|
Halifax, Nova Scotia;
August 15, 2011 –
Brigus Gold Corp. ("Brigus" or the "Company") (NYSE Amex:
BRD; TSX: BRD) produced 15,688 ounces of gold from its Black Fox Mine in the
Timmins Mining district during the second quarter of 2011, an 80% increase
over first quarter production of 8,772 ounces. Net income for the six months
ended June 30, 2011 was $0.9 million compared to a net loss of $20.9 million
for the six months ended June 30, 2010. The Company incurred a net loss of
$3.8 million for the quarter ended June 30, 2011 compared to a net loss of
$19.1 million for the same period in 2010.
Production from the Phase
2 of the open pit commenced during the quarter but was somewhat constrained
in the initial stages while the mining area of the pit was developed. Initial
grades from the Phase 2 open pit are meeting expectations. Production in the
underground mine also began but consisted primarily of preproduction
development ore. Underground production from mining stopes is continuing to
increase and grades are in line with the mine plan. Development of the
underground mine has been slower than anticipated and has resulted in a
longer ramp up period for underground production.
(All dollar amounts in
this news release are in U.S. dollars unless otherwise noted.)
Among the highlights for
Q2 2011 and to the date of this release, the Company:
- Produced
15,688 ounces of gold in the second quarter, an 80% increase over first
quarter production.
- Processed
181,488 tonnes of ore at an average grade of 2.86 grams of gold per
tonne and an average recovery of 94.1%.
- Sold
15,178 ounces of gold at an average realized price of $1,463 per ounce
in Q2 2011.
- Achieved
commercial production from the Phase 2 open pit in April 2011.
- Commenced
Phase 1 of the Black Fox Mill expansion, which is expected to be
completed and in service by the second quarter of 2012, increasing
processing capacity by 5 to 10%.
- Filled
several key mine positions and made progress with recruiting underground
mining employees. At
present 90% of positions are filled.
- Reported
positive drill results from the newly discovered 147 Zone, which now
extends to a vertical depth of 240 metres below surface and remains open
for expansion.
- Signed
an Impact Benefit Agreement with the Wahgoshig First Nation.
- Will
achieve commercial production from the underground mine in the third
quarter of 2011.
"We are encouraged
by the continuing progress at our Black Fox Mine. We significantly increased
gold production in the second quarter and expect further quarter over quarter
increases for the rest of 2011 as operations ramp up. We are working toward
definition of a resource on the recently discovered 147 Zone and Contact Zone
within the Black Fox Complex and expect to increase profitability through the
remainder of the year," said Wade K. Dawe, President and CEO for Brigus.
"Development of the underground mine has been slower than expected due
primarily to staffing and equipment challenges. We have recently made several
key hires and at present 90% of our mine positions are filled.
Overview
Phase 2 of the Black Fox
open pit mine began producing ore in April 2011 and is currently producing at
a rate of 1,000 to 1,500 tonnes per day ("tpd"). During the second
quarter 87,760 tonnes of ore, at an average grade of 4.03 grams per tonne
("gpt"), were produced from the open pit mine and 30,316 tonnes at
an average grade of 3.54 gpt were mined from the underground which resulted
in a credit to underground development cost of $4.3 million. Underground
production consisted of a combination of pre-production ore and initial ore
from a limited number of accessible stopes. The balance of production during
the quarter consisted of 63,412 tonnes of lowgrade ores drawn from existing
stockpiles that were milled at an average grade of 0.91 gpt.
The Black Fox underground
mine is expected to reach commercial production in the third quarter of 2011.
Underground ore production is expected to reach 800 tpd during the third
quarter and approximately 1,000 tpd by year-end, as previously announced,
once additional stopes are opened up.
Mill throughput averaged
1,994 tpd during the quarter and 2,115 tpd in the month of June 2011. Mill
throughput is expected to average 2,000 tpd for the balance of the year.
The Company announced at
the end of June that it would proceed with an initial expansion of the Black
Fox Mill, which is expected to be completed and in service during the first
half of 2012. This initial expansion will increase processing capacity at the
mill to up to 2,200 tpd. Processing capacity and recovery will be increased
through optimization of existing equipment, equipment additions and
elimination of production losses.
Continued positive
exploration drill results from targets such as the Contact Zone, the newly
discovered 147 Zone, Gibson and Grey Fox South represent near term potential
to expand gold resources and reserves.
