Turmalina Gold Mine Revised Mine Plan For Growing Production

TORONTO - Jaguar Mining Inc. reported that the Pilar Gold Mine continues to see solid results and remains on track to achieve the higher end of production guidance in line with management expectations. Grades have more than doubled in the past two years, as the current working levels approach the higher-grade areas of orebodies BF and BFII. Mine development and stope preparation inventories provide flexibility in maintaining consistent production rates. A new grade control program implemented at Pilar helped reduce dilution and improved reconciliations with reserve model. The orebody capacity provides confidence that the mine will continue to grow production in 2018 and a further growth is expected in 2019.

At the Turmalina Gold Mine geotechnical issues in the higher-grade area of Turmalina required modifying the mining sequence in the second quarter of 2018. This resulted in lower ore tonnage and grade as mine production was redirected to a lower grade area. Lack of mining flexibility required mining stopes prior to completing ore control drilling which contributed to a lower than expected grade profile.

Top near-term priorities at Turmalina include: Modifying the mining approach to minimize the number of unfilled open stopes. Converting from blind back stopes to cut-and-fill stoping below sill pillars to ensure minimal exposure from unfilled stope walls; Utilization of top down drilling to ensure better quality control on drilling, reduce dilution, improve mining recovery, and allow backfilling with waste rock; Strict adherence to backfilling in the stoping cycle to reduce unfilled open stopes; Use of better blasting techniques to reduce vibration into the rock mass; Improving ore control drilling, planning and execution to improve confidence in the ore production plan; and Improving development planning and execution to give a high confidence in the mine production schedule. The paste backfill plant has been commissioned and paste backfilling has begun in the upper levels of the Turmalina mine. In addition, a grade control program similar to Pilar has been implemented to reduce dilution.

The revised mine plan and schedule for the remainder of 2018 has been reviewed in detail which will allow Jaguar Mining to achieve the updated 2018 guidance of 80,000 to 85,000 ounces without any incremental costs.

"Our top priority remains delivering key operational improvements at Turmalina as a path to returning to a growing and sustainable production profile more reflective of our large base of mineral resources. Importantly, as we see the favorable trends in increasing grades continuing at Pilar, we are optimistic that we will have a good second half of the year. We expect to meet our cost targets and production targets, as well as improved operating cash flows," Guenther said.