Brigus Gold Corp. ("Brigus Gold" or the "Company") (TSX: BRD)(NYSE
Amex: BRD) reports that operations at its Black Fox Mine ("Black
Fox") continue to ramp-up with increases in gold production
continuing quarter over quarter as a result of processing higher
average grade ore through the period. The third quarter ending
September 30, 2010 ("Q3 2010") will be the best operational quarter
for the mine since start up in May 2009 and higher production is
anticipated again for the fourth quarter of 2010 ("Q4 2010").
Q3 2010 Operating Performance
For Q3 2010, open pit operations will exceed targets for ore and
waste moved from the Phase 1 open pit and over burden moved for the
Phase 2 layback of the open pit. To date for the quarter, ore
production from the open pit has exceeded target and contributed to
increases in surface stockpiles. The positive results are
attributable to high equipment availability and operator
performance, better than expected material quality and favourable
weather conditions.
The average gold head grade to the Black Fox Mill is forecast at
3.9 grams per tonne ("gpt") for Q3 2010, which is approximately15%
higher than the 3.4 gpt grade in the second quarter of 2010 ("Q2
2010") and 44% higher than 2.7 gpt in the first quarter of 2010.
Grade control practices in the open pit continue to improve and
grades are expected to continue to meet plans moving forward.
The mill throughput rate for Q3 2010 is forecast at over 1,950
tonnes per day ("tpd"). The throughput rate was impacted by a
48-hour shutdown to replace an underperforming motor on the primary
ball mill. Since the shutdown, the mill has consistently averaged
over 2,000 tpd. Early in the quarter, mill recoveries suffered from
high carbon attrition rates, directly related to receipt from a
supplier of poor quality carbon. This problem was investigated and
corrected but it took most of July to displace the carbon in
circuit with fresh, better quality material. Despite mine
production being in line with expectations, these processing issues
have resulted in mill production shortfalls during the quarter.
Gold production for the quarter is expected to be in the range of
21,000 to 22,000 ounces, which represents a 15% to 20% improvement
over production levels of 18,028 ounces during Q2 2010.
In an effort to identify and evaluate short and long term
performance enhancement opportunities with the mill, the Company
retained Mackie and Associates and EHA Engineering consultants to
carry out a review of the plant operation. The goal of the review
was to provide recommendations for immediate improvements to
recovery and throughput as well as to develop concepts and cost
benefit analysis leading to opportunities for potential increased
future throughput. The final report is being prepared and will be
available in October 2010.
Total cash costs for Q3 2010 are anticipated to be within the
Company's estimated range of $500 and $550 per ounce of gold sold,
compared with $532 per ounce for the first six months of 2010.
Pre-stripping of the Phase 2 open pit, which will not commence
mining of ore until 2011, are included in the Q3 2010 cash costs
per ounce forecast in accordance with United States Generally
Accepted Accounting Principles. Q3 2010 cash cost per ounce
estimates include approximately $100 per ounce of Phase 2 open pit
pre-stripping costs. Actual cash costs for the quarter will be
reported with Q3 2010 financial results by November 15, 2010.
Underground Operations
Initial underground production commenced, on schedule, in late
August 2010. During Q4 2010, the Company expects intermittent ore
will be produced from development headings while production faces
are prepared. The focus for the underground mine crews continues to
be completion of infrastructure to support an intended steady state
underground mining rate of 800 tpd. This ongoing work includes
developing a new, larger profile ramp to connect to the surface and
replace the existing ramp. The new ramp will remove the haulage
constraint experienced previously at the mine. The new ventilation
and service raise is expected to be completed by January 2011. The
long term mine plan continues to be optimized by Brigus Gold's new
management to provide for life of mine efficiency.
The current underground workforce includes 75 contract miners
from Cementation Inc. and other mining contractors, plus 20 Brigus
Gold employees. Brigus Gold's workforce continues to grow, and will
displace the majority of the contract workforce by mid-2011.
