Pegasus' Gold Ltd. Gold/Silver Operation At Zortman, Montana ? Introduction

Landusky Mining, Inc. and Zortman Mining, Inc. are two registered Montana Corporations wholly owned by Pegasus Gold, Ltd. of Vancouver, B.C. The Zortman and Landusky Mines are located in the Little Rockies District of central Montana. The Zortman-Landusky mines produced 2,100 kg gold in 1982. A total of 3,250,000 t of ore per year are mined during the period March 1, to September 15, at an average grade of 1.04 gm/t (0.03 oz/t) gold and 13.4 gm/t (0.385 oz/t) silver at a cutoff grade of 0.35 grams of gold/ton (0.01 oz of Au/t) of ore. The stripping ratio during 1983 is anticipated to be 0.75/1 waste to ore. Combined average plant capacity of the two Merrill-Crowe plants is 9,840 lpm (2,600 gpm). The combined heap spray capacity of the two plants approaches 18,900 lpm (5,000 gpm). The mine employs approximately 200 people, about half of these work for the mining companies and the other half for the mining contractor, N. A. Degerstrom of Spokane, Washington. Net profit in 1982 for Zortman and Landusky Mining, Inc. approximated $4,900,000 at an average gold price of $11.40/gm.