Premier Gold Provides Positive Initial Metallurgical Results for Hardrock

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THUNDER BAY, ON, Dec. 3, 2013 /CNW/ - Premier Gold Mines Ltd. ("Premier" or "The Company") (TSX:PG) is very pleased to announce encouraging results from ongoing metallurgical work being completed by SGS Canada Inc. Laboratories in Lakefield, Ontario on drill core samples and sample composites designed to reflect the domain and grade characteristics of the conceptual open pit portion of the Company's 100%-owned Hardrock gold deposit located in Northwestern Ontario. The results suggest that the open pit materials may achieve recoveries of up to 92% and are amenable to conventional milling and gold recovery circuits with low cyanide consumption. The work was completed under the Direction of Paul Blatter, Ing, Premier Gold Mines', Director of Metallurgy.

Highlights of the initial metallurgical results include:

• Gold extraction from whole ore samples ranged from 85%-92% displaying an increase in gold extraction with increasing fineness of grind, both with and without prior gravity recovery (see Table 2 below)
  
  
• Cyanide consumptions of 0.1 kilograms per tonne (kg/t) or less were obtained, and is considered low
  
  
• The weighted average calculated head grade of the processed material (28 kg to date) is 1.91 grams per tonne gold (g/t Au), very much in-line with expected grades (see Table 1 below)

"These results compare favourably to similar projects in North America, and are consistent with our expectations" commented Premier Director of Metallurgy, Paul Blatter. "The pit material shows excellent recovery results and amenability to established milling with low cyanide consumption, which bodes well for our ongoing economic, diagnostic and optimisation work".

A total of 54 core intervals totalling 1.6 tonnes of rock, and reflecting the spatial, lithological and grade variations of the conceptual open pit portion of the deposit were gathered for metallurgical work. Prior to compositing, each interval was assayed and tested to obtain individual grinding parameters. Portions of the 54 core intervals were grouped into 9 composites (A through I) based on lithology and domains. Each of the composites is undergoing detailed gold deportment studies and leach tests.

Global Composite Work

A single "global" composite was generated based on appropriate ratios of each lithology and closely following the geological model of the pit ("Global Composite"). The Global Composite was tested for gravity gold recovery amenability using a laboratory MD-3Knelson concentrator with the concentrate being recovered and upgraded further by treatment on a Mozley C800 laboratory separator. Whole ore leaching (with and without prior gravity recovery) were performed at different grind sizes ranging from 132 to 53 microns. Both oxygen and air were tested with cyanide concentration for all tests maintained constant at 0.5 g/L for this phase of work.

The weighted average gold head grade calculated from the test work completed to date (2 gravity tests, 8 whole ore cyanidation tests, totalling 28.0 kg) is 1.91 g/t Au and grades for individual samples tested range from 1.78 g/t Au to 2.73 g/t Au. Expected "Uncut" grade for this composite was 1.99 g/t Au with the "Cut" grade expected at 1.97 g/t Au as presented in Table 1.

Table 1: Global Composite Make-Up

Gold Recovery Work

Gold deportment studies are incomplete, but preliminary results from the Global Composite indicate the presence of free gold and gold associated with pyrite/arsenopyrite and iron oxides.

The original 54 core intervals (Variability Samples) were submitted for SAG Mill Communication ("SMC") tests and Bond Mill Gindability tests. The comprehensive approach to each Variability Sample for an SMC test will provide a robust dataset for mill sizing and design. Two 10kg gravity tests have returned an average of 26% gravity gold recovery.

The cyanidation testwork of the Global Composite involved investigating the recovery of gold from both whole ore and gravity tailings leaching. Coarse grind tests (~138 microns) displayed recoveries of 85-88% utilizing air and oxygen sparging, while finer grind tests (~56 microns; highlighted in Table 2) displayed recoveries of 92%. Overall, cyanide consumption of the Global Composites are considered "low". Results from this work are summarized in Table 2 below.

Table 2: Cyanidation Results

Future Testing

The flowsheet developed on the global composite will be tested against the individual composites for improvement opportunities and feed into future studies for incorporation into the resource block model.

On-going flowsheet development will incorporate additional grinding tests, solid-liquid separation, cyanide detoxification and leach optimization in order to optimize recoveries as the Company moves toward potential feasibility studies.

In early 2014, a 'Master Composite' (a sample of ore representing the first 3 years of production) will be prepared and optimized to increase economic robustness and provide additional improvement opportunities on ore that has the highest cash flow impact.

The Hardrock gold deposit is the largest of four gold deposits within the Trans-Canada Property and is located approximately 3.0 kilometres south of the Town of Geraldton, Ontario. Potentially open pit mineralization has been identified where historic gold mining comes to surface, and additional underground mineralization, not part of the current metallurgical test work, consists of both new horizons located parallel to the historic mine and extensions of the main zones historically mined. Preliminary Economic Assessment studies are in the process of being completed with the results expected in Q1-2014.

Stephen McGibbon, P. Geo., is the Qualified Person for the information contained in this press release and is a Qualified Person within the meaning of National Instrument 43-101. Assay results are from core samples sent to Activation Laboratories, an accredited mineral analysis laboratory in Ancaster, Ontario, for preparation and analysis utilizing both fire assay and screen metallic methods.

Premier Gold Mines Limited is one of North America's leading exploration companies with a high-quality pipeline of projects focused in proven, safe and accessible mining jurisdictions in Canada and the United States. The Company is well financed with a property portfolio that includes significant assets in world class gold mining districts such as Red Lake and Geraldton in Ontario and the Battle Mountain Trend in Nevada.

The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.

SOURCE Premier Gold Mines Ltd.