PUREGOLD REPORTS STRONG START TO THIRD QUARTER AND PROVIDES OUTLOOK FOR THE SECOND HALF OF 2021August 13, 2021
VANCOUVER, B.C. – Pure Gold Mining Inc. (TSX-V:PGM, LSE:PUR) (“PureGold” or the “Company”), is pleased to provide an operations update for the month of July and an outlook for the second half (“H2”) of 2021 at its high-grade PureGold Mine in Red Lake, Ontario.
July Production and H2 2021 Outlook Highlights
- Daily throughput averaged 703 tpd for the month of July, a 38% improvement compared to the second quarter average. The strong performance in July which led to the declaration of commercial production as of August 1 is attributed to significantly improved stope availability and inventory as a result of investments in development and infill drilling made in the first six months of the year. Average throughput is expected to continue to increase steadily up to and beyond nameplate capacity of 800 tpd for the balance of 2021.
- Excellent mining rates including a new single-day production record as unreconciled mined ore production averaged 849 tpd from the Main and East Ramps for the month, including a peak single day production record of over 1,450 tonnes of high-grade ore brought to surface in a span of 24 hours, reaffirming the strong potential to exceed 800 tonnes per day sustainably by the end of the year.
- Head grades achieved were in line with plan, averaging 5.6 g/t Au from all ore processed during the month of July, in line with plan for the month which was expected to be the lightest month from a grade perspective for H2 2021. Over the last two weeks of July, mill head grades averaged 6.9 g/t Au with mine feed coming from multiple headings, including both longhole and mechanized cut and fill stopes. As production transitions to higher grade stopes in Q3 and Q4, head grades are expected to continue to improve for the balance of the year along with increasing throughput.
- Steady progress on ramp development, with daily ramp development rates for the Main and East Ramps averaging 5.4 metres and 3.7 metres per day for July, respectively. With a dedicated contract crew now focused exclusively on the Main Ramp as of July, capital development will continue to be a priority for the balance of 2021 to ensure continued stope availability and flexibility and to accelerate drilling and access to 8 Zone. Once sufficiently ahead of mine production, capital development is expected to be reduced in 2022 and all-in sustaining costs1 (“AISC”) are expected to fall accordingly.
- Gold production achieved a new monthly record in July of approximately 3,730 ounces of gold produced. Mill recoveries averaged 96.0% for the month.2
- Four of six CIP interstage screens have been installed with the remaining two expected to be installed in August. The trommel screen for the SAG discharge is on site and expected to be operational by September. The screens are expected to increase mill capacity in excess of nameplate 800 tpd once commissioned.
Guidance for H2 2021
Gold production for H2 2021, inclusive of July, is expected to be in the range of 27 – 32 koz Au with grades and throughputs increasing steadily toward the end of the year. Cash Costs1 for the fourth quarter, the first full quarter of commercial production, are expected to be in the range of US$1,025 – $1,125 per ounce. AISC1 for the fourth quarter is expected to be in the range of US$1,600 – $1,750 per ounce. Looking forward into 2022, production is expected to increase and Cash Costs and AISC are expected to fall significantly driven by higher grades and throughput coupled with decreased investment in capital development and other sustaining capital programs. This dynamic of increasing production and falling costs is expected to continue throughout 2022 and beyond as grades generally improve as mining progresses deeper and toward the 8 Zone as outlined in the 2019 Feasibility Study.3
Darin Labrenz, President & CEO of PureGold, commented, “I am proud of the consistent progress we’ve made and of the key milestones achieved in ramping up the PureGold Mine in 2021, highlighted by the recent declaration of commercial production as of August 1, 2021. In July, with the new East Portal producing ore at full capacity for the first time, we got a glimpse of what the PureGold Mine is capable of, setting new monthly and daily records for both milled and mined tonnage, respectively, and demonstrating the strong potential to push beyond 800 tpd on a sustainable basis by the end of this year. As grades continue to improve and throughput continues to increase throughout the year, we look forward to strong and steadily improving production metrics for the balance of the year and into 2022.”
Qualified Persons and 43-101 Disclosure
Ken Donner, P. Eng., Vice President, Operations 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 growth company, located in the very heart of Red Lake, Canada. Our objective is pure and simple. To develop a highly-profitable long life gold mining company, becoming Canada’s next iconic gold producer. Our plan is very disciplined, very methodical and financially sound. To expand organically, and develop PureGold’s multi-million ounce high-grade gold asset incrementally, step-by-step, using a phased mining development plan to deliver maximum return.
- Refer to the “Non-IFRS” Financial Performance Measures” section at the end of this press release.
- Reported gold production and grades for July are unreconciled.
- For further information, see the technical report titled “Madsen Gold Project Technical Report Feasibility Study for the Madsen Deposit Red Lake, Ontario, Canada” with an effective date of February 5, 2019, and dated July 5, 2019 (the “Feasibility Study”), for further information please see puregoldmining.caor under the Company’s Sedar profile at www.sedar.com
ON BEHALF OF THE BOARD
Darin Labrenz, President & CEO
Adrian O’Brien, Director, Marketing and Communications
Non-IFRS Financial Performance Measures and Q2 Financial Results
The Company’s financial statements and Management’s Discussion and Analysis for the three and six months ended June 30, 2021, will be available on the Company’s website and under its Sedar profile at www.Sedar.com, on August 13 2021.
The Company has included certain non-IFRS measures in this new release. Refer to the Company’s MD&A for an explanation of non-IFRS measures. The Company believes that these measures, in addition to measures prepared in accordance with International Financial Reporting Standards (“IFRS”), provide readers with an improved ability to evaluate the underlying performance of the Company and to compare it to information reported by other companies. The non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These measures do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to similar measures presented by other issuers.
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 complex, quantity and timing of future production, expected cash costs and AISC for the balance of the year and beyond, the rate of development and potential for accelerating development of the two main ramps, potential for advancing the amount and timing for higher grade ore and improving grades and production metrics as the year progresses, potential for increasing throughput beyond 800 tonnes per day, the potential for decreased capital investment and cost per ounce of gold in the future 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”, “continue”, “planned”, “expect”, “project”, “predict”, “potential”, “targeting”, “intends”, “believe”, “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”, “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 the interpretation of results at the Pure Gold Red Lake Mine complex; 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 31, 2021 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.