CV Mexican pesos Minera Cerro Quema SA United States dollars Monitor Gold Corporation United States dollars |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORY | |
Schedule of inventories | December 31, December 31, 2021 2020 Stockpiled ore $ 2,458 $ — In-process inventory 6,513 — Materials and supplies 686 — Inventory – current $ 9,657 $ — Long term Stockpiled ore 1,299 — Inventory – long term $ 1,299 $ — |
RESTRICTED CASH (Tables)
RESTRICTED CASH (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
RESTRICTED CASH | |
Schedule of restricted cash | December 31, December 31, 2021 2020 Environmental bonds $ 3,243 $ 2,392 Severance funds 297 323 Other 140 68 $ 3,680 $ 2,783 |
VALUE ADDED TAXES RECOVERABLE (
VALUE ADDED TAXES RECOVERABLE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
VALUE ADDED TAXES RECOVERABLE | |
Schedule of value added taxes recoverable | December 31, December 31, 2021 2020 Current portion $ 16,776 $ 163 Long term portion 7,444 8,587 $ 24,220 $ 8,750 |
EQUIPMENT (Tables)
EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EQUIPMENT | |
Schedule of mineral properties, plant and equipment | Machinery Computers and and Other Right of use Buildings equipment software assets assets Total Cost At January 1, 2020 $ — $ 324 $ 150 $ 57 $ 89 $ 620 Additions — 72 160 55 233 520 Due to changes in exchange rates — (4) 10 3 16 25 At December 31, 2020 $ — $ 392 $ 320 $ 115 $ 338 $ 1,165 Additions 67 2,437 527 318 1,769 5,118 Transfers from construction (note 9) — 2,484 — — — 2,484 Due to changes in exchange rates (1) (75) (13) (6) 12 (83) At December 31, 2021 $ 66 $ 5,238 $ 834 $ 427 $ 2,119 $ 8,684 Accumulated depreciation At January 1, 2020 $ — $ 205 $ 96 $ 17 $ 18 $ 336 Depreciation — 26 30 11 39 106 Due to changes in exchange rates — 4 7 1 1 13 At December 31, 2020 $ — $ 235 $ 133 $ 29 $ 58 $ 455 Depreciation 6 115 86 41 352 600 Due to changes in exchange rates — — (1) — (5) (6) At December 31, 2021 $ 6 $ 350 $ 218 $ 70 $ 405 $ 1,049 Net book value At December 31, 2020 $ — $ 157 $ 187 $ 86 $ 280 $ 710 At December 31, 2021 $ 60 $ 4,888 $ 616 $ 357 $ 1,714 $ 7,635 |
MINERAL PROPERTIES AND RELATE_2
MINERAL PROPERTIES AND RELATED CONSTRUCTION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
MINERAL PROPERTIES AND RELATED CONSTRUCTION | |
Schedule of initial cost capitalized | Consideration comprised: Cash paid $ 25,000 Fair value of future cash consideration (note 14) 37,800 $ 62,800 |
Schedule of borrowing costs capitalized | At historical cost Accumulated Deposits to foreign Mineral construction Construction in Other costs exchange on Carrying properties vendors progress capitalized translation value At January 1, 2020 $ — $ — $ — $ — $ — $ — Transferred from exploration and evaluation properties 39,272 — — — (2,129) 37,143 Additions — 28,079 4,845 — — 32,924 Borrowing costs capitalized (note 9(c)) — — — 672 — 672 Change in site closure provision (note 16) — — — 164 — 164 Due to changes in exchange rates — — — — 369 369 At December 31, 2020 $ 39,272 $ 28,079 $ 4,845 $ 836 $ (1,760) $ 71,272 Additions 62,800 11,411 56,528 — — 130,739 Transfers within categories — (37,832) 37,832 — — — Transfers to Equipment (note 8) — — (2,484) — — (2,484) Borrowing costs capitalized (note 9(c)) — — — 13,967 — 13,967 Change in site closure provision (note 16) — — — 4,653 — 4,653 Due to changes in exchange rates — — — — (4,398) (4,398) At December 31, 2021 $ 102,072 $ 1,658 $ 96,721 $ 19,456 $ (6,158) $ 213,749 |
Schedule of mineral properties under development and construction | Year ended Year ended December 31, December 31, 2021 2020 Capitalized borrowing costs, beginning of the year $ 672 $ $ — Capitalized during the year: Borrowing costs – Camino Rojo project loan (note 12) 12,430 $ 700 Borrowing costs – Fresnillo obligation (note 14) 1,654 — Interest earned on borrowed funds (117) (28) Capitalized borrowing costs, end of the year $ 14,639 $ 672 |
EXPLORATION AND EVALUATION PR_2
EXPLORATION AND EVALUATION PROPERTIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Mineral Properties | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Schedule of exploration and evaluation properties | Camino Cerro Monitor Rojo Quema Gold Total Acquisition costs At January 1, 2020 $ 42,615 $ 82,429 $ 314 $ 125,358 Additions — — — — Transferred to “mineral properties and related construction” (39,272) — — (39,272) Transferred to value added taxes recoverable (3,343) — — (3,343) At December 31, 2020 $ — $ 82,429 $ 314 $ 82,743 Additions — — — — At December 31, 2021 $ — $ 82,429 $ 314 $ 82,743 Accumulated foreign exchange on translation At January 1, 2020 $ 285 $ — $ — $ 285 Due to changes in exchange rates (2,414) — — (2,414) Transferred to “mineral properties and related construction” 2,129 — — 2,129 At December 31, 2020 $ — $ — $ — $ — Due to changes in exchange rates — — — — At December 31, 2021 $ — $ — $ — $ — Acquisition costs At December 31, 2020 $ — $ 82,429 $ 314 $ 82,743 At December 31, 2021 $ — $ 82,429 $ 314 $ 82,743 |
TRADE AND OTHER PAYABLES AND _2
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES | |
Summary of trade and other payables | December 31, December 31, 2021 2020 Trade payables $ 5,966 $ 2,583 Payroll related liabilities 339 658 Royalties payable 113 — Lease obligations (note 15) 372 131 Other 26 11 $ 6,816 $ 3,383 |
Summary of accrued liabilities | December 31, December 31, 2021 2020 Construction-related $ 2,045 $ 1,082 Land and water fees 1,795 1,852 Payroll related 1,244 725 Other 575 684 $ 5,659 $ 4,343 |
CAMINO ROJO PROJECT LOAN (Table
CAMINO ROJO PROJECT LOAN (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Camino Rojo Project Loan | |
Borrowings | |
Schedule of long-tem debt | Transaction Loan advances costs Net At January 1, 2020 $ 25,000 $ (12,039) $ 12,961 Advances during the year 50,000 — 50,000 Cash transaction costs — (2,475) (2,475) Amortization of the transaction costs — 632 632 Foreign exchange — (422) (422) At December 31, 2020 $ 75,000 $ (14,304) $ 60,696 Advances during the year 50,000 — 50,000 Cash transaction costs — (165) (165) Accretion during the period, capitalized (note 9(c)) 9,613 2,817 12,430 Cash interest paid (9,613) — (9,613) Foreign exchange — (88) (88) At December 31, 2021 $ 125,000 $ (11,740) $ 113,260 |
NEWMONT LOAN (Tables)
NEWMONT LOAN (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Newmont Loan | |
Borrowings | |
Schedule of long-tem debt | Mexican pesos Mexican pesos US dollars (thousands) (thousands) (thousands) Undiscounted Discounted At January 1, 2020 219,466 182,700 $ 9,647 Accretion during the year — 27,713 1,295 Modification gains arising from changes in estimates — (22,093) (1,032) Foreign exchange — — (470) At December 31, 2020 219,466 188,320 $ 9,440 Accretion during the year — 28,031 1,382 Modification gains arising from changes in estimates — (4,470) (220) Foreign exchange — — (309) At December 31, 2021 219,466 211,881 $ 10,293 |
FRESNILLO OBLIGATION (Tables)
FRESNILLO OBLIGATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fresnillo obligation | |
Borrowings | |
Schedule of long-tem debt | Total At January 1, 2021 $ — Initial recognition 37,800 Accretion during the period, capitalized (note 9(c)) 1,654 Cash interest paid (1,654) At December 31, 2021 $ 37,800 Current 15,000 Non-current 22,800 $ 37,800 |
LEASE OBLIGATIONS (Tables)
LEASE OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LEASE OBLIGATIONS | |
Schedule of lease liabilities | December 31, December 31, 2021 2020 Beginning of year $ 273 $ 67 Additions 1,769 233 Interest expense 32 7 Lease payments (681) (47) Due to changes in exchange rates 8 13 End of year $ 1,401 $ 273 Current $ 372 $ 131 Non-current 1,029 142 $ 1,401 $ 273 |
Schedule of lease expenses recognized | December 31, December 31, 2021 2020 Interest on lease liabilities $ 32 $ 7 Variable lease payments not included in the measurement of lease liabilities 4,579 141 Expenses relating to short-term leases 131 48 Expenses relating to leases of low-value assets, excluding short-term leases 155 121 $ 4,897 $ 317 |
SITE CLOSURE PROVISIONS (Tables
SITE CLOSURE PROVISIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SITE CLOSURE PROVISIONS | |
Schedule of reconciliation of changes in site closure provisions | Camino Rojo Cerro Quema Project Project Total At December 1, 2020 $ 232 $ 343 $ 575 Decrease in estimated cash flows (57) — (57) At December 31, 2020 $ 175 $ 343 $ 518 Increase in estimated cash flows resulting from current activities 4,738 — 4,738 Accretion during the period 223 — 223 Foreign exchange (19) — (19) At December 31, 2021 $ 5,117 $ 343 $ 5,460 |
Schedule of inputs used for site closure provisions | Camino Rojo Cerro Quema Year ended December 31, 2021 Project Project Estimated settlement dates 2029 to 2041 2022 Undiscounted risk-adjusted cash flows $ 6,091 $ — Inflation rate 5.55 % — Discount rate 7.43 % — |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE | |
Schedule of revenues | 2021 2020 Gold $ 4,094 $ — Silver 30 — Subtotal 4,124 — Refining and transportation (33) — $ 4,091 $ — |
GENERAL AND ADMINISTRATIVE EX_2
GENERAL AND ADMINISTRATIVE EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
GENERAL AND ADMINISTRATIVE EXPENSES | |
Schedule of general and administrative expenses | 2021 2020 Office and administrative $ 1,911 $ 643 Professional fees 1,702 1,389 Regulatory and transfer agent 662 142 Salaries and benefits 2,932 2,156 $ 7,207 $ 4,330 |
EXPLORATION AND EVALUATION EX_2
EXPLORATION AND EVALUATION EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EXPLORATION AND EVALUATION EXPENSES | |
Exploration and Evaluation Expenses | 2021 2020 Camino Rojo Project $ 9,908 $ 12,658 Cerro Quema Project 4,771 3,465 Monitor Gold Project 366 136 Other 63 43 $ 15,108 $ 16,302 |
INTEREST AND FINANCE COSTS (Tab
INTEREST AND FINANCE COSTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Camino Rojo Project Loan | |
Borrowings | |
Schedule of interest and finance expense | 2021 2020 Accretion on Camino Rojo project loan (note 12) $ — $ 2,860 Accretion on Newmont loan (note 13) 1,382 1,295 Accretion on site closure provisions (note 16) 223 — Interest expense on leases (note 15) 32 7 Interest income (140) (267) Interest on IVA refunds (203) — Other 2 — $ 1,296 $ 3,895 |
OTHER (GAINS) AND LOSSES (Table
OTHER (GAINS) AND LOSSES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER (GAINS) AND LOSSES | |
Schedule of other (gains) losses | 2021 2020 Realized gains on foreign currency transactions $ (598) $ — Modification gains arising from changes in estimates (note 13) (220) (1,032) Other 9 (25) $ (809) $ (1,057) |
SHARE CAPITAL (Tables)
SHARE CAPITAL (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share capital | |
