Pure Gold Mining Inc. (TSX-V: PGM, LSE: PUR) (“Pure Gold” or the
“Company”) is pleased to announce that its unaudited condensed
interim consolidated financial statements (“Financial Statements”)
for its second quarter ended June 30, 2020 and the accompanying
Management’s Discussion and Analysis are available for download on
the Company’s website at www.puregoldmining.ca and under the
Company’s SEDAR profile at www.sedar.com.
Financial and Operating Highlights for
the quarter and to date:
During the three months ended June 30, 2020 and
up to the date of this MD&A, the Company significantly advanced
activities at its 100%-owned Pure Gold Red Lake Mine Project
(“RL Mine Project” or the
“Project”). A summary of the highlights for the
three months ended June 30, 2020 and subsequent period to date are
as follows:
- Receipt of Amended Environmental
Compliance Approval (“ECA”) – Air and Noise
During the quarter, the Company received the
first of three significant amended permits / approvals for the RL
Mine Project. The Ontario Ministry of the Environment, Conservation
and Parks (MECP) has approved and issued an Amended Environmental
Compliance Approval (“ECA”) for Air and Noise for the Project.
The amended ECA sets out operating conditions
relating to air and noise emissions for the PureGold mining and
milling operations, including all ancillary and support processes
and activities, at a Production Limit of up to 1,089 tonnes of gold
ore processed per day.
The company now awaits amendment of the
Industrial Effluent permit (ECA Industrial Sewage Works). Initial
regulatory review is complete, and the Company has applied for an
expedited approval of this permit amendment.
The Company has also filed its Closure Plan
amendment and is awaiting approval before posting the necessary
financial assurance.
- Development of the RL Mine Project
continues
The development of the RL Mine Project is
continuing at a rapid pace. Engineering is substantially
complete and drawing packages have been issued for the majority of
engineering components. The procurement of major equipment
95% complete, and the Company remains on track to bring first ore
to the mill before year-end.
- Completed flow through share
financing to allow for the continuation of exploration
drilling
On June 17, 2020 PureGold announced that it
closed a non-brokered private placement of 9,868,421 common shares
of the Company that qualified as “flow-through shares” for the
purposes of the Income Tax Act (Canada) (the “FT
Shares”) at a price of $1.52 per FT Share, for gross
proceeds to PureGold of $15,000,000. Subsequent to the private
placement, Mr. Eric Sprott was the back-end buyer of all of the FT
Shares, increasing his ownership position in the Company to
11.9%.
The Company commenced a 33,600 metre diamond
drill program to expedite the growth of mineral resources and
aggressively expand new high-grade discoveries. The program
includes 28,200 metres of surface drilling targeting Wedge and
other regional exploration targets to satisfy its flow through
share obligations, as well as 5,400 metres of underground
exploration drilling. In addition, the Company will perform a 2D
seismic survey over the North Madsen / Derlak claims and over the
8-Zone.
- Raised $13.5 million from the
exercise of share purchase warrants
During the quarter and subsequent to quarter
end, PureGold raised approximately $13.5 million from the exercise
of share purchase warrants with a strike price of $0.85 (the
“Warrants”), representing 100% of the Warrants
that otherwise would have expired May 24, 2020 and partial exercise
of Warrants expiring July 18, 2022.
The Company remains fully funded through
construction of the RL Mine.
- Announced significant results from
underground drilling
In July 2020, PureGold announced
that underground exploration drilling, initiated in June,
intersected high-grade gold mineralization from both infill and
step-out drill holes. Drilling has extended gold mineralization out
from planned stopes, has discovered new gold zones that will be
integrated into the mine plan, and has confirmed stopes scheduled
for near term production.1
Drilling results highlights1:
- 46.7 g/t
gold over 7.0 metres from drill hole
PGU-0118; including 193.5 g/t gold over 1.0
metre;
- 57.0 g/t
gold over 1.0 metre from drill hole PGU-0121;
- 15.8 g/t gold over 2.3
metres from drill hole PGU-0117;
- 7.2 g/t gold over 5.0
metres from drill hole PGU-0113;
including 22.3 g/t gold over 1.0 metre;
- 12.8 g/t
gold over 10.0 metres from drill hole
PGU-0136; including 20.1 g/t gold over 5.0
metres;
- 9.3 g/t gold over 2.4
metres from drill hole PGU-0123; including
16.2 g/t gold over 1.1 metres;
and
- 10.6 g/t gold over 2.0
metres from drill hole PGU-0124;
Selected Financial Data
The following selected financial data is derived
from our Financial Statements and related notes thereto for the
periods indicated, as prepared in accordance with International
Financial Reporting Standards. Details of these results are
described in the unaudited condensed interim consolidated financial
statements and Management’s Discussion and Analysis for the six
months ended June 30, 2020.
