McEwen Mining Inc. (NYSE:MUX) (TSX:MUX) acquired
the Black Fox Complex in October 2017 in a strategic investment
that increases our gold production, provides excess milling
capacity, and significantly expands our mineral resource base and
exploration potential in the Timmins district of Canada.
Exploration is the principal focus at Black Fox for 2018. A
$10 million property-wide exploration program that
will include approximately
330,000 feet (100,000
metres) of drilling is underway. The main objectives are
to test for extensions of existing resources, follow-up on
significant drill results, and to investigate new exploration
targets.
The Black Fox Complex is composed of two land
packages that cover 7 miles (11 km) along the prolific
Porcupine-Destor Fault, known internationally as the ‘Golden
Highway’. The combined production from the purchased properties
totals over 950,000 ounces of gold. The Black Fox mine was
initially in production from 1997 to 2001. It was re-commissioned
in 2009 and has operated continuously since then, producing a total
of 821,000 ounces of gold from an open pit and underground
mine. Although there is a history of exploration and production,
the land packages appear underexplored to depth and along trends.
The 2018 exploration budget has been almost tripled from the
previous year and will consist of approximately 200,000 feet
(60,000 m) of surface drilling and 130,000 feet (40,000 m) of
underground exploration and delineation drilling.
“We are very pleased with the addition
of the Black Fox Complex to our portfolio and to announce an
aggressive exploration program to assess the full potential of the
property.
Black Fox has all the criteria
characteristic of great exploration projects including: prime
location within a prolific mining region, high gold endowment,
presence of high-grade mineralization, multiple prospective
structural trends, as well as various styles of mineralization and
host rock types.
Despite successful past exploration, the
property remains largely under-explored and the upside potential is
considered excellent. We anticipate that our 2018 exploration
program will result in the growth of known deposits, and
lead to new discoveries of gold and base metal
mineralization.” - Sylvain Guerard, Senior Vice-President
Exploration.
When McEwen purchased the Black Fox Complex, the
last release of exploration results had occurred one year earlier
in Q3 2016, and there was a significant backlog of unassayed drill
core. Therefore, this release includes the undisclosed results from
late 2016 and 2017, along with new drill results generated since
the purchase (see Tables 1 to 3 for complete drill
information).
2017 Black Fox Mine Exploration
Highlights
In 2017, Black Fox underground exploration was
focused on extensions of existing resources proximal to the mine
infrastructure, and areas below and along the flanks of the deposit
where potential exists for new discoveries. Through this
exploration program, several advanced development targets including
the High Quartz (HQ), extensions of the
Deep Central (DC), and the Far
East zones, were brought into the conceptual mine plan.
Additional exploration targets include the Far
West, Gap, and deeper below the
DC (see Figure 1).
High Quartz (HQ)
Drilling in the HQ, carried out from an
exploration drift at the 1,700 ft (520 m) elevation, and targeting
mineralization at the 2,000-2,600 ft (600-800 m) elevation, had
positive results. Highlights of this drilling include:
- Hole 520-EX286-05 grading 43.6 g/t gold over 1.61
m, 330 ft (100 m) west of the DC, centered on the 2,300 ft
(700 m) elevation.
Deep Central (DC)
Exploration drilling was directed down plunge of
the DC and tested for extensions at 2,600-4,000 ft (800-1200 m)
elevation. This drilling proved technically challenging from
available drill stations due to poor ground conditions. Highlights
of this drilling include:
- Hole 520-EX346-17 grading 7.2 g/t gold over 3.89
m at the 3,000 ft (910 m) elevation; and
- Hole 520EX-346-23 grading 39.6 g/t gold over 5.13
m at the 2,700 ft (830 m) elevation.
Definition drilling within the known resource at
the DC returned some notable results including:
- Hole 680-F115-09 grading 77.3 g/t gold over 4.02
m (not true width) at the 2,800 ft (840 m) elevation;
and
- Hole 520-EX346-35 grading 29.5 g/t gold over 1.72
m at the 2,200 ft (675 m) elevation.
