Patagonia Gold PLC

Published : April 01st, 2015

Operational Update

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Operational Update



Patagonia Gold reports update on Cap-Oeste and COSE

Resource estimates

London, United Kingdom 30th March 2014 - Patagonia Gold Plc (AIM: PGD) ('Patagonia Gold' or the 'Company') is pleased today to provide an update of the two main resource models for Cap-Oeste and COSE deposits.

Highlights:

Cap-Oeste project:

· Updated JORC compliant Resource model increased total Indicated gold equivalent ounces by 98,000 to 1,295,000.

· High grade 'COSE' style mineralisation containing 75,000 ounces of gold and 3,533,000 ounces of silver modelled for inclusion into cyanide leachable resource.

COSE project:

· Updated JORC compliant Resource model increased total Indicated gold equivalent ounces by 19,165 to 83,000.

· Higher ore volume modelled to ensure underground mine design recovers the maximum possible of contained metal and ensuring that higher volume mechanised mining can be implemented.

Global Resource:

· The combined Indicated and inferred resources for Cap-Oeste, COSE, Manchuria and Lomada deposits has been increased by 213,183 ounces bringing the Company's global resources to 2,089,183 ounces of gold equivalent.

El Tranquilo property block:

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.

Cap-Oeste Resource update;

CUBE consulting from Perth, Western Australia has been retained to complete resource updates for the Cap-Oeste and COSE projects as part of the global pre-feasibility study package being completed for both projects.

A total of 502 drillholes for 102,300 metres were utilised in the re-interpretation and modelling of the Cap-Oeste deposit. Mineralisation was modelled in a broader envelope than previous and included holes not incorporated into the previously published resource dated 10th September 2012. Ordinary and Indicator Kriging were utilised to interpolate gold into a block model with cell sizes of 10m x 5m x 5m.

Additional metallurgical testing at Cap-Oeste has established that the central core section of the orebody hosts gold (Au) and silver (Ag) within a style of mineralisation very similar to that of the neighbouring high grade COSE, with free gold and silver associated with silver minerals such as Pyragerite, Electrum and Proustite. This mineralisation style is amenable to cyanide leaching and adds 75,000 oz of gold and 3,533,000 oz of silver bringing the total of the cyanide leachable gold in the Cap-Oeste resource to 406,000 oz of gold equivalent (AuEq) when added to the existing 'All Oxide' resource.

Table 1: Cap-Oeste JORC compliant Indicated and Inferred Resources March 2015.

Cap-Oeste Mineral Resource Estimate - March 2015 Model

(0.3g/t AuEq Cutoff)








INDICATED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal

(oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

All Oxide

4,779

0.95

35.42

1.54

146

5,437

237

Sulphide

9,806

2.25

66.51

3.36

708

20,970

1,058

TOTAL-Indicated

14,585

1.82

56.32

2.76

855

26,407

1,295









INFERRED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal

(oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

All Oxide

1,009

0.62

27.67

1.08

20

897

35

Sulphide

7,383

1.05

25.54

1.47

248

6,063

350

TOTAL-Inferred

8,392

1.00

25.79

1.43

269

6,960

385









INDICATED + INFERRED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal

(oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

All Oxide

5,788

0.90

34.07

1.46

166

6,334

272

Sulphide

17,189

1.73

48.92

2.55

957

27,033

1,407

TOTAL-ALL

22,977

1.52

45.17

2.27

1,123

33,367

1,679

Au equivalent was calculated by dividing a set Au price (USD$1,200/Oz) by a set Ag price (USD$20/Oz) following guidance from PGD. The formula used is; AuEq (g/t) = Au (g/t) + Ag (g/t)/60.

This new resource model has now been incorporated into the optimisation and mine design runs currently being completed in conjunction with the heap leach pad design and plant for the gold and silver extraction.

COSE Resource update:

An updated model of the COSE mineralisation has been completed including 123 drill holes for 25,471m. This model incorporated additional data from 37 drill holes not previously included into the former published resource. The model was completed with the intention of applying mechanised underground mining equipment to achieve maximum ore extraction considering the extremely high grade and style of mineralisation present.

The mineralisation was remodelled in section from drill hole core logging and a single block model was created with dimensions extended out to fully cover all of the COSE mineral resource area. The parent block size used was 2.5mE x 5mN x 5mRL with sub-celling to 0.625mE x 1.25mN x 0.625mRL.

Table 2: COSE JORC compliant Indicated and Inferred Resources March 2015

INDICATED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal (oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

TOTAL-Indicated

49

27.80

1,466.00

52.20

44

2,325

83









INFERRED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal (oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

TOTAL-Inferred

20

12.50

721.00

24.50

8

464

16









INDICATED + INFERRED RESOURCES


Tonnes (x 1000)

Grade (g/t)

Contained Metal (oz x 1000)

Au

Ag

AuEq

Au

Ag

AuEq

TOTAL-ALL

69

23.40

1,251.00

44.20

52

2,789

99

Au equivalent was calculated by dividing a set Au price (USD$1,200/oz) by a set Ag price (USD$20/oz) following guidance from PGD. The formula used is; AuEq (g/t) = Au (g/t) + Ag (g/t)/60.

