TSX: JAG
TORONTO, March 26, 2018 /CNW/ - Jaguar Mining Inc.
("Jaguar" or the "Company") (TSX: JAG) is pleased to announce
an increase in gold production at the underground Pilar Mine ("Pilar"), expected to continue for
the next 36 months. Pilar is part of the Caeté Complex that also
includes the underground Roça Grande Mine ("RG") and mill operation
that processes ore from both mines. As part of refocusing its
resources on Pilar and Turmalina Gold
Mine ("Turmalina"), as well as exploration growth
activities, the Company made a strategic decision to temporarily
suspend its Roça Grande mine operations.
Key Highlights
- Gold production at Pilar over the next 36 months is expected to
nearly double to 55,000–60,000 ounces annually compared to the 2017
production of 34,017 ounces
- 2018 Pilar gold production guidance increased to approximately
39,000–47,000 ounces
- Roça Grande mine to be placed on care and maintenance; focus
turns to a larger regional growth exploration program expected to
prove up mineral resources and mineral reserves
- 2018 annual gold production unchanged at 90,000–105,000
ounces
Rodney Lamond, President and CEO
of Jaguar Mining commented: "We are now seeing the benefits of the
significant investment we made in growth exploration projects over
the last 24 months at our core operating assets of Pilar and
Turmalina. Pilar's increasing grade profile and greater gold ounces
per vertical metre have positioned the mine to deliver strong
production growth over the next 36 months, approximately
55,000–60,000 ounces annually, nearly double its production in
2017. Capital spending during this period is also forecast to
remain stable as a significant amount of development has already
been completed. Over the past two years, Pilar has completed 4.53
kilometres of primary waste development and 3.85 kilometres of
sub-level ore development. We recognized an opportunity to turn
Pilar's operations into a high performing mine and took the
necessary steps to deliver on that opportunity. We continue to
invest in growth projects at Pilar given the significant upside
potential that still exists."
"With our higher cost Roça Grande mine on care and maintenance,
we are working to strategically rebuild this mine for the future.
As we have done with our other assets, we will focus on very
promising growth exploration projects that will prove up existing
mineral resources and provide a more complete understanding of
unknown mineral resources to ensure our investment continues to
provide a strong return."
"For 2018, we now expect Pilar's gold production to increase to
between 39,000–47,000 ounces, offsetting the reduction of ounces
from the RG Mine. We are maintaining the overall Company's annual
production guidance between 90,000–105,000 ounces for 2018."
Pilar Expected Production Growth
Following the recently updated Mineral Resources and Mineral
Reserves for Pilar, the Company has confirmed it expects an
increase in production growth over the next 36 months. This
increase is the result of strategic investment in exploration and
infill drilling over the last year, which has significantly
increased the ounce per vertical metre profile below the current
mining horizon. The increasing grades and profile of ounces per
vertical metre will allow the mine to gradually increase gold
production without significantly increasing the capital investment
to deliver these ounces. An increase in the mining fleet is
expected in 2019 with an additional two 30-tonne haulage trucks and
one additional fandrill for stoping.
Summary of Pilar Results
Back in January 2016, the Company
initiated an accelerated waste development program at Pilar that
focused on deepening the main ramp to access into the newly
discovered BFII orebody. The Company hired a mining contractor to
focus on completing the development work to increase overall mining
capacity of the mine. Over the past two years, Pilar has completed
4.53 kilometres of primary waste development and 3.85 kilometres of
sub-level ore development.
In addition to the investment in underground development over
the past two years, the Company completed 6,268 metres of growth
exploration drilling, which successfully confirmed the down plunge
extension of the main BFII and BF orebodies at Pilar, 300m vertically below the current mining
infrastructure.
In March 2018, the Company
reported Total Measured Resources increased 277% to 317,000 ounces
of gold, net of depletion, grading 4.47 g/t. Total Measured and
Indicated ("M&I") Resources increased 10% to 532,000 ounces of
gold, grading 4.37 g/t. Inferred Resources increased 104% to
433,000 ounces grading 5.69 g/t, reflecting a successful growth
exploration drilling campaign in 2017 targeting high-grade deeper
extensions to the principle banded iron formation orebodies (BFII,
BF, and BA) below current mine production levels. Higher quality
and increased grades of newly added mineral resources facilitate
resource-to-reserve conversion drilling to be prioritized in 2018
and scheduled as per the mine plan, while ensuring financial
discipline.
In addition, ounces per vertical metre have shown a strong
increase across the orebodies resulting from the infill and growth
exploration drilling (shown in Figure#1 and Figure#2).
The increase in resource and ounce per vertical metre at Pilar
supports the forecast increased gold production from its current
guidance of 43,000–48,000 ounces in 2018 to 55,000–60,000 ounces
per year by 2020.
Pilar Gold
Mine
|
2018
|
2019
|
2020
|
Q1
|
Q2
|
Q3
|
Q4
|
Total
|
Total
|
Total
|
Gold Production
(oz. Au)
|
10.2K1
|
10-12K
|
10-13K
|
10-13K
|
40–48K1
|
48–55K
|
55–60K
|
Sustaining Capex
(US$ M)
|
$2.5
|
$2.5
|
$3.1
|
$3.2
|
$11.3
|
$12.9
|
$15.0
|
1.
|
Q1 2018
includes production from Roça Grande Mine.
|
Roça Grande Mine Update
The Company has made the difficult decision to temporarily
suspend production at Roça Grande Mine, and will commence a growth
exploration program in the area.