Down dip drilling (i.e. parallel to the
mineralization) collared from development at the 2,400 ft (740 m)
elevation was used to drill over 650 ft (200 m) below the modeled
DC mineralization envelope. This method allowed rapid coverage
vertically beneath existing mineralization and helped demonstrate
continuity, while avoiding difficult ground conditions. Results
were positive and will be followed-up with drilling focused across
strike to delineate additional mineralization. Highlights of this
drilling include:
- Hole 740-L275-71, which had six significant intervals,
including 41.0 g/t gold over 1.75 m, followed by
36.9 g/t gold over 6.1 m, and 27.2 g/t
gold over 4.0 m, and 23.2 g/t gold over 1.56
m, and 223.7 g/t gold over 9.2 m, and
15.5 g/t gold over 1.25 m (not true widths).
Far East
Far East is a zone of mineralization plunging
shallowly to the southwest and located 500 ft (150 m) east of the
mine workings. Previous drilling was done at poor angles and was
complicated by a swarm of diabase dykes cutting the mineralization.
Recent drilling has intersected intense alteration, quartz
carbonate veining, as well as sulfide and gold mineralization,
which are all indicators of the potential for economic gold
mineralization. Highlights of this drilling include:
- Hole 520-EX662-07 grading 23.3 g/t gold over 3.00
m.
Gap
Recent drilling in the Gap, located between the
East and West Black Fox mining zones above the 1,600 ft (490 m)
elevation, intersected a mineralized zone between two vein swarms,
returning encouraging results in two of seven holes. Highlights of
this drilling include:
- Hole 490-L164-83 grading 16.3 g/t gold over 4.54
m (not true width) at approximately the 1,500 ft (470 m)
elevation; and
- Hole 490-L164-87 grading 25.0 g/t gold over 1.00
m, followed by 25.6 g/t gold over 1.0 m,
and 46.7 g/t gold over 1.84 m (not true widths) at
approximately the 1,200 ft (370 m) elevation.
Far West
Drilling in the Far West was carried out from an
exploration drift at the 1,700 ft (520 m) elevation, and targeted
mineralization at the 2,000-2,600 ft (600-800 m) elevation. Results
were positive, highlights of this drilling include:
- Hole 520-EX290-02 grading 87.3 g/t gold over 1.15
m, located 1,000 ft (300 m) west of the DC and centered on
the 675 m elevation; and
- Hole 520-EX286-45 grading 80.3 g/t gold over 0.73
m at the 2,100 ft (650 m) elevation.
2018 Black Fox Complex Exploration Targets
Black Fox Deep
A deep directional drilling program from surface
targeting potential extensions of mineralization down dip of the DC
zone at 3,000-4,600 ft (900-1,400 m) depth is currently underway.
The deepest mineral reserve at Black Fox is currently at the 2,750
ft (840 m) elevation, and the deepest mineral resource is at the
2,900 ft (880 m) elevation. The deepest DC drill intercept to-date
was in Hole 520-EX346-28 grading 5.3 g/t gold over 1.45
m in a quartz vein with visible gold at the 3,450 ft
(1,050 m) elevation.
Tamarack – Intriguing Base Metals and
Gold
The Tamarack zone is located southeast of the
Black Fox open pit and contains significant gold and
zinc-lead-silver massive sulfide mineralization. The zone starts
near surface and appears to extend for 2,500 ft (760 m) vertical
with a coherent dip at the contact between volcanic and sedimentary
rock units (see Figure 2). As the Tamarack zone is open along
strike and at depth, current exploration is focused on determining
the distribution of gold and base metal zones and true size
potential.
Five surface drill holes have recently been
completed targeting base metal and gold mineralization. Hole
17BF-621, located down the dip of the near surface mineralization
returned 23.6% zinc, 15.0% lead, 0.15 g/t gold, 277 g/t
silver over 5.10 m (not true width).