Disclosure of schedule of warrants outstanding. | Exercise December 31 December 31 Expiry date price 2020 Exercised Expired 2021 February 15, 2021 C$ 2.35 7,782,994 (7,439,744) (343,250) — July 8, 2021 C$ 0.62 370,000 (370,000) — — June 12,2022 C$ 1.65 4,992,500 (250,000) — 4,742,500 November 7, 2022 C$ 1.40 3,000,000 — — 3,000,000 December 18, 2026 C$ 3.00 32,500,000 — — 32,500,000 Total number of warrants 48,645,494 (8,059,744) (343,250) 40,242,500 Weighted average exercise price C$ 2.64 C$ 2.25 C$ 2.35 C$ 2.72 Exercise December 31 December 31 Expiry date price 2019 Exercised Expired 2020 February 15, 2021 C$ 2.35 8,790,600 (1,007,606) — 7,782,994 July 8, 2021 C$ 0.62 570,000 (200,000) — 370,000 June 12, 2022 C$ 1.65 5,842,500 (850,000) — 4,992,500 November 7, 2022 C$ 1.40 3,000,000 — — 3,000,000 December 18, 2026 C$ 3.00 32,500,000 — — 32,500,000 Total number of warrants 50,703,100 (2,057,606) — 48,645,494 Weighted average exercise price C$ 2.61 C$ 1.89 C$ — C$ 2.64 |
SHARE-BASED PAYMENTS (Tables)
SHARE-BASED PAYMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of share-based compensation recorded during the year | Year ended December 31 Share based payments expense 2021 2020 Stock options (note 23(a)) $ 1,350 $ 1,635 Restricted share units (note 23(b)) 738 545 Deferred share units (note 23(c)) 241 213 Bonus shares (note 23(d)) — 130 Share based payments expense $ 2,329 $ 2,523 |
Stock options | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of status of share option plan and changes during the year | 2021 2020 Weighted Weighted average average Stock options outstanding Number exercise price Number exercise price Beginning of year 9,959,927 C$ 1.60 9,917,336 C$ 1.20 Granted 678,347 4.74 2,233,438 2.91 Exercised (687,400) 0.87 (2,112,103) 1.15 Expired, forfeited or cancelled (50,000) 1.39 (78,744) 1.17 End of year 9,900,874 C$ 1.86 9,959,927 C$ 1.60 Vested, end of year 8,704,157 C$ 1.63 7,774,007 C$ 1.39 |
Summary of weighted average assumptions used in computing the fair value of stock options using the Black-Scholes option pricing model | 2021 2020 Number granted 678,347 2,233,438 Grant date fair value C$ 1,294 C$ 2,729 Weighted average of assumptions used: Share price at grant date C$ 4.74 C$ 2.91 Expected volatility 45 % 48 % Expected life 5 years 5 years Canadian dollar risk free interest rate 1.0 % 0.5 % Dividends nil nil |
Summary of information about share options outstanding and exercisable | Exercise Remaining life Number Expiry date price (C$) (years) Number vested June 23, 2022 1.39 0.5 2,200,000 2,200,000 May 31, 2023 1.25 1.4 700,000 700,000 June 27, 2023 1.25 1.5 944,514 944,514 September 10, 2023 1.25 1.7 100,000 100,000 November 13, 2023 1.30 1.9 1,000,000 1,000,000 March 29, 2024 1.06 2.2 1,835,227 1,835,227 May 15, 2024 1.00 2.4 117,450 117,450 August 13, 2024 1.65 2.6 103,212 103,212 March 25, 2025 2.21 3.2 1,022,124 677,646 April 16, 2025 2.39 3.3 600,000 400,000 April 20, 2025 2.58 3.3 50,000 33,334 July 1, 2025 3.82 3.5 300,000 200,000 August 24, 2025 6.03 3.6 200,000 133,334 September 1, 2025 5.80 3.7 50,000 33,334 March 24,2026 4.80 4.2 578,347 192,774 April 19,2026 4.76 4.3 50,000 16,666 October 4,2026 4.04 4.8 50,000 16,666 Total number of stock options 9,900,874 8,704,157 Exercise Remaining life Number Expiry date price (C$) (years) Number vested January 27, 2021 0.15 0.1 225,000 225,000 January 27, 2021 0.81 0.1 39,900 39,900 June 23, 2022 1.39 1.5 2,310,000 2,310,000 May 31, 2023 1.25 2.4 980,000 980,000 June 27, 2023 1.25 2.5 1,012,014 1,012,014 September 10, 2023 1.25 2.7 100,000 100,000 November 13, 2023 1.30 2.9 1,000,000 1,000,000 March 29, 2024 1.06 3.2 1,850,227 1,226,818 May 15, 2024 1.00 3.4 117,450 78,300 August 13, 2024 1.65 3.6 103,212 68,808 March 25, 2025 2.21 4.2 1,022,124 333,166 April 16, 2025 2.39 4.3 600,000 200,000 April 20, 2025 2.58 4.3 50,000 16,667 July 1, 2025 3.82 4.5 300,000 100,000 August 24, 2025 6.03 4.6 200,000 66,667 September 1, 2025 5.80 4.7 50,000 16,667 Total number of stock options 9,959,927 7,774,007 |
Restricted share units | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of information about number of units of other equity instruments and their weighted average fair value | Number of RSUs outstanding: 2021 2020 Outstanding, January 1 921,356 1,014,972 Awarded 235,091 320,447 Vested and settled (448,607) (414,063) Outstanding, December 31 707,840 921,356 Number of RSUs outstanding: Number vesting in the year Total 2021 2022 2023 2024 Outstanding, December 31, 2020 921,356 448,607 365,935 106,814 — Outstanding, December 31, 2021 707,840 — 444,301 185,179 78,360 |
Deferred share units | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of information about number of units of other equity instruments and their weighted average fair value | Number of DSUs outstanding: 2021 2020 Outstanding, January 1 644,525 508,780 Awarded and vested immediately 62,503 135,745 Outstanding, December 31 707,028 644,525 Of which, number of DSUs vested at December 31 707,028 644,525 |
Bonus shares | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of information about number of units of other equity instruments and their weighted average fair value | Number of bonus shares outstanding: 2021 2020 Outstanding, January 1 500,000 1,500,000 Vested and issued during the year — (1,000,000) Outstanding, December 31 500,000 500,000 Vested, end of year 500,000 500,000 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
Schedule of compensation of key management | Year ended December 31 2021 2020 Short term incentive plans Salaries $ 1,580 $ 1,361 Directors’ fees 183 171 1,763 1,532 Share based payments 1,750 1,859 Total $ 3,513 $ 3,391 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SUPPLEMENTAL CASH FLOW INFORMATION | |
Schedule of supplemental cash flow information | December 31, December 31, 2021 2020 Bank current accounts and cash on hand $ 20,516 $ 72,180 2021 2020 Financing activities Stock options exercised, credited to share capital with an offset to reserves 277 1,479 Common shares issued upon maturity of RSUs, credited to share capital with an offset to reserves 487 333 Warrants exercised, credited to share capital with an offset to reserves 2,140 506 Fresnillo obligation credited, with an offset to “mineral properties and related construction” 37,800 — Investing activities Initial recognition of right of use asset with an offset to lease obligation 1,769 233 Marketable securities adjustment included in account receivable with an offset to other gains — 25 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SEGMENT INFORMATION | |
Schedule of mineral assets and equipment by geographic region | (i) Mexico Panama USA Canada Total Year ended December 31, 2021 Revenue (note 17) $ (4,091) $ — $ — $ — $ (4,091) Cost of sales 1,358 — — — 1,358 Gross profit (2,733) — — — (2,733) Exploration and evaluation expenses (note 19) 9,908 4,771 366 63 15,108 General and administrative expenses (note 18) — — — 7,207 7,207 Depreciation — 36 — 118 154 Share based payments (note 23) 89 51 — 2,189 2,329 Interest and finance costs (note 20) 1,406 — — (110) 1,296 Foreign exchange loss 3,956 — — (230) 3,726 Other (gains) and losses (note 21) (220) — — (589) (809) Loss for the year $ 12,406 $ 4,858 $ 366 $ 8,648 $ 26,278 Mexico Panama USA Canada Total Year ended December 31, 2020 Exploration and evaluation expenses (note 19) $ 12,658 $ 3,465 $ 136 $ 43 $ 16,302 General and administrative expenses (note 18) — — — 4,330 4,330 Depreciation 34 22 — 50 106 Share based payments (note 23) — — — 2,523 2,523 Interest and finance costs (note 20) 1,294 — — 2,601 3,895 Foreign exchange loss 481 — — 1,114 1,595 Other (gains) and losses (note 21) (1,032) — — (25) (1,057) Loss for the year $ 13,435 $ 3,487 $ 136 $ 10,636 $ 27,694 (ii) Mexico Panama USA Canada Total At December 31, 2021 Equipment $ 7,466 $ 37 $ — $ 132 $ 7,635 Mineral properties and related construction 213,749 — — — 213,749 Exploration and evaluation properties — 82,429 314 — 82,743 Total assets 267,403 83,162 314 14,016 364,895 Mexico Panama USA Canada Total At December 31, 2020 Equipment $ 463 $ 73 $ — $ 174 $ 710 Mineral properties and related construction 71,272 — — — 71,272 Exploration and evaluation properties — 82,429 314 — 82,743 Total assets 82,781 83,260 314 72,840 239,195 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Financial Instruments | |
Schedule of financial assets and liabilities by level within the fair value hierarchy | Fair Quoted prices Approximate active Significant fair market other Significant due identical observable unobservable term Carrying assets inputs inputs of Total Classification value (Level (Level (Level instrument Fair V Financial assets Cash and cash equivalents FVTPL $ 20,516 $ 20,516 $ — $ — $ — $ 20,516 Accounts receivable Amortized cost 299 16 — — 283 299 Restricted cash Amortized cost 3,680 — 3,680 — — 3,680 $ 24,495 20,532 $ 3,680 $ — $ 283 $ 24,495 Financial liabilities Trade payables Amortized cost $ 5,966 $ — $ — $ — $ 5,966 $ 5,966 Accrued liabilities Amortized cost 5,659 — — — 5,659 5,659 Lease obligation Amortized cost 1,401 — 1,401 — — 1,401 Camino Rojo project loan Amortized cost 113,260 — 137,746 — — 137,746 Newmont loan Amortized cost 10,293 — 10,533 — — 10,533 Fresnillo obligation Amortized cost 37,800 — 37,800 — — 37,800 $ 174,379 $ — $ 187,480 $ — $ 11,625 $ 199,105 Fair Quoted prices in Approximate active Significant fair value market for other Significant due to short identical observable unobservable term nature Carrying assets inputs inputs of the Total Classification value (Level (Level (Level Fair Value Financial assets Cash and cash equivalents FVTPL $ 72,180 $ 72,180 $ — $ — $ — $ 72,180 Accounts receivable Amortized cost 39 25 — — 14 39 Restricted cash Amortized cost 2,783 — 2,783 — — 2,783 $ 75,002 72,205 $ 2,783 $ — $ 14 $ 75,002 Financial liabilities Trade payables Amortized cost $ 2,583 $ — $ — $ — $ 2,583 $ 2,583 Lease obligation Amortized cost 274 — 274 — — 274 Camino Rojo project loan Amortized cost 60,696 — 66,443 — — 66,443 Newmont loan Amortized cost 9,440 — 9,875 — — 9,875 $ 72,993 $ — $ 76,592 $ — $ 2,583 $ 79,175 |
Liquidity risk | |
Financial Instruments | |
Schedule of risk management | At December 31, 2021, our financial liabilities had expected maturity dates as follows: Between Between Less than 3 months and 1 year and More than 3 months 1 year 3 years 3 years Total Financial liabilities Trade payables $ 5,966 $ — $ — $ — $ 5,966 Accrued liabilities 5,659 — — — 5,659 Lease obligation 114 289 494 520 1,417 Camino Rojo project loan 2,750 8,250 146,083 — 157,083 Newmont loan — 10,662 — — 10,662 Fresnillo obligation 473 16,357 23,848 — 40,678 $ 14,962 $ 35,558 $ 170,425 $ 520 $ 221,465 At December 31, 2020, our financial liabilities had expected maturity dates as follows: Between Between Less 3 1 More 3 1 3 3 Total Financial liabilities Trade payables $ 2,583 $ — $ — $ — $ 2,583 Lease obligation 32 117 145 — 294 Camino Rojo project loan 1,650 4,950 13,200 81,050 100,850 Newmont loan — — 11,002 — 11,002 $ 4,265 $ 5,067 $ 24,347 $ 81,050 $ 114,729 |
Currency risk | |
Financial Instruments | |
