11th May 2020 16:34
(Alliance News) - Pure Gold Mining Inc on Monday said it is still on track for first gold pour by the end of 2020 at the PureGold Red Lake mine in Ontario, Canada.
Shares in Pure Gold were up 12% at 54.40 pence in London in afternoon trading.
Pure Gold noted its "significant progress towards completing construction" at the mine despite the Covid-19 pandemic, with first gold pour planned for the fourth quarter in line with "a robust and rising gold market".
The company further asserted that the current market "significantly exceeds the base-case parameters and strong project economics of the mine's 2019 feasibility study" and the company is still building both size and sale.
Pure Gold noted a 41% improvement in the price of gold in terms of CAD per ounce from the base case, with the price having risen to CAD2,400 on May 7 - approximately GBP1,387. This represents a further CAD679 million of revenue versus the base case, as the value of the safe haven asset increased amid a turbulent market during the Covid-19 pandemic.
In May, Pure Gold started drilling with the goal to convert resources to reserves at PureGold Red lake, as well as the aim of increasing resources from new high-grade discoveries both at surface and at depth.
The detailed engineering of the process plant is 95% completes and mine dry construction is close to completion.
President & Chief Executive Darin Labrenz said: "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 [square kilometre] 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."
By Anna Farley; [email protected]
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