Pure Gold ramps up mill, fine tunes underground ops

With the mill at Pure Gold Mining’s (TSXV: PGM) PureGold mine in Red Lake ramped up to its 800 tonne-per-day nameplate capacity, the new producer is now focusing on fine-tuning its underground operations.

First-quarter head grades came in below expectations due to overbreak dilution and limited scheduling flexibility from the temporary single-ramp access to the mine. With limited stope material, the mill processed low-grade stockpiles in the first quarter.

In the first three months of 2021, Pure Gold processed 47,182 tonnes grading 2.8 grams gold per tonne and generated 4,011 gold ounces. In the last quarter of 2020, the company milled 3,535 tonnes at a head grade of 7.8 grams gold per tonne.

Pure Gold has modified its blasting practices to reduce overbreak and shifted some stopes from longhole mining to mechanized cut and fill extraction (already the main mining method for the mine) to minimize dilution. Both stope accessibility and scheduling flexibility are expected to improve in the second quarter as the East ramp development advances. This second ramp has recently reached mineralization with stope access from the decline expected in April.

Based on a peak mill throughput of 897 tonnes per day recorded on March 19, the company is now looking at the throughput and gold production as indicators of reaching a commercial production milestone. Pure Gold expects to announce initial production and cost guidance for the year shortly after the announcement.

Pure Gold has also entered into a binding agreement with Sprott Private Resource Lending to increase the principal amount of its debt by up tot US$20 million; US$12.5 million of this amount will be available on closing. The agreement also defers the payment of cash interest until the end of June.

“We are pleased by the progress of the ramp-up of the PureGold mine to date, highlighted by the milling facilities achieving design capacity prior to quarter end. With the mill ramp-up effectively complete, we can now focus our attention solely on ramping up the mine and accessing high grade ore from multiple declines where we are making great progress,” Darin Labrenz, president and CEO of PureGold, said in a news release.

According to a 2019 feasibility study, the PureGold reserve grade of 9 grams gold includes average annual grades between 6.3 grams gold and 13.7 grams gold. First-quarter stopes averaged between 5 grams gold and 6 grams gold, before overbreak. The study outlined probable reserves of 1 million oz., from 3.5 million tonnes at 9 grams gold.