The objective of the exploration and delineation drilling programs at the Island Gold Mine is to unlock the geological potential of this cornerstone asset. To date, drilling results continue to demonstrate the significant potential to grow our near-mine reserve inventory and identify new resource blocks located outside the Expansion Case PEA area at depth, below the 1,000 metre level and laterally along strike, primarily to the east. Recent exploration drilling has intersected high-grade, wide mineralization in the down plunge extension of the main Island Gold deposit, with hole MH8-4 intersecting 19.85 g/t over 8.4 metres. Exploration and infill drilling results also continue to demonstrate the potential to add near-mine resources in the eastern lateral extension of the main deposit. (See July 27, 2017 news release for full disclosure and detailed drill results tables))

2017 DRILLING PROGRAM – ISLAND GOLD MINE

Ongoing drilling in 2017 continues to demonstrate the potential to expand the mineralized resource blocks located outside the Island Gold Expansion Case PEA area with quality high-grade ounces. The overall focus of the disciplined drilling program over the balance of the year will be to positively impact the mine life at near-term and identify the next million ounces of resources located outside of the PEA area.

Deep Directional Exploration Drilling Program Highlights

The successful 2016 deep drilling program identified a new large inferred resource block of 760,000 tonnes at a grade of 9.53 g/t gold (containing approximately 230,000 ounces, assays capped at 70 g/t gold) in the down plunge extension, located between the 1,050 and the 1,300 metre levels. The main objective of the 2017 deep directional exploration drilling program is to prove the high-grade extension of the new resource block to a minimum vertical depth of 1,500 metres. Results to date include three significant intercepts: (All results are reported with estimated true widths and assays capped at 70 g/t gold.)

  • Hole MH8-4 intersected 19.85 g/t gold over 8.4 metres in the eastern portion of the down plunge extension of the deposit. The intersection is located approximately 1,300 metres below surface and includes 71.76 g/t gold over 0.5 metres, 141.43 g/t gold over 0.59 metres and 318.28 g/t gold over 0.25 metres.
  • Hole MH2A-12 intersected 11.67 g/t gold over 9.42 metres, including 548.1 g/t gold over 0.24 metres.
  • Hole MH2A-13 intersected 8.86 g/t gold over 6.39 metres at a depth of 1,350 metres.

These three new high-grade, wide intercepts confirm that the interpreted down plunge extension of the main Island Gold deposit remains open to a minimum vertical depth of 1,350 metres. Mineralization in this area remains consistent with the main portion of the deposit.

Other highlights from the deep directional exploration drilling include:

  • Hole MH1-11: 20.78 g/t gold over 1.28 metres (undefined zone)
  • Hole MH7: 17.85 g/t gold over 1.68 metres (undefined zone)

Deep directional drilling holes have been completed below the western limit of the Expansion Case PEA area and assays are pending.

Currently, there are three deep directional drills working in the area with a total of 14,059 metres of a planned 36,000 metre drill program have been drilled to date.

Eastern Lateral Infill and Exploration Drilling Program

The 2016 drilling program successfully added two new inferred resource blocks in the eastern lateral extension, located approximately 300 metres east of the Expansion Case PEA area, between the 340 and the 750 metre levels. The largest inferred resource block contains approximately 290,000 tonnes at a grade of 10.35 g/t gold (approximately 95,000 ounces of gold, capped at 70 g/t gold).

Infill drilling is on-going in the upper part of the new resource block from the 340 metre level with encouraging results to date. The extension of the 620 metre level exploration drift is advancing as planned with infill drilling in the lower part of the block expected to begin shortly. Recent highlights from Eastern Lateral infill drilling include: (All results are reported with estimated true widths and assays capped at 70 g/t gold unless otherwise indicated.)

  • Hole 340-588-30: 14.15 g/t gold over 2.91 metres
  • Hole 340-588-40: 23.10 g/t gold over 2.40 metres
  • Hole 340-588-45: 14.71 g/t gold over 2.59 metres
  • Hole 340-588-50: 12.52 g/t gold over 3.00 metres
  • Hole 340-588-52: 16.16 g/t gold over 2.35 metres

Exploration drilling in the eastern lateral extension is focused in the area where hole GD-640-05 intersected 20.57 g/t of gold over a core length of 11.3 metres, at a vertical depth of approximately 1,000 metres. One directional drill rig has been redeployed to this area to follow-up on this intersection to better understand the geometry and true width of this new high-grade mineralization. Highlights of recent drilling include:

  • Hole GD-640-05-3 intersected 13.81 g/t gold over 5.2 metres (core length) at the same elevation of GD-640-05, but located 40 metres to the east. Results to date indicate a potential flat, high-grade zone with quartz veins.
  • Hole GD-640-05-5 intersected a small high-grade zone of 58.34 g/t gold over 0.43 metres in the plane of the E1E Zone.

Another surface drill rig is currently working further to the east, approximately 1,500 metres from the second dike, to test the lateral extension of the main mineralized structure. To date, two small gold zones have been identified, including:

  • Hole GD-670-01: 4.17 g/t gold over 2.44 metres
  • Hole GD-690-01: 15.39 g/t gold over 0.89 metres

A total of 18,465 metres of a planned 37,000 metres of exploration and infill drilling has been completed to date with two surface drill rigs and one underground drill from the 340 metre level.

Expansion Case PEA Delineation Drilling Program

For 2017, a total of 30,000 metres of delineation drilling is planned within the Expansion Case PEA area, primarily in the fourth mining horizon located between the 860 and 1,000 metre levels, with the objective of converting inferred resource blocks to reserves. Currently, two drill rigs are working in the area and a total of 8,515 metres has been completed to date. Recent highlights include: (All results are reported with estimated true widths and assays capped at 225 g/t gold.):

  • Hole 860-511-03: 37.09 g/t gold over 4.98 metres
  • Hole 860-511-07: 51.02 g/t gold over 3.54 metres
  • Hole 860-517-07: 52.09 g/t gold over 4.99 metres
  • Hole 860-517-08: 45.20 g/t gold over 3.27 metres
  • Hole 740-465-40: 31.80 g/t gold over 1.92 metres

Exploration drilling is also underway within the Expansion Case PEA area with the objective of adding resources between the current resources blocks. Recent drilling highlights include:

  • Hole 740-465-25: 87.64 g/t gold over 4.90 metres (undefined Zone)
  • Hole 740-465-29: 49.15 g/t gold over 4.19 metres (undefined Zone)

Phase 2 Regional Drilling Program

The Phase 2 regional drilling program is designed to continue to evaluate the potential extension of the mineralization below the Kremzar mine as well as other previously identified high-priority gold targets located elsewhere on the highly prospective 77 km2 Island Gold property. The Phase 2 regional drilling program is expected to begin later in 2017.