Pure Gold Mining Inc. (TSX-V: PGM, LSE: PUR) reports that mine construction activities at its Red Lake Mine in Ontario are on schedule for first gold pour before the end of the year.
Darin Labrenz, President and CEO, said the company continues to make significant progress towards completing construction while ensuring the health and safety of our employees and contractors during COVID-19.
“The first gold pour planned for Q4 2020 aligns with a robust and rising gold market, that significantly exceeds the base-case parameters and strong project economics of the mine’s 2019 feasibility study,” Mr Labrenz said.
“We also continue to build size and scale: this month we begin drilling with the intent to convert resources to reserves and increasing resources from new high-grade discoveries at surface and at depth.
“We are not just building an integrated mining operation. We are building a fully-funded, long-life growth company uniquely positioned in the Red Lake camp, one of the world’s largest gold-producing districts. Our opportunity is tremendous: the real potential to become Red Lake’s next senior gold producer.
“Our 47 sq. km property possesses a proven, large high-grade gold system, with the same rocks, structure, timing, geology, grade and endowment potential as Evolution’s Red Lake mine just 15 kilometres away. Work to date has proven we have a clear and precise understanding of the geology and district, and we have demonstrated our ability to execute on our goals. Our future cash flow will fund our aggressive gold growth plans, and there is no more important time to be building a gold mine.”
Mr Labrenz said current market conditions improve the $CDN/oz gold price by 41% from the base case. Base-case parameters for the company’s 2019 feasibility are US$1,275 per ounce of gold and a US to Canadian exchange rate of $1.33, equal to a CDN $1,700 gold price.
“As a Canadian gold producer, the combination of stronger gold price and declining Canadian dollar has a material positive impact. As at May 7th, 2020, with gold at CDN$2,400 per ounce, the mine would generate an additional C$679 million in revenue over the base case.”
Mr Labrenz said detailed engineering in the process plant is now 95% complete, strengthening certainty for meeting production timeline.
“The company has increased placed equipment purchase orders of long-lead items to 80%, based on value, including key processing equipment. To date, the company has hired 60 new employees, most of whom are Red Lake residents.
“We are also continuing build upon our relationships with local and First Nation contractors and service providers.’