Pure Gold expands mineral resource with additions from Russet South and Fork satellite deposits
Friday, Dec 15, 2017
Pure Gold Mining Inc. (TSX-V:PGM) (“Pure Gold” or the “Company”) is pleased to announce the addition of mineral resources from two satellite deposits at its 100% owned Madsen Gold Project (“Madsen”) in the Red Lake mining district in northwestern Ontario. This estimate, which includes mineral resources from the Russet South and Fork deposits, adds 96,000 ounces of indicated resources and an additional 118,000 ounces of inferred resources to the Madsen Gold Project.  Both deposits outcrop at surface and are situated approximately 1.5 kilometres from the existing milling infrastructure, and both remain open for expansion, highlighting the organic growth opportunity at Madsen.   The mineral estimate was prepared by Ginto Consulting Inc. of Vancouver, Canada (“Ginto”) and is dated December 14, 2017. 

Significant release highlights:

  • New indicated mineral resources at Russet South total 56,000 ounces (259,000 tonnes at an average grade of 6.7 g/t gold) and inferred mineral resources total 71,000 ounces (322,000 tonnes at an average grade of 6.8 g/t gold) at a 4.0 g/t cut-off;
     
  • New indicated mineral resources at Fork total 40,000 ounces (194,000 tonnes at an average grade of 6.5 g/t gold) and inferred mineral resources total 47,000 ounces (255,000 tonnes at an average grade of 5.8 g/t gold) at a 4.0 g/t cut-off;
     
  • The Fork and Russet South deposits have the potential to positively impact annual throughput and the production profile at Madsen;
     
  • Both deposits are outcropping at surface, road accessible, close to existing milling infrastructure, and remain open for expansion;
     
  • Exploration at site continues with 28,000 metres of surface drilling designed to target discovery and growth of mineral resources; and
     
  • No update was completed at this time for the main Madsen deposit mineral resource and the resource estimate disclosed on August 2, 2017 remains current.
“The discovery of high-quality, near surface mineral resources with strong potential to positively impact project economics is an important component of our strategy at Madsen,” said Darin Labrenz, President and CEO of Pure Gold.  “Our exploration to date has been highly successful in outlining the exceptional growth opportunity demonstrated by the significant expansion of the Madsen mine resource, previously disclosed, and the current addition of initial satellite resources.  With both Russet South and Fork deposits hosting near surface mineral resources within 1.5 kilometres of our existing milling infrastructure, we can begin to consider a scenario where supplementary mill feed from satellite deposits adds flexibility and an opportunity to boost the production profile.”

The mineral resources reported herein represent the first two initial estimates of the Company’s several satellite targets, and both targets remain open for further substantial expansion along strike and particularly to depth. Importantly, the technical team has developed a proven understanding of mineralizing controls both within and outside of the main Madsen Mine trend, and this understanding is adding considerable strength and confidence to our exploration targeting to expand known resources and to discover and delineate additional satellite deposits.

Mineral Resource Estimate


The geologic model utilized for both the Russet South and Fork estimates is integrated with the Company’s current geologic understanding of the Madsen mineral system.  The mineral resource estimate at Russet considered data from 32,803 metres of drilling from 123 drill holes, of which 110 drill holes were completed by Pure Gold. The data cut-off used for the resource estimate at Russet South is October 20, 2017.   At Fork, the mineral resource estimate considered data from 44,087 metres of drilling from 117 drill holes, of which 21 drill holes were drilled by Pure Gold. The data cut-off used for the resource estimate at Fork is October 20, 2017. At both deposits all available drill holes completed by other operators were re-logged and re-sampled if required, and all available collar locations were surveyed by sub-meter differential GPS. 

The estimation methodology used for all zones is ordinary kriging and the mineral resource is reported at a 4.0 g/t gold cut-off based on a gold price of US$1,200 per troy ounce, gold metallurgical recoveries of 92 percent, and assumed underground mining methodology.

The updated mineral resource estimate for the Russet South and Fork deposits is reported at a 4.0 g/t Au cut-off effective December 14, 20171.  The Madsen deposit mineral resource is reported at a 4.0 g/t cut-off effective August 2, 2017.  No update was completed at this time for the main Madsen deposit mineral resource and the resource estimate disclosed on August 2, 2017 remains current.  As such, the Preliminary Economic Assessment (“PEA”) disclosed by the Company on September 14, 2017 also remains current.  It is anticipated that the Madsen deposit mineral resource will be updated in conjunction with the 2018 Madsen Feasibility Study. To date, approximately 43,000 metres from 93 drill holes have been drilled to test and infill certain areas in the Madsen mine resource since the April 11, 2017 data cut-off.

Exploration Next Steps

Drilling and applied geoscience to date has provided a strong understanding of the controls and continuity of mineralization and the Company continues to successfully test extensions of the large mineral system present across the Madsen Property.  Recent drilling by the Company has successfully pursued near surface extensions of the Madsen mineral system southward from the Fork deposit into the footwall of the Starratt Olsen Mine.  Results from this drilling are pending and will be released once received.

Additionally, the Company will be targeting the Russet South – 8 Zone corridor in 2018 with the goal of expanding known mineralization up dip from the 8 Zone and down dip from Russet South, as well as testing the 1.6 kilometre gap between the two gold deposits. The Company intends to resume surface drilling in early 2018 to target the down dip extension of Russet South, with the intent of expanding the resource below its current depth extents of approximately 250 metres.

ABOUT MADSEN

The Madsen Gold Project has historic production of 2.5 million ounces of gold and remains one of the highest-grade, undeveloped gold projects in the world.2 With an indicated resource of 1,744,000 ounces gold at 8.7 g/t gold (in 6.2 million tonnes) and an inferred resource of 296,000 ounces gold at 7.9 g/t gold (in 1.2 million tonnes), the Project benefits from existing infrastructure including a mill and tailings facility, paved highway access, and access to power, water and experienced labour.3 The initiation of a feasibility study in 2017 has put the Madsen Gold Project firmly on the path to becoming Ontario’s next gold mine.

For more information, please visit: http://puregoldmining.ca

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