Pure Gold Mining Inc. (TSX-V:PGM) (LSE:PUR) reports its fourth quarter and full year 2021 summary financial and operating results. The Company’s audited financial statements and related management’s discussion and analysis for the year ended December 31, 2021, will be available for download on SEDAR and on the Company’s website. All amounts are expressed in Canadian dollars, unless otherwise noted.

Key operating results for the fourth quarter and year ended December 31, 2021, and subsequent to date for the Company and its 100% owned PureGold Mine Project are as follows:

Mining

• For the quarter ended December 31, 2021, a total of 46,949 tonnes of ore were mined from the PureGold Mine, or an average of 510 tpd.
• For the year ended December 31, 2021, a total of 177,192 tonnes of ore were mined from the PureGold Mine, or an average of 485 tpd.
• Mined tonnes and gold grades have, on average, been lower than expected throughout 2021 due to shortages of high-grade ore at various times. High-grade ore shortages led to blending of low-grade material and stockpiles which reduced the overall feed grade to the mill. These shortages were caused by a combination of factors including development delays, insufficient scheduling flexibility, insufficient geologic information available for stopes prior to mining, equipment downtime, and strategic misalignments.
• Significant changes to mine planning and scheduling were implemented during the fourth quarter of 2021 to establish and maintain access to enough high-confidence, high-grade stopes to feed the mill, with early signs of positive progress evident in December’s operating results. These changes include reorganization of information and workflow structures, resulting in enhanced accountability and reduced assay turnaround times. Additionally, definition drilling activity was expanded to provide mine planners with better information in a timely manner leading to improved stope designs and enhanced scheduling flexibility. Finally, a geologic confidence-based model was implemented to standardize decision making and improve mine scheduling and planning. Together, these changes are expected to drive sustainable increases in both ore throughput and head grade, though will require more time to fully implement.

Ore Processing

• For the quarter ended December 31, 2021, the PureGold Mine processed a total of 51,129 tonnes of ore, or an average of 556 tpd, at an average head grade of 4.8 grams of gold per tonne of ore and achieved an average recovery of 95.3%.
• For the year ended December 31, 2021, the PureGold Mine processed a total of 208,874 tonnes of ore, or an average of 576 tpd, at an average head grade of 4.2 g/t Au and achieved an average recovery of 95.1%.
• The main operating units in the mill and process facility are performing as expected.
• Mill upgrades are planned for the gravity circuit which are expected to increase gravity recovery by 10-15% and overall gold recoveries by 1-2% to 96-97% from 95%. These upgrades are also expected to reduce operating costs by reducing cyanide dosages (consumption) in leaching, carbon in carbon-in-pulp (CIP), and metabisulfite/copper sulfate in the detox circuit.
• Several key upgrades were completed at the milling facilities during 2021 including the installation of interstage screens on each of the six CIP tanks, installation of a trommel screen on the SAG mill discharge, and several pump upgrades.
• The mill has demonstrated capability of operating consistently and reliably at and above its design capacity of 800 tpd.
• Significant progress was made in 2021 on permit amendments to increase annual ore production limits from 292,000 tonnes (800 tpd) to 360,000 tonnes (1,000 tpd), and final approval of the amendment is on track to be received well in advance of the current limit becoming a constraint on production.

Gold Production

• Gold production for the quarter ended December 31, 2021 was 7,565 ounces and gold production for the year ended December 31, 2021 was 26,899 ounces.
• Gold sold for the quarter ended December 31, 2021 was 7,100 ounces and gold sold for the year ended December 31, 2021 was 25,238 ounces.

Surface Exploration

• A limited program of surface exploration drilling was completed outside of the mine reserve footprint during the first quarter of the year as the Company was focused on production ramp-up. Drilling at the Derlak and Gap targets with two surface rigs initiated in January, was completed in March 2021. The two surface drill rigs completed 5,234 metres of drilling on four deep holes at Derlak and Gap targets during 2021 with strong alteration and anomalous gold values intersected warranting follow-up. No surface exploration was completed during the last three quarters of 2021. Exploration is expected to resume in the second half of 2022.

Leadership Changes

• On October 27, 2021, Maryse Belanger, PureGold Director, and experienced mine operator and builder, stepped into the role of Mine General Manager at the PureGold Mine, following retirement by the incumbent. In this role, Ms. Bélanger oversaw all of the day-to-day operations of the PureGold Mine.
• On January 4, 2022, Troy Fierro, PureGold Director and seasoned mining engineer, replaced Darin Labrenz as President & CEO. Chris Haubrich, PureGold Vice President Business Development, replaced Sean Tetzlaff as CFO. Ashley Kates, PureGold Corporate Controller, was promoted to Vice President Finance & Corporate Secretary.
• On February 17, 2022, Terrence Smith was appointed to the position of Chief Operating Officer and Bryan Wilson was appointed Vice President Mine General Manager of the PureGold Mine. Phil Smerchanski was promoted to Vice President Exploration & Technical Services. Maryse Bélanger remains on PureGold’s Board of Directors.

Technical Report Update

Work on an updated Mineral Resource Estimate for the PureGold Mine including satellite deposits Wedge, Russet South and Fork is underway. Following completion of the updated resource estimate, an updated Technical Report is expected to be completed including an updated Mineral Reserve. Expected timing for the updated Technical Report is in the second half of 2022.

Financial results for the fourth quarter and year ended December 31, 2021, and subsequent to date for the Company and its 100% owned PureGold Mine Project or the are as follows:

• Mine operating loss of $13.2 million for the three months ended December 31, 2021. Mine operating loss of $19.1 million since the start of commercial production on August 1, 2021.
• Revenues, net of refining costs of $15.9 million for the three months ended December 31, 2021. Revenues, net of refining costs since the start of commercial production on August 1, 2021 of $31.9 million. Total proceeds received from gold sales for the year ended December 31, 2021 was $56.6 million.
• Net loss and comprehensive loss for the three and twelve months ended December 31, 2021 totaled $17.8 million and $34.9 million, respectively.
• Basic and diluted loss per share for the three and twelve months ended December 31, 2021 of $0.04 and $0.08, respectively.
• Cash balance as of December 31, 2021 of $8.5 million
• Total loans and borrowings as of December 31, 2021 of $123.4 million
• Gold Stream derivative liability as of December 31, 2021 of $44.7 million.

Operational and Financial Details

Additional information regarding the Company’s financial results and activities underway at the Company’s PureGold Mine is available in the Company’s 2021 Annual Financial Statements and accompanying management’s discussion and analysis for the year ended December 31, 2021.

Qualified Persons and 43-101 Disclosure

Terrence Smith, P.Eng., Chief Operating Officer for the Company, is the designated Qualified Person for this news release within the meaning of National Instrument 43-101 (“NI 43-101”) and has reviewed and verified that the technical information contained herein is accurate and approves of the written disclosure of same.

About Pure Gold Mining Inc.

PureGold is a Canadian gold mining company, located in the very heart of Red Lake, Ontario, Canada. Our vision is pure and simple. To build a highly profitable, multi-generational growth company in the world-class gold mining district of Red Lake. With our 100%-owned, fully constructed operating PureGold Mine, a multi-million-ounce gold endowment, and significant exploration upside, our value-maximizing strategy is to pursue operational excellence today, while investing in systematic exploration and phased expansions to fuel discovery and growth for the future.