Ms. Christina McCarthy reports
MCEWEN MINING ACQUIRES PROPERTY IN NEVADA
McEwen Mining Inc. has completed the purchase of the Afgan-Kobeh property in Nevada for $450,000 in cash. Afgan-Kobeh is an attractive acquisition for McEwen Mining because it hosts a near-surface, oxide gold resource in close proximity to the Gold Bar complex, which is expected to begin development in 2017. The objective is to develop the property into a satellite resource that can contribute to the production from Gold Bar. The property has immediate exploration potential with several historical higher-grade drill intersections open laterally and at depth. McEwen Mining plans to conduct a drill program beginning in May, 2016, with the objective to increase the known mineralization.
Property location and description
The Afgan-Kobeh property is located toward the southeast limit of the Battle Mountain-Eureka-Cortez mineral trend in Eureka county, Nevada. The Afgan deposit is approximately three miles (five kilometres) to the southeast of the main orebodies comprising the Gold Bar complex. Afgan is similar to other sedimentary-rock-hosted gold deposits in Nevada in that disseminated and oxidized gold mineralization occurs in the Webb formation and Devils Gate limestone lithologies.
Mineral resource estimate
A report titled "Updated Technical Report Afgan-Kobeh Property Eureka County, Nevada, USA," dated June 13, 2011, was published by the prior owner in accordance with compliance and disclosure requirements of National Instrument 43-101. Mine Development Associates of Reno, Nev., prepared the technical report that includes a mineral resource estimate for the Afgan deposit using a cut-off grade of 0.006 ounce per ton or 0.2 gram per tonne. The mineral resource includes drill information from 181 holes, for a total of 63,303 feet (19,295 metres) of drilling. The summary provided in the table is for informational purposes only and has not been verified by McEwen Mining.
RESOURCE ESTIMATE
Short tons Grade Tonnes Grade Gold ounces
(oz/t) (g/t)
Indicated 3,206,000 0.021 2,908,400 0.72 66,000
Inferred 3,972,000 0.014 3,603,300 0.48 55,000
The technical report filed June 24, 2011, is available on SEDAR.
Exploration potential
The Afgan deposit is open for possible resource expansion in several areas. Step-out drilling is planned to occur starting in May, 2016, and will test areas where the mineralization discovered by earlier drilling remains open. The primary objective of this drilling is to expand the size of the resource. Within the existing resource envelope there is potential to increase grades locally by infill drilling, as higher-grade mineralization occurs within relatively confined structurally controlled zones. Infill drilling is also planned to provide verification of historical results, increase confidence in the resource and obtain material for column leach testing.
Historical drill results
Exploration drilling at Afgan-Kobeh began in 1981, but most of the drilling has occurred since 1990. Data are available for over 200 exploration drill holes, mostly reverse circulation (RC) with some limited core, rotary and air track also recorded. The table is a compilation of the best holes in the Afgan deposit. These historical results are provided for informational purposes only and have not been verified by McEwen Mining.
DRILL RESULTS
Hole ID From To Interval Grade From To Interval Grade
(m) (m) (m) (g/t) (ft) (ft) (ft) (oz/t)
AF89-4 19.8 38.1 18.3 1.75 65 125 60 0.051
AF89-5 9.1 27.4 18.3 1.48 30 90 60 0.043
AF90-13 4.6 42.7 38.1 1.13 15 140 125 0.033
AF90-14 35.1 56.4 21.3 3.41 115 185 70 0.099
AF90-22 0 21.3 21.3 1.95 0 70 70 0.057
AF91-48 50.3 89.9 39.6 1.29 165 295 130 0.038
AF91-50 27.4 85.3 57.9 1.89 90 280 190 0.055
AF91-52 53.3 77.7 24.4 2.33 175 255 80 0.068
AF91-66 13.7 35.1 21.3 2.67 45 115 70 0.078
ANC-1 59.6 115.1 55.5 1.06 195.5 377.6 182.1 0.031
ANC-2 63.4 98.6 35.2 2.11 207.9 323.4 115.5 0.062
ANC93-10 142.4 155.3 12.9 1.98 467.1 509.5 42.4 0.058
ANR-9 236.4 249.7 13.3 4.08 775.5 819.2 43.7 0.119
AF07-05 68.6 96.0 27.4 1.32 225 315 90 0.039
AF10-1 48.8 65.5 18.3 4.51 160 215 55 0.132
AF10-20 53.3 85.3 32.0 1.24 175 280 105 0.036
AKR11-22 36.6 53.3 16.8 4.22 120 175 55 0.123
Metallurgical testing
A series of 62 48-hour bottle-roll leach tests was conducted on RC drill chips in 2011. Results from this analysis returned consistently good gold recovery averaging 78 per cent, suggesting that the mineralization of the Afgan deposit is amenable to heap-leach processing. Column leach tests are planned to determine heap-leaching characteristics once material from core drilling is available for testing.
Corporate update
McEwen Mining is pleased to provide an update on its financial position. On Feb. 19, 2016, the company had cash and precious metals of $36.5-million and no debt.
Technical information
The technical contents of this news release have been reviewed and approved by Robert L. Kastelic, CPG, McEwen Mining's senior consulting geologist, who is a qualified person as defined by National Instrument 43-101.
We seek Safe Harbor.
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