Anaconda Mining Announces Mineral Resource Estimate for the Argyle Gold Deposit - Point Rousse Project, Newfoundland

 

TORONTO, Jan. 8, 2018 /CNW/ - Anaconda Mining Inc. ("Anaconda" or the "Company") (ANX: TSX) is pleased to announce an initial Mineral Resource Estimate ("Resource") prepared in accordance with National Instrument 43-101 ("NI 43-101") for the Argyle Gold Deposit ("Argyle") at the Point Rousse Project, Newfoundland and Labrador.  The Resource is presented below in Table 1 and has an effective date of December 31, 2017. Highlights of the Resource and related developments associated with the deposit are as follows:

• Indicated resources of 38,300 ounces; Inferred resources of 30,300 ounces (capped grades);
• The deposit remains open in all directions and shows evidence of contained higher grade shoot trends;
• Approximately 45% of currently defined mineral resources are contained within an initial conceptual open pit shell prepared by Anaconda staff;
• A 1,000-metre diamond drilling program was initiated in early December to expand the deposit and is ongoing at present;
• Argyle is located 4.5 kilometres from the Pine Cove Mill and the area is accessible by existing road networks;
• Environmental assessment application documents are expected to be submitted to the Newfoundland and Labrador Department of Environment by February 2018; All permits and approvals for production are expected in the spring of 2019.

Table 1: *Argyle Mineral Resource Estimate – Effective Date: December 31, 2017

*See resource estimate notes presented below   

A Technical Report prepared in accordance with NI43-101 for the Point Rousse Project will be filed on SEDAR (www.sedar.com) within 45 days of this news release.

"It is a big milestone for Anaconda to have outlined another deposit in close proximity to the Pine Cove Mill. At the Point Rousse Project, we have built significant processing capability and tailings capacity while generating over $42 million in project level EBITDA from our mining activities in the last 6 years. To potentially add more local ore feed that can utilize this infrastructure and continue to produce cash flow for the Company is tremendous. Also, Argyle demonstrates our ability to find more mineral resources nearby our mill, even though we have been constrained financially for a number of years. With more investment, we believe we can continue to add more ounces to the Point Rousse Project. As we advance the Goldboro Project in Nova Scotia in parallel with our work at Point Rousse, we move closer to our goal of significantly increasing production company-wide."

~ Dustin Angelo, President and CEO

About the Argyle Deposit

The Argyle Gold Deposit, located 4.5 kilometres east of the Pine Cove Mill, is defined over a strike length of 600 metres and to a down-dip depth of 225 metres and is open for expansion in all directions.  Anaconda is currently completing a combination of step-out and infill drilling at Argyle. The step-out drilling is along strike to the east as well as down dip from the known mineralized area.  The step-out drilling is focused on the mapped and projected continuation of the Argyle gabbro, the host rock to mineralization, and is coincident with geophysical anomalies (magnetic and chargeability) like those associated with the Argyle Deposit.

Anaconda is also focused on determining the trend of high-grade zones discovered through previous drilling. The easternmost high-grade zone to date is outlined by drill holes AE-16-33, AE-16-40 and AE-16-43 and averages 14 metres thick with composited assays between 2.91 g/t and 5.52 g/t gold. The northernmost high-grade zone, outlined by drill hole AE-16-39, is 6.0 metres thick with a composited grade of 9.31 g/t and is open along strike and down-dip (see previous releases of July 13, September 27, and November 22, 2017).

About the Argyle Mineral Resource Estimate and Methodology

The current Resource estimate is defined at the 0.50 g/t gold grade and is based on 1 metre assay composites capped at 12 g/t gold. The cutoff value reflects reasonable potential for economic development in the foreseeable future, primarily by open pit mining methods. This is based on processing at the nearby Pine Cove Mill and the current, rounded three year trailing average gold price of $1225 (US).

Table 2 below illustrates cutoff value sensitivity of the grade capped resource estimate block model and Table 3 below illustrates sensitivity of the corresponding uncapped block model. At the resource statement cutoff value of 0.5 g/t gold, grade capping at 12 g/t has the effect of reducing Indicated category gold ounces by 10.9%, from 43,000 ounces in the uncapped model, and reducing Inferred category gold ounces by 30.8%, from 43,800 ounces in the uncapped model. Uncapped block model gold grades, tonnages and ounces are presented for comparative purposes and do not constitute resource statement values.

Table 2: Block Model Grade and Tonnage Sensitivity Report - Capped @ 12 g/t Au

*Resource statement cutoff value is 0.50 g/t Au; resource estimate values are highlighted

Table 3: Block Model Grade and Tonnage Sensitivity Report – Uncapped Model

*Resource statement cutoff value is 0.50 g/t Au; uncapped comparative values to resource statement are highlighted

Notes on Mineral Resource Estimate and Methodology: 

1. This Mineral Resource Estimate has an effective date of December 31, 2017 and was prepared in accordance with Canadian Institute of Mining, Metallurgy and Petroleum Standards on Mineral Resources and Reserves: Definitions and Guidelines (the CIM Standards) as well as disclosure requirements of NI 43-101.
   
   
2. Michael Cullen, P. Geo., of Mercator Geological Services Ltd. (Mercator) of Dartmouth, Nova Scotia supervised preparation of the estimate and is the responsible Qualified Person in this regard. Both Mr, Cullen and Mercator are independent of the Company within the meaning of NI 43-101. Mr. Cullen has reviewed and authorized the disclosure of the Mineral Resource Estimate technical information for the Argyle Gold Deposit presented in this press release.
   
