Toronto, Ontario, October 5, 2017 − NewCastle Gold Ltd. (TSX:NCA) (“NewCastle Gold” or the “Company”) is pleased to report the results of an independently supervised water pump testing program performed on the Company’s Castle Mountain gold project (the “Project”), located in San Bernardino County, California. The pump testing on the Company’s two new water wells has increased the total capacity of all the Company’s water supply wells to up to 547 gallons per minute (“gpm”), with specific capacities of 1.9 to 3.1 gpm/ft for the recently drilled wells after 5 days of sustained pumping. The pump testing was supervised by the Company’s hydrogeological consultants Geo-Logic Associates (“GLA”) of Tucson, Arizona.
Gerald Panneton, President and CEO commented: “We are extremely pleased with the results of the water well test program which added 400 gpm to our existing 147 gpm from the Viceroy NW field. The water supply for mine operations has been a concern for good reason as the old Viceroy well field encountered declining water levels over its 9 years of operation. The recent water well development and testing program has now significantly de-risked the project with sufficient water supply, now up to 547 gpm for the restart of the operation, and brings us one giant step closer to the restart of the mine.”
GLA states in their Water Supply Report that over an initial operating period of 5 years: “The water supply potential for the existing well network at the site is between 306 and 547 gpm. The project could enhance this pumping rate by drilling additional wells in either the northwest well field or in the bedrock around the mine site. Additionally the pumping rate from the mine area bedrock could be increased by accepting greater drawdown amounts than used in our evaluation.”
The Company feels these results put the Project in a very good position with regards to the potential water needs for the restart of operations. When Viceroy operated the mine from 1992 to 2001 they pumped on average 210 gpm of water to process an average of 9,900 tons of ore per day. Their maximum water extraction rate was of 304 gpm in 1997, when they processed an average of 11,241 tons per day. Additionally, the Company is currently evaluating using a Run of Mine (“ROM”) heap leaching method for most of the process feed from the JSLA backfill material, and thereafter at restart. This method of heap leaching uses 43% less water than the previous method of leaching used by Viceroy. ROM heap leach has far less fine particles therefore retaining less water once leaching has finished (results based on test work performed in 2015 on Castle Mountain Ore at McClelland Labs, Sparks Nevada).
The Company will now take these results and use the evolution of potential water supply in the pre-feasibility study that is being prepared and that is expected to be released by the end of 2017.
Marc Leduc, P. Eng., the Company’s Chief Operating Officer, is the designated Qualified Person for this news release within the meaning of NI 43-101. He has reviewed and verified that the technical information contained in this release is accurate and has approved of the written disclosure of the same.
About NewCastle Gold
NewCastle Gold (an Augusta Group company) has a 100% interest in the Castle Mountain property in San Bernardino County, California. The Castle Mountain heap leach gold mine produced over one million ounces of gold from 1991 to 2004. The Mine and Reclamation Plan, under which the mine operated, was authorized by the County of San Bernardino as the Lead Agency and remains in effect. Water for the drill programs was accessed from existing patented wells on the Project.
The 2017 resource statement will be updated when the new NI43-101 Technical Report for the updated resource is posted on SEDAR on or before October 27th 2017. In the meantime please refer to the NI 43-101 resource for the Project was announced December 2, 2015 which includes Measured Mineral Resources of 17.4 million tonnes grading 0.86 g/t gold containing 0.48 million gold ounces, Indicated Mineral Resources of 202.5 million tonnes grading 0.57 g/t gold containing 3.71 million gold ounces along with Inferred Mineral Resources of 40.8 million tonnes grading 0.58 g/t gold and containing 0.76 million gold ounces. The Project hosts a disseminated low sulphidation epithermal system. Gold is primarily hosted by late-stage rhyolite volcanic units within zones of silicification and brecciation associated with northeast-southwest trending/southeast dipping fault structures which are interpreted to have developed within a collapsed caldera environment. Eleven gold domains are represented by both steeply dipping high grade and stratabound hosted mineralization orientations.
For further information, please contact:
NewCastle Gold Ltd.
Gerald Panneton – President & CEO
Telephone: 416 366 5678
Gillian Roy- Director, Investor Relations & Communications
Telephone: 437 993 4353
Neither the Toronto Stock Exchange (TSX), nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this news release.
This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. Forward-looking information includes information that relates to, among other things, statements with respect to the drill program at Castle Mountain (including water supply drilling), the mineral resource expansion at Castle Mountain, the identification of future expansion targets at Castle Mountain and the restart of operation using Run of Mine (ROM) material from the JSLA pit. Forward-looking information is not, and cannot be, a guarantee of future results or events.
Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by us at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that we identified and were applied by us in drawing conclusions or making forecasts or projections set out in the forward looking information include, but are not limited to that the Company is able to procure personnel, equipment and supplies required for its exploration and development activities in sufficient quantities and on a timely basis and that actual results will be consistent with management’s expectations.
The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, the risks discussed under the heading “Risks” in general to the business of NewCastle in documents filed (or to be filed) with Canadian regulatory authorities. Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. NewCastle does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.
Figure 1 – Location of 2017 Water Test Holes, Castle Mountain Project
Figure 2- Water Well Drilling North-South Long-Section