Gold production is expected to continue to increase quarter over
quarter until steady state production is achieved with the
underground portion of the mine producing at 800 tpd and the open
pit moving to 1,200 tpd, down from the current open pit production
rate of 2,000 tpd. Steady state production from underground is
scheduled to occur in the second quarter of 2011.
Infrastructure Program
Mine infrastructure facilities, including offices, warehouse,
mine dry, core logging and sample preparation areas have been
completed and are in service. A new maintenance facility is
currently under construction on surface and will replace the
temporary facility that has been used for the past two years. The
new facility is expected be functional by early December 2010 and
will provide for proper equipment servicing through-out the mine
life.
Infrastructure upgrades, including completion of the new
maintenance facility, are expected to be completed at a cost of
$24.3 million, approximately $3.3 million in excess of the original
plan. These additional costs will be partly offset by expected
savings on overburden removal of the Phase 2 open pit development
referenced earlier.
Underground Definition Drilling Confirms Ore Grade
Recent underground definition drilling below the 235 metre ("m")
level, has confirmed the reserve grade and zone of mineralization
in the mine plan that will form part of the initial underground
production. Ongoing underground definition drilling by Brigus has
augmented previous drilling and highlights of assay results
include:
-- 759-016 : 8.54 gpt over 13.0 m, with 24.38 gpt over 4.1 m
-- 759-012: 4.58 gpt over 15.3 m with 13.27 gpt over 3.3 m and 4.97 gpt
over 6.1 m.
Surface Exploration Results
The exploration program at the Black Fox Complex, including the
Black Fox Mine and contiguous Grey Fox-Pike River properties, has
to date included the completion of 28 drill holes, totalling 10,387
metres ("m"), on the Contact Zone, Destor-Porcupine Fault Zone and
four new targets. As of this date, assay results have been returned
for 14 drill holes. (See the drill hole location map in the PDF of
this news release on Brigus Gold's website.)
The four new targets being drilled include the Historic Gibson
Deposit, the Gibson Shear, School House Zone and the Hislop North
Zone. All four of these targets lie within 1-km of the Contact
Zone. These gold mineralized zones were identified as potential
targets from an evaluation of historic exploration work, geophysics
and geologic mapping, and have now been confirmed by drilling. All
targets are located within 2-km of Brigus Gold's existing Black Fox
Mine and 37-km of the Black Fox Mill, providing the opportunity for
rapid advancement.
Assay results from the first 14 holes have shown consistently
good gold intercepts, similar to previous results from the Contact
Zone, (all uncut with no true widths defined unless otherwise
noted) including the following:
Gibson Shear
-- GF10-73: 2.11 gpt over 22.94 m
-- GF10-72: 2.3 gpt over 6.06 m
School House
-- GF10-71: 37.30 gpt over 1.0 m, 5.49 gpt over 0.95 m and 6.75 gpt over
0.45 m
Contact Zone/Hanging Wall (estimated true widths)
-- GF10-70: 5.69 gpt over 0.89 m and 2.46 gpt over 6.01 m
-- GF10-77: 3.53 gpt over 1.74 m with 5.28 gpt over 1.0 m
-- GF10-78: 3.60 gpt over 3.07 m with 8.38 gpt over 1.31 m
Detailed assay results are available on the Company's website at
www.brigusgold.com.
Howard Bird, Brigus Gold's Vice President of Exploration, said,
"The surface drilling program at the Black Fox Complex continues to
yield positive gold results. We are now undertaking an aggressive
drill program to complement the high-interest gold results obtained
from 2004-2005 deep drilling at the Black Fox Mine. We are
generating a pipeline of regional exploration opportunities at the
Black Fox Complex with excellent potential for new gold discoveries
and we are focused on expanding known gold mineralization at the
Contact Zone where an initial National Instrument 43-101 compliant
resource estimate will be released during the fourth quarter. In
addition, we are reviewing historical information from the past
producing Stock underground gold mine, located at our wholly owned
Black Fox Mill property, to determine the potential of identifying
new resources with the obvious advantage of having an operating
mill on site."
