Pure Gold Mining shares rise on latest development at Red Lake

Pure Gold Mining announced on Tuesday that mine development at the Pure Gold Red Lake Mine, initiated as part of the test mining programme, had now resumed, and exploration drilling in close proximity to that development had intersected high-grade gold mineralisation from both infill and step-out drill holes.

The London and Toronto-listed firm said the drilling tested potential for growth of ore zones that would provide initial feed for the mine processing plant, and had yielded positive results, suggesting “strong” mine continuity and the potential for mining stope expansion.

Results received and compiled would be integrated into short-term mine planning, the board said, with access development completed through the test programme set to facilitate production from some of those areas in 2020.

The Pure Gold Red Lake Mine was currently under construction and, to date, underground development was approximately four months ahead of the feasibility schedule, with construction said to be moving forward at a “rapid pace”, and first gold pour expected in the fourth quarter of 2020.

Pure Gold said the drilling results highlights included 24.9 grams of gold per tonne over one metre from drill hole PG19-708, and 34.1 grams of gold per tonne over 2.2 metres from drill hole PG19-710, including 64.6 grams of gold per tonne over one metre.

They also included 33.1 grams of gold per tonne over 3.4 metres from drill hole PG19-719, including 79.4 grams of gold per tonne over 1.4 metres, and 13.2 grams of gold per tonne over 6.3 metres from drill hole PG19-735, including 26.3 grams of gold per tonne over two metres.

“The Pure Gold Red Lake Mine continues to produce significant, high-grade gold drill intercepts and today's results from areas planned for mining this year highlight local opportunities for mine expansion,” said president and chief executive officer Darin Labrenz.

“Similar to the 2018 test mining program where the discovery of a new hanging wall zone resulted in 56% more ounces than predicted, these drill holes have identified both potential extensions to mine stopes and opportunities to test and develop new stopes.”

Labrenz said since announcing the start of construction in 2019, the firm had rapidly built out its operations team, adding that its ongoing test mining programme had provided development within reach of several of those planned stoping areas.

“We understand the orebody well and we are now demonstrating the potential for it to grow.

“With construction well underway, we look forward to first gold production expected in late 2020.”

At 1235 GMT, shares in Pure Gold Mining were up 10.89% in London at 49.9p.