Schedule of risk management | Canadian dollars US Mexican (thousands) (thousands) (thousands) Cash $ 7,583 $ 12,061 $ 50,923 Accounts receivable 20 4 5,733 Restricted funds 155 509 62,745 Trade payables (128) (2,642) (66,350) Accrued liabilities (1,637) (2,226) (44,070) Lease obligations (74) (520) (16,935) Camino Rojo project loan — (113,260) — Newmont loan — — (211,881) Fresnillo obligation — (37,800) — Total foreign currency 5,919 (143,874) (219,835) Exchange rate 1.2678 1.0000 20.5835 Equivalent US dollars $ 4,669 $ (143,874) $ (10,680) Our financial instruments were denominated in the following currencies as at December 31, 2020: Canadian dollars US Mexican (thousands) (thousands) (thousands) Cash $ 11,752 $ 62,809 $ 2,804 Accounts receivable 32 4 245 Restricted funds 86 473 44,726 Trade payables (73) (2,074) (9,022) Lease obligations (194) — (2,471) Camino Rojo project loan — (60,696) — Newmont loan — — (188,319) Total foreign currency 11,603 516 (152,037) Exchange rate 1.2732 1.0000 19.9487 Equivalent US dollars $ 9,113 $ 516 $ (7,621) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
Schedule of income tax expense | 2021 2020 Current tax expense $ — $ — Deferred tax expense — — Tax expense $ — $ — |
Schedule of reconciliation of the combined Canadian federal and provincial statutory income tax rate to the effective tax rate | 2021 2020 Income (loss) before tax $ (26,278) $ (27,694) Statutory income tax rate 26.8 % 26.6 % Expected income tax $ (7,042) $ (7,367) Differences between Canadian and foreign tax rates (744) (488) Items not deductible for tax purposes 2,850 736 Share based compensation 587 671 Change in unrecognized deductible temporary differences 6,208 6,190 True ups (1,913) 64 Effect of changes in tax rates from prior years (71) — Effect of changes in foreign exchange rates 393 202 Other (268) (8) Total income taxes — — Effective tax rate n/a n/a |
Schedule of deductible temporary differences | December 31 2021 2020 Mineral properties and exploration expenditures $ 55,548 $ 43,807 Equipment 1,814 1,700 Site closure provisions 5,460 518 Long term debt — 282 Share issue costs 5,724 2,428 Non capital losses 41,343 46,073 Intercompany debt 413 — Other 5,202 — Unrecognized deductible temporary differences $ 115,504 $ 94,808 |
Schedule of recognized deferred tax assets and liabilities | December 31 2021 2020 Mineral properties and exploration expenditures (8,173) — Long term debt (1,786) (322) Non-capital losses 10,447 867 Other (488) (545) Recognized deferred tax assets (liabilities) $ — $ — |
Schedule of deductible temporary differences expiry dates | Tax December 31 expire 2021 2020 Canada 2026 to 2041 $ 46,354 $ 39,108 Mexico 2027 to 2031 29,851 5,317 Panama 2022 to 2026 655 4,678 United States indefinite 16 — |
BASIS OF PREPARATION (Details)
BASIS OF PREPARATION (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Minerometalrgica San Miguel S de RL de CV | ||
Subsidiaries | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Principal place of business of subsidiary | Mexico | |
Camino Rojo | ||
Subsidiaries | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Principal place of business of subsidiary | Mexico | |
Cerro Quema | ||
Subsidiaries | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Principal place of business of subsidiary | Panama | |
Monitor Gold Corporation | ||
Subsidiaries | ||
Proportion of ownership interest in subsidiary | 100.00% | 100.00% |
Principal place of business of subsidiary | USA |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - Functional currency (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Orla Mining Ltd | |
Disclosure of subsidiaries [line items] | |
Functional currency | Canadian dollars |
Minerometalrgica San Miguel S de RL de CV | |
Disclosure of subsidiaries [line items] | |
Functional currency | Mexican pesos |
Camino Rojo | |
Disclosure of subsidiaries [line items] | |
Functional currency | Mexican pesos |
Cerro Quema | |
Disclosure of subsidiaries [line items] | |
Functional currency | United States dollars |
Monitor Gold Corporation | |
Disclosure of subsidiaries [line items] | |
Functional currency | United States dollars |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Mineral properties under development and construction, at historical rates | |
Impairment loss | $ 0 |
Vehicles | |
Mineral properties under development and construction, at historical rates | |
Useful life | 4 years |
Computer and software | |
Mineral properties under development and construction, at historical rates | |
Useful life | 3 years |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue | $ 4,091,000 | |
Cost of sales | 1,358,000 | |
Mineral properties and related construction | 213,749,000 | $ 71,272,000 |
Loss for the year | (26,278,000) | (27,694,000) |
Cash used in operating activities | (24,742,000) | (18,126,000) |
Cash used in investing activities | (113,266,000) | $ (36,895,000) |
Increase decrease due to early adoption of amendment | ||
Revenue | 0 | |
Cost of sales | 0 | |
Mineral properties and related construction | 2,733,000 | |
Loss for the year | 2,773,000 | |
Cash used in operating activities | 2,733,000 | |
Cash used in investing activities | $ 2,733,000 |
INVENTORY (Details)
INVENTORY (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Current inventory | |
Stockpiled ore | $ 2,458 |
In-process inventory | 6,513 |
Materials and supplies | 686 |
Inventory - current | 9,657 |
Long term | |
Stockpiled ore | 1,299 |
Inventory - long term | 1,299 |
Inventory write-down | $ 0 |
RESTRICTED CASH (Details)
RESTRICTED CASH (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Restricted Cash [Line Items] | ||
Restricted cash | $ 3,680 | $ 2,783 |
Environmental bonds | ||
Restricted Cash [Line Items] | ||
Restricted cash | 3,243 | 2,392 |
Severance funds | ||
Restricted Cash [Line Items] | ||
Restricted cash | 297 | 323 |
Other | ||
Restricted Cash [Line Items] | ||
Restricted cash | $ 140 | $ 68 |
VALUE ADDED TAXES RECOVERABLE_2
VALUE ADDED TAXES RECOVERABLE (Details) $ in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($) | Dec. 31, 2021MXN ($) | Dec. 31, 2020USD ($) | |
VALUE ADDED TAXES RECOVERABLE | |||
Current portion | $ 16,776 | $ 163 | |
Long term portion | 7,444 | 8,587 | |
Total | 24,220 | $ 8,750 | |
IVA Refunds received | $ 2,400 | $ 48.9 |
EQUIPMENT (Details)
EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Mineral properties under development and construction, at historical rates | ||
At beginning of period | $ (710) | |
Depreciation | 154 | $ 106 |
At end of period | (7,635) | (710) |
Other expenses | ||
Mineral properties under development and construction, at historical rates | ||
Depreciation | 200 | |
Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (1,165) | (620) |
Additions | 5,118 | 520 |
Transfers from construction (note 9) | 2,484 | |
Due to changes in exchange rates | (83) | 25 |
At end of period | (8,684) | (1,165) |
Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 455 | 336 |
Depreciation | 600 | 106 |
Due to changes in exchange rates | (6) | 13 |
At end of period | 1,049 | 455 |
Machinery and equipment | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (157) | |
At end of period | (4,888) | (157) |
Machinery and equipment | Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (392) | (324) |
Additions | 2,437 | 72 |
Transfers from construction (note 9) | 2,484 | |
Due to changes in exchange rates | (75) | (4) |
At end of period | (5,238) | (392) |
Machinery and equipment | Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 235 | 205 |
Depreciation | 115 | 26 |
Due to changes in exchange rates | 4 | |
At end of period | 350 | 235 |
Computer and software | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (187) | |
At end of period | (616) | (187) |
Computer and software | Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (320) | (150) |
Additions | 527 | 160 |
Due to changes in exchange rates | (13) | 10 |
At end of period | (834) | (320) |
Computer and software | Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 133 | 96 |
Depreciation | 86 | 30 |
Due to changes in exchange rates | (1) | 7 |
At end of period | 218 | 133 |
Other assets | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (86) | |
At end of period | (357) | (86) |
Other assets | Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (115) | (57) |
Additions | 318 | 55 |
Due to changes in exchange rates | (6) | 3 |
At end of period | (427) | (115) |
Other assets | Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 29 | 17 |
Depreciation | 41 | 11 |
Due to changes in exchange rates | 1 | |
At end of period | 70 | 29 |
Buildings | ||
Mineral properties under development and construction, at historical rates | ||
At end of period | (60) | |
Buildings | Cost | ||
Mineral properties under development and construction, at historical rates | ||
Additions | 67 | |
Due to changes in exchange rates | (1) | |
At end of period | (66) | |
Buildings | Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
Depreciation | 6 | |
At end of period | 6 | |
Right of use assets | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (280) | |
At end of period | (1,714) | (280) |
Right of use assets | Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (338) | (89) |
Additions | 1,769 | 233 |
Due to changes in exchange rates | 12 | 16 |
At end of period | (2,119) | (338) |
Right of use assets | Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 58 | 18 |
Depreciation | 352 | 39 |
Due to changes in exchange rates | (5) | 1 |
At end of period | 405 | $ 58 |
Equipment | ||
Mineral properties under development and construction, at historical rates | ||
Depreciation | 600 | |
Inventories | ||
Mineral properties under development and construction, at historical rates | ||
Depreciation | 200 | |
Construction in progress | ||
Mineral properties under development and construction, at historical rates | ||
Depreciation | $ 200 |
MINERAL PROPERTIES AND RELATE_3
MINERAL PROPERTIES AND RELATED CONSTRUCTION (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Mineral properties under development and construction, at historical rates | ||
At beginning of period | $ (710) | |
At end of period | (7,635) | $ (710) |
Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (71,272) | |
Transferred from exploration and evaluation properties | 37,143 | |
Additions | 130,739 | 32,924 |
Borrowing costs capitalized (note 9(c)) | 13,967 | 672 |
Change in site closure provision (note 16) | 4,653 | 164 |
Due to changes in exchange rates | (4,398) | 369 |
Transfers to Equipment (note 8) | (2,484) | |
At end of period | (213,749) | (71,272) |
Other assets | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (86) | |
At end of period | (357) | (86) |
Cost | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (1,165) | (620) |
Transferred from exploration and evaluation properties | 2,484 | |
Due to changes in exchange rates | (83) | 25 |
At end of period | (8,684) | (1,165) |
Cost | Construction in progress | Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (4,845) | |
