THUNDER BAY, ON, Dec. 18, 2019 /CNW/ - PREMIER GOLD MINES
LIMITED ("Premier", "the Company") (TSX: PG) (OTCPK:
PIRGF) is pleased to provide an operations update for the
Company's 100%-owned Mercedes Mine, located in the State of Sonora, Mexico and an exploration and
operations update at the 40%-owned South Arturo Property located in
the Carlin Trend of Nevada.
Mercedes Mine, Mexico
The Mercedes Mine is located 150 km northeast of the city
of Hermosillo in the state of Sonora, Mexico. Operations are
exploiting low-sulfidation quartz veins and quartz-veinlet
stockwork for gold and silver with an ore extraction rate targeting
2,000 tonnes per day.
The Company has worked on several initiatives at Mercedes to
provide an increased, stable and predictable production profile in
2020 and beyond. A successful 2019 drill campaign has resulted in
the discovery of higher-grade zones located near existing mine
workings, and plans are emplaced to benefit from them.
Operational improvement effort at the mine focused on a few key
areas, beginning with identifying near-mine, accessible ore in the
Lupita extension and Marianas. Entering in these areas in 2020 will
multiply the number of available ore heading and stopes, allowing
for more flexibility and increased production. An ameliorated
reconciliation process is being developed and implemented for the
mine to reconcile the grade of mined ore to the block model
estimate. This tool will also provide the operations with valuable
information that will be used for further refinement. Additionally,
the mine continues to work to reduce dilution, one initiative is
through the modification of mining equipment which is decreasing
the size of development headings where appropriate.
This year has seen the most significant exploration successes
since Premier acquired the mine in 2016. The discovery of the
Lupita Extension, San Martin and
Neo mineralized horizons are expected to positively impact not only
future resources, and therefore mine life, but also the grade as
drilling in 2019 is delivering results well in excess of current
reserve grade at the mine. Multiple high-grade results were
returned from these new areas as outlined in the November 21st press release "Premier
Expands High Grade at Mercedes Mine".
The Company recently bolstered its operational team with the
addition of Peter Van Alphen as
Chief Operating Officer. Under his guidance, the Company has
implemented several strategies to improve upcoming performance at
Mercedes. However, 2019 has been a difficult year with lower than
expected production and higher than expected costs. At the end of
the third quarter, year-to-date mine production totaled 47,627
ounces of gold and 146,496 ounces of silver with total Co-product
cash costs of $973/oz Au and
Co-product All-in sustaining costs of $1,226/oz Au. As previously stated, the Company
will not achieve its production or cost guidance at Mercedes for
the year but does expect substantial improvements in 2020 and
beyond.
South Arturo, Nevada
The South Arturo Mine is a joint venture between Premier and
Nevada Gold Mines LLC, a joint venture between
Newmont-Goldcorp and Barrick Gold Exploration Inc. ("Barrick")
operated by Barrick. During the year, mine development progressed
at two new mining centers, the El Nino underground mine and
the Phase 1 open pit.
El Nino underground mine has now declared commercial
production, ahead of schedule, and mining continues to ramp up in
this new production center that is expected to contribute
positively to the Company's production profile. Successful drilling
from underground drill stations returned numerous positive results
including 24.4 m of 20.60 g/t (SEC19010),
32.0 m of 10.09 g/t Au (IER19021), and
51.8 m of 11.13 g/t Au (IER19031).
Construction of the open pit portion of the project continues.
Stripping of the Phase 1 pit is ongoing and further economic
studies are being finalized for the Phase 3 pit. Currently
under review is a heap leach facility for the primary use of the
South Arturo ore. Heap leach material encountered in the
stripping program is being stockpiled on-site.
Exploration drilling was also completed at South Arturo in an
effort to increase reserves and resources. Primary targets include
the Phase 3 pit target and East Dee, a high-grade mineralized
zone located immediately to the east of the Phase 1 open pit.