2011 Outlook
Brigus projects
increasing gold production quarter over quarter during 2011 with higher-grade
underground ore augmenting open pit ore for a total throughput of 2,000 tpd
at the Black Fox Mill. The Company is projecting third quarter 2011
production of approximately 17,500 ounces and quarter four production of
approximately 19,500 ounces.
Planned capital
expenditures related to underground development and mine equipment are
estimated to be $37 million for 2011 as previously guided. As a result of the
adoption of IFRS, approximately $15M in stripping costs will be capitalized
in 2011, which would have been charged to operating costs under US GAAP. The
Company has also initiated the Phase 1 mill expansion announced in June 2011
and expects to incur $3.5 million of expenditures in 2011.
Exploration expenditures
are expected to be approximately $12.4 million related primarily to increased drilling at the 147 Zone and Contact Zones of
the Black Fox Complex.
At the Goldfields Project
in Saskatchewan, the Company expects to complete an updated National
Instrument ("NI") 43-101 technical report during the second half of
2011.
About Brigus
Brigus is a growing gold
producer committed to maximizing shareholder value through a strategy of
efficient production, targeted exploration and select acquisitions. The
Company operates the wholly owned Black Fox Complex in the Timmins gold
district of Ontario, Canada. The Black Fox Complex encompasses the Black Fox
Mine and Mill, and adjoining Grey Fox-Pike River property, all in the
Township of Black River-Matheson, Ontario, Canada.
Brigus is also advancing its Goldfields Project located near Uranium City,
Saskatchewan, Canada, which hosts the Box and Athona gold deposits. In
Mexico, Brigus has a letter of intent to sell 75% of its Ixhuatan silvergold
projected located in the state of Chiapas. In the Dominican Republic, Brigus
has a letter of intent to sell its remaining interests in three mineral
exploration projects.
Cautionary Note to
U.S. Investors Concerning Estimates of Mineral Resources
This news release uses
the term mineral "resources". The Company advises U.S. investors
that while these terms are defined in and required by Canadian regulations,
these terms are not defined terms under the U.S. Securities and Exchange
Commission ("SEC") Industry Guide 7 and are generally not permitted
to be used in reports and registration statements filed with the SEC. The SEC
generally only permits issuers to report mineralization that does not
constitute SEC Industry Guide 7 compliant "reserves" as in-place
tonnage and grade without reference to unit measures. U.S. investors are
cautioned not to assume that any part or all of mineral deposits in these
categories will ever be converted into reserves.
Cautionary and
Forward-Looking Statements
Statements contained in
this news release, which are not historical facts, are forward-looking
statements that involve risk, uncertainties and other factors that could
cause actual results to differ materially from those expressed or implied by
such forward-looking statements. All statements regarding the ability of the
Company to achieve its production, total cash costs, steady state annual
production and mining rate estimates; to achieve ramping up the Black Fox
underground mine to reach commercial production by the end of the third
quarter of 2011; estimated average gold grades for the open pit and
underground operations; exploration and capital programs for 2011, including
the estimated expenditures; expansion of the Black Fox Mill capacity;
increase in gold production; increase in profitability; exploration drill
results and resource additions; and the Company's ability to deliver gold
pursuant to the gold stream agreement, are forward-looking statements and
estimates that involve various risks and uncertainties. This forward-looking
statements include, or may be based upon, estimates, forecasts, and
statements as to management's expectations with respect to, among other
things, the outcome of legal proceedings, the issue of permits, the size and
quality of the company's mineral resources, progress in development of
mineral properties, future production and sales volumes, capital and mine
production costs, demand and market outlook for metals, future metal prices
and treatment and refining charges, and the financial results of the Company.
Important factors that
could cause actual results to differ materially from these forward-looking
statements include environmental risks and other factors disclosed under the
heading "Risk Factors" in Brigus' most recent Annual Information
Form and Management Discussion and Analysis filed under the Company's name at
www.sedar.com and annual report on Form 40-F filed with the United States
Securities and Exchange Commission at www.sec.gov as well as elsewhere in Brigus'
documents filed from time to time with the Toronto Stock Exchange, the NYSE
Amex Equities, the United States Securities and Exchange Commission and other
regulatory authorities. All forward-looking statements included in this news
release are based on information available to the Company on the date hereof.
The Company assumes no obligation to update any forwardlooking statements,
except as required by applicable securities laws.
Contact Information:
Jennifer Nicholson CA
Vice President, Investor Relations
Phone: 902/422-1421
Email: ir@brigusgold.com
|