NEW YORK, May 28, 2021 /PRNewswire/ -- Gold is widely viewed as an inflation hedge - a reliable measure of protection against purchasing power risk. Generally, gold prices increase in value as the purchasing power of the dollar declines. Now, there are major inflation concerns. JPMorgan Chase CEO Jamie Dimon warned the White House that the government's sweeping USD 4 Trillion spending plans could lead to inflation. While testifying before the Senate Banking Committee, Dimon suggested that the Federal Reserve may need to raise interest rates sooner than they have anticipated to reduce down rising prices. Gold Mountain Mining Corp. (TSX-V: GMTN) (OTC: GMTNF), Fortuna Silver Mines Inc. (NYSE: FSM), Yamana Gold Inc. (NYSE: AUY), Kinross Gold Corporation (NYSE: KGC), Endeavour Silver Corp. (NYSE: EXK)
According to a report by Kitco, Jon Deane, the CEO of Trovio, explained that "we are already seeing inflation. If you look around the world, you see real estate prices, building supplies, and services skyrocket," he said. "What we created since the early 1990s is an entire financial infrastructure that is relying on debt, and we have accelerated that dramatically in our response to managing the COVID-19 crisis. In that regard, we will continue to increase the money supply globally, and we will continue to have a quite aggressive fiscal policy. We are sitting on an economic cliff."
Gold Mountain Mining Corp. (TSX-V: GMTN) (OTCQB: GMTNF) announced yesterday breaking news, "an updated preliminary economic analysis of the Elk Gold Project. The update is based on the increased Mineral Resource Estimate announced on May 14, 2021, the Ore Purchase Agreement with New Gold Inc. ("New Gold") announced on January 26, 2021 (the "Ore Purchase Agreement") and the Mining Contract with Nhwelmen-Lake LP announced on January 19, 2021 (the "Mining Contract"). An updated preliminary economic assessment (the "PEA") will be filed on the Company's website and SEDAR within 45 calendar days of May 14, 2021.
- Updated PEA with an After-tax NPV5% of C$231M
- 19,000oz annual production (Years 1-3) expanding to 65,000oz annual production (Years 4-11)
- Increased cost certainty over September 2020 PEA through executed:
- Construction and Mining Contract with Nhwelmen-Lake LP
- Ore Purchase Agreement with New Gold Inc.
- Revised mine plan eliminates construction of an onsite mill and incorporates underground mining
Elk Gold Project PEA Summary
The PEA contemplates an initial 19,000 ounce per year mine that ramps up to 65,000 ounces of annual production by Year 4. The pre and post tax NPV (5% discount) are $395M and $231M, respectively. The PEA contemplates that for the life of mine, the mineralized material from the Elk Gold Project will be mined by the Company's contract mining partner, Nwhelmen-Lake LP ("Nwhelmen-Lake") and then delivered to New Gold's New Afton Mine located approximately 130km from the Elk Gold Project (the "New Afton Mine").
The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Elk Gold Resource Update - Summary
On May 14, 2021 the Company announced the following updated resource estimate at the Elk Gold Project:
Au Capped g/t
Ag Capped g/t
Measured + Indicated
CIM definitions were followed for classification of Mineral Resources.
Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
Results are presented in-situ and undiluted.
Mineral resources are reported at a cut-off grade of 0.3 g/t Au for pit-constrained resources and 3.0 g/t for underground resources.
The number of tonnes and metal ounces are rounded to the nearest thousand.
The Resource Estimate includes both gold and silver assays. The formula used to combine the metals is:
AuEq = ((Au_Cap*55.81*0.96) + (Ag_Cap*0.76*0.86))/(55.81*0.96)
The Resource Estimate is effective as of May 1, 2021.
Elk Gold Project Preliminary Economic Assessment`
Qualification and Assumptions
The following section sets out the qualifications and assumptions behind the economic analysis supporting the PEA. The PEA envisages a conventional open pit mining operation for the life of mine with underground mining is commissioned in Year 4. The first three years of operation are planned at 70,000tpa (200tpd). Starting in Year 4 of the mine plan, the mine expands to a 324,000tpa (900tpd) operation.