RG is located adjacent to the Caeté processing plant and has
been supplementing feed from Pilar. Over the last few years, work
has been focused on mining the end of the known resource on the
orebodies RG01 and RG07 while infill drilling continued to expand
the resources. Due to these conditions, production has decreased
resulting in significantly increased cash costs at unsustainable
levels above the average realized gold price.
The Company has planned to commence a broader Regional Growth
Exploration program in order to get a complete understanding of all
the orebodies in the region, which will allow management to
properly plan the restart of mining with sufficient reserves and
resources to be financially viable. The Company has been successful
in acquiring concessions around RG (see press release June 21, 2017), bringing total concession to
1,000 hectares. This concession includes areas where there has
already been underground mining work on RG01 and RG07 orebodies,
and open pit mining on RG 02E, RG 02W, RG03, RG05 and RG06
orebodies. The licensed area contains a number of strategic
exploration targets including the highly prospective Morro da Mina
target, which forms part of the Banded Iron Formation ("BIF")
continuity running through the concession hosting the
mineralization that makes up the RG complex.
Qualified Persons
Scientific and technical information contained in this press
release has been reviewed and approved by Jonathan Victor Hill, BSc (Hons) (Economic
Geology - UCT), Senior Expert Advisor Geology and Exploration to
the Jaguar Mining Management Committee, who is also an employee of
Jaguar Mining Inc., and is a "qualified person" as defined by
National Instrument 43-101 – Standards of Disclosure for Mineral
Projects ("NI 43-101").
Caeté Complex
The Caeté Complex is composed of the Roça Grande and Pilar Mines and the Caeté Plant. It
is located in the municipalities of Caeté and Santa Bárbara, in the
state of Minas Gerais, Brazil, and
is approximately 50 kilometres from Belo
Horizonte, the capital city of the state of Minas
Gerais.
About Jaguar Mining Inc.
Jaguar Mining Inc. is a Canadian-listed junior gold mining,
development, and exploration company operating in Brazil with three gold mining complexes, and a
large land package with significant upside exploration potential
from mineral claims covering an area of approximately 64,000
hectares. The Company's principal operating assets are located in
the Iron Quadrangle, a prolific greenstone belt in the state of
Minas Gerais and include the Turmalina Gold Mine Complex and Caeté
Gold Mine Complex. The Company also owns the Paciência Gold Mine
Complex, which has been on care and maintenance since 2012.
Additional information is available on the Company's website at
www.jaguarmining.com.
Forward-Looking Statements
Certain statements in this news release constitute
"forward-looking information" within the meaning of applicable
Canadian securities legislation. Forward-looking information
contained in forward-looking statements can be identified by the
use of words such as "are expected," "is forecast," "is targeted,"
"approximately," "plans," "anticipates," "projects," "anticipates,"
"continue," "estimate," "believe" or variations of such words and
phrases or statements that certain actions, events or results
"may," "could," "would," "might," or "will" be taken, occur or be
achieved. This news release contains forward-looking information
regarding the development of the Pilar Gold Mine, the reserve and
resource estimates for the Pilar Gold Mine and the assumptions and
parameters related thereto, the expected mine life and anticipated
gold production. The Company has made numerous assumptions with
respect to forward-looking information contained herein, including,
among other things, assumptions about the availability of financing
for exploration and development activities; the estimated timeline
for the development of the Pilar Gold Mine; the supply and demand
for, and the level and volatility of the price of, gold; the
accuracy of reserve and resource estimates and the assumptions on
which the reserve and resource estimates are based; the receipt of
necessary permits; market competition; ongoing relations with
employees and impacted communities; and general business and
economic conditions. Forward-looking information involves a number
of known and unknown risks and uncertainties, including among
others the uncertainties with respect to the price of gold, labor
disruptions, mechanical failures, increase in costs, environmental
compliance and change in environmental legislation and regulation,
procurement and delivery of parts and supplies to the operations,
uncertainties inherent to capital markets in general and other
risks inherent to the gold exploration, development and production
industry, which, if incorrect, may cause actual results to differ
materially from those anticipated by the Company and described
herein. Accordingly, readers should not place undue reliance on
forward-looking information.
For additional information with respect to these and other
factors and assumptions underlying the forward-looking information
made in this news release, see the Company's most recent annual
information form and management's discussion and analysis, as well
as other public disclosure documents that can be accessed under the
issuer profile of "Jaguar Mining Inc." on SEDAR at www.sedar.com.
The forward-looking information set forth herein reflects the
Company's reasonable expectations as at the date of this news
release and is subject to change after such date. The Company
disclaims any intention or obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, other than as required by
law. The forward-looking information contained in this news release
is expressly qualified by this cautionary statement.
Neither the TSX Exchange nor its Regulations Services
Provider (as that term is defined in policies of the TSX Exchange)
accepts responsibility for the adequacy or accuracy of this
release.
SOURCE Jaguar Mining Inc.