VANCOUVER, July 29,
2014 /PRNewswire/ - Goldgroup Mining Inc. ("Goldgroup"
or the "Company") (TSX:GGA, OTC:GGAZF, BMV SIX:GGAN.MX) is pleased
to announce a non-brokered private placement financing and
provides a corporate update with regards to the assets of the
Company.
Financing:
Goldgroup intends to complete a non-brokered
private placement financing to raise at least CAD$1 million at
a price of CAD$0.20 per unit. Each
unit will consist of one common share and one half of one
non-transferable share purchase warrant. Each full warrant will
entitle the holder to purchase one additional common share of the
Company at a price of CAD$0.25 for a
period of twenty-four months. The private placement is expected to
close on or before August 1, 2014,
and the Company expects that up to 25% of the units will be
purchased by Company insiders. The proceeds from the private
placement will be used for working capital. The common shares from
this private placement will be subject to a four-month hold period.
The private placement is subject to TSX Exchange and other required
regulatory approval.
San Jose de
Gracia:
The Government of the State of Sinaloa (the "Sinaloa Government")
has recently taken steps to attempt to bring a resolution to the
dispute over the high-grade San Jose de Gracia Gold Project ("San
Jose de Gracia"). Recently, the Sinaloa Government have
requested that Goldgroup and their Earn-In partner on San Jose de Gracia, DynaResource, Inc.
("DynaUSA"), resolve their differences through mediation with the
Sinaloa Government acting as facilitator to that mediation.
This process has commenced with meetings between Goldgroup, DynaUSA
and the Sinaloa Government having taken place. Goldgroup
hopes to find a resolution to this issue in the near-term.
Caballo Blanco:
Goldgroup's 100% owned Caballo Blanco Gold
Project ("Caballo Blanco") hosts Indicated Mineral Resources of
28.9 million tonnes grading 0.62 grams per tonne gold containing
approximately 575,000 ounces of gold and Inferred Mineral Resources
of 24 million tonnes grading 0.54 grams per tonne gold containing
approximately 419,000 ounces of gold (based on a 0.2 grams per
tonne cut-off grade; see the Company's technical report entitled
"Preliminary Economic Assessment, Caballo Blanco Heap Leach,
Veracruz, Mexico" dated
May 7, 2012). Caballo Blanco
remains a flagship asset of the Company and remains a priority of
Goldgroup. The Company maintains communication with all
stakeholders of Caballo Blanco inside and outside of the
State of Veracruz and remains
committed to advancing the project for the benefit of the
State of Veracruz, Mexico and
Goldgroup shareholders.
Cerro
Prieto:
For the three months ended June 30, 2014, the Company mined a total of
510,199 tonnes of material including 140,463 tonnes which were
placed on the leach pads at Cerro Prieto. Of the 140,463
tonnes of ore mined and placed on the pads, the majority of it has
been taken from outside the mine plan which resulted in a lower
average grade. This was done to allow for the necessary time
to strip overburden in order to expose ore within the mine
plan. Gold produced over the three and six month period ended
June 30, 2014 was 1,244 ounces and
3,098 ounces of gold, respectively.
The Company continues to define the optimal
crushing parameters which the Company believes should help improve
recovery rates of gold. Metallurgical test work on the
tertiary crusher (High Pressure Grinding Roll) product has helped
define the optimal parameters and finer crushing and screening
should be possible with the revised circuit, which is expected to
be operational within six to eight weeks.
The Company experienced a lack of water
availability, which has been resolved with the addition of two new
water wells being drilled and the commencement of the wet season.
The addition of the new wells is expected to provide sufficient
water for mining operations.
The Company wishes to clarify that it has not
based its production decision or its internal mine plan at
Cerro Prieto on a preliminary
economic assessment demonstrating the potential viability of
mineral resources or a feasibility study of mineral reserves
demonstrating economic and technical viability, and as a result
there is increased uncertainty and multiple technical and economic
risks of failure which are associated with this production decision
and internal mine plan. These risks, among others, include
areas that are analyzed in more detail in a PEA or Feasibility
Study, such as applying economic analysis to resources, more
detailed metallurgy and a number of various specialized
studies.
Cerro
Colorado:
The Company ceased adding reagents in
July 2014 to the leaching process at
the Company's 100% owned Cerro
Colorado mine which began a wind down phase in the fourth
quarter of 2013 and will continue to see declining amounts of gold
ounces being produced.
The Company also continues to actively pursue
opportunities to better match its assets to its long-term goal of
increasing shareholder value.
