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Ascot Mining nears completion of Chassoul gold mine expansion to triple capacity

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Ascot Mining (PLUS:ASMP, XETRA:AM3) is progressing towards the completion of an expansion programme at its Chassoul gold mine in Costa Rica to triple its capacity and mitigate the impact of the suspension of mill and mine development at the La Toyota concession.

Issues at the La Toyota project have forced Ascot Mining to take legal action against the proposed JV (joint venture) partner, while La Toyota refused to abide by the court order compelling it to return US$1.3 million of Ascot’s equipment and machinery, which had to be replaced in order to continue with Chassoul. This situation led to a shortage of working capital and revenues due to interrupted production schedule. However, the company noted that it has positioned itself as a company with multiple concessions and was not “hostage to losing business model by the suspension of La Toyota.”

Ascot said it was optimistic about the outcome of the legal case and that the written off investment in La Toyota could be repatriated to its balance with additional compensation.

The company outlined the details of its progress at Chassoul, where heavy lifting has been accomplished and the core construction and machinery installations are essentially complete, paving the way to move into a phase where production can be reached and maintained at 150 tpd (tonnes per day).

One of the more challenging aspects of mill expansion has been completed with all the reinforced supporting structures now in place to support the roofing and the massive inertia block to support the new large Ball Mill with capacity of 150 tpd. The large ball mill has now been successfully installed on a custom built steel frame. A custom transmission will shortly be installed and connected to its electrically driven power source.

The improvements will enable the project to triple its processing capacity. As part of this expansion, the ball mill liner is being upgraded with a modified heavy duty welded liner to obtain interrupted production.

While the large ball mill is being prepared for production, the original smaller ball mill will be reconfigured to integrate with the modified mill circuit to maximize mill feed efficiency. Ascot has also replaced the fine ore bin with a much larger steel fabricated mill to provide for greater efficiency and to match the threefold expansion of the mill.

Two new ore feed conveyors are being fabricated for installation while a third conveyor is being reconfigured for greater efficiency. Once these conveyors are in place, the new fine ore storage and mill ore feed systems will be complete.

Ascot has also provided an update on the underground construction operations at Chassoul, where the water associated with the rainy season is not expected to significantly impede progress with stope preparation to the south in the Cajeta vein. Sufficient timber is now on site for the construction of the ore chutes and any other ground support that may be required.

A larger air compressor is currently being refurbished and is expected to be available during the current week to deliver sufficient air at the required pressure for maximum drill efficiency.

The company added that the lower Cajeta tunnel has been cleaned and is being reinforced with high quality timber after an earthquake caused a large rock fall in the main working area.

The plant is set to be restarted in early September and the capacity of 150 tpd is expected to be reached by the end of the month. Gold recoveries are expected to remain at about 92% until two new leach tanks are connected to the circuit to increase recovery rates.

Gold production is targeted at 1,200 ounces per month.

Underground development included driving a tunnel under the stope, laying down rails for ore transport, and installing ore chutes in the tunnel back, which is expected to result in a more consistent feed to the mill and improvements in the economic of production.

“With this expansion nearing completion we have moved much closer to our original objective of utilizing the Chassoul operation as the hub of our Costa Rica operations,” said COO (Chief Operational Officer) of Ascot Mining Andrew von Kursell.

Currently there are three exploration targets at the projects, the Negra, Pochota, and the surface continuation of the Cajeta vein. Current operations include surface trenching and detailed surveying, which will provide what the company called vital data on geology, grade, and attitude of these veins, identified as the primary targets out of the nine known veins on the property, and identify the best location for a new exploration tunnel in the Negra vein as well as the relationship between the Pochota and Cajeta veins to provide substantial potential for increasing the workings on the property.

Back in July, Ascot announced that it had received an offer of financing of US$4.5 million from private equity group Equita Global, which would be used to complete the development of its three gold mines in Costa Rica, including the Chassoul expansion. Later that month, the company received recently commissioned NI43-101 technical reports, which together with the recently completed independent valuation formed the basis of its application for Canadian reporting issuer status.

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