Additions | 56,528 | 4,845 |
Transfers within categories | 37,832 | |
Transfers to Equipment (note 8) | (2,484) | |
At end of period | (96,721) | (4,845) |
Cost | Other assets | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (115) | (57) |
Due to changes in exchange rates | (6) | 3 |
At end of period | (427) | (115) |
Cost | Other assets | Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (836) | |
Borrowing costs capitalized (note 9(c)) | 13,967 | 672 |
Change in site closure provision (note 16) | 4,653 | 164 |
At end of period | (19,456) | (836) |
Cost | Mineral Properties | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (82,743) | (125,358) |
Transferred from exploration and evaluation properties | (3,343) | |
At end of period | (82,743) | (82,743) |
Cost | Mineral Properties | Camino Rojo | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (42,615) | |
Transferred from exploration and evaluation properties | (3,343) | |
Cost | Mineral Properties | Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (39,272) | |
Transferred from exploration and evaluation properties | 39,272 | |
Additions | 62,800 | |
At end of period | (102,072) | (39,272) |
Cost | Deposits to vendors on construction assets [Member] | Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | (28,079) | |
Additions | 11,411 | 28,079 |
Transfers within categories | (37,832) | |
At end of period | (1,658) | (28,079) |
Accumulated depreciation | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 455 | 336 |
Due to changes in exchange rates | (6) | 13 |
At end of period | 1,049 | 455 |
Accumulated depreciation | Mineral properties under development and construction | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 1,760 | |
Transferred from exploration and evaluation properties | (2,129) | |
Due to changes in exchange rates | (4,398) | 369 |
At end of period | 6,158 | 1,760 |
Accumulated depreciation | Other assets | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 29 | 17 |
Due to changes in exchange rates | 1 | |
At end of period | $ 70 | 29 |
Accumulated depreciation | Mineral Properties | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 285 | |
Due to changes in exchange rates | (2,414) | |
Accumulated depreciation | Mineral Properties | Camino Rojo | ||
Mineral properties under development and construction, at historical rates | ||
At beginning of period | 285 | |
Due to changes in exchange rates | $ (2,414) |
MINERAL PROPERTIES AND RELATE_4
MINERAL PROPERTIES AND RELATED CONSTRUCTION - Layback Area (Details) - Layback Agreement with Fresnillo - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended |
Feb. 28, 2021 | Dec. 31, 2021 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||
Consideration for right to mine | $ 62,800 | $ 62,800 |
Cash Paid | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Consideration for right to mine | 25,000 | |
Future cash consideration | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Consideration for right to mine | $ 37,800 |
MINERAL PROPERTIES AND RELATE_5
MINERAL PROPERTIES AND RELATED CONSTRUCTION - Borrowing costs capitalized (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about borrowings [line items] | ||
Capitalized borrowing costs, beginning of the year | $ 672,000 | |
Interest earned on borrowed funds | (117,000) | $ (28,000) |
Capitalized borrowing costs, end of the year | 14,639,000 | 672,000 |
Camino Rojo Project Loan. | ||
Disclosure of detailed information about borrowings [line items] | ||
Borrowing costs capitalised | 12,430,000 | 700,000 |
Fresnillo obligation | ||
Disclosure of detailed information about borrowings [line items] | ||
Borrowing costs capitalised | $ 1,654,000 | $ 0 |
MINERAL PROPERTIES AND RELATE_6
MINERAL PROPERTIES AND RELATED CONSTRUCTION - Initial acquisition (Details) - Camino Rojo | 1 Months Ended | 12 Months Ended |
Nov. 30, 2017 | Dec. 31, 2021 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||
Smelter Royalty Return | 2.00% | |
Special mining duty of taxable mining profits | 7.50% | |
Extraordinary mining duty of revenues from precious metals | 0.50% | |
Sulphide operations | Maximum | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Potential ownership interest in joint project | 70.00% | |
Sulphide operations | Minimum | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Potential ownership interest in joint project | 60.00% |
EXPLORATION AND EVALUATION PR_3
EXPLORATION AND EVALUATION PROPERTIES (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Feb. 28, 2017 | Dec. 31, 2021USD ($)haclaimOption | Dec. 31, 2020USD ($) | |
Mineral Properties | ||||
Royalty payments | $ 111 | |||
Monitor Gold Corporation | ||||
Mineral Properties | ||||
Number Of Separate Option Agreements | Option | 3 | |||
Number of mining claims | claim | 422 | |||
Area | ha | 3,416 | |||
Share issuances | $ 150,000 | |||
Royalty payments | 60,000 | $ 40,000 | ||
Work commitments | $ 125,000 | $ 75,000 | ||
Cerro Quema | ||||
Mineral Properties | ||||
Term of agreement | 20 years | 20 years | ||
Term of extension | 10 years |
EXPLORATION AND EVALUATION PR_4
EXPLORATION AND EVALUATION PROPERTIES - Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property interests | ||
At beginning of period | $ (710) | |
At end of period | 7,635 | $ 710 |
Exploration and evaluation properties (note 10) | 82,743 | 82,743 |
Cost | ||
Property interests | ||
At beginning of period | (1,165) | (620) |
Due to changes in exchange rates | (83) | 25 |
Transferred to value taxes recoverable | 2,484 | |
At end of period | 8,684 | 1,165 |
Accumulated depreciation | ||
Property interests | ||
At beginning of period | 455 | 336 |
Due to changes in exchange rates | (6) | 13 |
At end of period | (1,049) | (455) |
Mineral Properties | Cost | ||
Property interests | ||
At beginning of period | (82,743) | (125,358) |
Transferred to mineral properties under development and construction | (39,272) | |
Transferred to value taxes recoverable | (3,343) | |
At end of period | 82,743 | 82,743 |
Exploration and evaluation properties (note 10) | 82,743 | 82,743 |
Mineral Properties | Accumulated depreciation | ||
Property interests | ||
At beginning of period | 285 | |
Due to changes in exchange rates | (2,414) | |
Transferred to mineral properties under development and construction | 2,129 | |
Camino Rojo | Mineral Properties | Cost | ||
Property interests | ||
At beginning of period | (42,615) | |
Transferred to mineral properties under development and construction | (39,272) | |
Transferred to value taxes recoverable | (3,343) | |
Camino Rojo | Mineral Properties | Accumulated depreciation | ||
Property interests | ||
At beginning of period | 285 | |
Due to changes in exchange rates | (2,414) | |
Transferred to mineral properties under development and construction | 2,129 | |
Cerro Quema | Mineral Properties | Cost | ||
Property interests | ||
At beginning of period | (82,429) | (82,429) |
At end of period | 82,429 | 82,429 |
Exploration and evaluation properties (note 10) | 82,429 | 82,429 |
Monitor Gold Corporation | Mineral Properties | Cost | ||
Property interests | ||
At beginning of period | (314) | (314) |
At end of period | 314 | 314 |
Exploration and evaluation properties (note 10) | $ 314 | $ 314 |
TRADE AND OTHER PAYABLES AND _3
TRADE AND OTHER PAYABLES AND ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Trade and other payables | ||
Trade payables | $ 5,966 | $ 2,583 |
Payroll related liabilities | 339 | 658 |
Royalties payable | 113 | |
Lease obligations (note 15) | 372 | 131 |
Other | 26 | 11 |
Total trade and other current payables | 6,816 | 3,383 |
Accrued liabilities | ||
Construction-related | 2,045 | 1,082 |
Land and water fees | 1,795 | 1,852 |
Payroll related | 1,244 | 725 |
Other | 575 | 684 |
Accrued liabilities | $ 5,659 | $ 4,343 |
CAMINO ROJO PROJECT LOAN (Detai
CAMINO ROJO PROJECT LOAN (Details) | 12 Months Ended | |||||
Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)trancheshares | Jul. 14, 2021shares | Apr. 30, 2021USD ($) | Dec. 28, 2019$ / shares | |
Borrowings | ||||||
Total amounts drawn | $ 113,260,000 | $ 60,696,000 | ||||
Number of shares issued | shares | 9,085,263 | |||||
Interest costs capitalised | 12,400,000 | 700,000 | ||||
Camino Rojo Project Loan | ||||||
Borrowings | ||||||
Notional amount | $ 125,000,000 | |||||
Number of tranches | tranche | 3 | |||||
Total amounts drawn | 113,260,000 | 60,696,000 | $ 12,961,000 | |||
Undrawn borrowing facilities | $ 50,000,000 | |||||
Interest rate | 8.80% | |||||
Number of shares issued | shares | 32,500,000 | |||||
Exercise price of warrants | $ / shares | $ 3 | |||||
Capitalized interest on loan to mineral properties under development | $ 12,039,000 | |||||
Camino Rojo Project Loan | Loan advances | ||||||
Borrowings | ||||||
Total amounts drawn | $ 125,000,000 | $ 75,000,000 | $ 25,000,000 |
CAMINO ROJO PROJECT LOAN - Long
CAMINO ROJO PROJECT LOAN - Long term debt (Details) - USD ($) $ in Thousands | Oct. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Borrowings | ||||
Beginning | $ 60,696 | |||
Advances during the year | 50,000 | $ 50,000 | ||
Warrants issued to the lenders | (14,279) | (2,858) | ||
Cash interest paid | (11,307) | (2,914) | ||
Foreign exchange | (3,726) | (1,595) | ||
Ending | 113,260 | 60,696 | ||
Camino Rojo Project Loan | ||||
Borrowings | ||||
Beginning | 60,696 | 12,961 | ||
Advances during the year | $ 50,000 | 50,000 | 50,000 | $ 25,000 |
Cash transaction costs | 165 | 2,475 | ||
Amortization of the transaction costs | 632 | |||
Accretion during the period, capitalized (note 9(c)) | 12,430 | |||
Cash interest paid | (9,613) | |||
Foreign exchange | (88) | (422) | ||
Ending | 113,260 | 60,696 | 12,961 | |
Camino Rojo Project Loan | Loan advances | ||||
Borrowings | ||||
Beginning | 75,000 | 25,000 | ||
Advances during the year | 50,000 | 50,000 | ||
Accretion during the period, capitalized (note 9(c)) | 9,613 | |||
Cash interest paid | (9,613) | |||
Ending | 125,000 | 75,000 | 25,000 | |
Camino Rojo Project Loan | Transaction cost | ||||
Borrowings | ||||
Transaction costs, bgn | (14,304) | (12,039) | ||
Cash transaction costs | 165 | 2,475 | ||
Amortization of the transaction costs | 632 | |||
Accretion during the period, capitalized (note 9(c)) | 2,817 | |||
Foreign exchange | (88) | (422) | ||
Transaction costs, end | $ (11,740) | $ (14,304) | $ (12,039) |
NEWMONT LOAN (Details)
NEWMONT LOAN (Details) $ in Thousands, $ in Millions | Dec. 31, 2021MXN ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018 |
Newmont Loan | |||||
Borrowings | |||||
Newmont loan (note 13) | $ 10,293 | $ 9,440 | $ 9,647 | ||
Borrowings, interest rate | 14.60% | 15.40% | |||
Newmont Loan Camino Rojo Project [Member] | |||||
Borrowings | |||||
Newmont loan (note 13) | $ 219 | $ 10,600 |
NEWMONT LOAN - Long term debt (
NEWMONT LOAN - Long term debt (Details) $ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021USD ($) | Dec. 31, 2021MXN ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020MXN ($) | |