Marc Simpson, P.
Geo., acts as Goldgroup's in-house qualified person for exploration
results for the purposes of NI 43-101, and has reviewed and
verified the Technical Information.
The scientific and technical information
contained in this document relating to mining operations at
Cerro Prieto and Cerro Colorado were under the supervision of
Robert Friesen, P.Geo., who is a
"Qualified Persons" under National Instrument 43-101 Standards of
Disclosure for Mineral Projects. Mr. Friesen has reviewed and
verified the Technical Information.
About Goldgroup
Goldgroup is a Canadian-based gold production,
development, and exploration Company with significant upside in a
portfolio of projects in Mexico,
including its flagship 100%-owned advanced stage gold development
project Caballo Blanco in the state of Veracruz, and a 50% interest in DynaResource
de Mexico, S.A. de C.V., which
owns 100% of the high-grade gold exploration project, San José de
Gracia located in the state of
Sinaloa. The Company also operates
its 100%-owned Cerro Prieto and
Cerro Colorado heap-leach gold
mines, both in the state of
Sonora.
Goldgroup is led by a team of highly successful
and seasoned individuals with extensive expertise in mine
development, corporate finance, and exploration in Mexico. Goldgroup's mission is to increase
gold production, mineral resources, profitability and cash flow,
building a leading gold producer in Mexico.
For further information on Goldgroup, please
visit www.goldgroupmining.com
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
INFORMATION
Certain information contained in this news
release, including any information relating to future financial or
operating performance, may be considered "forward-looking
information" (within the meaning of applicable Canadian securities
law) and "forward-looking statements" (within the meaning of the
United States Private Securities Litigation Reform Act of 1995).
These statements relate to analyses and other information that are
based on forecasts of future results, estimates of amounts not yet
determinable and assumptions of management. Actual results could
differ materially from the conclusions, forecasts and projections
contained in such forward-looking information. These
forward-looking statements reflect Goldgroup's current internal
projections, expectations or beliefs and are based on information
currently available to Goldgroup. In some cases forward-looking
information can be identified by terminology such as "may", "will",
"should", "expect", "intend", "plan", "anticipate", "believe",
"estimate", "projects", "potential", "scheduled", "forecast",
"budget" or the negative of those terms or other comparable
terminology. Certain assumptions have been made regarding the
Company's plans at the Cerro
Prieto project. Many of these assumptions are based on
factors and events that are not within the control of Goldgroup and
there is no assurance they will prove to be correct.
Forward-looking information is subject to a variety of known and
unknown risks, uncertainties and other factors that could cause
actual events or results to materially differ from those reflected
in the forward-looking information, and are developed based on
assumptions about such risks, uncertainties and other factors
including, without limitation: uncertainties related to actual
capital costs, operating costs and expenditures, production
schedules and economic returns from Goldgroup's projects;
uncertainties associated with development activities; uncertainties
inherent in the estimation of mineral resources and precious metal
recoveries; uncertainties related to current global economic
conditions; fluctuations in precious and base metal prices;
uncertainties related to the availability of future financing;
potential difficulties with joint venture partners; risks that
Goldgroup's title to its property could be challenged; political
and country risk; risks associated with Goldgroup being subject to
government regulation; risks associated with surface rights;
environmental risks; Goldgroup's need to attract and retain
qualified personnel; risks associated with potential conflicts of
interest; Goldgroup's lack of experience in overseeing the
construction of a mining project; risks related to the integration
of businesses and assets acquired by Goldgroup; uncertainties
related to the competitiveness of the mining industry; risk
associated with theft; risk of water shortages and risks associated
with competition for water; uninsured risks and inadequate
insurance coverage; risks associated with potential legal
proceedings; risks associated with community relations; outside
contractor risks; risks related to archaeological sites; foreign
currency risks; risks associated with security and human rights;
and risks related to the need for reclamation activities on
Goldgroup's properties, as well as the risk factors disclosed in
Goldgroup's Annual Information Form and MD&A. Any and all of
the forward-looking information contained in this news release is
qualified by these cautionary statements. Although Goldgroup
believes that the forward-looking information contained in this
news release is based on reasonable assumptions, readers cannot be
assured that actual results will be consistent with such
statements. Accordingly, readers are cautioned against placing
undue reliance on forward-looking information. Goldgroup expressly
disclaims any intention or obligation to update or revise any
forward-looking information, whether as a result of new
information, events or otherwise, except as may be required by, and
in accordance with, applicable securities laws.
SOURCE Goldgroup Mining Inc.