Alamos Gold Sees Significant Increase in Mineral Reserves and Resources at Island Gold
ALAMOS GOLD INC.
Brookfield Place, 181 Bay Street, Suite 3910, P.O. Box #823
Toronto, Ontario, Canada M5J 2T3
Telephone: (416) 368-9932 or 1 (866) 788-8801
All amounts are in United States dollars, unless otherwise stated.
FOR IMMEDIATE RELEAS E
WEBSITE: www.alamosgold.com T RADING SYMBOL: TSX:A GI NYSE:AGI
Alamos Gold Sees Significant Increase in Mineral Reserves and Resources at
Island Gold
Toronto, Ontario (September 5, 2018) – Alamos Gold Inc. (TSX:AGI; NYSE:AGI) (“Alamos”
or the “Company”) today reported an updated National Instrument 43- 101 compliant Mineral
Reserve and Resource estimate for its Island Gold Mine as of June 30, 2018. This incorporates
exploration drilling completed during the first half of 2018, the majority of which was released in
the May 24, 2018 exploration update. A summary of updated Mineral Reserves and Resources
by category as at June 30, 2018 compared to December 31, 2017 is outlined in the table below.
Island Gold Mineral Reserves and Resources (Mineral Resources Exclusive of Reserves)
June 30, 2018 December 31, 2017 Change
Tonnes Grade Ounces Tonnes Grade Ounces Ounces Grade
(000's) (g/t Au) (000's) (000's) (g/t Au) (000's) (000's) % %
Proven Mineral Reserves 906 12.86 375 807 11.14 289 86 30% 16%
Probable Mineral Reserves 1,884 9.64 584 1,896 9.81 598 -14 -2% -2%
Proven & Probable Mineral Reserves 2,790 10.69 959 2,703 10.20 887 72 8% 5%
Measured Mineral Resources 35 4.83 5 48 4.46 7 -1 -21% 8%
Indicated Mineral Resources 806 8.32 216 542 5.98 104 111 107% 39%
Measured & Indicated Mineral Resources 841 8.18 221 591 5.86 111 110 99% 40%
Inferred Mineral Resources 3,673 9.99 1,180 2,958 9.55 908 271 30% 5%
• Proven and Probable Mineral Reserves increased 129,000 ounces before mining
depletion. Net of mining depletion, Mineral Reserves increased 8%, or 72,000
ounces, to 959,000 ounces, (2,790 thousand tonnes (“kt”) grading 10.69 grams per
tonne of gold (“g/t Au”)).
• Mineral Reserve grades increased 5% to 10.69 g/t Au
• Measured and Indicated Mineral Resources increased 99%, or 110,000 ounces,
to 221,000 ounces while grades increased 40% to 8.18 g/t Au (841 kt grading 8.18
g/t Au)
• Inferred Mineral Resources increased 30% , or 271,000 ounces, to 1,180,000
ounces with grades increasing 5% to 9.99 g/t Au (3,673 kt grading 9.99 g/t Au)
• Since the acquisition of Island Gold in November 2017, Mineral Reserves and
Resources have continued to grow:
• Proven and Probable Mineral Reserves have increased 365,000 ounces
before mining depletion, or 207,000 ounces, net of mining depletion of
158,000 ounces since the start of 2017. Mineral Reserve grades have
increased 17%
• Measured and Indicated Mineral Resources have increased 142%, or
130,000 ounces
• Inferred Mineral Resources have increased 18%, or 184,000 ounces
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• An $18 million exploration budget in 2018 is driving growth. This Mineral Reserve
and Resource update incorporated a total of 65,500 metres (“m”) of drilling completed
across 432 holes during the first half of 2018. A further 84,000 m of surface and
underground exploration and delineati on drilling has been budgeted for the
second half of 2018
“Island Gold continues to grow in both size and quality . In the nine months since we acquired
Island Gold, Mineral R eserves and R esources have grown in all categories while Mineral
Reserve grades have increased 17% . As 2018 drilling unfolds, we see excellent potential for
this growth to continue,” said John A. McCluskey, President and Chief Executive Officer.
