NYSE:
MUX

$1.81
+0.02 +1.12% Volume: 2,891,894 November 16, 2018
TSX:
MUX

$2.37
+0.00 +0% Volume: 110,435 November 16, 2018

BLACK FOX COMPLEX

About Black Fox

Located in Timmins

The Black Fox Complex is located in the well-established Timmins Gold Mining Camp in Northern Ontario, Canada. It is positioned approximately 10 kilometres east of the town of Matheson, 65 kilometres east of the city of Timmins and adjacent to Provincial Highway 101. Given the mine’s proximity to Matheson and Timmins, and that the region’s primary industries are mining and forestry, local supplies and services are easily available and can be delivered in a timely manner. The complex is composed of two land packages that total 1,750 hectares and cover 11 kilometres (7 miles) of the Destor-Porcupine Fault, known as the ‘Golden Highway’, which has a total strike length of approximately 200 kilometres (124 miles) and hosts many of Ontario’s richest gold mines. 

The Black Fox Mine is a key component of the complex, which also includes the Black Fox-Stock mill and the Froome and Grey Fox deposits. The Black Fox mine had an initial production from 1997 to 2001 and was re-commissioned, operating continuously from 2009. Commercial production from the Black Fox open pit occurred from May 2009 to September 2015, while underground mining commenced in October 2011. The open pit and underground operations at Black Fox mine produced a total of 835,000 ounces of gold to date. The Stock property surrounding the Black Fox-Stock mill is also the site of the former Stock Mine, which produced 137,000 ounces of gold from an underground operation between 1989 and 2005, bringing the combined production at the Black Fox Complex to 972,000 ounces of gold.

About Diagram About Diagram

In October 2017 the Black Fox Complex was acquired by McEwen Mining. The Black Fox mine has a production guidance of 48,000 gold equivalent ounces for 2018. During Q1, Q2 and Q3 of 2018, production was of 12,078, 14,055 and respectively 11,618 gold equivalent ounces, in line with the guidance for the full year.

The land packages of the Black Fox Complex continue to hold exploration potential to depth and along trends. A 2018 property-wide exploration program has been organized to test for extensions of existing resources, follow up on significant drill results, and to investigate new exploration targets.

1989 - Present
Black Fox Complex Operation

Black Fox Gold
+970,000
Oz Au

PRODUCTION

MINING AND PROCESSING
AT BLACK FOX

Commercial production from the underground mine began in October 2011. Underground ore is produced using a combination of long hole stoping, cut and fill, and narrow vein mining methods. Ore is accessed from a series of declines branching off from the main ramp to surface. The underground mine at Black Fox begins at the bottom of the open pit (approximately 200 metres below surface) and is expected to extend to more than 800 m in depth below surface. Ore mined at Black Fox is initially crushed on-site, transported 28 kilometres by road trucks to the Black Fox mill site and fed via a conveyor system to the mill’s crushing circuit.

The crushed product is transferred to a 1,500 tonne fine ore surge bin and then fed into 2,400 tonnes per day grinding circuit, which includes two stages of closed circuit ball milling. Soluble gold is recovered by adsorption upon granular activated carbon in CIC, CIL, and CIP trains, with a process efficiency of up to 96%. Gold is removed from the carbon in a high temperature strip vessel in a closed circuit with electro-winning deposition. Gold plate is further refined by induction smelting and cast into molds.

The Toxics Reduction Act (TRA) 2017 annual report can be downloaded here.

Gold pile

RESOURCES
& RESERVES

INDICATED

1,349,000 OZ AU EQ

INFERRED

215,000 OZ AU EQ

PROBABLE

113,000 OZ AU EQ

For details see 2018 press releases from Jul 25, Sep 6 and Sep 6.

BLACK FOX
COMPLEX EXPLORATION

Although there is a history of exploration and production, the land packages of the Black Fox Complex remain relatively underexplored. Black Fox has all the criteria characteristic of great exploration projects, including: prime location within a prolific mining region, high gold endowment, presence of high-grade mineralization, multiple prospective structural trends, as well as various styles of mineralization and host rock types.

Exploration is the principal focus at Black Fox for 2018. A $15 million property-wide exploration program that includes surface drilling, underground exploration and delineation drilling, has the main objectives extend mineralization around known deposits and to test new targets close to our mine and mill for potential contributions to near-term gold production.