Brigus Gold is preparing an initial National Instrument 43-101
compliant gold resource estimate for the Contact Zone based on
limited drilling completed in 2009 and 2008. The Contact Zone has
been intercepted along 850 m of strike and remains open on strike
to the north, south and down dip. Based on 65 completed holes, the
resource estimate will cover 435 m of the known 850 m strike
length. Most of the 2008 and 2009 drilling was concentrated within
120 m of bedrock and the deepest drill hole, GF09-58, intersected
the main lens at 222 m below surface grading a weighted average of
10.58 gpt over a true horizontal width of 3.7 m.
There are currently three drill rigs operating at the Black Fox
Complex. One rig will complete 5,000 m of step-out drilling
targeting the expansion of the Black Fox gold deposit along strike
and down-dip where the deposit remains open for expansion. Two
drill rigs are drilling the Contact Zone, the Destor- Porcupine
Fault Zone, the Historic Gibson Deposit, the Gibson Shear, the
School House Zone and the Hislop North Zone. A fourth drill rig
will be added to test new exploration targets. This surface
drilling program is expected to generate approximately 15,000 m of
core by year-end.
Gold Mineralization Potential at Brigus Gold's Black Fox Mill
Property
Brigus Gold has commenced reviewing historical information from
the past producing underground Stock Gold Mine located on our
wholly-owned 24 square km Black Fox Mill property, and adjacent to
the mill. The review will determine the potential of extending the
known gold mineralized zones (shoots) down plunge at the Stock gold
mine, as well as, to generate new drill targets. Similar to the
Black Fox gold mine, the Stock gold mine is hosted by the
Destor-Porcupine Fault Zone ("DPFZ"). The Stock gold mine comprises
a 3-compartment shaft developed to a depth of 275 meters below
surface. A production ramp extends from the 140 meter level to
approximately 330 meters below surface. The Stock Mine was in
production from 1989 to 1994 and also in 2000.
Following the completion of the Black Fox Mill Property data
compilation and review, it is expected that a drilling program will
be conducted on the Stock gold mine and surrounding targets such as
the Discovery West Zone.
Geophysical Exploration Program
An airborne, high-resolution, magnetic geophysical survey was
completed during the first week of September 2010 and final data
results are expected in October 2010. The airborne survey covered
the entire Black Fox complex, as well as the 24-square km Black Fox
Mill property, where the past producing Stock gold mine is located.
In addition, line cutting at the Black Fox Complex has commenced in
preparation for the advanced Quantec Titan 24 geophysical system
survey. This system detects conductive mineralization, disseminated
mineralization, alteration, structure and geology resulting in the
identification of prospective drill targets. The Titan survey was
completed over the Black Fox Mine in 2004 and successfully defined
the mine deposit.
Underground drilling was conducted by Azimut Drilling and
surface drilling was conducted by Norex Drilling. Drilling was
supervised by the Black Fox staff. All 2010 sample analyses
reported herein were performed by Polymet Labs of Cobalt, Ontario,
which is ISO 9001:2000 certified in North America, and by SGS
Laboratories of Sudbury, Ontario, using standard fire assay
procedures. Intercepts cited do not necessarily represent true
widths, unless otherwise noted. Brigus Gold's quality control
checks include insertion of blanks and standards to ensure
laboratory accuracy.
Vice President and Chief Operating Officer Richard Allan
reviewed the operations information in this news release and Senior
Exploration Project Manager John A. Dixon P. Geo reviewed the
technical exploration information in this release as the Qualified
Persons for the Company.
