Midway Advances Toward First Gold Pour at Pan

Denver, Colorado (FSCwire) - Midway Gold Corp. (TSX and NYSE-MKT: MDW) (the “Company” or “Midway”) reports on the construction progress at its Pan gold project in Nevada. Pan is in late stage construction with a first gold pour expected in January 2015. A US$55M Project Finance Facility with Commonwealth Bank of Australia was closed in July 2014 with first draw on the loan expected in November.

Ken Brunk, Midway’s President and CEO stated, “Midway continues to advance steadily to gold production at Pan. This milestone is what we have worked so hard toward these past few years. The reward for the effort is near. Our successes at Pan include permitting in record time, securing our debt financing in an extremely selective environment, and the placement of a hedging program to help protect our operations in an uncertain gold price environment. We are benefiting from the employment of contract mining at very competitive costs to all-in owner mining and have utilized Run-of-Mine leaching on South Pan to harness further potential for efficiencies. We believe our current cash on hand in combination with the expected draws on the debt financing will be sufficient to fund construction at Pan as well as working capital requirements through startup. We continue to look for ways to remain cost efficient in this environment while maintaining a strong core from which to grow.

To that effect, we continue to advance the Environmental Impact Statement process at our second project, Gold Rock, to achieve a targeted second quarter 2015 Record of Decision. Even further, we have worked to realize additional value to our shareholders with impressive resource growth at Spring Valley this year. We are continually thankful to our Midway team for their perseverance through the volatility of these markets and we are all looking ahead to operations and cash flow in 2015.”

Milestones at Pan:

• Pregnant solution pond is complete and final integrity tests were completed in October
• The barren pond is now completed and undergoing final integrity tests
• Storm related repairs are complete
• Carbon columns and other related equipment are set in place
• Mining commenced in September and approximately 500,000 tons have been placed on the leach pad
• Staffing of Ledcor is currently at 3 crews covering 2 shifts per day with 24/7 operations expected to commence by month end
• Pan operations staff have moved to site from the Ely offices
• Detailed start-up planning is well underway and operating training has commenced

Third Quarter Financial Results

The Company also reported its financial results for the period ended September 30, 2014. These results have been filed with the United States Securities and Exchange Commission in the Company’s quarterly report on Form 10-Q, and with the relevant securities regulators in Canada.

The Company’s operating loss for the three months ended September 30, 2014 was $4,547,497 compared to $3,964,571 for the corresponding period in 2013. The Company began stacking ore on the leach pad during September 2014, placing 350 recoverable ounces on the pad. Using expected gold prices, reduced by further processing, shipping and royalty costs, the Company recognized a $266,054 inventory write-down.  Further contributing to the Company’s operating loss was increased depreciation and accretion, salaries and benefits, and office and administration. Accretion expense increased as a result of the Company’s asset retirement obligation due to the advancement of the Pan Project. Office and administration expense, salaries and benefits expense increased as a result of the Pan office general and administrative costs no longer being allocated to mineral exploration expenditures in conjunction with the commencement of construction in January 2014. Offsetting these increased expenses was a reduction in spending on legal, audit and accounting expenses due to the Company incurring significant legal, tax advisory and accounting fees during the three months ended September 30, 2013 related to a non-recurring restructuring of the Company’s subsidiaries. 

The Company incurred other expense of $56,558 in the current quarter compared to $291,878 during the same period of 2013. As a result of the change in the parent Company’s functional currency from the Canadian dollar to the U.S. dollar effective January 1, 2014, there was no gain or loss recorded on the change in the fair value of derivative liability for the three months ended September 30, 2014. The Company recorded a gain of $988,443 related to the change in the fair value of derivative liability for three months ended September 30, 2013. Additionally, the Company recorded a foreign exchange loss of only $25,462 during the three months ended September 30, 2014 compared to a foreign exchange gain of $1,259,322 for the corresponding period in 2013 due to the change in functional currency.

The Company’s consolidated net loss attributable to common shareholders for the quarter ended September 30, 2014 was $7,815,980 or $0.05 basic and diluted loss per share compared to loss of $3,983,821, or $0.05 basic and diluted loss per share for the comparable period in 2013.

Condensed Consolidated Interim Balance Sheet

(Expressed in Canadian dollars) (unaudited)