2018 Exploration Program
The focus of the 2018 exploration drilling program is on expanding the down-plunge and lateral
extensions of the Island Gold deposit with the objective of adding new near mine Mineral
Resources. Drilling is being conducted across three main areas of focus along the two kilometre
long Island Gold Main Zone including; the Main Extension; the Eastern Extension; and the
Western Extension. The 2018 program has been successful in extending high grade gold
mineralization across all three areas with the bulk of the Mineral Resource increase coming in
the Main Extension where the majority of the surface exploration drill holes have been
concentrated. The exploration program has also been successful in adding to Mineral Reserves
within the Eastern Extension as well as in the Main C Zone.
A total of 65,500 m of drilling across 432 holes was completed during the first half of 2018 and
incorporated into Mineral Reserves and Resources as of June 30, 2018. This included 22,500
m of surface directional exploration drilling, 16,300 m of underground exploration drilling, 11,100
m of underground delineation drilling and 15,600 m of underground definition drilling . New
highlight intercepts that were incorporated into updated Mineral Reserves and Resources can
be found in Figures 1 to 4 and Tables 1 to 3 at the end of this release.
A further 84,000 m has been budgeted for the second half of 2018 with the objective of
extending high grade mineralization and adding near-mine Mineral Resources across all three
areas of focus. A significant portion of the surface exploration drilling planned for the second
half of 2018 will be at wider drill spacing than required for inclusion to Inferred Mineral
Resources and focused on regional targets. As such the Company is not expecting the same
pace of Mineral Resource growth with the December 31, 2018 update.
Mineral Reserves
Proven and Probable Mineral Reserves increased by 129,000 ounces, or 72,000 ounces net of
mining depletion through the first half of 2018, to 959,000 ounces of gold. Mineral Reserve
grades increased 5% to 10.69 g/t Au. Since the acquisition of Island Gold in November 2017,
Mineral Reserves have increased 365,000 ounces, or 207,000 ounces net of mining depletion
of 158,000 ounces since the start of 2017. M ineral Reserve grades have also increased 17%
as the deposit continues to grow in size and quality. Since the end of 2014, mineral reserves
have increased by nearly 800,000 ounces , net of mining depletion of nearly 300,000 ounces,
while grades have increased nearly 70% from 6.39 g/t Au to 10.69 g/t Au.
Approximately 65% of the 129,000 ounce increase in Mineral Reserves (as of June 30, 2018),
prior to mining depletion, came t hrough a combination of underground delineation and
exploration drilling in the Main Zone and Eastern Extension. Underground drilling conducted
from the 340, 620 and 840 metre level exploration drifts was successful in converting existing
Inferred Mineral Resources to higher classifications including Indicated Mineral Resources and
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Proven and Probable Mineral Reserves . The program was also successful in adding new
Indicated and Inferred Mineral Resources (as discussed below).
The remaining growth in Mineral Reserves was driven by an increase in grades within
developed ore blocks in the Main C Zone. The higher grades were the result of an increase in
the capping factor applied to face samples in development headings in the Main C Zone to 125
g/t Au, from 65 g/t Au. The increase in the capping factor was supported by a statistical analysis
incorporating ongoing channel sampling and positive grade reconciliation of 15% from actual
mining results since the end of 2016.
Mineral Resources
Measured and Indicated Mineral Resources (exclusive of Mineral Reserves) nearly doubled to
221,000 ounces while grades increased 40% to 8. 18 g/t Au. The majority of the increase was
within the Eastern Extension.
Inferred Mineral Resources increased 30% to 1,180,000 ounces while grades increased 5% to
9.99 g/t Au. This included the addition of 510,000 ounces during the first six months of 2018
prior to mining depletion and the conversion to higher classifications for a net increase of
271,000 ounces. Inferred Mineral Resources were added in all three areas of focus with the
majority coming in the Main Extension where most of the surface exploration drilling has been
concentrated.
Mineral Resource additions by area are detailed as follows.
Main Extension (Figure 2)
A total of 390,000 ounces of Inferred Mineral Resources were added within the Main Extension.
The bulk of the increase was in an area of focus down- plunge from existing Mineral Reserves
where gold mineralization had been extended up to 1.2 kilometres. Exploration drilling in 2017
and through the first half of 2018 has successfully defined a new Inferred Mineral Resource in
this area totaling 314,000 ounces and grading 11.20 g/t Au.