|
For the three months ended June 30, 2020 |
For the three months ended June 30, 2019 |
For the six months ended June 30, 2020 |
For the six months ended June 30, 2019 |
Total Revenue |
|
- |
|
- |
|
- |
|
- |
Exploration Expenditures |
$ |
0.1 million |
$ |
2.0 million |
$ |
0.2 million |
$ |
3.6 million |
Change in fair value of derivatives |
$ |
10.9 million |
$ |
-- |
$ |
0.4 million |
$ |
-- |
Net Loss and Comprehensive loss for the period |
$ |
9.7 million |
$ |
4.0 million |
$ |
1.0 million |
$ |
6.9 million |
Basic and Diluted Loss per Share |
$ |
(0.03) |
$ |
(0.02) |
$ |
(0.00) |
$ |
(0.03) |
|
|
|
As at June 30, 2020 |
|
As at December 31, 2019 |
Total assets |
$ |
197.3 million |
$ |
130.6 million |
Current liabilities |
$ |
20.1 million |
$ |
8.2 million |
Non-current liabilities |
$ |
104.9 million |
$ |
72.8 million |
Cash dividends declared |
$ |
- |
$ |
- |
|
Grant of Deferred Share UnitsThe Company has
granted 100,000 Deferred Share Units to a director of the
Company.
This press release should be read in conjunction
with Pure Gold’s Condensed Interim Consolidated Financial
Statements and Management’s Discussion and Analysis for the six
months ended June 30, 2020. In addition, for further
information please see Pure Gold’s Annual Information Form for the
fiscal period ended December 31, 2019. These documents can be found
on the Company’s website (www.puregoldmining.ca) or under the
Company’s profile on SEDAR at www.sedar.com. Shareholders may
receive a printed copy of the audited consolidated financial
statements, free of charge, upon request.
Qualified Persons and 43-101 Disclosure
Darin Labrenz, P. Geo., President & CEO for
the Company, is the designated Qualified Person for this news
release within the meaning of National Instrument 43-101 (“NI
43-101”) and has reviewed and verified that the technical
information contained herein is accurate and approves of the
written disclosure of same.
About Pure Gold Mining Inc.
The Pure Gold Red Lake Mine is Canada’s highest
grade gold mine development project. Fully funded, the
project is on track to deliver near term gold production into a
rising Canadian gold price environment, with first production
scheduled for late 2020. The orebody is situated within a seven-
kilometre long gold system that is wide open for expansion at depth
and along strike, and multiple discoveries by the Company suggest
potential opportunities for near-term growth.
Additional information about the Company and its
activities may be found on the Company’s website
at www.puregoldmining.ca and under the Company’s profile
at www.sedar.com.
ON BEHALF OF THE BOARD"Darin
Labrenz"
Darin Labrenz, President & CEO
Investor inquiries: Adrian O’Brien, Director of
Marketing & Communications Tel:
604-646-8000info@puregoldmining.ca
Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
All statements in this press release, other than
statements of historical fact, are "forward-looking information"
with respect to Pure Gold within the meaning of applicable
securities laws, including, but not limited to statements with
respect to those that address proposed timing of development plans
for the RL Mine Project, timing of expected production, expected
capital costs, expected development schedule and the focus of the
Company in the coming months . Forward-looking information is
often, but not always, identified by the use of words such as
"seek", "anticipate", "plan", "continue", "planned", "expect",
"project", "predict", "potential", "targeting", "intends",
"believe", "potential", and similar expressions, or describes a
"goal", or variation of such words and phrases or state that
certain actions, events or results "may", "should", "could",
"would", "might" or "will" be taken, occur or be achieved.
Forward-looking information is not a guarantee of future
performance and is based upon a number of estimates and assumptions
of management at the date the statements are made including, among
others, assumptions about future prices of gold and other metal
prices, currency exchange rates and interest rates, favourable
operating conditions, political stability, obtaining governmental
approvals and financing on time, obtaining renewals for existing
licences and permits and obtaining required licences and permits,
labour stability, stability in market conditions, availability of
equipment, accuracy of any mineral resources, successful resolution
of disputes and anticipated costs and expenditures. Many
assumptions are based on factors and events that are not within the
control of Pure Gold and there is no assurance they will prove to
be correct.
Such forward-looking information, involves known
and unknown risks, which may cause the actual results to be
materially different from any future results expressed or implied
by such forward-looking information, including, risks related to
the interpretation of results at the RL Mine Project; changes in
project parameters as plans continue to be refined; current
economic conditions; future prices of commodities; possible
variations in grade or recovery rates; the costs and timing of the
development of new deposits; failure of equipment or processes to
operate as anticipated; the failure of contracted parties to
perform; the timing and success of exploration activities
generally; delays in permitting; possible claims against the
Company; the timing of future economic studies; labour disputes and
other risks of the mining industry; delays in obtaining
governmental approvals, financing or in the completion of
exploration as well as those factors discussed in the Annual
Information Form of the Company dated March 26, 2020 in the section
entitled "Risk Factors", under Pure Gold’s SEDAR profile at
www.sedar.com.
Although Pure Gold has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking information, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that such information will
prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements. Pure
Gold disclaims any intention or obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise unless required by law.
1 See press releases dated July 7, 2020 and July 28, 2020
available at www.puregoldmining.ca under the Company’s Sedar
profile at www.sedar.com, for further details about these drill
results.
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