Borrowings | ||||
Foreign exchange | $ (3,726) | $ (1,595) | ||
Newmont Loan | ||||
Borrowings | ||||
BGN | 9,440 | 9,647 | ||
Accretion during the year | 1,382 | 1,295 | ||
Modification gains arising from changes in estimates | (220) | (1,032) | ||
Foreign exchange | (309) | (470) | ||
End | $ 10,293 | $ 9,440 | ||
Undiscounted cash flow | Newmont Loan | ||||
Borrowings | ||||
BGN | $ 219,466 | $ 219,466 | ||
End | 219,466 | 219,466 | ||
Discounted cash flow | Newmont Loan | ||||
Borrowings | ||||
BGN | 188,320 | 182,700 | ||
Accretion during the year | 28,031 | 27,713 | ||
Modification gains arising from changes in estimates | (4,470) | (22,093) | ||
End | $ 211,881 | $ 188,320 |
FRESNILLO OBLIGATION (Details)
FRESNILLO OBLIGATION (Details) - Fresnillo obligation - USD ($) | Feb. 22, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Borrowings | |||
Consideration for right to mine | $ 62,800,000 | ||
Percentage of interest payable | 5.00% | ||
Borrowinng costs capitaliised | 1,654,000 | $ 0 | |
Upon receipt of COFECE approval | |||
Borrowings | |||
Consideration for right to mine | 25,000,000 | ||
Earlier of December 1, 2022, and 12 months following the commencement of commercial production | |||
Borrowings | |||
Consideration for right to mine | 15,000,000 | ||
At the Camino Rojo Project | |||
Borrowings | |||
Consideration for right to mine | $ 22,800,000 |
FRESNILLO OBLIGATION - Long ter
FRESNILLO OBLIGATION - Long term debt (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about borrowings [line items] | ||
Cash interest paid | $ (11,307,000) | $ (2,914,000) |
Current | 15,000,000 | |
Non-current | 22,800,000 | |
Fresnillo obligation | ||
Disclosure of detailed information about borrowings [line items] | ||
Initial recognition | 37,800,000 | |
Accretion during the period, capitalized (note 9(c)) | 1,654,000 | $ 0 |
Cash interest paid | (1,654,000) | |
At December 31, 2021 | 37,800,000 | |
Current | 15,000,000 | |
Non-current | 22,800,000 | |
Total | $ 37,800,000 |
LEASE OBLIGATIONS (Details)
LEASE OBLIGATIONS (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Mineral Properties | |||
Lease obligations | $ 1,029 | $ 142 | |
Variable lease payments | $ 4,579 | $ 141 | |
Mining equipment | |||
Mineral Properties | |||
Lease term | 5 years | ||
Vehicles | Minimum | |||
Mineral Properties | |||
Lease term | 3 years | ||
Vehicles | Maximum | |||
Mineral Properties | |||
Lease term | 5 years | ||
Buildings | Minimum | |||
Mineral Properties | |||
Lease term | 3 years | ||
Buildings | Maximum | |||
Mineral Properties | |||
Lease term | 5 years | ||
Camino Rojo | |||
Mineral Properties | |||
Right-of-use asset | $ 900 | ||
Variable lease payments | $ 4,600 | ||
Camino Rojo | Mining equipment | |||
Mineral Properties | |||
Lease term | 5 years |
LEASE OBLIGATIONS - Lease liabi
LEASE OBLIGATIONS - Lease liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
LEASE OBLIGATIONS | ||
Beginning of year | $ 273 | $ 67 |
Additions | 1,769 | 233 |
Interest expense | 32 | 7 |
Lease payments | (681) | (47) |
Due to changes in exchange rates | 8 | 13 |
End of year | 1,401 | 273 |
Current | 372 | 131 |
Non-current lease liabilities | 1,029 | 142 |
Lease liabilities | $ 1,401 | $ 273 |
LEASE OBLIGATIONS - Lease expen
LEASE OBLIGATIONS - Lease expenses recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
LEASE OBLIGATIONS | ||
Interest expense on lease | $ 32 | $ 7 |
Variable lease payments not included in the measurement of lease liabilities | 4,579 | 141 |
Expenses relating to short-term leases | 131 | 48 |
Expenses relating to leases of low-value assets, excluding short-term leases | 155 | 121 |
Lease Expenses | $ 4,897 | $ 317 |
SITE CLOSURE PROVISIONS - Chang
SITE CLOSURE PROVISIONS - Changes in site closure provisions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in site closure provisions | ||
Beginning balance | $ 518 | $ 575 |
Increase (decrease) in estimated cash flows | 4,738 | (57) |
Accretion during the period | 223 | |
Foreign exchange | (19) | |
Ending balance | 5,460 | 518 |
Camino Rojo | ||
Changes in site closure provisions | ||
Beginning balance | 175 | 232 |
Increase (decrease) in estimated cash flows | 4,738 | (57) |
Accretion during the period | 223 | |
Foreign exchange | (19) | |
Ending balance | 5,117 | 175 |
Minera Cerro Quema SA | ||
Changes in site closure provisions | ||
Beginning balance | 343 | 343 |
Ending balance | $ 343 | $ 343 |
SITE CLOSURE PROVISIONS (Detail
SITE CLOSURE PROVISIONS (Details) - Camino Rojo $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Disclosure of other provisions [line items] | |
Undiscounted risk-adjusted cash flows | $ 6,091 |
Inflation rate | 5.55% |
Discount rate | 7.43% |
REVENUE (Details)
REVENUE (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
REVENUE | |
Gold | $ 4,094 |
Silver | 30 |
Subtotal | 4,124 |
Refining and transportation | (33) |
Total revenue | $ 4,091 |
GENERAL AND ADMINISTRATIVE EX_3
GENERAL AND ADMINISTRATIVE EXPENSES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
GENERAL AND ADMINISTRATIVE EXPENSES | ||
Office and administrative | $ 1,911 | $ 643 |
Professional fees | 1,702 | 1,389 |
Regulatory and transfer agent | 662 | 142 |
Salaries and benefits | 2,932 | 2,156 |
Total general and administrative expense | $ 7,207 | $ 4,330 |
EXPLORATION AND EVALUATION EX_3
EXPLORATION AND EVALUATION EXPENSES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Subsidiaries | ||
EXPLORATION AND EVALUATION EXPENSES (note) | $ 15,108 | $ 16,302 |
Camino Rojo | ||
Subsidiaries | ||
EXPLORATION AND EVALUATION EXPENSES (note) | 9,908 | 12,658 |
Cerro Quema | ||
Subsidiaries | ||
EXPLORATION AND EVALUATION EXPENSES (note) | 4,771 | 3,465 |
Monitor Gold Corporation | ||
Subsidiaries | ||
EXPLORATION AND EVALUATION EXPENSES (note) | 366 | 136 |
Other. | ||
Subsidiaries | ||
EXPLORATION AND EVALUATION EXPENSES (note) | $ 63 | $ 43 |
INTEREST AND FINANCE COSTS (Det
INTEREST AND FINANCE COSTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Borrowings | ||
Accretion on site closure provisions (note 16) | $ 223 | |
Interest expense on leases (note 15) | 32 | $ 7 |
Interest income | (140) | (267) |
Interest on IVA refunds | (203) | |
Other | 2 | |
Total interest costs incurred | 1,296 | 3,895 |
Camino Rojo Project Loan | ||
Borrowings | ||
Accretion | 2,860 | |
Newmont Loan | ||
Borrowings | ||
Accretion | $ 1,382 | $ 1,295 |
OTHER (GAINS) AND LOSSES (Detai
OTHER (GAINS) AND LOSSES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
OTHER (GAINS) AND LOSSES | ||
Realized gains on foreign currency transactions | $ (598) | |
Modification gains arising from changes in estimates (note 13) | (220) | $ (1,032) |
Other | 9 | (25) |
Total other (gains) and losses | $ (809) | $ (1,057) |
SHARE CAPITAL (Details)
SHARE CAPITAL (Details) | Jul. 14, 2021USD ($)shares | Jul. 14, 2021CAD ($)$ / sharesshares | Feb. 05, 2021USD ($)shares | Dec. 31, 2021USD ($)shares | Dec. 31, 2021CAD ($)shares | Dec. 31, 2020USD ($) |
Disclosure of classes of share capital [line items] | ||||||
Number of shares issued | shares | 9,085,263 | 9,085,263 | ||||
Price per share | $ / shares | $ 4.75 | |||||
Proceeds from issuing shares | $ 34,400,000 | $ 43,200,000 | $ 34,442,000 | $ 53,368,000 | ||
Fair value of shares issued | $ | $ 150,000 | 150,000 | ||||
Number of shares issued | shares | 33,000 | |||||
Warrants exercised | $ | 14,279,000 | 2,858,000 | ||||
Proceeds from exercise of warrants | $ | 14,279,000 | 2,858,000 | ||||
Transaction costs | $ 1,000,000 | $ 1,300,000 | $ 1,000,000 | $ 2,034,000 | ||
Stock options. | ||||||
Disclosure of classes of share capital [line items] | ||||||
Warrants exercised (in shares) | shares | 100,000 | 100,000 | ||||
Proceeds from exercise of warrants | $ 234,000 | $ 300,000 |
SHARE CAPITAL - Outstanding (De
SHARE CAPITAL - Outstanding (Details) | 12 Months Ended | ||||
Dec. 31, 2021USD ($)$ / shares$ / shares | Dec. 31, 2021USD ($)$ / shares | Dec. 31, 2020USD ($)$ / shares$ / shares | Dec. 31, 2020USD ($)$ / shares | Dec. 31, 2019$ / shares | |
Disclosure of classes of share capital [line items] | |||||
Weighted average | $ / shares | $ 2.72 | $ 2.72 | $ 2.64 | $ 2.64 | $ 2.61 |
Weighted average exercise price - Expired | $ / shares | 2.35 | ||||
Exercised (per share) I $ / shares | $ / shares | $ 2.25 | $ 1.89 | |||
Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 48,645,494 | 48,645,494 | 50,703,100 | 50,703,100 | |
Exercised | (8,059,744) | (8,059,744) | (2,057,606) | (2,057,606) | |
Expired | (343,250) | (343,250) | |||
End | 40,242,500 | 40,242,500 | 48,645,494 | 48,645,494 | |
Price range one [member] | Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 7,782,994 | 7,782,994 | 8,790,600 | 8,790,600 | |
Exercised | (7,439,744) | (7,439,744) | (1,007,606) | (1,007,606) | |
Expired | (343,250) | (343,250) | |||
End | 7,782,994 | 7,782,994 | |||
Exercised (per share) I $ / shares | $ / shares | $ 2.35 | $ 2.35 | |||
Price range two [member] | Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 370,000 | 370,000 | 570,000 | 570,000 | |
Exercised | (370,000) | (370,000) | (200,000) | (200,000) | |
End | 370,000 | 370,000 | |||
Exercised (per share) I $ / shares | $ / shares | $ 0.62 | $ 0.62 | |||
Price range three [member] | Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 4,992,500 | 4,992,500 | 5,842,500 | 5,842,500 | |
Exercised | (250,000) | (250,000) | (850,000) | (850,000) | |
End | 4,742,500 | 4,742,500 | 4,992,500 | 4,992,500 | |
Exercised (per share) I $ / shares | $ / shares | $ 1.65 | $ 1.65 | |||
Price range four [member] | Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 3,000,000 | 3,000,000 | 3,000,000 | 3,000,000 | |
End | 3,000,000 | 3,000,000 | 3,000,000 | 3,000,000 | |
Exercised (per share) I $ / shares | $ / shares | $ 1.40 | $ 1.40 | |||
Price range five [member] | Warrants | |||||
Disclosure of classes of share capital [line items] | |||||
Bgn | 32,500,000 | 32,500,000 | 32,500,000 | 32,500,000 | |
End | 32,500,000 | 32,500,000 | 32,500,000 | 32,500,000 | |
Exercised (per share) I $ / shares | $ / shares | $ 3 | $ 3 |
SHARE-BASED PAYMENTS - Share-ba
SHARE-BASED PAYMENTS - Share-based compensation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Share-based payments expense | $ 2,329 | $ 2,523 |
Stock options | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Share-based payments expense | 1,350 | 1,635 |
Restricted share units | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Share-based payments expense | 738 | 545 |
Deferred share units | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Share-based payments expense | $ 241 | 213 |
Bonus shares | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Share-based payments expense | $ 130 |
SHARE-BASED PAYMENTS - Share op
SHARE-BASED PAYMENTS - Share option plan changes (Details) | 12 Months Ended | |
