Atlantic Gold Corporation ("Atlantic" or the "Company") is pleased to announce commencement of a resource definition drilling program (the "Program") with an objective of bringing the resources at the Company's Cochrane Hill and Fifteen Mile Stream deposits to measured and indicated status aimed at adding to the existing mine life at its Moose River Consolidated Project ("MRC Project"), one of Canada's few construction stage, permitted, financed, open pit gold projects. A feasibility study released in early July of 2015 demonstrated that the MRC project will produce 87,000 oz gold per year on average for 8.5 years at AISC of C$690/oz. with post-tax NPV5 C$168 million, and an IRR of 30% (@US$1,200 and $0.80 CAD/USD). Please see the Company's news release dated July 2, 2015.
The Company will also commence a regional program targeting advanced exploration prospects to further add to the Company's resource base within proximity to the MRC processing facility. This program will be designed to provide further "proof of concept" of the potential of Company's large exploration tenement holdings in the Meguma Terrane of Nova Scotia.
Recent recognition of disseminated style mineralization has changed the understanding of the potential of the region. To date, gold has been mined since the 1860's only from high grade underground deposits. Previously overlooked low to medium grade shale hosted mineralization, when combined with traditional quartz veins in the targeted stratigraphy has generated wide mineable zones suitable for open pit mining, as demonstrated by the company's Touquoy and Beaver Dam deposits.
Cochrane Hill and Fifteen Mile Stream - Snapshot of Current Resource
The current resource estimates for these two deposits are tabulated below:
*The Mineral Resource estimate for Cochrane Hill is quoted at a cut-off grade of 0.5g/t. It has an effective date of August 1, 2014 and was prepared as part of a technical report in accordance with NI 43-101 by Mr. Neil Schofield, a principal of FSSI (Australia) Pty Ltd, released on August 14, 2014 on SEDAR.
**The Mineral Resource estimate for Fifteen Mile Stream is quoted at a cut-off grade of 0.5g/t. It has an effective date of February 18, 2015 and was prepared as part of a technical report in accordance with NI 43-101 by Mr. Neil Schofield, a principal of FSSI (Australia) Pty Ltd, released on April 2, 2015 on SEDAR.
Please view the map below:
Resource Definition Program
The Program is estimated to commence in earnest in September 2016, comprising approximately 340 holes for a total of 44,000 metres of diamond drilling over three phases at a measured pace and is expected to be completed over a period of up to 9 months. The program will begin with a precursor program of 2,500m over 20 diamond core holes across both deposits. Results from the precursor program will determine the scope of drilling for the second phase, to be done on a 50m x 20m grid, and results from the second phase will determine the scope of drilling for the third phase, to be done on a 25m x 20m grid.
The Company is planning a program of approximately 1500 metres over 15 diamond core holes directed initially at five regional targets within trucking distance of the MRC plant which is presently under construction. These targets are characterized by various combinations of attributes: historic workings, encouraging drill intersections obtained by previous explorers or from Atlantic's own regional reconnaissance programs, and/or geophysical anomalies reminiscent of those associated with known mineralization.
The execution of the Program is subject to the completion of the Company's recently announced flow-through private placements (announced September 1, 2016) which is currently scheduled to occur on September 22, 2016. Results and updates will be reported progressively.
Steven Dean, Chairman and CEO commented, "With site development now fully underway at the MRC Project, Atlantic is now in a position to strategically build and consolidate its gold Mineral Resource within the economic radius of the Touquoy processing plant. It is fully expected that this drilling program will be successful in upgrading the Mineral Resources at Cochrane Hill and Fifteen Mile Stream to Measured and Indicated status, and will also identify additional resources in the region, that are expected to substantially extend the mine life and /or annual production at MRC".
Neil Schofield MS - Applied Earth Sciences, MAusIMM, MAIG, an independent consultant to the Company, and a Qualified Person as defined by National Instrument 43-101 ("NI 43-101"), has reviewed and approved the contents of this news release.
On behalf of the Board of Directors,
Steven Dean, Chairman and Chief Executive Officer