Two underground drills were also mobilized, one
targeting the down dip projection of the surface base metal and
gold zone, and the second tracing the Deep Tamarack zone up dip at
the 1,650 and 2,000 ft (500 and 600 m) elevations. Hole
520-EX582-45 located 260 ft (80 m) up dip of Deep Tamarack returned
5.6% zinc, 0.4% lead, 0.5 g/t gold and 9.8 g/t silver over
5.97 m, including 40.8% zinc over 0.37 m
(not true width).
In 2017, six underground holes from the 1,700 ft
(520 m) elevation were drilled to refresh the understanding of a
tight cluster of historic holes that define the Deep Tamarack zone.
Drill holes tested the 2,450 and 2,800 ft (750 and 850 m)
elevations on approximately 160 ft (50 m) horizontal spacing around
the historic holes. Significant intersections of gold and base
metal mineralization (not always coincident) include:
- Hole 520-EX582-40 grading 5.4 g/t gold over 4.70
m; and
- Hole 520-EX584-42 grading 10.4 % zinc, 1.3% lead, 1.43
g/t gold, 18 g/t silver over 2.00 m
(not true width) in semi-massive sulfide mineralization.
Froome
Deposit
The Froome deposit is located 2,800 ft (850 m)
to the West of the Black Fox open pit. It was discovered in 2014
and has a current Indicated resource of 151,000 gold ounces
at a grade of 5.5 g/t. A drill program is focusing on
extending the Froome deposit at depth. It will be executed in
conjunction with geophysical methods to aid in vectoring towards
mineralization. Lateral extensions will also be tested to follow up
on prior significant lateral drill intersections to the northwest
and southeast of the deposit (see Figure 3).
Drilling in late 2016 along strike 1,000 ft (300
m) northwest of Froome returned an excellent intersection in Hole
16PR-G214 grading 12.5 g/t gold over 22.0
m, including 61.1 g/t gold over 3.2 m
(not true width). The follow up program of six holes intercepted
significant gold values without repeating the high-grade assays,
however the drilling supports the continuity of the host lithology
and warrants additional drilling, which will be completed in
2018.
Grey Fox
Deposit
Grey Fox has a current open pit and underground
resource of 668,000 gold ounces at a grade of 4.4
g/t in the Indicated category, and 174,000 gold
ounces at a grade of 4.2 g/t in the Inferred category.
Exploration at Grey Fox in 2018 will drill test the depth
extensions of high-grade portions of the deposit and along strike
within the Grey Fox structural zone.
Stock Property
The Stock property (location of the Black Fox
Stock Mill) is the site of the former Stock Mine, which
produced 137,000 gold ounces at a grade of 5.5 g/t
from an underground mine between 1989-2005. Exploration at Stock
will start by validating a historical near surface zone of
mineralization to the East of the mine.
Figures
1-3:http://mcewenmining.com/files/doc_news/archive/20180117_black_fox/figures_mux_jan_17_2018.pdf
Table 1 – Black Fox Drilling:
http://mcewenmining.com/files/doc_news/archive/20180117_black_fox/table_1_mux_jan_17_2018_black_fox_au_composites.xlsx
Table 2 – Froome Drilling:
http://mcewenmining.com/files/doc_news/archive/20180117_black_fox/table_2_mux_jan_17_2018_tamarack_composites.xlsx
Table 3 – Tamarack Drilling:
http://mcewenmining.com/files/doc_news/archive/20180117_black_fox/table_3_mux_jan_17_2018_froome_composites.xlsx
ABOUT MCEWEN MINING
McEwen has the goal to qualify for inclusion in
the S&P 500 Index by creating a profitable gold and silver
producer focused in the Americas. McEwen’s principal assets consist
of: the San José mine in Santa Cruz, Argentina (49% interest); the
El Gallo Gold mine in Mexico; the Black Fox mine in Timmins,
Canada; the Gold Bar mine in Nevada, currently under construction;
and the large Los Azules copper project in Argentina, advancing
towards development.
McEwen has a total of 337 million shares
outstanding. Rob McEwen, Chairman and Chief Owner, owns 24% of
McEwen.