Dec. 31, 2021USD ($)Option$ / shares | Dec. 31, 2020USD ($)$ / shares | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Granted | 250,000 | |
Exercised | Option | (122,500) | |
On grant date | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Vesting of stock options ( as a percentage) | 0.33% | |
After grant date year one | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Vesting of stock options ( as a percentage) | 0.33% | |
After grant date year two | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Vesting of stock options ( as a percentage) | 0.33% | |
Stock options | ||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||
Balance | 9,959,927 | 9,917,336 |
Granted | 678,347 | 2,233,438 |
Exercised | (687,400) | (2,112,103) |
Expired, forfeited or cancelled | 50,000 | 78,744 |
Balance | 9,900,874 | 9,959,927 |
Vested (in shares) | 8,704,157 | 7,774,007 |
Weighted average exercise price of share options outstanding in share-based payment arrangement at beginning of period | $ / shares | $ 1.60 | $ 1.20 |
Granted | $ / shares | 4.74 | 2.91 |
Exercised | $ / shares | 0.87 | 1.15 |
Expired, forfeited or cancelled | $ / shares | 1.39 | 1.17 |
Weighted average exercise price of share options outstanding in share-based payment arrangement at end of period | $ / shares | 1.86 | 1.60 |
Vested, end of year | $ / shares | $ 1.63 | $ 1.39 |
Stock options life | 5 | 5 |
SHARE-BASED PAYMENTS - Black-sc
SHARE-BASED PAYMENTS - Black-scholes (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021USD ($) | Dec. 31, 2021CAD ($)$ / shares | Dec. 31, 2020USD ($) | Dec. 31, 2020CAD ($)$ / shares | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||||
Granted | 250,000 | |||
Stock options | ||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | ||||
Granted | 678,347 | 2,233,438 | ||
Grant date fair value | $ 1,294 | $ 2,729 | ||
Share price at grant date | $ / shares | $ 4.74 | $ 2.91 | ||
Expected volatility, share options granted | 45.00% | 48.00% | ||
Option life, share options granted | 5 | 5 | ||
Risk free interest rate, share options granted | 1.00% | 0.50% | ||
Dividends | $ 0 | $ 0 |
SHARE-BASED PAYMENTS - Outstand
SHARE-BASED PAYMENTS - Outstanding (Details) | 12 Months Ended | ||||
Dec. 31, 2021USD ($)Option | Dec. 31, 2021CAD ($)USD ($)Option$ / shares | Dec. 31, 2020USD ($) | Dec. 31, 2020USD ($)$ / shares | Dec. 31, 2019USD ($) | |
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 5.37 | ||||
Remaining life | 5 years | 5 years | |||
Stock options exercised | Option | 122,500 | 122,500 | |||
Proceeds from exercise of options | $ 475,000 | $ 158,700 | $ 1,823,000 | ||
Shares issued after reporting period | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Proceeds from exercise of options | $ 125,000 | ||||
Stock options | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Outstanding (in shares) | 9,900,874 | 9,959,927 | 9,917,336 | ||
Vested (in shares) | 8,704,157 | 7,774,007 | |||
Stock options exercised | 687,400 | 2,112,103 | |||
Stock options | Price range five [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.30 | $ 1.25 | |||
Remaining life | 1 year 10 months 24 days | 1 year 10 months 24 days | 2 years 6 months | ||
Outstanding (in shares) | 1,000,000 | 1,012,014 | |||
Vested (in shares) | 1,000,000 | 1,012,014 | |||
Stock options | Price range four [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.25 | $ 1.25 | |||
Remaining life | 1 year 8 months 12 days | 1 year 8 months 12 days | 2 years 4 months 24 days | ||
Outstanding (in shares) | 100,000 | 980,000 | |||
Vested (in shares) | 100,000 | 980,000 | |||
Stock options | Price range one [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.39 | $ 0.15 | |||
Remaining life | 6 months | 6 months | 1 month 6 days | ||
Outstanding (in shares) | 2,200,000 | 225,000 | |||
Vested (in shares) | 2,200,000 | 225,000 | |||
Stock options | Price range three [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.25 | $ 1.39 | |||
Remaining life | 1 year 6 months | 1 year 6 months | 1 year 6 months | ||
Outstanding (in shares) | 944,514 | 2,310,000 | |||
Vested (in shares) | 944,514 | 2,310,000 | |||
Stock options | Price range two [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.25 | $ 0.81 | |||
Remaining life | 1 year 4 months 24 days | 1 year 4 months 24 days | 1 month 6 days | ||
Outstanding (in shares) | 700,000 | 39,900 | |||
Vested (in shares) | 700,000 | 39,900 | |||
Stock options | Price range six [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.06 | $ 1.25 | |||
Remaining life | 2 years 2 months 12 days | 2 years 2 months 12 days | 2 years 8 months 12 days | ||
Outstanding (in shares) | 1,835,227 | 100,000 | |||
Vested (in shares) | 1,835,227 | 100,000 | |||
Stock options | Price range seven [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1 | $ 1.30 | |||
Remaining life | 2 years 4 months 24 days | 2 years 4 months 24 days | 2 years 10 months 24 days | ||
Outstanding (in shares) | 117,450 | 1,000,000 | |||
Vested (in shares) | 117,450 | 1,000,000 | |||
Stock options | Price range eight [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 1.65 | $ 1.06 | |||
Remaining life | 2 years 7 months 6 days | 2 years 7 months 6 days | 3 years 2 months 12 days | ||
Outstanding (in shares) | 103,212 | 1,850,227 | |||
Vested (in shares) | 103,212 | 1,226,818 | |||
Stock options | Price range nine [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 2.21 | $ 1 | |||
Remaining life | 3 years 2 months 12 days | 3 years 2 months 12 days | 3 years 4 months 24 days | ||
Outstanding (in shares) | 1,022,124 | 117,450 | |||
Vested (in shares) | 677,646 | 78,300 | |||
Stock options | Price range ten [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 2.39 | $ 1.65 | |||
Remaining life | 3 years 3 months 18 days | 3 years 3 months 18 days | 3 years 7 months 6 days | ||
Outstanding (in shares) | 600,000 | 103,212 | |||
Vested (in shares) | 400,000 | 68,808 | |||
Stock options | Price range eleven [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 2.58 | $ 2.21 | |||
Remaining life | 3 years 3 months 18 days | 3 years 3 months 18 days | 4 years 2 months 12 days | ||
Outstanding (in shares) | 50,000 | 1,022,124 | |||
Vested (in shares) | 33,334 | 333,166 | |||
Stock options | Price Range twelve [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 3.82 | $ 2.39 | |||
Remaining life | 3 years 6 months | 3 years 6 months | 4 years 3 months 18 days | ||
Outstanding (in shares) | 300,000 | 600,000 | |||
Vested (in shares) | 200,000 | 200,000 | |||
Stock options | Price range thirteen [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 6.03 | $ 2.58 | |||
Remaining life | 3 years 7 months 6 days | 3 years 7 months 6 days | 4 years 3 months 18 days | ||
Outstanding (in shares) | 200,000 | 50,000 | |||
Vested (in shares) | 133,334 | 16,667 | |||
Stock options | Price range fourteen [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 5.80 | $ 3.82 | |||
Remaining life | 3 years 8 months 12 days | 3 years 8 months 12 days | 4 years 6 months | ||
Outstanding (in shares) | 50,000 | 300,000 | |||
Vested (in shares) | 33,334 | 100,000 | |||
Stock options | Price range fifteen[member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 4.80 | $ 6.03 | |||
Remaining life | 4 years 2 months 12 days | 4 years 2 months 12 days | 4 years 7 months 6 days | ||
Outstanding (in shares) | 578,347 | 200,000 | |||
Vested (in shares) | 192,774 | 66,667 | |||
Stock options | Price range sixteen [member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 4.76 | $ 5.80 | |||
Remaining life | 4 years 3 months 18 days | 4 years 3 months 18 days | 4 years 8 months 12 days | ||
Outstanding (in shares) | 50,000 | 50,000 | |||
Vested (in shares) | 16,666 | 16,667 | |||
Stock options | Price Range Seventeen [Member] | |||||
Disclosure of range of exercise prices of outstanding share options [line items] | |||||
Exercise price (per share) | $ / shares | $ 4.04 | ||||
Remaining life | 4 years 9 months 18 days | 4 years 9 months 18 days | |||
Outstanding (in shares) | 50,000 | ||||
Vested (in shares) | 16,666 |
SHARE BASED PAYMENTS - RSU's (D
SHARE BASED PAYMENTS - RSU's (Details) - Restricted share units - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share capital | ||
Bgn | 921,356 | 1,014,972 |
Awarded | 235,091 | 320,447 |
Exercised or vested(in shares) | (448,607) | (414,063) |
End | 707,840 | 921,356 |
Later than one year and not later than two years [member] | ||
Share capital | ||
Bgn | 448,607 | |
End | 448,607 | |
Later than two years and not later than three years [member] | ||
Share capital | ||
Bgn | 365,935 | |
End | 444,301 | 365,935 |
Later than three years and not later than four years [member] | ||
Share capital | ||
Bgn | 106,814 | |
End | 185,179 | 106,814 |
Later than four years and not later than five years [member] | ||
Share capital | ||
End | 78,360 | |
After award date year one | ||
Share capital | ||
Vesting of stock options ( as a percentage) | 0.33% | |
After award date year two | ||
Share capital | ||
Vesting of stock options ( as a percentage) | 0.33% | |
After award date year three | ||
Share capital | ||
Vesting of stock options ( as a percentage) | 0.33% |
SHARE BASED PAYMENTS - Deferred
SHARE BASED PAYMENTS - Deferred Share Units (Details) - Deferred share units - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of classes of share capital [line items] | ||
Bgn | 644,525 | 508,780 |
Awarded and vested immediately | 62,503 | 135,745 |
End | 707,028 | 644,525 |
Vested (in shares) | 707,028 | 644,525 |
SHARE BASED PAYMENTS - Bonus Un
SHARE BASED PAYMENTS - Bonus Units (Details) - Bonus shares | Nov. 13, 2018USD ($)tranche$ / sharesshares | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2017USD ($)$ / shares |
Disclosure of classes of share capital [line items] | ||||
Bgn | 500,000 | 1,500,000 | ||
Exercised | (1,000,000) | |||
End | 500,000 | 500,000 | ||
Vested (in shares) | 500,000 | 500,000 | ||
Directors | ||||
Disclosure of classes of share capital [line items] | ||||
Fair value (per share) | $ / shares | $ 0.537 | $ 1.31 | ||
Awarded | 1,000,000 | 500,000 | ||
Grant date fair value | $ 537,000 | $ 655,000,000 | ||
Number of tranches | tranche | 4 | |||
Number of equity instruments granted per tranch | shares | 250,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of transactions between related parties [line items] | ||
Short term incentives | $ 1,763,000 | $ 1,532,000 |
Share based payments | 1,750,000 | 1,859,000 |
Total Key Management compensation | 3,513,000 | 3,391,000 |
Accrued short term | 783,000 | 773,000 |
Directors | ||
Disclosure of transactions between related parties [line items] | ||
Short term incentives | 183,000 | 171,000 |
Consulting fees | ||
Disclosure of transactions between related parties [line items] | ||
Short term incentives | $ 1,580,000 | $ 1,361,000 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure of reconciliation of liabilities arising from financing activities [line items] | |||
