- August gold production of 4,595 ounces driven by strong ore tonnage and improved grades
- Robust drilled inventory supports September forecast; Q3 2022 guidance reaffirmed
- Further growth forecasted as mining transitions fully into Austin / South Austin Zones
- Results of updated Life-of-Mine plan remain on track for Q4 2022
VANCOUVER, British Columbia, Sept. 12, 2022 (GLOBE NEWSWIRE) — Pure Gold Mining Inc. (TSX-V:PGM, LSE:PUR) (“PureGold” or the “Company”), today reaffirmed third quarter 2022 guidance and announced that gold production in August 2022 set a new monthly record for the PureGold Mine (the “Mine”), driven by record ore throughput and improved grades.
|QTD Total /
|Ore Tonnes Processed (t)||25,188||24,052||49,240||71,300-80,500|
|Average Daily Throughput (tpd)||813||776||794||775-875|
|Head Grade (g/t Au)||5.9||3.1||4.5||4.0-5.0|
|Ounces Produced (oz)||4,595||2,232||6,827||8,700-12,300|
Production Update and Outlook
Both the August ore throughput of 25,188 tonnes or 813 tonnes per day (“tpd”) and gold production of 4,595 ounces represent monthly records for the Mine to date. Ore throughput of 24,052 tonnes in July was also a monthly record until being broken in August.
The increase in average ore throughput in the third quarter to date of 794 tpd compared to the second quarter average of 500 tpd has been driven primarily by improved short-range planning processes, improved mining execution, and increased mill availability. These fundamental improvements are expected to continue to support strong and increasing production going forward. The Company’s near-term target is to increase ore throughput towards 1,000 tpd.
The head grade in August of 5.9 g/t Au increased 90% compared to July at 3.1 g/t Au. This improvement was driven by an increase in mill feed from high-grade stopes. Recent improvements to mine planning practices have established a drilled inventory of high-grade stopes to help optimize grades and production. Additionally, the Company expects grades to continue to increase as mining continues to transition into higher-grade Austin and South Austin Zones.
With September production forecasts largely underpinned by a robust drilled inventory, the Company remains on track to achieve its previously stated third quarter production guidance of 775-875 tpd at 4.0-5.0 g/t Au. The Company has not previously provided monthly results and does not intend to do so on a regular basis but is nevertheless providing data for July and August to support the reaffirmation of guidance for the third quarter of 2022.
Definition drilling and planning activities are currently focused on production for November and December. The Company expects to disclose actual production for the third quarter and production guidance for the fourth quarter by early October.
Pre-Feasibility Study, Life of Mine Plan and Technical Report Update
The updated Life-of-Mine plan and Pre-Feasibility Study remain on track for release in Q4 2022. The Company remains on track to file an updated Technical Report in respect of the updated Mineral Resource Estimate announced August 10, 2022 by September 25, 2022.
Site-level operating plus sustaining capital costs are expected to be in the range of $9.5 – $10.5 million per month for the third quarter. Costs at these levels are in line with costs in the second quarter of 2022 and represent an absolute reduction of approximately 25% and a cost-per-tonne reduction of approximately 50% compared to the first quarter of 2022. Several opportunities to further reduce costs are currently underway or have been completed including replacing rentals and contractors with more permanent solutions and completing key infrastructure upgrades including the new camp, new electric compressors, and a new mine air heater.
Further opportunities have been identified and are now expected to be implemented in early 2023. This represents a slight delay from prior disclosure of implementation by the end of 2022. The estimated amounts for these further opportunities remains unchanged from prior disclosure at savings of $1 million per month (approximately 10%) compared to third quarter costs. These and other longer-term savings opportunities are expected to be identified and incorporated into the Updated Life-of-Mine plan.
Capital and Liquidity
The Company currently has $6 million in cash. The Company’s cash balance is unchanged from the previous disclosure on August 15 and has been stable since late July.
Qualified Persons and 43-101 Disclosure
Terrence Smith, P.Eng., Chief Operating Officer for the Company, is the designated Qualified Person for this news release within the meaning of National Instrument 43-101 (“NI 43-101”) and has reviewed and verified that the technical information contained herein is accurate and approves of the written disclosure of same.
About Pure Gold Mining Inc.
PureGold is a Canadian gold mining company, located in the very heart of Red Lake, Canada. We are a principled and ethical company who want to be good neighbours. We are committed to our People (safety, training, culture, good salaries and benefits for our workers), our Community (strong sustainable economic benefits and community development) and the Environment (meeting and exceeding standards).
ON BEHALF OF THE BOARD
Mark O’Dea, President & CEO
Director, IR & Communications
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
All statements in this press release, other than statements of historical fact, are “forward-looking information” with respect to PureGold within the meaning of applicable securities laws, including, but not limited to statements with respect to those that address proposed timing of development plans for the PureGold Mine, including the proposed updated NI 43-101 Technical Report and timing and content of such Technical Report, including the life of mine plan; expectations to achieve previously stated production guidance in the third quarter; expectations regarding the disclosure of third quarter production and fourth quarter guidance in October, expectations regarding the effectiveness of new initiatives to improve stope access and result in increased throughput, improved grades and reduced costs; expectation to achieve forecasted site-level costs in the third quarter and to reduce costs by early 2023 relative to the third quarter; potential for extending the mine life of the PureGold Mine; the timing and results of the new Pre-Feasibility Study and updated Life of Mine Plan; the potential to convert resources to reserves; the transition of mining from the McVeigh Zone to the South Austin and Austin Zones; expectation for grades to continue to increase; and potential for additional resources and expansion of known deposits and potential for making new discoveries and the focus of the Company in the coming months. Forward-looking information is often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “progress”, “confirms”, “continue”, “planned”, “expect”, “expectations”, “expand”, “enhanced”, “increasing”, “optimize”, “project”, “predict”, “potential”, “supports”, “targeting”, “intends”, “believe”, “improved”, “potential”, and similar expressions, or describes a “goal”, or variation , of such words and phrases or state that certain actions, events or results “may”, “should”, “confirms”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licences and permits and obtaining required licences and permits, labour stability, stability in market conditions, availability of equipment, accuracy of any mineral resources, successful resolution of disputes and anticipated costs and expenditures. Many assumptions are based on factors and events that are not within the control of PureGold and there is no assurance they will prove to be correct.
Such forward-looking information, involves known and unknown risks, which may cause the actual results to be materially different from any future results expressed or implied by such forward-looking information, including, risks related to liquidity and the Company’s ability to continue as a going concern; mine closure and rehabilitation; failure to achieve estimates or material increases in costs; history of net losses and negative operating cash flow, indebtedness; interpretation of results at the PureGold Mine complex, including reserve and resource estimates may prove to be incorrect; changes in project parameters as plans continue to be refined; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; the costs and timing of the development of new deposits; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; the timing and success of exploration and development activities generally; delays in permitting; possible claims against the Company; the timing of future economic studies; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration as well as those factors discussed in the Annual Information Form of the Company dated March 30, 2022 in the section entitled “Risk Factors”, under PureGold’s SEDAR profile at www.sedar.com.
Although PureGold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. PureGold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.