Recent highlight intercepts in Phase 3 open pit drilling
include 112.8 m of 7.29 g/t Au (MAD19004) and
62.5 m of 7.39 g/t Au (MAD19002) (See press release
dated October 28, 2019 for complete
results).
McCoy-Cove, Nevada
During the year, work progressed towards the commencement of an
underground development and drilling program in order to complete a
Feasibility Study related to the Cove deposit. This Carlin-style
deposit is host to one of the highest-grade undeveloped gold
deposits in the United States. The
construction of a power line to the proposed portal location, as
well as hydrological pump tests from large diameter wells were
completed on the property. The underground program is currently
under review to optimize the timing while the Company finalizes the
budget for 2020.
Greenstone Gold Mines, Ontario
In October, the Company announced the results of an updated
mineral resource estimate for the Hardrock deposit, which includes
the Hardrock open pit deposit that is located south of Geraldton, Ontario. Hardrock, the primary
deposit within the larger Greenstone Property, is owned by
Greenstone Gold Mines, a 50/50 partnership between Premier and
Centerra Gold Inc (TSX:CG).
The resource update resulted in total Measured and Indicated
Resources of 7,105,000 ounces of gold for the Hardrock deposit, an
11% increase versus the 2016 estimate including Measured and
Indicated Resources (M+I) restricted to open pit potential of
5,868,000 ounces of gold including an initial
237,000 ounces in the Measured category. The updated
2019 mineral resource estimate represents a 21% increase in grade,
26% increase in ounces and 4% increase in tonnes versus
Measured and Indicated O/P resources reported in the 2016
Feasibility Study and is supported by some 12,000 m of
additional infill core drilling and 26,000 m of reverse
circulation (RC) drilling in selected areas during two
campaigns held in 2018 and 2019.
Premier Gold Mines Limited is a gold-producer and
respected exploration and development company with a high-quality
pipeline of precious metal projects in proven, accessible and safe
mining jurisdictions in Canada,
the United States, and
Mexico. Premier remains focused on
creating a low cost, mid-tier gold producer through its two
producing gold mines, South Arturo and Mercedes, and through future
mine development opportunities at Hardrock in Ontario (Greenstone Gold JV), where permitting
and development initiatives are ongoing and at the McCoy-Cove
Project in Nevada.
Stephen McGibbon, P. Geo., is the
Qualified Person for the information contained in this press
release and is a Qualified Person within the meaning of National
Instrument 43 - 101. The primary assay laboratories for
the South Arturo Mine are ALS Chemex Labs (ALS Chemex) and American
Assay Labs (American Assay) in Reno,
Nevada. For a complete description of sample preparation,
analytical methods and QA/QC procedures, refer to the technical
report for the South Arturo dated March 26,
2018 (effective date December 31,
2017), entitled "Technical Report on the South Arturo Mine,
Elko County, State of Nevada, USA" located on Premier's
website and at www.sedar.com.
This Press Release contains certain information that may
constitute "forward-looking information" under applicable Canadian
securities legislation. Forward-looking information includes, but
is not limited to, statements about strategic plans, including
future operations, future work programs, capital expenditures,
discovery and production of minerals, price of gold and currency
exchange rates, mineral resource and mineral reserve estimates and
corporate and technical objectives. Forward-looking information is
necessarily based upon a number of assumptions that, while
considered reasonable, are subject to known and unknown risks,
uncertainties, and other factors which may cause the actual results
and future events to differ materially from those expressed or
implied by such forward-looking information, including the risks
inherent to the mining industry, adverse economic and market
developments and the risks identified in Premier's annual
information form under the heading "Risk Factors". 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 information. Accordingly, readers should not
place undue reliance on forward-looking information. All
forward-looking information contained in this press release is
given as of the date hereof and is based upon the opinions and
estimates of management and information available to management as
at the date hereof. Premier disclaims any intention or obligation
to update or revise any forward-looking information, whether as a
result of new information, future events or otherwise, except as
required by law.
SOURCE Premier Gold Mines Limited