TORONTO, Jan. 30, 2013 /CNW/ - Patagonia Gold Plc (TSX: PAT, AIM: PGD) ("the Company") today provided a progress update
for its Lomada de Leiva and Cap-Oeste projects in Santa Cruz Province,
Construction of the first stage of the fully permitted Lomada heap leach
project is well advanced and is on target for commencement of leaching
in Q2 2013.
To accelerate gold production, the Company has elected to expand the
existing trial pad to 315,000 tonnes capacity, preparation for which is
also well advanced. Mining and loading of ore onto the pad has already
commenced with irrigation set to start next month.
The trial has so far recovered approximately 4,045 ounces of gold,
representing over 66% of contained gold and continues to leach.
Processing and smelting is on-going.
An expanded geophysical IP study has been completed over the
Cap-Oeste/COSE structure and surrounds. Preliminary results have
revealed two new large IP anomalies parallel to and similar in
intensity to Cap-Oeste/COSE (see attached plan).
Drilling will re-commence next month on the Cap-Oeste/COSE structure to
further explore the highly prospective zone identified in drilling last
season. On receipt of the full geophysical report, an exploratory
drilling campaign will be carried out.
Photos of the progress at Lomada and Cap-Oeste will be posted on the
Company's website, www.patagoniagold.com.
LOMADA DE LEIVA
The Lomada de Leiva project is located approximately 40 kilometres
south-east of the town of Perito Moreno in the Province of Santa Cruz,
and is within the Company's La Paloma property block, covering over 44
Construction of the first stage of the fully permitted Lomada main heap
leach project is well advanced and is on target for commencement of
operations in Q2 2013. The total pad area has been stripped of topsoil,
which is being stacked for later rehabilitation purposes. Earthworks
for infrastructure, holding and containment dams are under way. The
plastic membrane, irrigation pipework and pumps have all been ordered,
scheduled for arrival and installation in Q1 2013. The pregnant
solution will be pumped to the existing processing plant constructed
for the trial in 2011.
Plant expansion is under way, with an additional six carbon columns
currently under construction designed to increase the plant throughput
to 160m3/hr of pregnant solution. In addition, the explosives magazine
has also been completed and is awaiting final approval.
The gold room facility, located at the Bajada property, is now fully
operational and commissioned.
The Company received its first revenue from gold sales in December,
being US$708,186 for 425.67 ounces of gold produced during the
commissioning of the gold room production facility. A further 38 kilos
of doré containing approximately 1,120 ounces of gold has since been
processed from existing carbon stocks and dispatched to the refinery.
The remaining estimated 2,000 ounces of gold from existing carbon stocks
together with recent production from the trial of approximately 500
ounces of gold is currently being processed. The trial has so far
recovered approximately 4,045 ounces of gold, representing over 66% of
contained gold and continues to leach.
To accelerate gold production, the Company has elected to expand the
existing trial pad of 135,000 tonnes to 315,000 tonnes. This will allow
the main production to be advanced by several months. Preparation of
the expansion is well advanced with earthworks completed and the
membrane scheduled for installation in early February. In the meantime,
mining and loading of ore onto the existing pad has already commenced
with irrigation set to start in late February 2013.
Mining has recommenced utilising a contract fleet until the Company
receives delivery of its own fleet of equipment now expected during
March and April 2013. Ramp up to full production is expected to be
achieved by mid Q2 this year once the full fleet is operational and the
overburden from the main pit area is removed.
The El Tranquilo property block, covering approximately 80,000 hectares,
contains Patagonia Gold's flagship project, the Cap-Oeste deposit,
together with the COSE bonanza gold and silver deposit and numerous
other prospects including Monte Leon.
Quantec Geoscience of Santiago, Chile, has recently completed an
expanded IP study over the CapOeste/COSE structure and NW El Tranquilo
block. Approximately 50% of the work area has been covered with closer
spaced lines completed specifically over the Cap-Oeste/COSE area and
surrounds. Preliminary results have revealed two completely new large
IP anomalies striking in the same direction as the Cap-Oeste/COSE
anomaly and offset by approximately 700m. The anomalies are significant
in that their intensity and size are very similar to the existing
anomalies over Cap-Oeste/COSE and also Don Pancho, both areas with
significant areas of known mineralization.