Bank current accounts and cash on hand | $ 20,516 | $ 72,180 | $ 23,106 |
Initial recognition of right of use assets | 1,769 | 233 | |
Marketable securities adjustment included in account receivable with an offset to other gains | 25 | ||
Interest expense on lease | 32 | 7 | |
Stock options | |||
Disclosure of reconciliation of liabilities arising from financing activities [line items] | |||
Liabilities arising from financing activities | 277 | 1,479 | |
Restricted share units | |||
Disclosure of reconciliation of liabilities arising from financing activities [line items] | |||
Shares issued | 487 | 333 | |
Warrants | |||
Disclosure of reconciliation of liabilities arising from financing activities [line items] | |||
Liabilities arising from financing activities | 2,140 | $ 506 | |
Fresnillo obligation | |||
Disclosure of reconciliation of liabilities arising from financing activities [line items] | |||
Liabilities arising from financing activities | $ 37,800 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of geographical areas [line items] | ||
Revenue (note 17) | $ (4,091) | |
Cost of sales | 1,358 | |
Gross profit | (2,733) | |
Exploration and evaluation expenses (note 19) | 15,108 | $ 16,302 |
General and administrative expenses (note 18) | 7,207 | 4,330 |
Depreciation (note 8) | 154 | 106 |
Share based payments (note 23) | 2,329 | 2,523 |
Interest and finance costs (note 20) | 1,296 | 3,895 |
Foreign exchange loss | 3,726 | 1,595 |
Other (gains) and losses (note 21) | (809) | (1,057) |
LOSS FOR THE YEAR | 26,278 | 27,694 |
Equipment (note 8) | 7,635 | 710 |
Mineral properties and related construction | 213,749 | 71,272 |
Exploration and evaluation properties | 82,743 | 82,743 |
Total assets | 364,895 | 239,195 |
Total liabilities | (180,478) | (78,614) |
Mexico | ||
Disclosure of geographical areas [line items] | ||
Revenue (note 17) | (4,091) | |
Cost of sales | 1,358 | |
Gross profit | (2,733) | |
Exploration and evaluation expenses (note 19) | 9,908 | 12,658 |
Depreciation (note 8) | 34 | |
Share based payments (note 23) | 89 | |
Interest and finance costs (note 20) | 1,406 | 1,294 |
Foreign exchange loss | 3,956 | 481 |
Other (gains) and losses (note 21) | (220) | (1,032) |
LOSS FOR THE YEAR | 12,406 | 13,435 |
Equipment (note 8) | 7,466 | 463 |
Mineral properties and related construction | 213,749 | 71,272 |
Total assets | 267,403 | 82,781 |
Panama | ||
Disclosure of geographical areas [line items] | ||
Exploration and evaluation expenses (note 19) | 4,771 | 3,465 |
Depreciation (note 8) | 36 | 22 |
Share based payments (note 23) | 51 | |
LOSS FOR THE YEAR | 4,858 | 3,487 |
Equipment (note 8) | 37 | 73 |
Exploration and evaluation properties | 82,429 | 82,429 |
Total assets | 83,162 | 83,260 |
USA | ||
Disclosure of geographical areas [line items] | ||
Exploration and evaluation expenses (note 19) | 366 | 136 |
LOSS FOR THE YEAR | 366 | 136 |
Exploration and evaluation properties | 314 | 314 |
Total assets | 314 | 314 |
Canada | ||
Disclosure of geographical areas [line items] | ||
Exploration and evaluation expenses (note 19) | 63 | 43 |
General and administrative expenses (note 18) | 7,207 | 4,330 |
Depreciation (note 8) | 118 | 50 |
Share based payments (note 23) | 2,189 | 2,523 |
Interest and finance costs (note 20) | 110 | 2,601 |
Foreign exchange loss | (230) | 1,114 |
Other (gains) and losses (note 21) | (589) | (25) |
LOSS FOR THE YEAR | 8,648 | 10,636 |
Equipment (note 8) | 132 | 174 |
Total assets | $ 14,016 | $ 72,840 |
CAPITAL MANAGEMENT (Details)
CAPITAL MANAGEMENT (Details) - USD ($) $ in Thousands | Oct. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Amount drawn | $ 50,000 | $ 50,000 | ||
Camino Rojo Project Loan | ||||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Notional amount | $ 125,000 | |||
Amount drawn | $ 50,000 | 50,000 | 50,000 | $ 25,000 |
Newmont Loan Camino Rojo Project [Member] | ||||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Amount drawn | 125,000 | $ 75,000 | ||
Minimum | Camino Rojo Project Loan | ||||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Working capital | $ 5,000 |
FINANCIAL INSTRUMENTS (Details)
FINANCIAL INSTRUMENTS (Details) | 12 Months Ended | |||||||
Dec. 31, 2021USD ($) | Dec. 31, 2021USD ($)$ / $ | Dec. 31, 2021USD ($)CAD ($) | Dec. 31, 2021USD ($)MXN ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020USD ($)$ / $ | Dec. 31, 2020USD ($)CAD ($) | Dec. 31, 2020USD ($)MXN ($) | |
Financial Instruments | ||||||||
Average foreign exchange rate | 1 | 1.2678 | 20.5835 | 1 | 1.2732 | 19.9487 | ||
Camino Rojo Project Loan | ||||||||
Financial Instruments | ||||||||
Estimated fair value | $ 137,700,000 | $ 137,700,000 | $ 137,700,000 | $ 137,700,000 | $ 66,400,000 | $ 66,400,000 | $ 66,400,000 | $ 66,400,000 |
Discount rate | 5.00% | 5.00% | 5.00% | 5.00% | 10.80% | 10.80% | 10.80% | 10.80% |
Newmont Loan | ||||||||
Financial Instruments | ||||||||
Average foreign exchange rate | $ / $ | 20.58 | 19.95 | ||||||
Estimated fair value | $ 10,500,000 | $ 10,500,000 | $ 10,500,000 | $ 10,500,000 | $ 9,900,000 | $ 9,900,000 | $ 9,900,000 | $ 9,900,000 |
Discount rate | 5.00% | 5.00% | 5.00% | 5.00% | 10.50% | 10.50% | 10.50% | 10.50% |
Carrying value | ||||||||
Financial Instruments | ||||||||
Financial assets | $ 24,495,000 | $ 24,495,000 | $ 24,495,000 | $ 24,495,000 | $ 75,002,000 | $ 75,002,000 | $ 75,002,000 | $ 75,002,000 |
Financial liabilities | 174,379,000 | 174,379,000 | 174,379,000 | 174,379,000 | 72,993,000 | 72,993,000 | 72,993,000 | 72,993,000 |
Carrying value | Amortized cost, liabilities | Trade payables | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,966,000 | 5,966,000 | 5,966,000 | 5,966,000 | 2,583,000 | 2,583,000 | 2,583,000 | 2,583,000 |
Carrying value | Amortized cost, liabilities | Accrued liabilities | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,659,000 | 5,659,000 | 5,659,000 | 5,659,000 | ||||
Carrying value | Amortized cost, liabilities | Fresnillo obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 37,800,000 | 37,800,000 | 37,800,000 | 37,800,000 | ||||
Carrying value | Amortized cost, liabilities | Lease obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 1,401,000 | 1,401,000 | 1,401,000 | 1,401,000 | 274,000 | 274,000 | 274,000 | 274,000 |
Carrying value | Amortized cost, liabilities | Camino Rojo Project Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 113,260,000 | 113,260,000 | 113,260,000 | 113,260,000 | 60,696,000 | 60,696,000 | 60,696,000 | 60,696,000 |
Carrying value | Amortized cost, liabilities | Newmont Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 10,293,000 | 10,293,000 | 10,293,000 | 10,293,000 | 9,440,000 | 9,440,000 | 9,440,000 | 9,440,000 |
Carrying value | FVTPL, financial asset | Cash and cash equivalents. | ||||||||
Financial Instruments | ||||||||
Financial assets | 20,516,000 | 20,516,000 | 20,516,000 | 20,516,000 | 72,180,000 | 72,180,000 | 72,180,000 | 72,180,000 |
Carrying value | Amortized costs, financial asset | Accounts receivable | ||||||||
Financial Instruments | ||||||||
Financial assets | 299,000 | 299,000 | 299,000 | 299,000 | 39,000 | 39,000 | 39,000 | 39,000 |
Carrying value | Amortized costs, financial asset | Restricted funds | ||||||||
Financial Instruments | ||||||||
Financial assets | 3,680,000 | 3,680,000 | 3,680,000 | 3,680,000 | 2,783,000 | 2,783,000 | 2,783,000 | 2,783,000 |
Fair value | ||||||||
Financial Instruments | ||||||||
Financial assets | 24,495,000 | 24,495,000 | 24,495,000 | 24,495,000 | 75,002,000 | 75,002,000 | 75,002,000 | 75,002,000 |
Financial liabilities | 199,105,000 | 199,105,000 | 199,105,000 | 199,105,000 | 79,175,000 | 79,175,000 | 79,175,000 | 79,175,000 |
Fair value | Amortized cost, liabilities | Trade payables | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,966,000 | 5,966,000 | 5,966,000 | 5,966,000 | 2,583,000 | 2,583,000 | 2,583,000 | 2,583,000 |
Fair value | Amortized cost, liabilities | Accrued liabilities | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,659,000 | 5,659,000 | 5,659,000 | 5,659,000 | ||||
Fair value | Amortized cost, liabilities | Fresnillo obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 37,800,000 | 37,800,000 | 37,800,000 | 37,800,000 | ||||
Fair value | Amortized cost, liabilities | Lease obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 1,401,000 | 1,401,000 | 1,401,000 | 1,401,000 | 274,000 | 274,000 | 274,000 | 274,000 |
Fair value | Amortized cost, liabilities | Camino Rojo Project Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 137,746,000 | 137,746,000 | 137,746,000 | 137,746,000 | 66,443,000 | 66,443,000 | 66,443,000 | 66,443,000 |
Fair value | Amortized cost, liabilities | Newmont Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 10,533,000 | 10,533,000 | 10,533,000 | 10,533,000 | 9,875,000 | 9,875,000 | 9,875,000 | 9,875,000 |
Fair value | FVTPL, financial asset | Cash and cash equivalents. | ||||||||
Financial Instruments | ||||||||
Financial assets | 20,516,000 | 20,516,000 | 20,516,000 | 20,516,000 | 72,180,000 | 72,180,000 | 72,180,000 | 72,180,000 |
Fair value | Amortized costs, financial asset | Accounts receivable | ||||||||
Financial Instruments | ||||||||
Financial assets | 299,000 | 299,000 | 299,000 | 299,000 | 39,000 | 39,000 | 39,000 | 39,000 |
Fair value | Amortized costs, financial asset | Restricted funds | ||||||||
Financial Instruments | ||||||||
Financial assets | 3,680,000 | 3,680,000 | 3,680,000 | 3,680,000 | 2,783,000 | 2,783,000 | 2,783,000 | 2,783,000 |
Approximate fair value due to short term nature of the instrument | ||||||||
Financial Instruments | ||||||||
Financial assets | 283,000 | 283,000 | 283,000 | 283,000 | 14,000 | 14,000 | 14,000 | 14,000 |
Financial liabilities | 11,625,000 | 11,625,000 | 11,625,000 | 11,625,000 | 2,583,000 | 2,583,000 | 2,583,000 | 2,583,000 |
Approximate fair value due to short term nature of the instrument | Amortized cost, liabilities | Trade payables | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,966,000 | 5,966,000 | 5,966,000 | 5,966,000 | 2,583,000 | 2,583,000 | 2,583,000 | 2,583,000 |
Approximate fair value due to short term nature of the instrument | Amortized cost, liabilities | Accrued liabilities | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 5,659,000 | 5,659,000 | 5,659,000 | 5,659,000 | ||||
Approximate fair value due to short term nature of the instrument | Amortized costs, financial asset | Accounts receivable | ||||||||
Financial Instruments | ||||||||
Financial assets | 283,000 | 283,000 | 283,000 | 283,000 | 14,000 | 14,000 | 14,000 | 14,000 |
Level 1 of fair value hierarchy [member] | Fair value | ||||||||
Financial Instruments | ||||||||
Financial assets | 20,532,000 | 20,532,000 | 20,532,000 | 20,532,000 | 72,205,000 | 72,205,000 | 72,205,000 | 72,205,000 |
Level 1 of fair value hierarchy [member] | Fair value | FVTPL, financial asset | Cash and cash equivalents. | ||||||||
Financial Instruments | ||||||||
