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Midway Reports Strong Progress At The Pan Gold Project, Nevada

Stocks in this article: MDW

Midway Gold Corp. ("Midway" or the "Company") (MDW:TSX-V; MDW: NYSE-MKT) today announced that engineering and permitting activities continue to advance at a rapid pace at its 100%-owned Pan heap leach gold project located in White Pine County, Nevada. Recent project development activities include:

  • Completion of the scoping phase of the federal permitting process, including public meetings. Base line studies are complete and JBR Environmental, a third-party consulting firm, is currently preparing a draft version of the Environmental Impact Statement (EIS).
  • Selection of Jacobs Engineering Group for front-end engineering of mine related infrastructure including project buildings, roads, electrical and water supply. Jacobs is one of the world’s largest and most diverse providers of engineering, technical, and construction services. Forbes Magazine ranked Jacobs one of the top three engineering and construction companies in 13 of the last 14 years.
  • Acquisition of adequate water rights for mineral processing and completion of a production size water well and five monitor wells.
  • Completion of engineering for the heap leach pad and ponds by SRK Consulting.
  • Completion of engineering design and permitting for a new access road and selection of a contractor.
  • Selection of Summit Valley Technologies (SV), a division of FL Smidth, to provide gold recovery equipment for the processing plant. SV is a world-wide leader for supplying gold recovery equipment.
  • Ongoing large scale column tests to determine gold recovery amounts from larger size material which could reduce crushing requirements and lower capital costs.
  • Ongoing diamond drilling for crusher site characterization, reverse circulation drilling to test deep exploration targets, and follow-up condemnation drilling beneath proposed mine facilities.

Ken Brunk, Midway’s President and CEO, commented, “We continue to make excellent progress in the development of Pan which will be our first producing gold mine. We have completed key milestones in our permitting process and selected high-quality engineering firms with significant experience in the construction of gold mines in Nevada. Midway’s in-house engineers continue to optimize the mine plan and find ways to reduce capital and operating costs. I am very pleased with the progress being made on multiple fronts to advance Pan toward commercial production.”

About the Pan Project

The Pan project is an oxidized, Carlin-style gold deposit mineable by shallow open pit methods and treatable by heap leaching. The project has a current Mineral Resource estimate of 1.13M oz of gold comprised of 579,000 oz gold in 37M tonnes of 0.49 gpt gold in the Measured category and 551,000 oz gold in 43M tonnes of 0.40 gpt gold in the Indicated category using a 0.14 gpt gold cutoff grade (NI 43-101 Technical Report; Sept. 1, 2011).

The Pan Project represents a US$99 million capital investment in an economically depressed part of Nevada (see Feasibility Study dated December 19, 2011). Once in operation, the Pan mine is projected to provide 145 workers with stable, high-paying jobs. In addition to direct employment, Midway expects the mine will have a multiplier effect by creating support jobs in the surrounding communities. A Feasibility Study was completed in November that shows the NPV (5%) of the project is robust at a range of gold prices, ranging from $123 million at $1,200/oz gold to $344M at $1,900/oz gold. The IRR grows from 32% to 79% using the same gold price range. Both are after-tax figures (see press release dated November 15, 2011).

This release has been reviewed and approved for Midway by William S. Neal (M.Sc., CPG), Vice President of Geological Services of Midway, a "qualified person" as that term is defined in NI 43-101.

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