Minera Alamos Announces Santana Mine Operations Update and Optimization Progress 2021 Year-End Targets Exceeded and Explosives Storage Permit Received
Minera Alamos Announces Santana Mine
Operations Update and Optimization Progress
2021 Year-End Targets Exceeded and Explosives Storage
Permit Received
Toronto, Ontario and Vancouver, British Columbia--(Newsfile Corp. - February 10, 2022) -
Minera
Alamos Inc.
(TSXV: MAI)
(the "Company" or "Minera Alamos")
is pleased to provide a 2021 year-
end summary of the ramp-up of mining activities at the Santana gold mine in Sonora, Mexico.
Through
the end of 2021 approximately 9,100 ounces of gold were mined and stacked on the leach pad during
the first phase of the project mining activities.
The total exceeded the Company's initial mine opening
projections and provides a sufficient amount of mining, crushing and leaching data to allow for final
optimization of the operation through the last stages of ramp-up.
Operational highlights through the end of 2021
Gold inventory moved to the leach pad - 9,100 oz;
Mine production rates approaching the 100,000 tonnes of mineralized material per month initial
target for the project ramp-up;
Cumulative gold recovery from mineralization under leach for more than 30 days exceeds 70% with
additional recovery ongoing;
Total area of stacked mineralization under finished/active leaching remains in excess of 50% and
continues to expand;
Low reagent consumptions in line with previous test pad results (~0.2 kg/t NaCN and <2 kg/t lime)
"The results from the first phase of early operations at the Santana project continue to impress. Gold
extraction kinetics demonstrated to date underscore both the rapid leaching and strong recoveries
achievable at Santana," stated Darren Koningen, CEO.
"The ramp-up period has allowed us to gain
valuable production insights which can then be utilized to further optimize the operation before it enters
commercial production.
This careful and methodical approach has been particularly helpful to guide
modifications in our planning in order to address typical situations that arise during a normal project
start-up prior to them evolving to a point where they may impact future performance. In addition, it allows
our experienced technical team us to identify opportunities for consideration that could accelerate the
longer-term value creation at the site. We are pleased to have recently received the explosives storage
permit that will provide us the flexibility to implement more efficient blast scheduling moving forward."
Ongoing Project Ramp-up and Performance Optimization
Gold extraction from mineralized material stacked on the Company's leach pad continues to
demonstrate rapid leach kinetics similar to those reported previously.
As the areas under active leach
continue to increase the cumulative recovery curve for this part of the leach pad now exceeds 70% and is
on a trend towards the results from previous test leaching studies performed in the area.
Mining rates
have approached the initial monthly targets of 100,000 tonnes of mineralized material from the Nicho
Norte starter pit prior to the next phase of operations where production will ultimately expand to also
include material from the main Nicho deposit.
Reagent consumptions remain low as anticipated.
Following the better than anticipated early results and the large amount of production data gained
through initial operations the Company decided to scale back site mining activities over the holiday
period in order to work internally and with the Company's mine contractor to analyze new information and
focus on how to better optimize the back half of the ramp-up.
Results from these optimization studies are
summarized below and are currently being implemented as normal mining activities have resumed.
Although economically positive, higher than anticipated gold grades from the Nicho Norte starter
severely strained the capacity of the site crushing operations due to a much higher proportion of
mine material (+70%) being crushed versus sent to the pad as run-of-mine (<30%).
This also
negatively impacted the overall efficiency of material flows between the mine and leach pad.
Crushing cut-offs will be increased in the next phase of operations in order to rebalance the ratio of
crushed to ROM material at closer to 50/50 which should remove most of the production
bottlenecks.
The overall impact of the change on expected gold recoveries will be minimal due to
the extent of fragmentation that has been achieved by blasting to date which has demonstrated the
ability to generate significant quantities of final size material without crushing (see next point).
Early efforts to optimize blasting fragmentation in the open pit have been very successful.
These
efforts will continue with a focus on varying fragmentation levels based on the material being mined
in order to minimize the costs of both crushing and blasting (maximize fragmentation in mineralized
zones and minimize in waste areas).
A complete review of the mine contractor operations data in conjunction with decisions to relocate
the site crushing operations will minimize material haulage distances (primary and re-handling)
and therefore better utilize the existing equipment.
Opportunities to reduce the size of the overall
fleet were also identified.
The leach pad stacking sequence was reworked to further reduce equipment and leaching
congestion issues that are common during early operations.
Short-term changes to be
implemented over the next couple of months will allow for a more regular and efficient advance of
new stacked areas under leach as the project moves forward and remove bottlenecks that could
cause future issues as mining rates are projected to increase following the initiation of operations
at the Nicho Main Zone.
Planning was completed for the start of operations at the Nicho Main Zone.
Discussions are
ongoing with the current mine contractor to fully evaluate the paths into production from this new
and larger second pit and opportunities to accelerate its development.
As is occurring in many areas of the broader economy, the Company continues to feel real and lasting
impacts from the past two years of the worldwide Covid pandemic.
Discussions aimed at minimizing
these impacts are particularly relevant not just for the Company's current Santana operations but also for
the planning and preparations underway for future projects in the Company's development pipeline.
To
proactively manage these impacts the Company is addressing areas that include:
Options to minimize the impact from difficulties in sourcing maintenance parts/equipment (along
with corresponding extended delays and cost inflation) particularly related to mining and crushing
contractor operations.
Accelerated construction of on-site laboratory facilities which can provide basic mine blasthole and
leach solution analyses to reduce the quantity (and associated delays) of samples being sent to
third party facilities for analysis.
Discussions with new suppliers for reagents and general site maintenance supplies in order to try
and ensure multiple supply options for key items so that any supply chain delays can be reduced.
