Canadian Gold Corp. Tartan Mine: Looking to Improve Financial Returns & Sustainability

Toronto, Ontario--(Newsfile Corp. - June 5, 2023) - Canadian Gold Corp. (TSXV: CGC) ("Canadian Gold" or the "Company") is pleased to outline several initiatives the Company is undertaking at the Tartan Mine (Flin Flon, Manitoba) to improve potential future returns, while focused on sustainability. In addition to the items outlined in this news release, the most important driver for the Company will be the discovery of additional high-grade gold resources. Details regarding the Company's 2023 Phase 1 exploration program, which began on June 1, are set out in the Company's news release dated May 12, 2023 (click here).

Potential Operational Improvements

1) Electric Mining Equipment

On May 17, 2023, members of the Canadian Gold team visited the Borden Mine, owned by Newmont Corporation, which utilizes electric mining equipment. This trip was part of a broader review with MacLean Engineering, in order to evaluate how the Tartan Mine can best reduce its environmental footprint. With Manitoba's low-cost electricity, which is approximately 98% renewable (water, wind and solar) the Tartan Mine could be an ideal project for electric mining.

Some of the potential advantages of electric versus traditional mining equipment include lower direct operating costs (initial investment in equipment tends to be higher), reduced emissions, less noise, which can have a positive impact on working conditions, improved health and safety, and it allows a company to comply with new emission standards. The Company will be working with Manitoba Hydro to determine the power availability to the Tartan Mine using the existing infrastructure and changes that might be required.

2) Ore Sorting Test Program

The Company intends to initiate a preliminary ore sorting study on the Tartan Mine mineralization. Ore sorting refers to the process of separating higher-grade mineralization from non-mineralized material based on specific characteristics, such as grade, mineral composition or density. The purpose of this program is to potentially improve revenue per tonne of mill feed at Tartan by reducing the amount of waste material, increasing the overall gold grade and reducing the impact on the environment by consuming less reagents, energy and water.

3) Gold Recoveries

An analysis will be performed to identify areas where gold recoveries can be increased versus the original process plant design. During the 3 years that the mine operated, gold recoveries averaged 76.4%. With modifications to the process plant, an average of 85% gold recovery was achieved during the final year of production with some months being greater than 90%. Based on initial reviews by the Company, it is believed there are various alternatives that will allow it to achieve high gold recoveries, while balancing capital/operating costs and permitting.

Financial Improvements

1) Manitoba Tax Incentives

In 2010, the Company was granted a tax incentive for the Tartan Mine by the Manitoba Government under its "New Mine Status", which provided for a 3-year tax holiday once the mine commenced production. Today, the New Mine Status exempts qualified companies from paying mining taxes until profits equal the amount of capital spent to open the mine. At the end of the tax incentive, a company will be allowed to depreciate the assets against future taxes payable. The Company will be looking to establish over the coming weeks the current tax status applicable to the Tartan Mine. The Company will also be making an application the Manitoba Mineral Development Fund ("MMDF"). The MMDF supports northern economic development and mining projects that create partnerships, increase local employment and stimulate investment with grants up to CDN$300,000.

These tax incentive programs established by the Manitoba Government to attract investment should be applauded, with the province seen as a favourable place to do business.

2) Removal of 2% Net Smelter Royalty

The Tartan Mine is subject to a 2% Net Smelter Royalty ("NSR"). The Company has the option to buy-out each 1% for CDN$1 million. If the Company was to proceed with restarting production at a future date, it's the intention of Canadian Gold to reduce the NSR to zero prior to that time. This would make the Tartan Mine royalty free, providing shareholders with the maximum upside to gold prices. At current gold prices, the removal of the 2% NSR would lower any production costs by approximately US$40 per ounce (CDN$50 per ounce) produced.

Operational Permits

The Tartan Mine operated under various provincial permits during its construction and 3-years of production. These permits have remained valid but will require a review by the Manitoba Government based on current environmental regulations and may require amendments based on the various operational improvements outlined in this news release. Canadian Gold will also be identifying any additional permits required for production should the Company make the formal decision to restart the Tartan Mine.

For Further Information, Please Contact:

Jennifer Boyle, B.A., LL.B. Director/Executive Vice PresidentCanadian Gold Corp.(416) [email protected]

About Canadian Gold Corp.

Canadian Gold Corp. is a Toronto-based mineral exploration and development company whose objective is to expand the high-grade gold resource at the past producing Tartan Mine, located in Flin Flon, Manitoba. The Company holds a 100% interest in greenfields exploration properties in Ontario and Quebec adjacent to some of Canada's largest gold mines and development projects, specifically, the Canadian Malartic Mine (QC), the Hemlo Mine (ON) and Hammond Reef Project (ON). The Company is 37.6% owned by Rob McEwen, who was the founder and CEO of Goldcorp and is Chairman and CEO of McEwen Mining.

Qualified Person

Wesley Whymark, P. Geo., is the qualified person who has reviewed and approved the contents of this news release.

CAUTION REGARDING FORWARD-LOOKING INFORMATION

This news release of Company contains statements that constitute "forward-looking statements." Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Canadian Gold's actual results, performance or achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/168752