Financial assets | 20,516,000 | 20,516,000 | 20,516,000 | 20,516,000 | 72,180,000 | 72,180,000 | 72,180,000 | 72,180,000 |
Level 1 of fair value hierarchy [member] | Fair value | Amortized costs, financial asset | Accounts receivable | ||||||||
Financial Instruments | ||||||||
Financial assets | 16,000 | 16,000 | 16,000 | 16,000 | 25,000 | 25,000 | 25,000 | 25,000 |
Level 2 of fair value hierarchy [member] | Fair value | ||||||||
Financial Instruments | ||||||||
Financial assets | 3,680,000 | 3,680,000 | 3,680,000 | 3,680,000 | 2,783,000 | 2,783,000 | 2,783,000 | 2,783,000 |
Financial liabilities | 187,480,000 | 187,480,000 | 187,480,000 | 187,480,000 | 76,592,000 | 76,592,000 | 76,592,000 | 76,592,000 |
Level 2 of fair value hierarchy [member] | Fair value | Amortized cost, liabilities | Fresnillo obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 37,800,000 | 37,800,000 | 37,800,000 | 37,800,000 | ||||
Level 2 of fair value hierarchy [member] | Fair value | Amortized cost, liabilities | Lease obligation | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 1,401,000 | 1,401,000 | 1,401,000 | 1,401,000 | 274,000 | 274,000 | 274,000 | 274,000 |
Level 2 of fair value hierarchy [member] | Fair value | Amortized cost, liabilities | Camino Rojo Project Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 137,746,000 | 137,746,000 | 137,746,000 | 137,746,000 | 66,443,000 | 66,443,000 | 66,443,000 | 66,443,000 |
Level 2 of fair value hierarchy [member] | Fair value | Amortized cost, liabilities | Newmont Loan | ||||||||
Financial Instruments | ||||||||
Financial liabilities | 10,533,000 | 10,533,000 | 10,533,000 | 10,533,000 | 9,875,000 | 9,875,000 | 9,875,000 | 9,875,000 |
Level 2 of fair value hierarchy [member] | Fair value | Amortized costs, financial asset | Restricted funds | ||||||||
Financial Instruments | ||||||||
Financial assets | $ 3,680,000 | $ 3,680,000 | $ 3,680,000 | $ 3,680,000 | $ 2,783,000 | $ 2,783,000 | $ 2,783,000 | $ 2,783,000 |
FINANCIAL INSTRUMENTS - Liquidi
FINANCIAL INSTRUMENTS - Liquidity risk (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Financial Instruments | ||
Trade and other non-current payables | $ 161 | $ 92 |
Liquidity risk | ||
Financial Instruments | ||
Financial liabilities | 221,465 | 114,729 |
Trade payables | 5,966 | 2,583 |
Trade and other non-current payables | 5,659 | |
Gross lease liabilities | 1,417 | 294 |
Liquidity risk | Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings | 157,083 | 100,850 |
Liquidity risk | Newmont Loan | ||
Financial Instruments | ||
Borrowings | 10,662 | 11,002 |
Liquidity risk | Fresnillo obligation | ||
Financial Instruments | ||
Trade payables | 40,678 | |
Less than 3 months | Liquidity risk | ||
Financial Instruments | ||
Financial liabilities | 14,962 | 4,265 |
Trade payables | 5,966 | 2,583 |
Trade and other non-current payables | 5,659 | |
Gross lease liabilities | 114 | 32 |
Less than 3 months | Liquidity risk | Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings | 2,750 | 1,650 |
Less than 3 months | Liquidity risk | Fresnillo obligation | ||
Financial Instruments | ||
Trade payables | 473 | |
Between 3 months and 1 year | Liquidity risk | ||
Financial Instruments | ||
Financial liabilities | 35,558 | 5,067 |
Gross lease liabilities | 289 | 117 |
Between 3 months and 1 year | Liquidity risk | Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings | 8,250 | 4,950 |
Between 3 months and 1 year | Liquidity risk | Newmont Loan | ||
Financial Instruments | ||
Borrowings | 10,662 | |
Between 3 months and 1 year | Liquidity risk | Fresnillo obligation | ||
Financial Instruments | ||
Trade payables | 16,357 | |
Between 1 year and 3 years | Liquidity risk | ||
Financial Instruments | ||
Financial liabilities | 170,425 | 24,347 |
Gross lease liabilities | 494 | 145 |
Between 1 year and 3 years | Liquidity risk | Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings | 146,083 | 13,200 |
Between 1 year and 3 years | Liquidity risk | Newmont Loan | ||
Financial Instruments | ||
Borrowings | 11,002 | |
Between 1 year and 3 years | Liquidity risk | Fresnillo obligation | ||
Financial Instruments | ||
Trade payables | 23,848 | |
Later than 3 years | Liquidity risk | ||
Financial Instruments | ||
Financial liabilities | 520 | 81,050 |
Gross lease liabilities | $ 520 | |
Later than 3 years | Liquidity risk | Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings | $ 81,050 |
FINANCIAL INSTRUMENTS - Currenc
FINANCIAL INSTRUMENTS - Currency risk (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Financial Instruments | ||
Interest expense for financial liabilities not at fair value through profit or loss | $ 520,000 | $ 427,000 |
Currency risk | ||
Financial Instruments | ||
Percentage of reasonably possible increase in unobservable input, assets | 10.00% | |
Percentage of reasonably possible decrease in unobservable input, liabilities | 10.00% | |
Increase (decrease) in fair value measurement due to reasonably possible increase | $ 12,200 | 800 |
Increase (decrease) in fair value measurement due to reasonably possible decrease | $ 4,200 | $ 700 |
Camino Rojo Project Loan | ||
Financial Instruments | ||
Borrowings, adjustment to interest rate basis | 8.80% | |
Fresnillo obligation | ||
Financial Instruments | ||
Borrowings, adjustment to interest rate basis | 5.00% |
FINANCIAL INSTRUMENTS - Financi
FINANCIAL INSTRUMENTS - Financial instruments (Details) | 12 Months Ended | |||||||||
Dec. 31, 2021CAD ($)$ / $ | Dec. 31, 2021USD ($)$ / $ | Dec. 31, 2021MXN ($)$ / $ | Dec. 31, 2020CAD ($)$ / $ | Dec. 31, 2020USD ($)$ / $ | Dec. 31, 2020MXN ($)$ / $ | Dec. 31, 2021USD ($) | Dec. 31, 2021MXN ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020MXN ($) | |
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ 5,919,000 | $ (143,874,000) | $ (219,835,000) | $ 11,603,000 | $ 516,000 | $ (152,037,000) | ||||
Exchange rate | 1.2678 | 1 | 20.5835 | 1.2732 | 1 | 19.9487 | ||||
Equivalent US dollars | $ 4,669,000 | $ 9,113,000 | $ (143,874,000) | $ (10,680,000) | $ 516,000 | $ (7,621,000) | ||||
Trade payables | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | (128,000) | $ (2,642,000) | $ (66,350,000) | (73,000) | $ (2,074,000) | $ (9,022,000) | ||||
Lease obligation | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ (74,000) | (520,000) | (16,935,000) | $ (194,000) | (2,471,000) | |||||
Camino Rojo Project Loan | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ (113,260,000) | $ (60,696,000) | ||||||||
Newmont Loan | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ (211,881,000) | $ (188,319,000) | ||||||||
Exchange rate | $ / $ | 20.58 | 20.58 | 20.58 | 19.95 | 19.95 | 19.95 | ||||
Fresnillo obligation | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ (37,800,000) | |||||||||
Accrued liabilities | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ (1,637,000) | (2,226,000) | $ (44,070,000) | |||||||
Cash | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | 7,583,000 | 12,061,000 | 50,923,000 | $ 11,752,000 | $ 62,809,000 | $ 2,804,000 | ||||
Accounts receivable | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | 20,000 | 4,000 | 5,733,000 | 32,000 | 4,000 | 245,000 | ||||
Restricted funds | ||||||||||
Disclosure of maturity analysis for derivative financial liabilities [line items] | ||||||||||
Total foreign currency | $ 155,000 | $ 509,000 | $ 62,745,000 | $ 86,000 | $ 473,000 | $ 44,726,000 |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of tax rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of average effective tax rate and applicable tax rate | ||
Income (loss) before tax | $ (26,278) | $ (27,694) |
Statutory income tax rate | 26.80% | 26.60% |
Expected income tax | $ (7,042) | $ (7,367) |
Differences between Canadian and foreign tax rates | (744) | (488) |
Items not deductible for tax purposes | 736 | |
Items not deductible for tax purposes (credit) | 2,850 | |
Share based compensation | 587 | 671 |
Change in unrecognized deductible temporary differences | 6,208 | 6,190 |
True ups | (1,913) | 64 |
Effect of changes in tax rates from prior years | (71) | |
Effect of changes in foreign exchange rates | 393 | 202 |
Other | $ (268) | $ (8) |
Statutory income tax rate | 26.80% | 26.60% |
INCOME TAXES - Unrecognized ded
INCOME TAXES - Unrecognized deductible temporary differences (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | $ 115,504 | $ 94,808 |
Mineral properties and exploration expenditures | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 55,548 | 43,807 |
Equipment. | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 1,814 | 1,700 |
Site closure provisions | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 5,460 | 518 |
Share issue costs | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 5,724 | 2,428 |
Long term debt | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 282 | |
Non-capital losses | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 41,343 | $ 46,073 |
Deductible temporary differences | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 0 | |
Intercompany debt | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | 413 | |
Others | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Unrecognized deductible temporary differences | $ 5,202 |
INCOME TAXES - Recognized defer
INCOME TAXES - Recognized deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Recognized deferred tax assets (liabilities) | $ 0 | |
Temporary differences associated with investments in subsidiaries for which a deferred income tax liability has not been recognized | $ 4,653,000 | 3,328,000 |
Mineral properties and exploration expenditures | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Recognized deferred tax assets (liabilities) | (8,173,000) | 0 |
Long term debt | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Recognized deferred tax assets (liabilities) | (1,786,000) | (322,000) |
Non-capital losses | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Recognized deferred tax assets (liabilities) | 10,447,000 | 867,000 |
Others | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Recognized deferred tax assets (liabilities) | $ (488,000) | $ (545,000) |
INCOME TAXES - Tax loss carryfo
INCOME TAXES - Tax loss carryforwards (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Mexico | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Tax loss carryforwards | $ 29,851 | $ 5,317 |
Canada | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Tax loss carryforwards | 46,354 | 39,108 |
Panama | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Tax loss carryforwards | 655 | $ 4,678 |
USA | ||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||
Tax loss carryforwards | $ 16 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Purchase orders and contracts | ||
Commitments and Contingencies | ||
Capital commitments | $ 8,560,000 | $ 49,050,000 |
Severance payments | ||
Commitments and Contingencies | ||
Financial effect | $ 3,220,000 | $ 3,000,000 |