April 2, 2013
BC & Elko, NV - April 2, 2013 - Klondex Mines Ltd. (TSX: KDX or
OTCQX: KLNDF) (“Klondex”) today announces that it has entered into a
toll milling agreement with Veris Gold Corp. (“Veris Gold”) to process
Klondex material from its Fire Creek project near Elko, Nevada.
Under the terms of the agreement, Veris Gold will
accept for processing, delivery of the Fire Creek material to the
Jerritt Canyon Mill, approximately 120 miles northeast of Fire Creek.
Klondex will pay to Veris Gold the costs to mill and transport the
mineralized material and a toll-milling fee with quarterly adjustments
reflecting the change in contributing costs associated with processing
of mineralized material. All precious metals milled pursuant to the
agreement will be the property of Klondex. The total costs for shipping
(transportation) and milling will be $148.50 per ton. Klondex will
receive the recoveries achieved by Veris Gold’s circuit.
Mike Doolin, General Manager of the Fire Creek project
stated, “I’m happy to report we continue to gain momentum in the
development of the Fire Creek gold project towards a production decision
via our bulk sampling program. Finalizing this milling agreement is
another major step forward for us, and we are extremely pleased to be
working with the team at Veris Gold.”
Paul Huet, Klondex Mines CEO commented, “The Nevada
team delivers another important milestone for Klondex; the group has a
reputation of consistently delivering and this is another great example.
2013 is a pivotal year for us as we continue to de-risk the Fire Creek
asset. The excavation of the secondary egress, necessary to begin our
bulk sampling, is now 20% complete and is on-track to be commissioned
mid-June, 2013. Now, through this milling agreement with Veris Gold, we
have a place to process mineralized material from Fire Creek. I have had
the opportunity to work with this group at Veris Gold in the past and
look forward to a continued relationship with such a professional team.”
Randy Reichert, Co-CEO and COO of Veris stated, “This
second toll milling agreement adds to our third party ore processing
revenue stream and provides an excellent additional source of ore as the
Klondex team ramps up their mining operations into 2014. This agreement
will further reduce our costs by making use of the excess capacity at
the Jerritt Canyon Mill when we begin processing the Fire Creek ore in
the third quarter of 2013. We look forward to working with yet another
gold producing neighbour in Nevada.”
About Klondex Mines Ltd.
Klondex Mines is focused on the exploration and
development of its Fire Creek gold deposit in North Central Nevada. Fire
Creek is a compelling gold mining prospect located in a region of
prolific gold production that is near power, transportation, mining
infrastructure and several milling facilities. As of March 25, 2013
Klondex had 64.4 million shares issued and outstanding, and 85.3 million
shares on a fully diluted basis.
President & CEO
Klondex Mines Ltd.
Manager, Investor Relations
Klondex Mines Ltd.
Catalyst Global LLC
This news release contains
forward-looking statements, including about current expectations on the
timing of project development. These forward-looking statements entail
various risks and uncertainties, are based on current expectations, and
actual results may differ materially from those contained in such
statements. These risks and uncertainties include, but are not limited
to the risks and hazards associated with environmental compliance and
permitting for its underground operations. Risks and uncertainties about
the Company’s business are more fully discussed in the Company’s
disclosure materials filed with the securities regulatory authorities in
Canada and available at www.sedar.com. Readers are urged to read these
materials. Klondex assumes no obligation to update any forward-looking
statement or to update the reasons why actual results could differ from
such statements unless required by law.
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