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Gold Bar

About Gold Bar

Located in Eureka County, Central Nevada

The Gold Bar mine is located in the southern Roberts Mountains of the Battle Mountain-Eureka-Cortez gold trend in Eureka County, Central Nevada.

Historical production at Gold Bar includes 134,000 gold ounces obtained between 1991 and 1994 from Gold Pick and Gold Ridge, at an average mining grade of 2.5 grams per tonne (0.074 ounces per ton). The Gold Pick, Gold Ridge and Cabin Creek and Gold Bar South deposits of the property are included in McEwen Mining's plans of open pit operations.

25 miles southeast of the Gold Bar property is Waterton Global’s Ruby Hill mine and 25 miles north and northwest is the Nevada Gold Mines joint venture of Barrick and Newmont, with the Cortez-Goldrush cluster holding over 10 million gold ounces in reserves and 50 million gold ounces in past production and current resources.

About Diagram About Diagram
Gold pile

 

MEASURED & INDICATED

499,000 OZ AU

INFERRED

53,000 OZ AU

Contained, as of Dec 1, 2020 (see press release dated Jan 7, 2021).

OVERVIEW

The Gold Bar property is located on patented lands and public lands managed by the Bureau of Land Management (BLM) Battle Mountain Field Office. McEwen Mining has been pursuing building the Gold Bar mine since 2013. A signed Record of Decision on the Final Environmental Impact Statement published by BLM in November 2017 marked the completion of the National Environmental Protection Act process. Gold Bar was the first new gold mine in Nevada to gain permit approval in several years.

After obtaining the permit approval in late 2017, a property-wide exploration program was designed to extend the life of the mine by expanding the mineral inventory surrounding the planned open pits and testing new targets on the property.

Exploration delivered encouraging results, through initial drilling focused on three areas: northwest of the planned Gold Pick open pit, northwest of the planned Gold Ridge open pit, and in-between Gold Pick and Gold Ridge. A new shallow oxide mineralization zone has been identified in Hole GB257, which returned 1.4 gpt gold over 16.8 m, starting at a depth of 9 m. Holes that encountered significant mineralization had a weighted average grade and thickness of 1 gpt gold over 15.2 m, comparable to the average grade of the deposit.

In February 2018 a feasibility study was completed, with changes to the implementation strategy for the Gold Bar mine, such as the addition of a crushing, conveying and agglomeration plant and changes in heap leach pad construction, were made with the goal of reducing overall project risk and maintain high capital efficiency.

Acquired by McEwen Mining in 2016, Gold Bar South is a property that consists of 109 mining claims, located approximately 3.5 miles (5.5 kilometers) southeast of our Gold Bar mine, and that hosts a near surface oxide gold deposit. An infill and pit definition drilling program conducted in 2019 at Gold Bar South had 25% of the new drill intersections showing gold grades averaging above 1 gpt. New mineralized structures were identified outside the existing resource, including notable gold intersections such as 6.66 gpt over 24 m, 2.13 gpt over 55 m and 2.21 gpt over 51.8 m (for more results see press releases from Aug 20, 2019 and Oct 15, 2019). Drilling has encountered an area between the NE and NW trending faults of higher-grade oxide mineralization of over 2 gpt gold, measured at 50 m wide, 50 m long and 50 m thick. The Gold Bar South resource was upgraded following the 2019 drilling program, and in 2020 work was continued in order to incorporate the associated satellite pit into the mine plan.

In 2019 Gold Bar had the first ingot poured in February and commercial production was achieved in May. Gold Bar reached 30,700 gold ounces in its first year of production, at cash costs and all-in sustaining costs of $1,101 and $1,282 per gold equivalent ounce, respectively.

The majority of the material mined at Gold Bar in 2019 was from the Cabin pits, which reconciled positively to our block model for gold grade (+18%) and negatively for ore tons (-8%), with resulting contained gold ounces at +8%. The transition in 2020 to mining from the Pick West pit has returned lower ore tons and gold grade from the upper benches as compared to the block model, due to greater structural control of the mineralization than was previously expected.

In light of the significant differences observed between the modeled (expected) and mined (actual) ore tonnage and gold grade from the Pick West pit, the reserve estimate and the future mine plan have been re-evaluated in 2020.

Significant work was completed in 2020 to determine the extent of the reduction in contained ounces at Gold Bar and to mitigate it. The work included a 110,500 feet (33,700 m) drilling program - 64,000 feet (19,500 m) completed at the Pick deposit, 35,000 feet (10,700 m) at Gold Bar South and 11,500 feet (3,500 m) at the Ridge deposit - and additional metallurgical testing.

The Pick, Ridge, and Gold Bar South geological models and resource estimates were updated by McEwen Mining technical staff. The Cabin resource estimate was updated by Mine Technical Services. The geologic interpretations were updated to include structural modeling for all deposits and all resource estimates had independent third-party review for quality assurance. In addition, experts in the field of heap leach technology were engaged to review ore processing and recommended improvements based on test work and site observations, which include ending agglomeration, revised recovery estimates for all resources, and categorization of resources based on metallurgical attributes and clay content. In a Jan 7, 2021 press release the Company announced an updated resource estimate of 499,000 contained gold ounces in the Indicated category and 53,000 contained gold ounces in the Inferred category and a Probable Reserve Estimate of 302,000 recoverable gold ounces for the Gold Bar Mine (resources and reserves with effective date Dec 1, 2020).

To provide perspective on the changes that have occurred at Gold Bar, consider that in 2019, when we started mining, the reserve estimate was 430,000 gold ounces. Cumulative mine production to December 2020 was 58,600 gold ounces, and the December 2020 reserve estimate is 302,000 gold ounces. The net reserve reduction of 16% is driven by changes to the geologic model, metallurgical recovery, additional drilling information, and higher gold prices.

Gold Bar’s estimated After-Tax Net Present Value discounted at 8% and using a gold price of $1,500/oz is in the range of $62 to $76 million; while the upside case at a gold price of $1,900/oz is in the range of $150 to $170 million. Potential mine life is in the range of 5 to 7 years based on currently estimated reserves. A new feasibility study for Gold Bar will be published by late February, 2021.