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Fiore Gold Ltd
Symbol F
Shares Issued 97,778,128
Close 2019-10-17 C$ 0.40
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Fiore produces 41,491 oz Au at Pan in fiscal 2019

2019-10-17 09:46 ET - News Release

Mr. Tim Warman reports

FIORE GOLD MEETS FULL YEAR 2019 PRODUCTION GUIDANCE

Fiore Gold Ltd. has released preliminary production results for the company's fourth fiscal quarter and the full fiscal year 2019, which ended on Sept. 30, 2019, for its Pan open-pit mine in White Pine county, Nevada.

Highlights:

  • Full-year gold production of 41,491 ounces, a 21-per-cent increase over the preceding year and within full-year guidance of 40,000 to 43,000 ounces. Q4 gold production was 9,282 ounces.
  • Sales of 40,886 gold ounces for the year, with Q4 sales of 8,902 gold ounces.
  • Full-year mined ore production of 13,923 tons per day at a stripping ratio of 1.8. Q4 mined ore production of 13,156 tons per day at a stripping ratio of 2.3.
  • The company's operations team at Pan received the small mine safety award from the Nevada Mining Association for the fourth consecutive year.
  • A total of 91,672 man-hours worked in fiscal 2019, achieving the company's goal of zero reportable incidents, zero reportable accidents and zero lost-time injuries. Currently, the operation is at 1,230 consecutive days of attaining this triple-zero achievement.
  • Transition from run-of-mine to 100-per-cent-crushed ore placement nearing completion with the commissioning of the Pan mine primary crushing circuit. A 10,000-metre program of resource expansion drilling under way at the Pan mine in support of a resource and reserve update as well as a new life-of-mine plan in mid-2020.
  • Approximately 10,000 m of drilling largely completed and metallurgical work under way at the federally permitted Gold Rock project in support of a preliminary economic assessment by the end of calendar 2019.

Tim Warman, Fiore's chief executive officer, commented: "Our team at the Pan mine had another excellent year, with gold production within our guidance range and 21 per cent higher than 2018, while continuing to maintain our high standards for safety and environmental protection. Gold production in Q4 decreased relative to Q3 in part due to placing lower-grade ore as well a slower ramp-up of the crusher than we anticipated. However, tons crushed per day consistently increased through the quarter, and, as ore placement on the leach pad returns to planned levels, gold production is expected to likewise return to planned levels over the first quarter of fiscal 2020. The change from ROM to crushed ore marks the last major operational change at Pan, and the focus is now on our adjacent Gold Rock project, which we intend to advance rapidly towards development and production. A PEA will be completed by year-end, and our plan is to transition directly from a positive PEA to a full feasibility study, with the goal of arriving at a construction decision by mid-2021."

Fiscal 2019 production

Quarterly and full-year production numbers for the Pan mine are shown in the attached table.

                              Q1       Q2       Q3       Q4     2019

Gold production (oz)       9,765   10,759   11,685    9,282   41,491 
Ore tons mined (tpd)      15,196   13,211   14,114   13,156   13,923 
Gold grade (oz per ton)    0.016    0.015    0.014    0.013    0.015  
Total tons mined (tpd)    37,792   34,782   38,275   43,005   38,484 

Gold production of 41,491 ounces fell comfortably within the company's full-year production guidance of 40,000 to 43,000 ounces. Pan mined 13,923 ore tons per day, also in line with the company's guided target of 14,000 ore tons per day. Total tons mined of 38,484 tons per day reflects a strip ratio of 1.8, which, as expected, was higher than the 1.6 life-of-mine average strip. Importantly, the total tons mined per day trended upward through 2019 with Q4 of 43,005 total tons mined per day. This is a positive reflection of improved productivity from a mining perspective.

Q4 gold production was impacted by lower gold grades in the second half of the year, which was in line with the mine plan. Additionally, Q4 ore mining rates and placement of crushed ore on the leach pad were lower than planned as the company worked to achieve consistent crusher availability and throughput. Tons crushed per day consistently increased through the quarter. As ore placement on the leach pad returns to planned levels, gold production is expected to likewise return to planned levels over the first quarter of fiscal 2020. With 2019 production finishing 21 per cent over 2018, the company will look to build on the positive momentum heading into 2020, when it expects to see increased gold recoveries and production with a full year of placing predominantly crushed ore on the leach pad.

A new drilling program aimed at increasing the resource and reserve base and extending the mine life at Pan commenced in September, 2019. The program will consist of approximately 10,000 m of reverse circulation drilling and may also include some diamond core holes. Once the drilling is complete, a new resource estimate will be carried out by the company's independent geological consultants and a new life-of-mine plan will be prepared by mid-2020.

At Gold Rock, work on the PEA continues to progress well, with approximately 10,000 m of RC drilling now complete and a further 1,800 m of core drilling expected to wrap up by the end of October. Results for 17 of the 32 RC holes have been released to date, with the remaining holes in process at the assay lab. Drilling has encountered thick intervals of oxide gold mineralization, both within and outside of the current resource pit shells, and has shown that mineralization continues through a lightly drilled gap in the current resource.

The drilling program, resource update and continuing metallurgical testing are part of a detailed development plan for Gold Rock that lays out the activities and schedule required to advance the project toward production. The plan aims to arrive at a construction decision by mid-2021, assuming successful completion of these activities and a positive feasibility study. Based on its experience operating the nearby Pan mine, the company intends to proceed directly from the PEA to a feasibility study in order to shorten the development time frame.

The Gold Rock development plan will look to leverage the infrastructure and work force at the adjacent Pan mine to the greatest extent possible, in particular the existing Pan power line and the access road from Highway 50. The company is also evaluating opportunities to reduce capital, operating expenses and environmental impacts by using the Pan ADR plant and assay lab.

Webinar

Red Cloud Financial Services will be hosting a webinar to discuss the above results on Friday, Oct. 18, 2019, at 11 a.m. To register, please visit the Red Cloud Financial website.

Technical disclosure

The scientific and technical information relating to Fiore Gold's properties contained in this news release was approved by J. Ross MacLean (MMSA), Fiore Gold's chief operating officer, a qualified person under National Instrument 43-101.

We seek Safe Harbor.

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