Red Eagle Mining Reports Q1 2018 Financial Results

VANCOUVER, BC - Red Eagle Mining Corporation reported that during Q1 2018, underground development at the at the Santa Rosa Gold Project, Antioquia, Colombia, continued to advance according to plan with 1,141 meters completed. Development during Q1 2018 was primarily focused on secondary access ramps and advancing attack ramps on levels -100, -125, -150 and -175 meters, measured from surface. The mine currently has 21 active attack ramps with 11 in production (which provided 31 active ore production faces in April) and the remaining attack ramps in breasting and backfill. 

Stope mining operations continued to ramp up with an average of 614 tonnes per day mined in March and an average of 680 tonnes per day mined in April. Mining rates have increased each month since October 2017. With the arrival of two additional scoops in April and development currently underway, six new attack ramps are expected to be completed during Q2 to begin ore production in high-grade areas to the west, to the east and at depth from existing production areas. These additional production faces will allow mining rates to continue to increase to an estimated 900 tonnes per day in June and to an estimated 1,000 tonnes per day in July as planned.

Rather than constructing a paste backfill plant, a thin layer of cemented paste fill is being injected on top of the backfill where appropriate to tighten fill and minimize ore loss. This alternative will result in lower capital and operating costs and more operational flexibility with a similar production profile.

The mill successfully restarted on January 2, 2018, as planned, and has been operating continuously to date. Process improvements in flotation and regrinding are expected to lead to sustained higher recoveries going forward.

Ore processed to date has an average grade of 3.12 grams per tonne and a mine call factor of 80%, though the mine call factor has gradually increased during the year to 89% during April 2018. This compares to a life of mine processed grade of 4.57 grams per tonne and a mine call factor of 88% in the feasibility study. Red Eagle Mining expects the mined grade to continually improve over time with increased experience mining the San Ramon deposit. Gold production is forecast to increase to 3,000 ounces of gold per this month.

The mining stope delineation underground drill program continued during Q1 2018. Approximately, 21,688 meters have been drilled to date on ten meter centers in 250 delineation holes. The delineation drilling program continues to return intercepts with grades significantly higher than the reserve grade of 5.2 g/t Au. 

Underground exploration drilling at the mine during the quarter intersected high grade mineralization including 4.75 meters at 20.3 grams per tonne gold. The drilling was below the mine workings along 300 meters of strike between sections 856,970 E and 857,200 E extending the vertical extent of known gold mineralization. Mineralization is open to depth in an area with no previous drilling and outside of the mineral resource and mineral reserve.