QUALIFIED PERSON Technical information
pertaining to geology and exploration contained in this news
release has been prepared under the supervision of Dean Crick.
Mr. Crick is a "qualified person" within the meaning of NI
43-101.
TECHNICAL INFORMATIONBlack Fox
Complex drilling was conducted by Norex Drilling supervised by
McEwen’s Geology Department. All exploration drill core
samples at the Black Fox Complex were submitted as 1/2
core and analyses reported herein were performed by the independent
laboratories: Accurassay Laboratories, which is ISO/IEC 17025
certified, ALS Laboratories, which is ISO 9001/IEC17025
certified, Activation Labs, which is ISO 9001/IEC17025 certified,
SGS Canada Laboratories, which is ISO9001/IEC17025
certified, and Swastika Laboratories, which is ISO 17025
certified. Samples from definition and select delineation drilling,
and development sampling completed within the Black Fox mine are
assayed at McEwen's onsite laboratory. McEwen’s quality control
program includes systematic insertion of blanks, standard reference
material and duplicates to ensure laboratory accuracy.
To determine the lengths of significant
mineralised intervals, the following composite criteria was
established: a minimum reportable interval length of 3 m was
determined by establishing a cut off grade of 3.4 g/t Au for
underground (1 g/t Au for near surface). A consecutive maximum
length of 3 m of internal waste, including sub cut-off grade
material, is allowed and incorporated into the reported
composites. Where an interval of less than 3 m is considered,
if the grade x length calculation is greater than 10, it may be
reported. There is no top cutting or capping of assays.
CAUTION CONCERNING FORWARD-LOOKING
STATEMENTSThis news release contains certain
forward-looking statements and information, including
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. The forward-looking
statements and information expressed, as at the date of this news
release, McEwen Mining Inc.'s (the "Company") estimates,
forecasts, projections, expectations or beliefs as to future events
and results including, but not limited to, the closing of the
Offering and the use of proceeds thereof. Forward-looking
statements and information are necessarily based upon a number of
estimates and assumptions that, while considered reasonable by
management, are inherently subject to significant business,
economic and competitive uncertainties, risks and contingencies,
and there can be no assurance that such statements and information
will prove to be accurate. Therefore, actual results and future
events could differ materially from those anticipated in such
statements and information. Risks and uncertainties that could
cause results or future events to differ materially from current
expectations expressed or implied by the forward-looking statements
and information include, but are not limited to, factors associated
with fluctuations in the market price of precious metals, mining
industry risks, political, economic, social and security risks
associated with foreign operations, the ability of the corporation
to receive or receive in a timely manner permits or other approvals
required in connection with operations, risks related to
fluctuations in mine production rates, risks associated with the
construction of mining operations and commencement of production
and the projected costs thereof, risks related to litigation, the
state of the capital markets, environmental risks and hazards,
uncertainty as to calculation of mineral resources and reserves,
and other risks. The Company’s dividend policy will be reviewed
periodically by the Board of Directors and is subject to change
based on certain factors such as the capital needs of the Company
and its future operating results. Readers should not place undue
reliance on forward-looking statements or information included
herein, which speak only as of the date hereof. The Company
undertakes no obligation to reissue or update forward-looking
statements or information as a result of new information or events
after the date hereof except as may be required by law.
See McEwen Mining's Annual Report on Form 10-K for the fiscal
year ended December 31, 2016 and other filings with
the Securities and Exchange Commission, under the caption
"Risk Factors", for additional information on risks, uncertainties
and other factors relating to the forward-looking statements and
information regarding the Company. All forward-looking statements
and information made in this news release are qualified by this
cautionary statement.
The NYSE and TSX have not reviewed and do not accept
responsibility for the adequacy or accuracy of the contents of this
news release, which has been prepared by management of McEwen
Mining Inc.
CONTACT INFORMATION: |
Mihaela IancuInvestor Relations(647)-258-0395 ext
320info@mcewenmining.com |
Website:
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