Sabina Gold & Silver Provides Update on Advancement of its Back River Gold Project - Seite 2

2020 Project Development Plans

Initiatives underway during 2020 include: a) a phased extension of the Goose Project airstrip to accommodate larger aircraft to reduce transport costs and support future construction and underground exploration activities; b) activities to develop an underground ramp for exploration drilling from subsurface; c) procurement of underground mining and ancillary equipment and infrastructure to support the exploration decline program, including the airlift campaign to bring this equipment to site; d) commencement of engagement for detailed engineering.  All this work will be funded from the existing treasury.

Detailed Engineering

In 2019, the Company had been focused on pursuing an Engineering, Procurement and Construction Contract for the processing plant for a fixed price bid and with performance guarantees.  Given the ongoing supply chain uncertainties driven by global impacts of the evolving COVID-19 pandemic, Sabina is now assessing alternative delivery methods, focusing initially on delivery of detailed engineering which will better define the execution plan as well as provide greater certainty on procurement and construction costs and enable us to solicit for a lump sum bid and performance guarantees on construction.

Internal Studies and Updated Feasibility Study

The 2015 FS envisioned a 3,000 tonne per day mine producing approximately 200,000 ounces a year over an 11.8 year mine life from a series of three open pits and one underground.  The mineral reserve estimate in the 2015 FS utilized only 2.5 million ounces of the total Goose Project resources (4.2 million ounces measured and indicated, and 0.9 million ounces inferred*), in addition, new discoveries and significant resource extensions have been made since the 2015 FS.  internal studies were undertaken to determine what impact these areas might have to meaningfully increase the production profile and mine life, with a similar throughput, through a combination of open pit and underground at all deposits.  For example, recent drilling at Umwelt underground has demonstrated the opportunity to bring high-grade underground material earlier into the mine life which could dynamically impact Project economics, production profile and payback period.  This drilling and the optimization studies will form the basis of an updated resource estimate and feasibility study expected during Q1, 2021.   Further infill drilling may be undertaken in 2021 to inform future resource estimate updates.