Gryphon Gold Advances Critical Data Analysisadmin
Gryphon Gold Corporation announced on October 21, 2010 that the Board of Directors has developed a strategy to expedite the Borealis Heap Leach Gold Project production timeline. The focus of this strategic direction is to finalize certain critical data pertaining to the Freedom Flats Re-Leach to expedite the start-up of its gold mining operation. The expedited plan is based on staging the capital requirements set out in the September 17, 2009 Pre-Feasibility Study which forms part of the technical report described below (“NI 43-101 Pre-Feasibility Study of the Mineral Resources of the Borealis Gold Project Located in Mineral County, Nevada, USA”). This expedited plan is projected to produce positive cash flow in a timeframe of three to four months after breaking ground. Implementation of the expedited start is contingent upon adequate financing and regulatory approval.
“In expediting our mine development plans the Company is exploring multiple options for financing,” said Gryphon Gold President, John L. Key. “As we grow closer to a decision, we will release news accordingly, as required by the Toronto Stock Exchange and Securities and Exchange Commission Rules and Regulations.”
To “finalize certain critical data” Gryphon secured three bulk samples from the Freedom Flats Re-Leach which is scheduled to be the initial feed for Gryphon’s plans under the “Road to Production” initiative. The material was delivered to Kappes Cassidy and Associates of Reno, Nevada and column leach tests began on November 19, 2010. Although initial results are encouraging, reportable results will not be available until late December of this year.
A reverse circulation drill program began on the Freedom Flats Re-Leach on November 25, 2010. The drill program is scheduled to run through December 7, 2010 and confirmation assays should be available by mid to late December. The combination of this new data combined with the data included in the April 28, 2008 Canadian NI 43-101 Technical Report on Mineral Resources of the Borealis Gold Project will determine the Freedom Flats Re-Leach final reserve grade. This reserve grade combined with the column test work noted above will determine the recoverable gold for this initial feed and confirm the commercial feasibility for the project.
The “Road to Production” presentation, posted on Gryphon Gold’s website at http://www.gryphongold.com/main/presentation, presents a plan that outlines management’s strategic objectives and the path forward, including timelines. The above referenced critical data is scheduled to be confirmed by late December 2010, which should allow for ground breaking in early 2011 and subsequent start of production in the 2nd quarter of 2011 with the specific dates dependent on completion of financing and the end of the winter hard freeze. Capital requirements to be secured for the completion of Phase 1 are projected to be in the range of $7 – $8 million.
“The work completed to date and the planned release of the grade and recovery data that is being used to confirm the data used in the September 17, 2009 Canadian NI 43-101 Pre-Feasibility Study keeps the Road to Production on schedule for a March, 2011 ground breaking pending a successful financing. The “Road to Production” is a robust plan to generate early and profitable gold production at our Borealis property in a low-cost manner,” stated Key.
The “Road to Production” is based on upon an anticipated quick start to this permitted (all major permits are in place) resource by utilizing already mined materials and generating cash flow in a 4 month period from ground-breaking. The Phase 1 concept is to recover material that was partially leached and recover gold at a very low operating cost. “The reserve of partially leached material is projected to provide leach pad feed for nearly 7 months, yielding gold recovery and cash flow to advance the project into in-situ production,” said Key. The planned gold recovery for the first 12 months will be gold to carbon with the gold recovery from the carbon being done on a toll basis.
Subject to successful financing and implementation of Phase 1, two critical steps are expected to be taken in an eight month period: 1) construction of the A.D.R. plant will commence, and 2) in-situ ore will begin to be mined from the East Ridge pit. Completion of the A.D.R. six months later will be the final mark to accomplishing the critical elements of the September 17, 2009 NI 43-101 Pre-Feasibility Study allowing for the achievement of the 50,000 ounces gold/year production benchmark.