VANCOUVER, March 2, 2017 /CNW/ – Goldgroup Mining Inc. ("Goldgroup" or the "Company") (TSX:GGA, OTC:GGAZF, BMV SIX:GGAN.MX) announces increased gold production in 2016 with plans for continued expansion in 2017 for Cerro Prieto.
On April 1, 2016, the Cerro Prieto mine achieved its main commercial production criteria of over 1,200 oz gold production per month consistently over a two-month period. This was achieved by better utilization of crushing and pad capacity by management. During the year ended December 31, 2016, Cerro Prieto produced approximately 15,608 ounces of gold.
GOLD OZ 2016 | Q1 | Q2 | Q3 | Q4 | Total |
PRODUCED | 3,379 | 4,494 | 3,811 | 3,924 | 15,608 |
SOLD | 3,339 | 4,499 | 3,884 | 4,021 | 15,743 |
During the period ended December 31, 2016, the Company:
- Completed electrical installation to the National Grid, which is expected to reduce diesel consumption resulting in lower operating cost.
- Installed on site bulk explosive handling, which is also expected to reduce unit cost.
- Designed tertiary cone crusher and screen system, which will further reduce the feed size to the final HPGR crusher, and also give increased throughput. This is expected to increase gold production and enhance the profit margin and is expected to be completed the beginning of Q2 2017.
- Planned further exploration within current concessions to potentially extend mine life (current planned term is 4 years).
Cerro Prieto is an operation that was historically worked underground over 100 years ago. It contained many old stope openings and hence detailed ore definition was difficult to achieve by drilling alone. The Company opened up the mine with a number of open cut faces to better determine resources and characteristics. It has been in trial operation for the last two years with detailed mine planning as the mineralized zones were opened up and better defined, metallurgy utilizing fine crushing and agglomeration was optimized and the leaching parameters were determined in trial operations.
Annual Production 2014: | 4,890 oz gold |
Annual Production 2015: | 9,151 oz gold |
Annual Production 2016: | 15,608 oz gold |
Expected Annual Production 2017: | approx. 20,000 oz gold |
Production costs based on recent operations indicate a sustaining cost less than US$900 /oz gold for 2017.
Now that the mine is in sustainable operation, additional resources within the same mineralized zone are being investigated to extend mine life beyond the programmed 4 years. Goldgroup believes that additional resources outside the current mining zone but within the Cerro Prieto concessions also show promise.
Keith Piggott, Chairman, President and CEO of Goldgroup commented: "Our primary focus for 2017 is to continue to ramp up gold production and lower crushing and mining costs through bringing better efficiency into Cerro Prieto, which will improve the financial position of the Company moving forward."
The Company wishes to make clear that it is not basing its production decision on a preliminary economic assessment demonstrating the potential viability of mineral resources or a feasibility study of mineral reserves demonstrating economic and technical viability, and as a result there is increased uncertainty and there are multiple technical and economic risks of failure which are associated with this production decision. These risks, among others, include areas that are analyzed in more detail in a Preliminary Economic Assessment ("PEA") or Feasibility Study, such as applying economic analysis to resources or reserves, more detailed metallurgy, a number of various specialized studies.
Scientific and technical information relating to Cerro Prieto presented above has been approved by Rodney A. Blakestad, J.D., C.P.G., who by reason of education, affiliation with a professional association (as defined in NI 43-101) and past relevant work experience, fulfills the requirements of a Qualified Person as defined in NI 43-101, and he is Independent of the issuer applying all of the tests in Section 1.5 of NI 43-101CP.
About Goldgroup
Goldgroup is a Canadian-based gold production, development, and exploration Company with a significant upside in a portfolio of projects in Mexico and Ecuador, including a 50% interest in DynaResource de Mexico, S.A. de C.V., which owns 100% of the high-grade gold exploration project, San José de Gracia located in the State of Sinaloa. The Company operates its 100%-owned Cerro Prieto heap-leach gold mine, in the State of Sonora, Mexico, and is continuing the environmental assessment and permitting processes to advance to production the El Mozo property in Ecuador.
Goldgroup is led by a team of highly successful and seasoned individuals with extensive expertise in mine development, corporate finance, and exploration in Mexico and Ecuador. Goldgroup's mission is to increase gold production, mineral resources, profitability and cash flow, with a view to building a leading gold producer.
For further information on Goldgroup, please visit www.goldgroupmining.com