The IP anomaly at Palmeras was expected as previous mapping and
geochemical surveys had picked up the existence of mineralised
structure at surface. A further anomaly to the NE of "VALLE" has also
been identified with traces of sinter found at surface.
A preliminary exploration programme is being designed to drill test both
of the new targets during the 2013 campaign while concentrating on
exploration within the highly prospective corridors of Cap-Oeste/COSE
and Don Pancho.
The construction of the underground access decline for the COSE project
is now planned for the second half of 2013 so that all available effort
and funds can be focused towards bringing the Lomada heap leach project
into full production.
Meanwhile, the heavy mining equipment and infrastructure pre purchased
for COSE is being utilised on the Lomada construction providing
considerable savings in hire costs.
About Patagonia Gold
Patagonia Gold Plc is a mining company that seeks to grow shareholder
value through exploration, development and production of gold and
silver projects in the southern Patagonia region of Argentina. The
Company is primarily focused on three projects: the flagship Cap-Oeste
project, the nearby COSE project and the Lomada heap leach project,
which is generating free cash flow. Patagonia Gold, indirectly through
its subsidiaries or under option agreements, has mineral rights to over
220 properties in several provinces of Argentina and Chile, and is one
of the largest landholders in the province of Santa Cruz.
Patagonia Gold is listed on the Toronto Stock Exchange (TSX) under the
symbol PAT and has been listed on the AIM market of the London Stock
Exchange under the symbol PGD since 2003.
Matthew Boyes, (BSC. Geology, Fellow AusIMM) Chief Operating Officer for
Patagonia Gold PGSA and a qualified person as defined in Canadian
National Instrument 43-101, has reviewed and verified all scientific or
technical mining disclosure contained in this press release.
Cautionary Note Regarding Technical and Forward-Looking Information
The Company's production decision in respect of the Lomada project is
not based on a feasibility study of mineral reserves demonstrating
economic and technical viability and therefore readers are cautioned
that there is increased uncertainty and there are economic and
technical risks of failure associated with such production decisions.
This news release may contain certain information that constitutes
forward-looking information within the meaning of applicable securities
laws. Forward-looking information is frequently characterised by words
such as "plan," "expect," "project," "intend," "believe," "anticipate"
and other similar words, or statements that certain events or
conditions "may" or "will" occur. Forward-looking information includes,
but is not limited to, statements about strategic plans, mineral
resources estimates, spending commitments, forecasts of free cash flow,
future operations, results of exploration, commencement and completion
of pre-feasibility studies, future work programs, commencement
production, production schedules, capital expenditures and objectives.
Forward-looking information is based on the opinions, expectations and
estimates of management at the date the statements are made, and are
subject to a variety of risks and uncertainties and other factors that
could cause actual events or results to differ materially from those
projected in the forward-looking information. These factors include the
inherent risks involved in the exploration and development of mineral
properties, the uncertainties involved in interpreting drilling results
and other geological data, fluctuating metal prices and other factors
described above and in the Company's most recent annual information
form under the heading "Risk Factors," which has been filed
electronically by means of the Canadian Securities Administrators'
website located at www.sedar.com. The Company disclaims any obligation
to update or revise any forward-looking information if circumstances or
management's estimates, expectations or opinions should change. The
reader is cautioned not to place undue reliance on forward-looking
Image with caption: "MINING AT LOMADA DE LEIVA (CNW Group/Patagonia Gold plc)". Image available at: http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23117.jpg
Image with caption: "DORÉ FROM THE SECOND POUR 38KG LOMADA DE LEIVA (CNW Group/Patagonia Gold plc)". Image available at: http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23118.jpg
Image with caption: "GEOPHYSICAL IP SURVEY CAP-OESTE (CNW Group/Patagonia Gold plc)". Image available at: http://photos.newswire.ca/images/download/20130129_C9627_PHOTO_EN_23119.jpg
SOURCE: Patagonia Gold plc
For further information:
Bill Humphries, CEO
Patagonia Gold Plc
Tel: +44 (0)20 7409 7444
Philip Yee, CFO
Patagonia Gold Plc
Tel: +1 (416) 572 2007
Barnes Communications Inc.
Tel: +1 (416) 367-5000
Simon Raggett / Angela Hallett
Strand Hanson Ltd
Tel: +44 (0)20 7409 3494
Mirabaud Securities LLP
Tel: +44 (0)20 7484 3510
David Bick / Mark Longson
Square 1 Consulting
+44 (0)20 7929 5599