Patagonia Gold Provides Progress Update For Lomada De Leiva And
Cap-Oeste Projects
TORONTO,
Jan. 30, 2013 /CNW/ - Patagonia
Gold Plc (TSX: PAT, AIM: PGD) ("the Company") today provided a
progress update for its Lomada de Leiva and Cap-Oeste projects in
Santa Cruz Province, Argentina.
Highlights
- Construction of the first stage of the fully permitted Lomada
heap leach project is well advanced and is on target for
commencement of leaching in Q2 2013.
- To accelerate gold production, the Company has elected to
expand the existing trial pad to 315,000 tonnes capacity,
preparation for which is also well advanced. Mining and loading of
ore onto the pad has already commenced with irrigation set to start
next month.
- The trial has so far recovered approximately 4,045 ounces of
gold, representing over 66% of contained gold and continues to
leach. Processing and smelting is on-going.
- An expanded geophysical IP study has been completed over the
Cap-Oeste/COSE structure and surrounds. Preliminary results have
revealed two new large IP anomalies parallel to and similar in
intensity to Cap-Oeste/COSE (see attached plan).
- Drilling will re-commence next month on the Cap-Oeste/COSE
structure to further explore the highly prospective zone identified
in drilling last season. On receipt of the full geophysical report,
an exploratory drilling campaign will be carried out.
Photos of the progress at Lomada and Cap-Oeste will be posted on
the Company's website, www.patagoniagold.com.
LOMADA DE LEIVA
The Lomada de Leiva project is located approximately 40 kilometres
south-east of the town of Perito Moreno in the Province of
Santa Cruz, and is within the
Company's La Paloma property block, covering over 44 square
kilometres.
Construction of the first stage of the fully
permitted Lomada main heap leach project is well advanced and is on
target for commencement of operations in Q2 2013. The total pad
area has been stripped of topsoil, which is being stacked for later
rehabilitation purposes. Earthworks for infrastructure, holding and
containment dams are under way. The plastic membrane, irrigation
pipework and pumps have all been ordered, scheduled for arrival and
installation in Q1 2013. The pregnant solution will be pumped to
the existing processing plant constructed for the trial in
2011.
Plant expansion is under way, with an additional
six carbon columns currently under construction designed to
increase the plant throughput to 160m3/hr of pregnant solution. In
addition, the explosives magazine has also been completed and is
awaiting final approval.
The gold room facility, located at the Bajada property, is now
fully operational and commissioned.
The Company received its first revenue from gold
sales in December, being US$708,186
for 425.67 ounces of gold produced during the commissioning of the
gold room production facility. A further 38 kilos of doré
containing approximately 1,120 ounces of gold has since been
processed from existing carbon stocks and dispatched to the
refinery.
The remaining estimated 2,000 ounces of gold
from existing carbon stocks together with recent production from
the trial of approximately 500 ounces of gold is currently being
processed. The trial has so far recovered approximately 4,045
ounces of gold, representing over 66% of contained gold and
continues to leach.
To accelerate gold production, the Company has
elected to expand the existing trial pad of 135,000 tonnes to
315,000 tonnes. This will allow the main production to be advanced
by several months. Preparation of the expansion is well
advanced with earthworks completed and the membrane scheduled for
installation in early February. In the meantime, mining and loading
of ore onto the existing pad has already commenced with irrigation
set to start in late February
2013.
Mining has recommenced utilising a contract fleet until the
Company receives delivery of its own fleet of equipment now
expected during March and April 2013.
Ramp up to full production is expected to be achieved by mid Q2
this year once the full fleet is operational and the overburden
from the main pit area is removed.
CAP-OESTE
The El Tranquilo property block, covering approximately 80,000
hectares, contains Patagonia Gold's flagship project, the Cap-Oeste
deposit, together with the COSE bonanza gold and silver deposit and
numerous other prospects including Monte
Leon.
