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Sabina Gold & Silver Corp
Symbol SBB
Shares Issued 219,679,412
Close 2016-05-25 C$ 1.50
Market Cap C$ 329,519,118
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Sabina tests at Back show up to 3% increase in recovery

2016-05-25 09:40 ET - News Release

Mr. Bruce McLeod reports

SABINA GOLD & SILVER REPORTS ENCOURAGING METALLURGICAL OPTIMIZATION RESULTS AT BACK RIVER GOLD PROJECT, CANADA

Sabina Gold & Silver Corp. has released positive preliminary metallurgical optimization test results on its 100-per-cent-owned Back River gold project in Nunavut, Canada.

After release of the Back River initial project feasibility study in September of last year, Sabina has identified several metallurgical optimization opportunities that could have a positive economic impact on the Back River project. The two opportunities with the greatest potential impact are coarser grinding as part of the carbon-in-pulp circuit contemplated in the feasibility study, and revisiting flotation with the addition of regrinding concentrates to 50 microns before leaching.

Sabina has completed the initial scoping testwork for the flotation and grinding of concentrates followed by leaching with very encouraging preliminary results.

"These results are the first of many optimization studies under way on the project," said Bruce McLeod, president and chief executive officer. "These test results continue to demonstrate the optionality of Back River. This work could not only positively impact the economics of the initial production scenario, but could also generate compelling alternatives for future satellite production, at George for example. We are very encouraged and look forward to continuing work on the flow sheet."

Four representative composites were created, one for each of the Llama, Goose, Umwelt open-pit and Umwelt underground deposits. The results from this first round of testwork showed promising results. Recoveries for three of four composites (Umwelt open pit, Umwelt underground and Llama, representing approximately 71 per cent of the reserves in the feasibility study) showed a potential increase in gold recoveries of approximately 2 to 3 per cent. The Goose composite showed a potential reduction of approximately 3 to 4 per cent in gold recovery. If further studies support the preliminary testwork, this could result in an overall increase of 25,000 ounces of gold produced over the current life of mine.

Initial desktop studies have also indicated that changing to a flotation circuit could have positive impacts on both capex (capital expenditures) and opex (operating expenditures). Operating costs would largely be impacted by a potential reduction in installed power and a reduction in reagent consumption. Additional benefits could include a reduction in greenhouse gas emissions due to reduced power and transportation requirements.

A flotation optimization testwork program to further define the impacts to the project has been initiated.

Permitting

During the week of April 25 to April 30, 2016, the company attended its final public hearings on the environmental assessment of the project in Cambridge Bay, Nunavut. The Nunavut Impact Review Board is reviewing all submissions from those hearings and advised that it will make a final project recommendation to the Minister of Indigenous and Northern Affairs Canada on or about June 15, 2016. A positive recommendation would be a significant milestone in the permitting/environmental assessment process and enable the transition into the licensing phase.

Qualified persons

The qualified person as defined by National Instrument 43-101 as pertains to the Back River project, is Wes Carson, vice-president, project development, for the company.

We seek Safe Harbor.

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