   
3. This Mineral Resource Estimate is based on a database containing 52 holes drilled into the Argyle Gold Deposit totaling 4,820.2 metres of diamond drilling, and 426 surface channel samples cut from trenches using a diamond saw. Independent Qualified Person Michael Cullen, P. Geo., has verified the data used for the resource calculation including sampling protocols and analytical methods and the laboratory conducting the analysis.
   
   
4. Mineralization was constrained within 3D geologic solids built using Surpac software using a nominal 0.5 g/t gold assay cut-off. Contributing 1.0 metre assay composite populations were capped at a gold grade of 12 g/t. 
   
   
5. Gold grades were estimated using inverse distance squared interpolation methodology with 2 interpolation passes. Interpolation pass 1 utilizes ellipsoid ranges of 65 m, 39 m, and 25 m for the major, semi-major and minor axes respectively. Interpolation pass 2 utilizes ellipsoid ranges of 125 m, 75 m, and 25 m for the major, semi-major, and minor axes respectively Interpolation ellipsoids plunge between 15° and 20° towards an azimuth of 050°. The interpolation model was checked using ordinary kriging methodology. 
   
   
6. Indicated resources reflect resource blocks with interpolated gold grades from the first interpolation pass and contributing composites from 3 or more drill holes with an average distance of 50 m or less to the block centroid. Inferred resources consist of all other valid blocks interpolated in interpolation pass 1 or interpolation pass 2 that occur within the deposit peripheral constraint solid model.
   
   
7. A density factor of 2.7g/cm³ was applied to all blocks and is based on averaging of 74 drill core density values for samples within the mineralized zone solid.
   
   
8. Reported block model tonnages have been rounded to the nearest 1,000 tonnes and associated calculated gold ounces have been rounded to the nearest 100 ounces; calculated gold ounce totals may vary slightly due to rounding.
   
   
9. The mineral resources defined by this estimate are considered to have reasonable potential for economic development in the foreseeable future, primarily through open pit mining methods at the current, rounded three year trailing average gold price of $1225 (US) per ounce. 

This news release has been reviewed and approved by Paul McNeill, P. Geo., VP Exploration and Gordana Slepcev. P.Eng., Chief Operating Officer with Anaconda Mining Inc., "Qualified Persons" and Michael Cullen, P. Geo., of Mercator Geological Services Ltd., an "Independent Qualified Person", under National Instrument 43-101 Standard for Disclosure for Mineral Projects.

All samples and the resultant composites referred to in this release were collected using QA/QC protocols including the regular insertion of certified standards and blanks within each sample batch sent for analysis and completion of check assays of select samples. Drill core samples were routinely analyzed for Au at Eastern Analytical Ltd. in Springdale, NL (Eastern), using standard fire assay (30g) pre-concentration and Atomic Absorption finish methods. Eastern is a fully accredited firm within the meaning of NI 43-101 for provision of this service. Mineralized intervals referred to in this press release are reported as drill intersections and are apparent widths only. Apparent widths reported in this press release are estimated to be approximately 80 – 100% of true widths.

Diamond drilling at Argyle and the resource estimate outlined within this press release, benefited from a JEA grant from the Department of Natural Resources, Government of Newfoundland and Labrador. Anaconda would like to thank the Government of Newfoundland and Labrador.

A version of this press release will be available in French on Anaconda's website (www.anacondamining.com) in two to three business days.

ABOUT ANACONDA MINING INC.

Anaconda is a TSX-listed gold mining, exploration and development company, focused in the prospective Atlantic Canadian jurisdictions of Newfoundland and Nova Scotia. The Company operates the Point Rousse Project located in the Baie Verte Mining District in Newfoundland, comprised of the Pine Cove open pit mine, the fully-permitted Pine Cove Mill and tailings facility, the Stog'er Tight and Argyle deposits, and approximately 5,800 hectares of prospective gold-bearing property. Anaconda is also developing the recently acquired Goldboro Project in Nova Scotia, a high-grade Mineral Resource, with the potential to leverage existing infrastructure at the Company's Point Rousse Project.

The Company also has a pipeline of organic growth opportunities, including the Viking and Great Northern Projects on the Northern Peninsula and the Tilt Cove Property on the Baie Verte Peninsula. 

FORWARD-LOOKING STATEMENTS

This news release contains "forward-looking information" within the meaning of applicable Canadian and United States securities legislation. Forward-looking information includes, but is not limited to, use of proceeds and TSX final acceptance of the Offering. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Anaconda to be materially different from those expressed or implied by such forward-looking information, including risks associated with the exploration, development and mining such as economic factors as they effect exploration, future commodity prices, changes in foreign exchange and interest rates, actual results of current production, development and exploration activities, government regulation, political or economic developments, environmental risks, permitting timelines, capital expenditures, operating or technical difficulties in connection with development activities, employee relations, the speculative nature of gold exploration and development, including the risks of diminishing quantities of grades of resources, contests over title to properties, and changes in project parameters as plans continue to be refined as well as those risk factors discussed in Anaconda's annual information form for the year ended May 31, 2017, available on www.sedar.com.  Although Anaconda has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Anaconda does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

SOURCE Anaconda Mining Inc.

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