An increase in the contained Indicated ounces of Au and Ag of 4,150 oz and 1,040,000 Oz respectively was reported while Inferred ounces were reduced by 18,566 and 391,000 oz respectively, the conversion of previously Inferred to Indicated category ounces and the use of a lower Silver price of $20/oz attributed to the overall reduction in AuEq ounces from 106,412 to 99,000. However the Company considers the model to be far more robust and the modelling update has considerably de-risked the project through application of more conservative estimation parameters.

Kenmore Consulting from Perth is in the final stages of completing an underground mine design and development plan for COSE.

Global Resource:

The Global resource base for the company is shown below

INDICATED RESOURCES

Area

Indicated

Grade (g/t)

Metal (oz)

Name

Tonnes

Au

Ag

AuEq

Au

Ag

AuEq

La Manchuria

425,705

2.95

135

4.07

40,317

1,848,211

55,684

COSE

49,000

27.8

1466

52.2

44,000

2,325,000

83,000

Cap-Oeste

14,585,000

1.82

56.32

2.76

855,000

26,407,000

1,295,000

Lomada

5,002,016

1.003

NA

NA

161,346

0

161,346

TOTAL Indicated





1,100,663

30,580,211

1,595,030









INFERRED RESOURCES

Area

Inferred

Grade (g/t)

Metal (oz)

Name

Tonnes

Au

Ag

AuEq

Au

Ag

AuEq

La Manchuria

1,469,020

1.53

49.4

1.92

72,335

2,335,236

90,682

COSE

20,000

12.5

721

24.5

8,000

464,000

16,000

Cap-Oeste

8,392,000

1

25.79

1.43

269,000

696,000

385,000

Lomada

3,412,270

0.672

NA

NA

73,726

NA

73,726

Total Inferred





423,061

3,495,236

565,408









INDICATED + INFERRED RESOURCES






Metal (oz)






Au

Ag

AuEq

Total IND + INF Oz





1,523,724

34,075,447

2,160,438

Note: The Lomada Indicated resource shown above has been depleted by an estimated 71,255 ounces through mining from 2012 to 31st December 2014. A new resource update is in progress to incorporate additional drilling.

The company last reported global resources 10th September 2012 with indicated resources of 1,478,000 ounces AuEq and inferred resources of 398,000 ounces AuEq totalling 1,876,000 ounces of AuEq on the Cap-Oeste, COSE, Manchuria and Lomada deposits in the aggregate. All resources were estimated in accordance with JORC and NI 43-101.

Note: The final resource estimate reports will be posted onto the company's website.

Ends

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/COSE project, the La Manchuria 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.

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.

Contact Information

Bill Humphries, CEO
Patagonia Gold Plc
Tel: +44 (0)20 7409 7444

David Bick / Mark Longson
Square 1 Consulting
+44 (0)20 7929 5599

Angela Hallett/James Spinney
Strand Hanson Limited
Tel: +44 (0)20 7409 3494

Jeremy Stephenson/Stewart Dickson
Cantor Fitzgerald Europe
Tel: +44 (0)20 7894 7000


This information is provided by RNS
The company news service from the London Stock Exchange
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Patagonia Gold PLC

CODE : PGD.L
ISIN : GB0003049409
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Patagonia Gold is an exploration gold company based in United kingdom.

Patagonia Gold holds various exploration projects in Argentina.

Its main exploration property is LA MANCHURIA in Argentina.

Patagonia Gold is listed in United Kingdom. Its market capitalisation is GBX 73.3 billions as of today (US$ 79.4 billions, € 70.9 billions).

Its stock quote reached its lowest recent point on December 08, 2017 at GBX 0.80, and its highest recent level on February 15, 2019 at GBX 97.50.

Patagonia Gold has 2 363 474 884 shares outstanding.

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Corporate news of Patagonia Gold PLC
2/2/2016Trilogy Earn-In Agreement
12/23/2015Removal of tax on gold exports
12/21/2015Economic & fiscal policy changes in Argentina
11/24/2015Lomada Production Update
10/26/2015Second Price Monitoring Extn
10/26/2015Price Monitoring Extension
9/30/2015Half Yearly Report
7/13/2015RPT-INSIGHT-Sage grouse flies into U.S. species protection c...
7/13/2015Sage grouse flies into U.S. species protection crossfire
6/19/2015Additional Listing/Directors' Shareholdings
4/21/2015Appointment of CEO
4/9/2015Final Results
4/1/2015Update on Cap-Oeste
4/1/2015Operational Update
2/11/2015Additional Listing
2/11/2015Lomada Production Results
12/23/2014Company Update
11/18/2014Operational Update
11/18/2014Subscription and Open Offer
2/26/2014Directors' Shareholdings/Issue of equity
2/26/2014Exercise of Options
2/26/2014Exercise of Options
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