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Enter Symbol
or Name
USA
CA



Lundin Gold Inc
Symbol LUG
Shares Issued 119,666,840
Close 2018-01-10 C$ 5.15
Market Cap C$ 616,284,226
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Lundin mine development into hard rock at Fruta

2018-01-10 08:55 ET - News Release

Mr. Ron Hochstein reports

LUNDIN GOLD UNDERGROUND MINE DEVELOPMENT INTO HARD ROCK AT FRUTA DEL NORTE

Soft tunnelling was completed in December, 2017, and mine development is now into hard rock at Lundin Gold Inc.'s Fruta del Norte gold project in Ecuador.

Further highlights

  • Award of all major process plant equipment packages;
  • Mobile equipment packages, including underground mine scoop trams and haul trucks, have been awarded;
  • Process plant excavation is progressing ahead of schedule;
  • 1,000-person construction camp is nearing completion;
  • Approval of power line environmental impact assessment (EIA).

"Tunnelling through soft clay was a significant risk factor to underground mine development due to the potential for ground failure. We were able to get through this challenging task, and the mine development is now advancing at a quicker pace," said Ron Hochstein, president and chief executive officer of Lundin Gold. "We are also ramping up other major projects, including the process plant and power line."

Mine development

The company transitioned from soft tunnelling to hard-rock tunnelling in December, 2017, working through 77 metres of saprolite (soft clay) in the first decline and 69 metres in the second. Drilling and blasting in hard rock commenced on Dec. 7 in the first decline and Dec. 17 in the second, and currently the advance in hard rock reached 100 metres and 78 metres, in the first and second declines, respectively.

Process plant equipment procurement

In October, 2017, Lundin Gold awarded the long-lead time grinding equipment packages, including the SAG and ball mills (complete with motors), and the flotation and filtration packages to Outotec Chile SA.

The gravity mill, CIL and detox tanks, and ADR plant and gold room packages were recently awarded to FLSmidth USA Inc. TelSmith Inc. will provide the crushing packages for both the process plant and aggregate quarry crushers. ABB Inc. has been awarded switchgear and substation equipment and transformers packages.

Mobile equipment

Most of the mobile mine equipment orders have been placed. Importadora Industrial Agricola SA/Caterpillar will provide the underground mine scoop trams and trucks, as well as the surface earthworks and quarry equipment. Orders for the mine jumbos and bolters are expected to be awarded this quarter.

Power line

The EIA for the power line received final approval at the end of 2017. Easement agreements have been reached with 91 per cent of affected landholders, and the company expects the remaining easements to be obtained this quarter. Detailed engineering and procurement are well under way, and the engineering, procurement and construction contractor is on track to begin building the power line this quarter.

Major earthworks

Regardless of difficult ground conditions, site earthworks are on schedule. Earthworks on the process plant are 13 per cent complete with concrete mill foundations planned to start this quarter.

The north access road is progressing well and 32 per cent of the road has been built. A second earthworks contractor was mobilized at El Pindal, where the north access road will link to the national highway system. Approximately six kilometres needs to be built to connect the north access road from either side.

Construction camp

All other construction disciplines are actively working on the 1,000-person construction camp which is nearing completion, with over 60 per cent of the units currently available for occupancy. Combined with the existing camp, there are more than 1,200 beds available. During the last month, approximately 800 people were at site, including contractors.

About Lundin Gold Inc.

Lundin Gold, headquartered in Vancouver, Canada, is developing its wholly owned Fruta del Norte gold project in southeast Ecuador. Fruta del Norte is one of the highest-grade and largest gold projects currently under construction. The company's board and management team have extensive expertise in mine construction and operations, and are dedicated to advancing this project through to first gold production in 2019.

The company operates with transparency and in accordance with international best practices. Lundin Gold is committed to delivering value to its shareholders, while simultaneously providing economic and social benefits to impacted communities, fostering a healthy and safe workplace and minimizing the environmental impact.

This press release has been reviewed and approved by Ron Hochstein, PEng, a metallurgical engineer and the company's president and chief executive officer, who is a qualified person under Canadian National Instrument 43-101.

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