About Brigus Gold
Brigus Gold is a growing gold producer committed to maximizing
shareholder value through a strategy of efficient production,
targeted exploration and select acquisitions. The Company operates
the wholly owned Black Fox Mine in the Timmins Gold District of
Ontario, Canada. The Black Fox Mine is located in the Township of
Black River-Matheson, Ontario, Canada. Brigus Gold is also
advancing the Goldfields Project located near Uranium City,
Saskatchewan, Canada, which hosts the Box and Athona gold deposits.
In Mexico, Brigus Gold holds a 100 percent interest in the Ixhuatan
Property located in the state of Chiapas, and an 80 percent
interest in the Huizopa Joint Venture, an early stage, gold-silver
exploration joint venture located in the State of Chihuahua. In the
Dominican Republic, Brigus Gold also has a joint venture for the
APV and Loma El Mate gold exploration projects.
Cautionary Note to U.S. Investors Concerning Estimates of
Mineral Resources
This news release uses the term mineral "resources". The Company
advises U.S. investors that while these terms are defined in and
required by Canadian regulations, these terms are not defined terms
under the U.S. Securities and Exchange Commission ("SEC") Industry
Guide 7 and are generally not permitted to be used in reports and
registration statements filed with the SEC. The SEC generally only
permits issuers to report mineralization that does not constitute
SEC Industry Guide 7 compliant "reserves" as in-place tonnage and
grade without reference to unit measures. U.S. investors are
cautioned not to assume that any part or all of mineral deposits in
these categories will ever be converted into reserves.
Non-GAAP Financial Measures
The term "total cash cost" is a non-GAAP financial measure and
is used on a per ounce of gold basis. Total cash cost is equivalent
to direct operating cost as found on the Consolidated Statements of
Operations and includes by-product credits for payable silver
production. The Company has included total cash cost information to
provide investors with information about the cost structure of our
mining operations. This information differs from measures of
performance determined in accordance with GAAP in the United States
and Canada and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP. This measure is not necessarily indicative of operating
profit or cash flow from operations as determined under GAAP and
may not be comparable to similarly titled measures of other
companies.
Cautionary and Forward-Looking Statements
This news release includes "Forward-Looking Statements" within
the meaning of section 21E of the United States Securities Exchange
Act of 1934, as amended. All statements regarding the increased
quarterly gold production, average grade of gold, anticipated total
cash costs, tonnes of material moved, expected mill throughput
rate, in each case in Q3 2010, operational performance in Q4 2010,
ore produced from development headings in the underground mine in
Q4 2010, completion of the ventilation and surface raise and new
ramp in respect of the underground mine, plans for the Company's
surface and underground exploration drilling programs and the
results associated therewith, the amount of surface drilling, the
addition of drill rigs operating at Black Fox Complex and the
timing associated therewith, increase of Black Fox resources,
matters relating to the geophysical survey of the Black Fox Complex
and the timing thereof, release date of a National Instrument
43-101-compliant estimate for the Contact Zone, and additions to
resources in 2011 are forward-looking statements and estimates that
involve various risks and uncertainties. There can be no assurance
that such statements will prove to be accurate and actual results
and future events could differ materially from those anticipated in
such statements. Important factors that could cause actual results
to differ materially from these forward-looking statements include
environmental risks and other factors disclosed under the heading
"Risk Factors" in Brigus Gold's and its predecessor companies' most
recent annual report on Form 10-K filed with the United States
Securities and Exchange Commission and elsewhere in Brigus Gold's
documents filed from time to time with the Toronto Stock Exchange,
the NYSE Amex, the United States Securities and Exchange Commission
and other regulatory authorities. All forward-looking statements
included in this news release are based on information available to
the Company on the date hereof. The Company assumes no obligation
to update any forward-looking statements, except as required by
applicable securities laws.
Contacts: Brigus Gold Corp. Wendy Yang Vice President of
Investor Relations 720-886-9656 Ext. 217 ir@brigusgold.com Brigus
Gold Corp. Sean Tufford Director of Investor Relations 902-422-1421
or Toll Free: 1-866-785-0456 sean@brigusgold.com
www.brigusgold.com
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