TSX Venture Exchange
TORONTO, March 5, 2013 /CNW/ - NWM Mining Corporation ("NWM" or the "Company") (TSX-V: NWM) is pleased to provide further details related to its recently announced intention to acquire all of the outstanding common shares of Auriga Gold Corporation ("Auriga"). The potential acquisition adds significantly to the current NWM asset base and production growth profile:
- Creates a New, High Growth Gold Producer
- The integration of the Lluvia de Oro/Jojoba and Maverick projects provides potential for steady annual growth in gold production from the approximately 19,000 oz. produced in 2012 to in excess of 80,000 oz. per annum over the next 3-4 years. (see notes later in release)
- Significantly Increases Attributable Gold Resources
- Total combined gold reserves and resources (which are NI 43-101 compliant) stand at approximately 384,000 oz. of gold reserves, 174,000 oz. in dedicated gold resources and an additional 758,000oz. of inferred gold resources (see Combined Reserve/Resource Summary below).
- No Geo-Political Risk
- Both deposits are located in excellent mining jurisdictions (Mexico and Canada, respectively).
- Strategic Acquisition of a Development Ready Project
- NWM will also acquire the Maverick project mineral processing plant which was designed for a treatment capacity in excess of 1,000 ore tonnes per day. The facility was placed on "care and maintenance" following closure of the mine in the 1990's. Costs for construction of an equivalent facility today are estimated to be in excess of $50 million.
- Permits for mining operations at the Maverick deposit are in place and an amendment to the final closure plan for the mine has recently been filed.
- Opportunity to Efficiently Unlock Value of Maverick Gold Project
- The development schedule for the Maverick project will be optimized so that capital required can be largely financed internally as gold production from the Lluvia de Oro mine ramps up to an annual rate of 35-40,000 oz. by 2014.
- Creates a Significant Value Proposition for NWM Shareholders
- Based on current reserves/resources, gold prices and project development cycles, the combined entity has an estimated NPV in excess of $200 million. (note - calculated at 5% discount rate and partly based on February 2012 PEA for Maverick deposit)
"Acquisition of the Auriga assets will significantly enhance NWM's growth profile and provide a path towards the development of a new, high growth junior gold mining company in the next few years," said Chris Berlet, CEO of NWM. "The recent introduction of a proven and capable technical management team has allowed NWM to look for opportunities to increase our medium term growth profile. NWM's short term focus remains exclusively on the continuing ramp up of mining operations and gold production at the Lluvia de Oro gold mine in Sonora, Mexico. Further updates related to the ongoing activities at the Lluvia de Oro mine will be provided in the coming days."
Combined Reserve/Resource Summary
The total resources/reserves for the proposed combined entity are summarized in the table below.
|Resource Category|| Tonnes
| Contained Ounces
|- Lluvia de Oro||11,800||0.51||191,000|
|- Lluvia de Oro(2)||10,230||0.52||170,000|
|Total Indicate Resources||944||5.73||174,000|
|Total Inferred Resources||15,070||1.56||758,000|
- July 2010 Pre-Feasibility Study ($900/oz gold price).
- Inferred Resource estimates from July 2010 Pre-Feasibility Study ($900/oz gold price).
- August 2011 NI43-101 compliant resource estimate ($1231/oz gold price).
- The Nokomis Deposit is located approximately 10 kilometers from the Maverick Deposit. A previous operator in 1985 estimated a resource of 349,110 tonnes @ 6.10 gpt gold for the Nokomis Deposit (NWM is not treating this historical resource estimate as a NI43-101 defined resource (or reserve) verified by a qualified person has and the issuer is not treating the historical estimate as current mineral resources. A confirmation drill program of 19 drill holes totaling 1335 metres was completed in 2012 by Auriga Gold Corp to upgrade the resource to NI43-101 compliance and the results are pending..
- Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
- Project development details and economic estimates for Maverick deposit taken from February 2012 PEA.
- The quantity and grade of reported Inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an Indicated or Measured mineral resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured mineral resource category.
About Auriga Gold Corporation.
Auriga Gold Corp. is a Canadian mine development and exploration company focused on re-starting its 100% owned past producing Puffy Mine and expanding the current gold resources at the Maverick Gold Project ("MGP). Auriga management has plans in place to initiate additional infill drilling and exploration programs to upgrade and expand gold resources, complete a pre-feasibility report and detailed engineering studies to further enhance and de-risk the MGP and ultimately re-start operations when adequate funding has been put in place. The MGP is located just north of the full-service mining community of Flin Flon, Manitoba. Existing onsite mining infrastructure includes a 1,000 tpd flotation mill, underground development to a 135 metre vertical depth, and access to existing road, rail and power infrastructure.
To view current images of the property & mill, please see www.aurigagold.ca/s/photogallery.asp
About NWM Mining Corporation
NWM is in commercial gold production at its wholly owned Lluvia-Jojoba gold mine. The mine is an open pit heap leach operation in Sonora State, Mexico. Management believes the property is significantly under-explored and hosts potential to provide further gold discoveries and resource and reserve upgrades. While management has focused in the past on developing the mine and supporting cash flows, the focus in 2013 will shift to increasing mining rates and drilling to expand geological resources and reserves. Cash flows from mining operations are expected to be used for exploration which can result in adding resources and creating shareholder value.
This press release has been reviewed by Mr. Darren Koningen, P. Eng. Mr. Koningen is a Qualified Person under National Instrument 43-101.
Neither the 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 of this release.
SOURCE: NWM Mining Corporation
For further information:
NWM Mining Corporation
Tel: 416 364-6799