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TORONTO, ONTARIO -- (Marketwire) -- 01/17/13 -- Argonaut Gold Inc. ("Argonaut Gold" or the "Company") (TSX: AR), announced today that the Company achieved record gold production of 32,000 ounces during the 4th quarter ended December 31, 2012. This included 25,805 ounces at its 100% owned El Castillo Mine ("El Castillo") in Durango, Mexico and 6,195 ounces at its 100% owned La Colorada Mine ("La Colorada") in Sonora, Mexico. All dollar amounts are in US dollars except as otherwise noted.
FOURTH QUARTER 2012 HIGHLIGHTS:
El Castillo
-- Record production of 25,805 gold ounces (+31% improvement over Q4 2011)-- 39,329 gold ounces loaded on the pad (+30% improvement over Q4 2011)-- West Side Pad 8 construction moving forward; first cell to be loaded starting in Q2 of 2013
La Colorada
-- Production of 6,195 gold ounces and 47,890 silver ounces-- 8,845 gold ounces and 815,219 silver ounces loaded on the pad-- Phase 2 pad construction is 65% complete-- Crushing circuit relocated and fully operational -- Final crushing circuit expansion scheduled for early in Q2 of 2013-- Overburden removal commenced in the La Colorada/Gran Central pit
Financial
-- Year-end cash balance was $191 million as of December 31, 2012, of which C $115 million for warrant exercises was included-- Fourth Quarter sales of 29,500 ounces of gold and 70,910 ounces of silver
Full year 2012
-- Total production of 108,081 ounces of gold (+50% over 2011) -- El Castillo 87,712 ounces (+22% over 2011) -- La Colorada 20,369 ounces
El Castillo In Pit Sulphide Mineralization
-- Over 360,000 gold ounces have been added to El Castillo's in-pit resources. The additional sulfide mineralization is divided into two categories including non-silicified sulphides and silicified sulphides; this provides 22.6 million tonnes at a grade of 0.504 g/t. The majority of the mineralization falls in the non-silicified category which has an average grade of 0.47 g/t with recoveries ranging from 25% to over 50%. The smaller silicified zone of mineralization is mainly confined to a higher grade breccia pipe averaging 0.80 g/t. yielding recoveries of 11% to 28%.-- Results encompass approximately 5,000 meters of core drilling for 32 holes completed in multiple programs over the last three years. All metallurgical testing was completed by Kappes, Cassidy & Associates ("KCA") in Reno, Nevada.Measured and Indicated Resource Table---------------------------------------------------------------------------- Sulphide non-silicified Sulphide silicified----------------------------------------------------------------------------Cutoff Tonnes Au g/t Au oz cont. Tonnes Au g/t Au oz cont.----------------------------------------------------------------------------0.15 24,032,586 0.428 330,392 2,801,142 0.717 64,590----------------------------------------------------------------------------0.20 22,639,932 0.443 322,310 2,599,320 0.759 63,388----------------------------------------------------------------------------0.25 20,200,020 0.469 304,655 2,415,744 0.799 62,064----------------------------------------------------------------------------0.30 17,337,720 0.501 279,379 2,085,348 0.882 59,127----------------------------------------------------------------------------0.40 10,978,344 0.589 208,000 1,680,330 1.013 54,715----------------------------------------------------------------------------For economic evaluation, the non-silicified sulphide zone is based upon 30%recovery; the silicified sulphide zone is based upon 17% recovery.-- Global Sulphide Resource: -- El Castillo's global measured and indicated ("M&I") sulphide resource shows 1.5 million ounces of gold at an average grade of 0.296 g/t; it lies below the oxide and transitional gold resource at El Castillo. It is the Company's current interpretation that the silicified sulphides make up a relatively low percentage of the total sulfides and is largely limited to the silicified breccia pipe.