This has extended Inferred Mineral Resources a further 500 m and this east-plunging high-
grade ore shoot remains open down- plunge. Surface directional drilling in the second half of
2018 will be focused on further extending high-grade mineralization with the objective of defining
additional Mineral Resources.
Eastern Extension (Figure 3)
Indicated Mineral Resources increased 77 ,000 ounces within the Eastern Extension while
Inferred Mineral Resources decreased 22,000 ounces reflecting the conversion to higher
categories. Through a mix of underground delineation and exploration drilling, new Indicated
and Inferred Mineral Resources were defined below existing Mineral Reserves while existing
Inferred Mineral Resources were upgraded to higher Resource and Reserve classifications (as
noted above). This area remains open a t depth and will be an ongoing focus of underground
drilling from the 620 level in the second half of 2018. Surface directional drilling is also planned
to test this area between a depth of 900 and 1,300 m this fall.
Western Extension (Figure 4)
A total of 30,000 ounces of Inferred Mineral Resources were added in the Western Extension
through limited drilling with two holes completed through first half of 2018 . Surface directional
drilling during the second half of 2018 will be focused on expanding high -grade mineralization
which remains open laterally and down-plunge from existing Inferred Mineral Resource blocks.
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Approximately 88,000 ounces of the increase in Inferred Mineral Resources came through an
increase in the capping factor applied to drilling assay s east of the post mineralization dykes
(Figure 1). This represents less than 8% of the total Inferred Mineral Resource of 1,180,000
ounces. The majority of Mineral Resources are located east of the dykes and ongoing drilling
has been incorporated into a s tatistical study supporting an increase in the capping factor to
100 g/t Au, from 70 g/t Au.
A $1,250 per ounce gold price assumption was used in estimating Mineral Reserves and $1,400
per ounce assumption was used for estimating Mineral Resources as of June 30, 2018, both
unchanged from 2017. Mineral Resources are not Mineral Reserves and do not have
demonstrated economic viability. With the exception of the above noted change in capping
factors in the C and E1E Zones, all other parameters used in estimating Mineral Reserves and
Resources as of June 30, 2018 are unchanged from 2017.
Qualified Persons
Chris Bostwick, FAusIMM, Alamos Gold’s Vice President, Technical Services, has reviewed
and approved the scientific and technical information contained in this news release. Chris
Bostwick is a Qualified Person within the meaning of Canadian Securities Administrator’s
National Instrument 43-101 (“NI 43-101”).
Exploration programs at the Island Gold Mine are directed by Raynald Vincent, P.Eng., M.G.P.,
Chief Geologist at the Island Gold M ine and a Qualified Person within the meaning of NI 43-
101.
Quality Control
Assays for the delineation and exploration drilling were done at LabExpert in Rouyn-Noranda,
PQ. The Corporation inserts at regular intervals quality control (QC) samples (blanks and
reference materials) to monitor laboratory performance. Cross check assays are done on a
regular basis in a second accredited laboratory.
About Alamos
Alamos is a Canadian-based intermediate gold producer with diversified production from four
operating mines in North America. This includes the Young-Davidson and Island Gold mines in
northern Ontario, Canada and the Mulatos and El Chanate mines in Sonora State, Mexico.
Additionally, the Company has a significant portfolio of development stage projects in Canada,
Mexico, Turkey, and the United States. Alamos employs more than 1,700 people and is
committed to the highest standards of sustainable development. The Company’s shares are
traded on the TSX and NYSE under the symbol “AGI”.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Scott K. Parsons
Vice President, Investor Relations
(416) 368-9932 x 5439
The TSX and NYSE have not reviewed and do not accept responsibility for the adequacy or accuracy of this
release.
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Cautionary Note
This news release includes certain statements that constitute forward-looking information within the meaning of
applicable securities laws ("Forward-looking Statements"). All statements in this news release, other than statements
of historical fact, which address events, results, outcomes or developments that Alamos expects to occur are
Forward-looking Statements. Forward-looking Statements are generally, but not always, identified by the use of
forward-looking terminology such as "expects", is expected", "anticipates", "plans" or “is planned”, “trends”,
"estimates", "intends" or “potential” or variations of such words and phrases and similar expressions or statements
that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved or the
negative connotation of such terms. Forward-looking Statements in this news release include the statements with
respect to planned exploration programs, costs and expenditures, changes in Mineral Resources and conversion of
Mineral Resources to Proven and Probable Mineral Reserves, and other information that is based on forecasts and
projections of future operational, geological or financial results, estimates of amounts not yet determinable and
assumptions of management.
