Atmospheric Alkaline Oxidation Of Gold Rich Sulphide Mineralization At Sleeper Project

WINNEMUCCA, NV - Paramount Gold Nevada Corp. reported on metallurgical tests designed to recover gold from sulphide mineralization, which is not included in the current mine plan for its 100% owned Sleeper Gold Project in northern Nevada. As part of Paramount’s strategic plan to advance the former high-grade producing Sleeper gold mine towards a production decision, last year the Company initiated metallurgical testing of Atmospheric Alkaline Oxidation (“AAO”) for treatment of sulphide mineralization. The objective was to increase “mineable material” to the projected conventional heap leach operation outlined in the existing Preliminary Economic Assessment (PEA) by evaluating an alternative process to oxidize gold rich, sulphide material.

The current PEA, completed in 2015, envisioned a 30,000 tonnes per day heap leach operation that would process oxide and transitional ores only. The PEA anticipated processing over 77 million tonnes of ore containing over 1 million ounces of gold and over 5 million ounces of silver, with a pretax NPV5% of $201.8 million. Recent testing concentrated on the gold rich, sulphide bearing mineralized material not included in the PEA from the West Wood Zone, with composites from core samples grading between 0.32 and 3.35g/t of gold. A total of 14 composite samples were evaluated in various lab conditions at McClelland Laboratories, Inc. in Reno, Nevada. Following successful oxidation of the sulfide material that occurred within 48 hours, initial gold recoveries in lab conditions were excellent, reaching up to 83.4%.

The next step in the metallurgical testing is to identify the optimal parameters for the AAO process including but not limited to oxidation time, temperatures, and crush size to emulate heap oxidation. Once the AAO metallurgical testing is complete, Paramount will compare the results with cyanide column leaching tests and results from bio-oxidation testing completed in 2015 that averaged gold recoveries of 76% and up to 81%.

Paramount and MDA, a division of RESPEC, will then evaluate various mining and processing scenarios with the intent of completing a new Preliminary Economic Assessment (“PEA”) that complies with new SEC SK 1300 disclosure regulations and updates the economic analysis with current gold and silver prices. The PEA will include gold recoveries using conventional heap leaching of the oxide and transitional ore, plus the selected oxidation method to process the remaining higher grade sulphide gold mineralization.

The Sleeper restart initiative is one of four value-enhancing programs now in progress at Paramount including final permitting of the high-grade gold Grassy Mountain Project, drilling on the high priority Frost Project and target identification at the Bald Peak Project where drilling is expected later this year.