An overall review of bureaucratic matters and areas where significant delays continue to exist as a
result of Covid shutdowns of government offices and the resultant backlogs.
While in receipt of
necessary permits to start operations, the Company has experienced delays (see explosives
permit below) in approvals for some items that will allow for a more efficient expansion of
operations at Santana. The Company is evaluating all opportunities to minimize the impact that
these delays may have on the ongoing ramp-up of current operations while continuing to work to
advance the receipt of the formal documentation.
The recent receipt of a formal permit for
explosives storage at site is an example of a permit that became significantly delayed and
required temporary workarounds to prevent significantly impacting start-up.
With the permit now in
hand the Company has added flexibility to implement a more efficient and cost effective approach
to blasting activities at Santana thereby paving the way towards opening up the Nicho Main Zone.
The Company's extensive experience in Mexico continues to be a significant asset while facing the
challenges of developing new mining operations in the wake of Covid disruptions. Without appropriate
foresight and planning these challenges could overwhelm a start-up operation.
To date, the Company
has managed to identify solutions as required to lessen any potential negative impacts on operations
and will continue wherever possible to plan proactively for both the remaining phase of ramp up at
Santana but also in preparation for the second planned operation at Cerro de Oro where we hope to
begin the permitting process shortly upon receipt of all remaining surface rights agreements.
Photo 1: Advancement of stacking and leaching activities at Santana heap leach pad
To view an enhanced version of Photo 1, please visit:
https://orders.newsfilecorp.com/files/4183/113370_390c668e744c286a_002full.jpg
Cautionary Statement
The Company made its production decision and has started the development and production of the
Santana gold mine without having completed a feasibility study demonstrating economic and technical
viability. As such, there may be increased uncertainty of achieving planned production levels, estimated
recovery of gold, the costs associated with such recovery, including increased risks associated with
developing a commercially mineable deposit. Historically, such projects have a much higher risk of
economic and technical failure. Failure to commence production would have a material adverse impact
on the Company's ability to generate revenue and cash flow to fund operations.
Mr. Darren Koningen, P. Eng., Minera Alamos' CEO, is the Qualified Person responsible for the
technical content of this press release under National Instrument 43-101.
For Further Information Please Contact:
Minera Alamos Inc.
Doug Ramshaw, President
Tel: 604-600-4423
Email:
Website:
www.mineraalamos.com
Victoria Vargas de Szarzynski, VP Investor Relations
Tel: 289-242-3599
Email:
About Minera Alamos Inc.
Minera Alamos is a gold prodution and development Company undergoing the operational startup of its
first gold mine that produced its first gold in October 2021. The Company has a portfolio of high-quality
Mexican assets, including the 100%-owned Santana open-pit, heap-leach mine in Sonora that is
currently going through its operational ramp up. The 100%-owned Cerro de Oro oxide gold project in
northern Zacatecas that has considerable past drilling and metallurgical work completed and could enter
the permitting process rapidly. The La Fortuna open pit gold project in Durango (100%-owned) has an
extremely robust and positive preliminary economic assessment (PEA) completed and the main Federal
permits in hand. Minera Alamos is built around its operating team that together brought 3 mines into
successful production in Mexico over the last 13 years.
The Company's strategy is to develop very low capex assets while expanding the projects' resources
and continuing to pursue complementary strategic acquisitions.
Caution Regarding Forward-Looking Statements
This news release may contain forward-looking information and Minera Alamos cautions readers that
forward-looking information is based on certain assumptions and risk factors that could cause actual
results to differ materially from the expectations of Minera Alamos included in this news release. This
news release includes certain "forward-looking statements", which often, but not always, can be
identified by the use of words such as "believes", "anticipates", "expects", "estimates", "may", "could",
"would", "will", or "plan". These statements are based on information currently available to Minera
Alamos and Minera Alamos provides no assurance that actual results will meet management's
expectations. Forward-looking statements include estimates and statements with respect to Minera
Alamos' future plans with respect to the Projects, objectives or goals, to the effect that Minera Alamos or
management expects a stated condition or result to occur and the expected timing for release of a
resource and reserve estimate on the projects. Since forward-looking statements are based on
assumptions and address future events and conditions, by their very nature they involve inherent risks
and uncertainties. Actual results relating to, among other things, results of exploration, the economics of
processing methods, project development, reclamation and capital costs of Minera Alamos' mineral
properties, the ability to complete a preliminary economic assessment which supports the technical and
economic viability of mineral production could differ materially from those currently anticipated in such
statements for many reasons. Minera Alamos' financial condition and prospects could differ materially
from those currently anticipated in such statements for many reasons such as: an inability to finance
and/or complete an updated resource and reserve estimate and a preliminary economic assessment
which supports the technical and economic viability of mineral production; changes in general economic
conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation,
legislative, environmental and other judicial, regulatory, political and competitive developments;
technological and operational difficulties encountered in connection with Minera Alamos' activities; and
other matters discussed in this news release and in filings made with securities regulators. This list is not
exhaustive of the factors that may affect any of Minera Alamos' forward-looking statements. These and
other factors should be considered carefully and readers should not place undue reliance on Minera
Alamos' forward-looking statements. Minera Alamos does not undertake to update any forward-looking
statement that may be made from time to time by Minera Alamos or on its behalf, except in accordance
with applicable securities laws.
The Company does not have a feasibility study of mineral reserves, demonstrating economic and
technical viability for the Santana project, and, as a result, there may be an increased uncertainty of
achieving any particular level of recovery of minerals or the cost of such recovery, including increased
risks associated with developing a commercially mineable deposit.
Historically, such projects have a
much higher risk of economic and technical failure. Failure to commence production would have a
material adverse impact on the Company's ability to generate revenue and cash flow to fund operations.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT
TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/113370