Gold Mountain’s updated PEA (May 27, 2021) incorporates an increased mineral resource estimate, the ore purchase agreement with New Gold and the mining services contract with Nhwelmen-Lake. New Gold is an intermediate gold producer, and Nhwelmen-Lake is a construction and mining services contractor 51%-owned by Nlaka’pamux Nation Tribal Council and 49%-owned by Lake Excavating, operator of similar projects including at Teck Resources Limited’s Highland Valley Copper Mine and New Gold’s New Afton Mine.

The PEA outlines an 11-year combined open pit and underground operation, with production from Elk Gold expected at approximately 19,000 ounces in years 1-3 from an open pit-only operation and then expanding to 65,000 ounces in years 4-11 with the expansion of the open pits and the addition of an underground operation. Total life-of-mine production is estimated at 525,000 ounces at an all-in sustaining cost of US$554/oz. The underground component currently accounts for roughly 18% of the total measured and indicated contained gold equivalent ounces. Gold Mountain’s ore purchase agreement with New Gold allows Gold Mountain to both operate and scale mine operations without the need for an on-site mill. Under this agreement, Gold Mountain will deliver to New Gold 70,000 tonnes per year in years 1-3 and then up to 350,000 tonnes per year in years 4-11 with the ore being processed at the New Afton processing facility 133 km from Elk Gold. The metal payable split from the ore purchase agreement is 89% to Gold Mountain and 11% to New Gold. Elk Gold’s life-of-mine processed gold grade is estimated in the PEA to be 6.98 g/t with a 92% gold recovery.

On December 7, 2021, Gold Mountain released an updated Mineral Resource Estimate following the conclusion of its Phase 2 drill program at Elk Gold.