Spanish Mountain Gold Reports Results on Environmental Assessment & Project Optimization; Sets Tangible Targets for 2022
1120‐1095 West Pender Street
Vancouver, British Columbia, V6E 2M6
Tel: 604.601.3651
January 25, 2022
Spanish Mountain Gold Reports Results on Environmental Assessment & Project
Optimization; Sets Tangible Targets for 2022
Vancouver, BC ‐ Spanish Mountain Gold Ltd. (the “Company”) (TSX‐V: SPA) is pleased to report
encouraging results based on significant progress achieved on a number of value‐added initiatives for
the Spanish Mountain Gold Project (the "Project") located in British Columbia, Canada. As announced on
September 9, 2021, the work programs underway build on the successful completion of the Project’s
Pre‐feasibility study (PFS filed in June 2021) in which a multi‐million ounce Mineral Reserve has been
delineated along with robust economics and a 14‐year mine plan.
Environmental Assessment
The Company continues to execute its stated strategy of fast‐tracking its multi‐million ounce Resource
through the process for environmental assessment/ permitting. In addition to ongoing technical
analyses and comprehensive field surveys, the Company has launched multiple initiatives to intensify
ongoing engagements with all three Indigenous Nations whose traditional territories include the project
area. Significant progress has been made as follows:
Indigenous Nations Engagement — the Company signed an Engagement Protocol Agreement
with Xatśūll First Nation in October 2021 and Lhtako Dené Nation in December 2021 formalizing
the engagement process between the Nations and the Company; and proceeded with the
process of completing a Life‐of‐Mine relationship agreement with Williams Lake First Nation.
Management has also initiated pre‐submission review of the draft Initial Project Description (see
details below) with all three First Nations. Continuous engagement with Indigenous Nations will
remain an integral part of the Project.
Initial Project Description (IPD) — the draft Initial Project Description for the Project is now in
pre‐submission review with all three First Nations. Management has adopted an engagement
practice in which the First Nations communities will have opportunities to address their interests
and concerns throughout the EA process. The Company expects to submit the IPD to the B.C.
Environmental Assessment Office and Impact Assessment Agency of Canada within the first
quarter of the year and thereby formalize the first stage of both the provincial and the federal EA
processes.
Site‐wide Water Balance — the Company commenced a field program in September 2021 to
study groundwater flows in the area of the planned open pit and Tailings Storage Facility. In
spite of challenging operating environment caused by extreme weather events and the
pandemic, the field staff successfully completed the targeted drill holes over a wide area where
monitors will be installed. The drilling crew was demobilized in December. The field work
resumed in mid‐January to perform pump test in order to monitor and gather ground water data
needed for the development of the site‐wide water balance for the Project. The water balance
model is a critical tool for formulating effective water management strategy and cost
optimization.
The Company has targeted ambitious environmental assessment milestones to be achieved within 2022
as follows:
submission of the Initial Project Description to the provincial and federal agencies
submission of Detailed Project Description to the provincial and federal agencies
signing of Life‐of‐Mine relationship agreement with all three First Nations
launching open houses and consultations with surrounding communities to the extent allowed
by pandemic restrictions
formulating critical environmental strategies based on comprehensive data collected and the
Best Practice in Environmental, Social & Governance.
Project Optimization
The Company has initiated a number of optimization exercises with the objective of front‐ identifying
areas where enhancement of project economics and process improvements are potentially achievable.
In due course, the feasibility study is expected to capture the full benefit of these exercises without
causing delays in its delivery.
Gold Recovery
The Company has engaged Ausenco as an independent expert consultant to conduct a targeted
metallurgical program to further optimize the milling process incorporated in the PFS. The current
flowsheet is characterized by low input costs for reagents and power as well as an average gold recovery
of 90%.
The Company is pleased to announce that preliminary testing has demonstrated the viability of
incorporating Direct Flotation Reactor technology in the milling process, which has the potential to lead
to savings in capital and operating costs. Building on the results of the latest metallurgical work, the
Company expects to commence Phase 2 of the program later in the year which will include a number of
trade‐off studies and variability testing on fresh bulk samples. Once the program is complete, the
optimized flowsheet and the detailed processing configuration will be the basis for ore processing and
the recovery of gold in the definitive feasibility study.