Quantec Geoscience of Santiago, Chile, has recently completed an
expanded IP study over the CapOeste/COSE structure and NW El
Tranquilo block. Approximately 50% of the work area has been
covered with closer spaced lines completed specifically over the
Cap-Oeste/COSE area and surrounds. Preliminary results have
revealed two completely new large IP anomalies striking in the same
direction as the Cap-Oeste/COSE anomaly and offset by approximately
700m. The anomalies are significant in that their intensity and
size are very similar to the existing anomalies over Cap-Oeste/COSE
and also Don Pancho, both areas with
significant areas of known mineralization.
The IP anomaly at Palmeras was expected as
previous mapping and geochemical surveys had picked up the
existence of mineralised structure at surface. A further anomaly to
the NE of "VALLE" has also been identified with traces of sinter
found at surface.
A preliminary exploration programme is being
designed to drill test both of the new targets during the 2013
campaign while concentrating on exploration within the highly
prospective corridors of Cap-Oeste/COSE and Don Pancho.
COSE
The construction of the underground access decline for the COSE
project is now planned for the second half of 2013 so that all
available effort and funds can be focused towards bringing the
Lomada heap leach project into full production.
Meanwhile, the heavy mining equipment and
infrastructure pre purchased for COSE is being utilised on the
Lomada construction providing considerable savings in hire
costs.
About Patagonia Gold
Patagonia Gold Plc is a mining company that seeks to grow
shareholder value through exploration, development and production
of gold and silver projects in the southern Patagonia region of
Argentina. The Company is
primarily focused on three projects: the flagship Cap-Oeste
project, the nearby COSE project and the Lomada heap leach project,
which is generating free cash flow. Patagonia Gold, indirectly
through its subsidiaries or under option agreements, has mineral
rights to over 220 properties in several provinces of Argentina and Chile, and is one of the largest landholders
in the province of Santa Cruz.
Patagonia Gold is listed on the Toronto Stock
Exchange (TSX) under the symbol PAT and has been listed on the AIM
market of the London Stock Exchange under the symbol PGD since
2003.
Matthew Boyes,
(BSC. Geology, Fellow AusIMM) Chief Operating Officer for Patagonia
Gold PGSA and a qualified person as defined in Canadian National
Instrument 43-101, has reviewed and verified all scientific or
technical mining disclosure contained in this press
release.
Cautionary Note Regarding Technical and
Forward-Looking Information
The Company's production decision in respect of
the Lomada project is not based on a feasibility study of mineral
reserves demonstrating economic and technical viability and
therefore readers are cautioned that there is increased uncertainty
and there are economic and technical risks of failure associated
with such production decisions.
This news release may contain certain
information that constitutes forward-looking information within the
meaning of applicable securities laws. Forward-looking information
is frequently characterised by words such as "plan," "expect,"
"project," "intend," "believe," "anticipate" and other similar
words, or statements that certain events or conditions "may" or
"will" occur. Forward-looking information includes, but is not
limited to, statements about strategic plans, mineral resources
estimates, spending commitments, forecasts of free cash flow,
future operations, results of exploration, commencement and
completion of pre-feasibility studies, future work programs,
commencement production, production schedules, capital expenditures
and objectives. Forward-looking information is based on the
opinions, expectations and estimates of management at the date the
statements are made, and are subject to a variety of risks and
uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the
forward-looking information. These factors include the inherent
risks involved in the exploration and development of mineral
properties, the uncertainties involved in interpreting drilling
results and other geological data, fluctuating metal prices and
other factors described above and in the Company's most recent
annual information form under the heading "Risk Factors," which has
been filed electronically by means of the Canadian Securities
Administrators' website located at www.sedar.com. The Company
disclaims any obligation to update or revise any forward-looking
information if circumstances or management's estimates,
expectations or opinions should change. The reader is cautioned not
to place undue reliance on forward-looking information.
SOURCE Patagonia Gold plc
Image with caption: "MINING AT LOMADA DE LEIVA (CNW
Group/Patagonia Gold plc)". Image available at:
http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23117.jpg
Image with caption: "DORÉ FROM THE SECOND POUR 38KG LOMADA DE
LEIVA (CNW Group/Patagonia Gold plc)". Image available at:
http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23118.jpg
Image with caption: "GEOPHYSICAL IP SURVEY CAP-OESTE (CNW
Group/Patagonia Gold plc)". Image available at:
http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23119.jpg