TORONTO, March 29, 2017 /CNW/ - AuRico Metals Inc.
(TSX: AMI),("AuRico" or the "Company") is pleased to provide an
update on its royalty portfolio, highlighting significant increases
in mineral reserves and resources at Fosterville, Hemlo, and Eagle
River, and further developments relating to the Company's
royalty pipeline.
"We're very happy to see that ongoing exploration efforts at
Fosterville and Hemlo have yielded 66% and 73% increases,
respectively, in mineral reserves at these operations," commented
Chris Richter, President and CEO of
AuRico Metals. "The significant growth in reserves and resources at
operations underlying our royalties underscore the high quality
nature of our royalty portfolio."
Fosterville (2% NSR
Royalty)
On March 28, Kirkland Lake Gold
Ltd. ("Kirkland") announced that updated mineral reserves at the
Fosterville gold mine increased by
66%, to 643,000 ounces of gold, after depletion, accompanied by a
27% increase in grade to 9.2 g/t Au from the prior year estimate.
Measured and Indicated mineral resources, inclusive of reserves,
increased by 23% to 2,790,000 ounces of gold accompanied by a 25%
increase in grade to 5.7 g/t Au.
As stated in Kirkland's press
release dated March 28, 2017, the
significant increase in mineral reserves is underpinned by
down-plunge extensions of the high-grade, visible gold-bearing
Lower Phoenix Gold Zone and the discovery of visible gold-bearing
Harrier Zone. Fosterville
continues to maintain a large underlying mineral resource base that
is expected to support future additions to mineral reserves, with
potential to further extend the current known mineral resource
following ongoing surface and underground drilling, testing
near-mine gold systems up and down-plunge from current mineral
reserves and resources.
The Fosterville Gold Mine is 100% owned by Kirkland. Separate from the Fosterville mine, Kirkland also holds exploration licenses
covering an area over 500 km2, encompassing the entire
known strike extent of the Fosterville Goldfield. AuRico's 2% net
smelter return (NSR) royalty is payable over all of this
ground.
For more information and complete reserve and resource details
see Kirkland's press release dated
March 28, 2017 and visit the website
at www.klgold.com.
Hemlo (0.25% NSR Royalty on
Williams Mine, and 1.5% NSR on David Bell Property)
On February 15, Barrick Gold announced a 73% increase in mineral
reserves at Hemlo from 917,000
ounces of gold at the end of 2015 to 1,588,000 ounces at the end of
2016, after mining depletion. Measured and Indicated mineral
resources, exclusive of reserves, increased 19% to 1,720,000 ounces
of gold. Annual production at Hemlo totaled 235,000 ounces of gold in 2016,
representing an increase of 7% from the prior year.
Barrick Gold's 2017 guidance for
Hemlo is 205,000 to 220,000 ounces
at all-in sustaining cash costs of $880-$980 per ounce.
For more information, visit Barrick
Gold's website at www.barrick.com.
Eagle River (0.5% NSR
Royalty)
On February 22, Wesdome Gold Mines
("Wesdome") announced a 15% increase in mineral reserves at
Eagle River from 300,000 ounces of
gold at the end of 2015 to 344,000 ounces of gold at the end of
2016, after mining depletion.
Wesdome has stated that it will continue its focus on
development into higher grade areas of the Eagle River Underground
Mine with initial stope production from the 7 Zone which commenced
in Q4 2016, well ahead of schedule. This will enable stope
production from multiple high grade areas within the Eagle River
Mine earlier than expected.
For more information, see Wesdome's press release dated
February 22, 2017 and visit the
website at www.wesdome.com.
Exploration Joint Venture Agreement at Kliyul with First
Quantum Minerals Ltd ("First Quantum")
On March 8, AuRico closed the
acquisition of Kiska Metals adding six additional royalties to the
Company's portfolio as well as six wholly-owned properties with the
potential for organic royalty creation. On March 17, AuRico entered into a binding Letter
Agreement with First Quantum for one of these properties, Kliyul,
located in British Columbia,
approximately 50 km south of AuRico's Kemess property.
Under the terms of the agreement, First Quantum has 12 months to
evaluate the Kliyul project. It can then choose to enter into an
Option to earn a 51% interest by incurring a minimum of
C$5 million of expenditures on the
project prior to December 31, 2021.
First Quantum's interest will increase by a further 29% (80% total)
when a decision to mine is made. Upon a decision to mine, AuRico
will be entitled to receive advance royalty payments of
C$2 million per year until the
commencement of commercial production, and will retain a 0.5% NSR
royalty once production commences.
New Royalties Acquired Near Goldcorp's Red Lake Mine and New
Gold's Rainy River Project
On March 3, the Company acquired a
new royalty together with Abitibi Royalties Inc., whereby each
party acquired a 1.0% NSR on two exploration properties, one
located 6 km to the east and the other located 8 km to the south of
Goldcorp's Red Lake Mine in Ontario.
On February 17, the Company
acquired a new royalty together with Abitibi Royalties Inc.,
whereby each party acquired a 0.75% NSR on nine exploration
properties located in the Rainy River district, near New Gold's
Rainy River Project in Ontario.
These transactions add further depth and optionality to the
Company's high quality royalty portfolio, which now consists of 18
royalties.
Qualified Person Statement
Technical information in this press release has been approved by
Chris Rockingham, P. Geol., Vice
President, Development for the Company and "qualified person" (QP)
for the purposes of NI 43-101.
About AuRico Metals
AuRico Metals is a mining development and royalty company with a
100% interest in the Kemess property in British Columbia, Canada. The Kemess property
hosts the feasibility-stage Kemess Underground Gold-Copper Project,
the Kemess East Exploration Project, and the infrastructure
pertaining to the past producing Kemess South mine. AuRico's
royalty portfolio includes a 1.5% NSR royalty on the Young-Davidson
Gold Mine and a 2% NSR royalty on the Fosterville Mine, as well as
a portfolio of additional producing and pre-production royalty
assets located in North America
and Australia.
Cautionary Statement on Forward-Looking Information
This press release contains forward-looking statements and
forward-looking information as defined under Canadian and U.S.
securities laws. All statements, other than statements of
historical fact, are, or may be deemed to be, forward-looking
statements. The words "expect", "believe", "anticipate", "will",
"intend", "estimate", "forecast", "budget" and similar expressions
identify forward-looking statements. Forward-looking statements
include statements related to the Company's royalty portfolio and
Kliyul project. These statements are based on a number of
factors and assumptions that, while considered reasonable by
management at the time of making such statements, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Known and unknown factors
could cause actual results to differ materially from those
projected in the forward-looking statements. Such
forward-looking statements and the factors and assumptions
underlying them in this document include, the future price of gold,
the estimation of mineral reserves and resources, realization of
mineral reserve estimates, and the timing and amount of estimated
future production.
Actual results and developments are likely to differ, and may
differ materially, from those expressed or implied by the
forward-looking statements contained herein. Such statements are
based on a number of assumptions which may prove to be incorrect,
including assumptions about: business and economic conditions;
commodity prices; credit market conditions and conditions in
financial markets generally; the accuracy of reserve and resource
estimates; the impact of changes in currency exchange rates on
costs and results; interest rates; and taxation.
Readers are cautioned that forward-looking statements are not
guarantees of future performance. All of the forward-looking
statements made in this press release are qualified by these
cautionary statements. The Company disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
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SOURCE AuRico Metals