Water Management & Treatment
The Project’s sustainability strategy is formulated to ensure effective protection for local surface and
ground waters around the project area. Baseline water quality monitoring is continuing; adding to the
expansive database for the project area.
The Company has engaged Linkan Engineering to develop preliminary designs for the passive treatment
systems concept presented in the PFS and to conduct a study of measures to potentially inhibit sulphide
oxidation and any associated neutral metal leaching from the non‐acid generating waste rock.
Site‐wide water balance and water quality models are expected to be completed by the end of the year,
which will allow the development of comprehensive water management methodology. The water
models are also critical for completing the Project’s environmental assessment process/ permitting.
Power Line
As detailed in the PFS, the Project’s location is supported by excellent infrastructure including an
abundance of connectivity to the provincial power grids supplied with low‐cost, renewable hydro power.
There is also an established right‐of‐way between various substations and the proposed mine site.
The Company has commissioned a study investigating the routing for a power line to the proposed mine
that may have the potential combined benefits of utilizing existing route corridors and traversing more
accommodating terrains over a shorter distance. If successful, the selected route is expected to result in
lower permitting risks and construction costs.
The Company is pleased to report that the technical team has completed the LIDAR survey for reviewing
the route alternates and has not identified any significant constructability issues for a power line from
the substation to the proposed mine. The technical team will continue to work with consultants and BC
Hydro to refine the parameters for the new power line and address technical and permitting issues.
Resource Expansion
While the Company’s current priority is to de‐risk and optimize the Project through the environmental
assessment/ permitting phase, the technical team will continue to advance the objective of resource
expansion.
The geological model for the deposit suggests that the Mineral Resource is open at depth and along
strike. The latest drill program (results of which were announced in July, 2021) has identified four broad
areas near the proposed pit boundary that could potentially expand the overall Mineral Resource.
In addition, the geological team conducted a grassroots exploration program last fall testing targets as
far as two kilometres northwest of the pit boundary. The results for this program are pending and could
demonstrate the potential extent of the deposit’s mineralized trend. Areas with the best prospect for
adding ounces to the overall Mineral Resource will be prioritized for drilling in due course.
Acquisition of Placer Claims
The Company has recently staked and acquired a contiguous block of placer claims covering an area of
approximately 220 hectares. These claims overlay the Company’s existing mineral claims and cover an
area where critical infrastructures for the proposed mine are planned.
Larry Yau, Chief Executive Officer, commented: “As we have seen multiple cases of disruptions in other
BC mining operations caused by recent weather events and the pandemic, we are indebted to our
employees and consultants for their diligence in keeping our work place safe and our project work on
track without any noticeable disruptions. We look forward to delivering on our 2022 project milestones
to further de‐risk and optimize our multi‐million ounce gold resource.”
Annual Stock Option Grant
The Board of Directors has authorized granting of incentive stock options to acquire an aggregate of
2,450,000 common shares of the Company to employees, consultants and directors. The options, which
will be vested in accordance with the Company’s Incentive Stock Option Plan, have an exercise price of
$0.21 per share expiring January 24, 2027. The foregoing is subject to regulatory acceptance.
About Spanish Mountain Gold
Spanish Mountain Gold Ltd. is focused on advancing its 100%‐owned Spanish Mountain gold project in
southern central British Columbia. The Company is simultaneously pursuing the dual objectives of
delivering critical project milestones for the multi‐million ounce Mineral Reserve and further expanding
the overall Mineral Resource. The Pre‐Feasibility Study (2021) demonstrates the Project’s potential to be
a mining operation with a robust production profile (>150,000 oz per year) and profitability (AISC $801
per oz) over a mine life of 14 years. Details on the Project and the Company are available on
www.sedar.com and on the Company’s website: www.spanishmountaingold.com
On Behalf of the Board,
SPANISH MOUNTAIN GOLD LTD.
Larry Yau
Chief Executive Officer
Inquiries:
Spanish Mountain Gold Ltd.
Phone: (604) 601‐3651
E‐mail: [email protected]
Website: www.spanishmountaingold.com
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The Company's forward ‐looking statements and information are based on the assumptions, beliefs, expectations and opinions
of management as of the date of this press release, and other than as required by applicable securities laws, the Company
does not assume any obligation to update forward ‐looking statements and information if circumstances or management's
assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or
information. For the reasons set forth above, investors should not place undue reliance on forward ‐looking statements and
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