Positive Preliminary Oxidation Test Results At Hycroft

RENO, NV - Allied Nevada Gold Corp. reported preliminary results for ongoing oxidation test work completed on Hycroft sulfide concentrate. The first phase of testing was completed by an independent consultant in collaboration with Allied Nevada technical staff.

Initial testing indicates that gold and silver recoveries in the mid-80% range from rougher concentrate may be achieved using the ambient pressure alkaline oxidation process. Allied undertook this testing to identify the viability of an on-site alternative for concentrate oxidation, allowing for processing of 100% of the rougher concentrate and production of Dora on-site as compared with the previous plans. Preliminary economics indicate operating costs for an on-site ambient pressure alkaline oxidation process will be less than $4.00 per ton of whole ore, which includes operation of an oxygen plant. If air was used in place of oxygen, it is expected that operating cost to be lower. These preliminary operating costs compare favorably with operating costs to autoclave of approximately $9.60 per ton of whole ore.

Beginning in 2007, Allied Nevada has been examining options for treating Hycroft sulfidic ores. The original focus was on traditional oxidation methods currently employed in the industry, including pressure oxidation (POX), roasting, and direct cyanidation. Test work on these processes concluded that each of these options would be feasible, with varying degrees of economic recovery. A mine plan was developed using on-site POX to treat one-third of the rougher concentrate and sell the remaining concentrate, as either rougher or cleaner concentrate, for processing in third party facilities.

In late 2012, Allied began a review of other oxidation processes, starting with bio-oxidation ("BIOX"), with a goal of determining an economically viable on-site process in lieu of building and operating an autoclave and relying on offsite sales. The BIOX¿ testing was completed by SGS Canada Inc. in Lakefield, Ontario and SGS South Africa (Pty) Limited in Johannesburg in collaboration with BIOMIN South Africa (Pty) Limited (formerly part of Gold Fields Ltd.). Final results from the BIOX  testing indicated that the process was viable, and also identified a number of important characteristics regarding the oxidation of Hycroft concentrates. Most importantly, the ore appeared to require less than complete levels of sulfide oxidation to achieve acceptable gold and silver recoveries, providing potentially significant capital and operating cost savings.

Using this information, a first phase test program was conducted on a suite of commonly used oxidation methods including chlorination, ambient pressure alkaline oxidation, fine-grind with intense cyanidation, and the Albion oxidation process. Initial results using each of these methods have been positive. Testing indicates that processing rougher concentrate may be optimal as cleaner concentrates contain on average approximately 10% less metal due to losses in the flotation cleaning process. Thus, a focus on treating rougher concentrate, to maximize overall gold and silver recovery and project economics, will continue.

Ambient pressure alkaline oxidation testing of rougher concentrate at an oxidation time of 24 hours, a reaction temperature of 60íC and a grind size of 44 microns, resulted in a sulfide oxidation percentage of 57% and recoveries of 85% gold and 82% silver. Altering the testing parameters for rougher concentrate to increase temperature to 75íC and significantly decrease retention time to 8 hours resulted in recoveries of 82% for gold and silver from 44-micron material. Continuing to refine the optimal operating parameters could translate to a reduction in capital and operating costs without significantly impacting recoveries.

The results above utilized oxygen as the oxidant; however, preliminary test work using air in place of oxygen had similar results. Factors being considered in ongoing test work include reagent volumes, air in place of oxygen, and identification of the minimum temperature and reaction time for effective sulfide oxidation at various grind sizes. Further optimization is required to determine the best economics for the project.

Allied Nevada has contracted with Hatch Ltd. to conduct the next phase of engineering study including a review of recent metallurgical testing. Goals in the next phase are to further refine the flow sheet, define optimal parameters, and develop capital and operating costs as well as a preliminary economic analysis.