Alamos cautions readers not to place undue reliance on the forward-looking statements in the information and content
on this news release as a number of factors could cause actual future results, conditions, actions or events to differ
materially from the targets, outlooks, expectations, goals, estimates or intentions expressed in the Forward-looking
Statements. These factors include, but are not limited to: risks related to obtaining and maintaining necessary
permits, licenses and authorizations required to carry out planned exploration or development work, the actual results
of current exploration activities, conclusions of economic and geological evaluations, changes in project parameters
as plans continue to be refined and fluctuations the price of gold.
Exploration results that include geophysics, sampling, and drill results on wide spacings may not be indicative of the
occurrence of a mineral deposit. Such results do not provide assurance that further work will establish suff icient
grade, continuity, metallurgical characteristics and economic potential to be classed as a category of Mineral
Resource. A Mineral Resource that is classified as "Inferred" or "Indicated" has a great amount of uncertainty as to
its existence and economic and legal feasibility. It cannot be assumed that any or part of an "Indicated Mineral
Resource" or "Inferred Mineral Resource" will ever be upgraded to a higher category of Mineral Resource. Investors
are cautioned not to assume that all or any part of mineral deposits in these categories will ever be converted into
Proven and Probable Mineral Reserves.
Additional risk factors and details with respect to risk factors affecting the Company are set out in the Company’s
latest Annual Information From and MD&A, each under the heading “Risk Factors”, available on the SEDAR website
at www.sedar.com or on EDGAR at www.sec.gov. The foregoing should be reviewed in conjunction with the
information found in this news release. The Company disclaims any intention or obligation to update or revise any
forward-looking statements, whether written or oral, or whether as a result of new information, future events or
otherwise, except as required by applicable law.
Cautionary Note to U.S. Investors – Mineral Reserve and Resource Estimates
All Mineral Resource and Reserve estimates included in this news rele ase or documents referenced in this news
release have been prepared in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for
Mineral Projects ("NI 43-101") and the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM ") - CIM
Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (the
"CIM Standards"). NI 43- 101 is a rule developed by the Canadian Securities Administrators, which established
standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects.
The terms "Mineral Reserve", "Proven Mineral Reserve" and "Probable Mineral Reserve" are Canadian mining terms
as defined in accordance with NI 43-101 and the CIM St andards. These definitions differ materially from the
definitions in the Securities and Exchange Commission Industry Guide 7 ("SEC Industry Guide 7") under the United
States Securities Act of 1933, as amended, and the Exchange Act. Under SEC Industry Guide 7 standards, a "final"
or "bankable" feasibility study is required to report reserves, the three-year historical average price is used in any
reserve or cash flow analysis to designate reserves and the primary environmental analysis or report must be filed
with the appropriate governmental authority.
In addition, the terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral Resource" and "Inferred
Mineral Resource" are defined in and required to be disclosed by NI 43-101 and the CIM Standards; however, these
terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be used in reports and
registration statements filed with the U.S. Securities and Exchange Commission (the "SEC"). Investors are cautioned
not to assume that all or any part of mineral deposits in these categories will ever be converted into Mineral Reserves.
"Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and great uncertainty as to
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their economic and legal fea sibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will
ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form
the basis of feasibility or pre- feasibility studies, except in very limited circumstances. Investors are cautioned not to
assume that all or any part of an Inferred Mineral Resource exists or is economically or legally mineable. Disclosure
of "contained ounces" in a Mineral Resource is permitted disclosure under Canadian regulations; however, the SEC
normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in
place tonnage and grade without reference to unit measures.
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Figure 1: Island Gold Mine Main Zone Longitudinal – Mineral Reserves and Resources
as of June 30, 2018
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Figure 2: Island Gold Mine Main Zone Longitudinal – Main Extension