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Numbers at McEwen's Black Fox for Q3 and 9M up 43% and 26%

Nov 8, 2021

McEwen Mining Inc. has reported its third quarter (Q3) results for the period ended September 30th, 2021.

  • We continue to execute our turnaround strategy and have made significant progress both from an operational and a financial perspective (see Tables 1-3 below). We expect this trend to continue with the ongoing production ramp-up from the Froome deposit at the Fox Complex.
  • Our operations delivered production results in line with our expectations, and we are on track to meet our 2021 production guidance of 141,000 to 160,400 GEOs.
  • Cash and liquid assets(1) and working capital at September 30th, 2021 were $72.7 million(2) and positive $45.8 million, respectively, including $40 million of cash raised by our McEwen Copper subsidiary to advance the Los Azules project.
  • Continued to aggressively invest $6.2 million in exploration and $4 million in advanced projects, primarily focused on the Fox Complex.
  • These investments in our future growth and profitability accounted for a large part of our reported net loss of $17.4 million,or ($0.04) per share, compared to a net loss of $9.8 million, or ($0.02) per share in Q3 2020.
  • Commercial production at the Froome deposit was reached on September 19th. Froome is the newest production area at the Fox Complex and has several advantages compared to Black Fox mine, such as a straighter, shorter, and more efficient underground haulage route, and wider more consistent mineralization that is amenable to lower-cost bulk mining methods.
  • Results of the Fox Complex Expansion PEA are expected by the end of Q4 2021. The study will incorporate the 2021 exploration and resource definition drilling results and will highlight the exciting development plans for the Grey Fox and Stock deposits.

Black Fox production for Q3 and 9M was 43% and 26% better, respectively, compared to Q3 and 9M 2020. Cash costs and AISC for the 9M period both dropped by 23%, compared 9M 2020.
8,300 GEOs were produced in Q3 at total cash costs and AISC of $1,154 and $1,423 per GEO sold, respectively. This compares to 5,800 GEOs in Q3 2020 at total cash costs and AISC of $1,581 and $1,644 per GEO, respectively. The increase in production and the corresponding decrease in costs were attributed to improved efficiencies realized from production at the Froome deposit. In September, commercial production was achieved at Froome, three months ahead of schedule. Mining from Froome is expected to bridge production while the Grey Fox and Stock projects will be advanced in the production pipeline.
At the Stock property, we see the opportunity to further expand the Stock West footprint beyond the grade-thickness contours shown below (see Figure 1). Of particular interest is hole S21-202, which returned 4.4 g/t gold over 21.0 m estimated true width, 200 m above hole S19-95, which returned 27.2 g/t gold over 7.0 m. These holes are located at the projected intersection of the Stock West shallow eastern plunge and the historically steep Stock Mine plunge, and they command further drilling in 2022.

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