Alio Gold (TSX: ALO; NYSE: ALO) has boosted measured and indicated resources at its operating Florida Canyon gold mine in Nevada by 52% over the previous estimate, contained in a 2016 preliminary economic assessment (PEA).
The project now contains 132.9 million measured and indicated tonnes grading 0.4 gram gold per tonne for 1.7 million oz. gold, assuming a US$1,350 per oz. gold price. It also contains 1.4 million inferred tonnes grading 0.43 gram gold for 22,000 oz. gold.
The company will include the updated resource estimate in a new technical report it expects to table by the end of 2018. The report will also include a life of mine plan for Florida Canyon and several optimization studies, including a possible look at the effect of upgrading the crushing circuit and expanding the heap leach pad.
The updated resource estimate only encompasses the oxide resource at Florida Canyon. The company expects its forthcoming technical report will recommend exploring a known sulphide deposit beneath the oxide resource.
Alio Gold acquired Florida Canyon when it bought out Rye Patch Gold in May 2018. Rye Patch restarted the mine in April 2017 and brought it to commercial production in December 2017. According to Rye Patch’s 2016 PEA, the mine could produce 75,000 oz. gold per year over an eight-year mine life.
In 2018’s second quarter, the mine produced 11,587 oz. gold and 8,734 oz. silver. In 2018’s first quarter it produced 10,846 oz. gold and 5,709 oz. silver.
Alio recently suspended exploration and development work at its Ana Paula gold project in Guerrero, Mexico, to refocus on its Florida Canyon and San Francisco gold mines. The company laid off several staff members in the process.
Shares of Alio Gold are currently trading at $1.09 with a 52-week range of 81¢ to $5.34. The company has a $90 million market capitalization.