Gold Mountain (TSX.V: GMTN) is pleased to provide a corporate update as it nears its 6 month trading anniversary, showcasing its transformation from a small-scale asset to a near-term producer on the cusp of mining operations and reaching 1,000,000 ounces.
In May of 2019, Gold Mountain (TSX.V: GMTN) (formerly Bayshore Minerals Inc.) acquired the property from Equinox Gold (TSX: EQX) for $10M, with a $1M deposit and a $9M interest-free promissory note. The asset had 127,000m of historical drilling, was located on an all-season highway near Merritt, British Columbia and had an M-199 mine permit. When the Elk Gold Project was mining high-grade ore in 2012, it ran into operational challenges and a soft gold market which led to the asset being put into care and maintenance. The Gold Mountain team saw an opportunity to leverage their strong BC mining operations experience and were confident in their ability to expand the mineral resource, amend the mining permit and get the project back into production.
Progress Since Public Listing
Since listing on December 31, 2020 the Company has:
- January - Established cost certainty through its mining partnership with Nhwelmen-Lake LP which establishes fixed costs for construction, mining and highway haulage.
- January - Signed an Ore Purchase Agreement with New Gold Inc. to sell its ore to New Gold's New Afton Mine located 133Km from the Elk Gold Project.
- February - Closed a $10M, oversubscribed private placement with lead order from Crescat Capital.
- February - Engaged JDS Energy & Mining Inc. ("JDS") to complete a pre-feasibility study which will validate the open pit mine plan contemplated in Years 1-3 and transition into an underground mining and open-pit hybrid scenario in Year 4.
- March - Completed its Phase 1, 8,700m Drill Program with grades reaching 124 g/t au.
- April - Received its Notice of Departure ("NOD") from the Ministry of Energy, Mines and Low Carbon Innovation to begin mine construction. The NOD included authorization for upgrades to haul roads, lay down areas and construction of site offices. The NOD also included permission for a gravel borrow which will allow the company to begin waste rock mining in Pit 2 while waiting for the M-199 mining permit amendment and dewatering of existing pits.
- May - Announced a 49% increase in the total mineral resources to 651,000 ounces grading 6.1 g/t Au in the Measured & Indicated categories and 159,000 ounces grading 4.8 g/t Au in the Inferred category with an effective date of May 1, 2021.
- May - Announced the conclusions of an updated Preliminary Economic Assessment with an after-tax NPV5% of C$231M, with a 19,000 oz annual production (Years 1-3) expanding to 65,000 oz of production (Years 4-11)
- May - Completed its $3M property payment to Equinox which was one of largest perceived risks surrounding the project.
- June - Received its Draft Mining Permit from the Ministry of Energy, Mines and Low Carbon Innovation, to review the document's terms and provide comments prior to receiving its final permit.
- June - Began mine Construction with Nhwelmen Lake LP
Initiatives For The Remainder of 2021
While the Company is proud of its achievements to date, below are the upcoming milestones management is forecasting to accomplish during the latter half of 2021:
- June - Close its $10M, bought private placement led by Canaccord Genuity, Eight Capital and Red Cloud Securities. These funds will be used to continue expanding the resource and carry the Company into commercial production.
- June - Submit its final mining permit comments to the statutory decision maker. The Company anticipates its permit to be sent up for final approval in the coming weeks.
- June/July/August - Waste rock mining in Pit 2.
- September - Begin ore mining along the high-grade 1300 vein.
- September - Add an additional diamond drill rig for its Phase 3 exploration program.
- October - Complete JDS's Pre-Feasibility study, increase the contained mineral resources past 1,000,000 ounces and declare maiden Reserves.
- October - Deliver first ore to New Gold.
- November - Receive payment and begin revenue generation.
- December - Establish steady state commercial production.
Initiatives and Outlook For 2022
- Environmental Assessment ("EA") - Begin the EA process to increase annual production to 324,000 tonnes per year
- Continued Expansion - Continue to aggressively drill the property and look to acquire additional projects to become a multi-asset company.
- U.S. Listing - Upgrade its U.S. listing to the New York Stock Exchange
"We have had an extremely active first six months since coming to trade and given our commitment to continuously deliver to shareholders, we wanted to update the market with our timeline for the remainder of the year. When we started this project, the feedback was this mine is always going to be too small, expensive to operate and very difficult to get back into production. Today, we have a PEA built off of locked-in agreements showing an AISC of $554 (USD) per ounce, we've shown we can efficiently expand the resource, our draft permit is in, and we're on schedule to drop off our first batch of ore to New Gold in October." commented Kevin Smith, CEO and Director of Gold Mountain. "It's still heads down here at Gold Mountain as we continue to drive this company forward and create value for those who want to join us in building out BC's next gold producer."
The technical disclosure contained herein is based off of the Company's most recent Preliminary Economic Assessment (the "PEA"), the results of which are summarized in a Press Release dated May 27, 2021 a copy of which is available at www.sedar.com The Company anticipates filing the Preliminary Economic Assessment prior to the end of June.