The exploration program included work designed to refine and tighten the focus of our exploration efforts: airborne electromagnetic and magnetic surveys (VTEM); geophysical data processing and interpretation work with Terra Resources to develop new drill targets; data processing and application of machine learning by Goldspot Discoveries; and development of interactive 3D models by MRB Consulting. Exploration covered 11,200 m underground drilling and 31,200 m surface drilling during Q1 2018 and 39,300 m of surface drilling during Q2 2018.

All areas explored so far in 2018 have returned encouraging drill assay results, reinforcing our view about the strong exploration potential of the Black Fox Complex.

Overview

Stock East

Stock Mine and Gap Zone

Overview Property Stock Overview

The Stock property covers a 4 mile (6.5 km) section of the prolific Destor-Porcupine Fault. The property is the site of the current Black Fox Stock Mill and of the former Stock Mine, which produced 137,000 gold ounces at a grade of 5.5 g/t from an underground operation between 1989 and 2005.

Our 2018 drilling program started in February and was designed to follow-up on historical intersections and geophysical targets, with focus on the Stock East target.

Stock East is part of a 2 km long mineralized trend that also hosts the former Stock Mine. Encouraging drill results from Stock East prompted us to extend drilling activities over this mineralized trend, that includes the Stock Mine, Gap and Stock East targets.

For 2018 drill results on the Stock property see links to tables that have been included in press releases from April 30, July 25 and September 6.

Stock East Property Stock East

Stock East, a target that was unexplored for over 20 years, lies approximately 700 m East of the former Stock Mine and current mill facilities, at the intersection of a NW-SE fault and the E-W Porcupine-Destor Fault.

Positive drill results include narrow higher grade intersections, and also wider and lower grade intersections that indicate the potential for open pit mining. Highlights of 2018 drill intersections at Stock East: 2.94 g/t gold over 18.03 m (hole S18-01), 5.24 g/t gold over 11.96 m (hole S18-10) and 5.76 g/t gold over 9.69 m (hole S18-47).

Drilling at Stock East outlined an initial resource estimate of 114,000 gold ounces Inferred at average grade of 2.54 g/t, comprised of two components:

  • an Open Pit constrained resource (using a cut-off grade of 0.25 g/t) of 40,000 gold ounces at a grade of 1.58 g/t and
  • an Underground resource (using a cut-off grade of 2.40 g/t) of 73,000 gold ounces at a grade of 3.85 g/t.

Stock East has a strike length of approximately 400 m, it extends vertically from surface to a depth of at least 350 m and is open in all directions. The ongoing 2018 infill drill program has the objective to contribute toward upgrading this initial resource to the Indicated category.

For the initial resource estimation on Stock East see the press release from September 6, 2018.

Mine Property Stock Mine

The Stock Mine depth extension and the Gap Zone have had very little previous drilling. Holes have been drilled:

  • underneath the historical mine workings testing for the extension of the Stock Mine mineralization at depths from approximately 320 to 700 m below surface; and
  • along a 400 m trend east of the Stock Mine, testing continuity in sparsely drilled areas located along the main structure (Gap Zone).

Gold mineralization has been intersected in a variety of lithological settings including altered feldspar porphyry intrusions, altered mafic volcanic rocks and fuschite-altered ultramafic rocks. The zones include wide intervals of:

  • lower-grade gold mineralization - grades from 0.8 to 1.25 g/t gold over widths of 18 to 30 m, such as:
    0.92 g/t gold over 24.18 m (from 464.3 m to 497.4 m in hole S18-26 at Stock Mine);
    0.78 g/t gold over 25.77 m (from 125 m to 160 m in hole S18-70 at Gap Zone); and
  • narrow intervals of higher-grade gold mineralization - grades of 5 to 22 g/t gold over widths of 1 to 4 m, such as:
    22.15 g/t gold over 1.39 m (from 333 m to 335 m in hole S18-35 at Stock Mine);
    6 g/t gold over 1.84 m (from 141 m to 143 m in hole S18-27 at Gap Zone).

The obtained drill results support the potential for extending the mineralization down plunge from the Stock Mine, and for shallow mineralization along the 2 km long trend between the hanging wall of the Stock Mine and the Stock East Zone. Follow-up drilling is ongoing.

The current drill rigs will also test the depth extension of the Stock Mine below 500 m, and attempt to join mineralization at Stock East with the historical Stock Mine over a 2,000 m long trend.