The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability…
The foregoing technical information was approved by Grant Carlson, P.Eng., a Qualified Person, as defined under National Instrument 43-101 and the Chief Operating Officer for Gold Mountain Mining Corp.
The technical information relating to the resource estimate was prepared by Greg Mosher P. Geo (Global Mineral Resource Services) a Qualified Person as such term is defined under National Instrument 43-101 who is independent of Gold Mountain.
The technical information relating to the project economics were prepared by Antonio Loschiavo P. Eng (AKF Mining Services Inc. and also responsible for the overall preparation of the PEA), and a Qualified Person as such term is defined under National Instrument 43-101 who is independent of the Company."
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Fortuna Silver Mines Inc. (NYSE: FSM) reported last year the first gold pour from its Lindero Mine located in the Province of Salta in Argentina. The pour took place today, on Tuesday, October 20th, 2020, and produced 728 ounces of gold. Jorge A. Ganoza, President, CEO and Director, commented, "The first gold pour at Lindero, our third mine in the Americas, is a significant achievement for the Company as we advance the mine's ramp-up phase towards commercial production in the first quarter of 2021. Lindero is a mine with reserves for a projected life of thirteen years and is a pillar in Fortuna's asset portfolio." Mr. Ganoza continued, "I want to take this opportunity to commend our Salta based team's commitment and hard work in achieving this milestone, especially in the context where COVID-19 related restrictions continue to pose multiple limitations." Mr. Ganoza concluded, "If conditions permit, we look forward to hosting an on-site inauguration ceremony of Argentina's newest gold mine with provincial and federal authorities early next year."
Yamana Gold Inc. (NYSE: AUY) announced back in March that National Instrument 43-101 technical reports have been filed with Canadian securities regulators for the Canadian Malartic mine in Quebec, Canada, and the El Peñón mine in Antofagasta Region, Chile. The new technical reports, called "NI 43-101 Technical Report, Canadian Malartic mine, Quebec, Canada" and "NI 43-101 Technical Report, El Peñón Gold-Silver mine, Antofagasta Region, Chile", respectively, have an effective date of December 31, 2020, and are available under Yamana's profile on www.sedar.com. The reports provide technical updates on two of Yamana's cornerstone assets and information supporting the mineral reserves and mineral resources that form the basis for the Company's 10-year strategic production outlook presented in January.
Kinross Gold Corporation (NYSE: KGC) announced last September, that it has entered into agreements to acquire a 70% interest in the high-quality Peak Gold project in Alaska from Royal Gold, Inc. ("Royal Gold") and Contango ORE, Inc. (OTCQB: CTGO) ("Contango") for total cash consideration of USD 93.7 Million. Kinross will have broad authority to construct and operate the Peak Gold project, with Contango retaining a 30% non-operating minority interest. "The relatively high-grade, low-cost Peak Gold project is an excellent addition to our portfolio, as it allows us to leverage our existing mill and infrastructure at Fort Knox and strengthens our medium-term production and cash flow profile. In today's gold price environment, Peak Gold is an attractive, high-margin project that is expected to generate robust returns," said J. Paul Rollinson, Kinross Gold President and CEO. "The project is also expected to add to our strong record of socio-economic contributions to our host communities in Alaska, one of the top mining jurisdictions in the world."
Endeavour Silver Corp. (NYSE: EXK) reported recently that it has intersected high grade gold-silver mineralization in its 2021 exploration drill program to expand the Melladito and Belen orebodies at the Bolañitos Mine in Guanajuato State, Mexico. The Company is currently producing from four orebodies at Bolañitos: Plateros, Lucero, San Miguel and Melladito. Exploration drilling is ongoing along the Melladito and Belen veins (view longitudinal sections here). Luis Castro, Vice President of Exploration, commented, "We continue to intersect strong drill results as we step out from the current margins of the Melladito and Belen orebodies, with a number of other targets to drill, along both the Melladito and Belen veins."
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