Marathon Gold Announces Q3 2017 Financial Results

TORONTO, Nov. 15, 2017 (GLOBE NEWSWIRE) -- Marathon Gold Corp. (TSX:MOZ) (“Marathon”) announced today its financial results for the period ended September 30, 2017.

Highlights:

• At September 30, 2017 Marathon had $17.4 million in cash and cash equivalents compared to $8.5 million at December 31, 2016.

Marathon completed the following activities in the period ended September 30, 2017, and subsequently to the date of this press release:

• Buy-back of Net Smelter Returns Royalty – On November 14, 2017 Marathon bought back a Net Smelter Returns royalty on the Valentine Lake property, which consists of a 3% royalty on gold production and a 2% royalty on base metals production and which covers a land package which includes all of the current resources associated with the Valentine Lake project, for cash consideration of US $8.7 million.
  
• Financing – On May 25, 2017, Marathon closed a bought deal prospectus financing underwritten by a syndicate of underwriters led by RBC Capital Markets. Marathon issued a total of 6,900,000 common shares at a price of $1.03 per common share and 9,200,000 flow-through shares at a price of $1.25 per flow through share, for aggregate gross proceeds of $18.6 million.
  
  These proceeds have funded and are currently funding an aggressive ongoing infill and extension drilling program at the Marathon and Leprechaun Deposits and detailed prospecting focused on the northeastern part of the Valentine Lake property where there are indications of gold mineralization but limited historical exploration activity. Additional work will include advanced environmental studies which will be used in economic studies on the project and for permitting and a preliminary economic assessment (PEA), which is underway.
  
  In addition, Marathon obtained proceeds of $2.8 million from the exercise of warrants and stock options during the nine-month period ended September 30, 2017 and subsequently to the date of this press release.
  
  
• Mineral resource estimate – In February 2017, Marathon released an updated mineral resource estimate and the supporting National Instrument 43-101 technical report for the Valentine Lake property, incorporating the results of drilling on the property since the completion of the previous resource estimate in 2015 through February 2017. With completion of the updated resource, the Valentine Lake property hosted a total measured and indicated resource of 1.4 million ounces of gold at a grade of 1.91 g/t and an additional inferred resource of 0.8 million ounces at a grade of 2.24 g/t. Compared to the previous global resource estimate, the global measured and indicated resource increased by 0.4 million ounces or 31%, while the global inferred resource increased by 0.6 million ounces or 284%.
  
  In the third quarter of 2017, Marathon began work on a revised mineral resource estimate for the entire Valentine Lake property, which is underway and nearing completion. In addition to incorporating the results of 2017 drilling at the Marathon and Leprechaun Deposits, the resource estimate will reflect a remodeling of the Leprechaun Deposit undertaken to better reflect the revised geological model of this deposit. Management had originally expected to complete the updated resource estimate in October 2017, but the Marathon Deposit resource update model identified a few areas that warranted additional drilling to better define the grade and resource content. Drilling in these areas is close to complete, and management expects that the resource, incorporating these additional holes, will be completed by the end of November 2017. This resource estimate will serve as the foundation for the PEA.
  
  
• Drilling - Drill programs, which ran from January to March and June to December 2016, January to March 2017, and May 2017 to date, focused on expanding and upgrading the Leprechaun and Marathon Deposit resources, with three drills currently operating at the Marathon Deposit. Since May 22, 2017, Marathon has completed a total of 91 holes covering 43,250 meters out of a planned program of 60,000 meters of infill and extension drilling at Leprechaun and Marathon, of which a total of 63 holes covering 29,074 meters have been assayed and reported.

Operating Results:

The results of operations for the three- and nine-month periods ended September 30, 2017 and 2016 are summarized below and reflect increases in staff compensation costs and director fees following an independent benchmarking review of Marathon’s compensation practices; a performance bonus awarded to management and employees driven by the sharp increase in mineral resources at the Valentine Lake Gold Camp and related to performance in 2015 and 2016; stock options issued in the second and third quarter of 2017s; and professional fees associated with changes to Marathon’s shareholder rights plan, stock option plan, and corporate governance practices and policies.

This press release should be read in conjunction with Marathon's unaudited condensed interim consolidated financial statements for the periods ended September 30, 2017 and 2016 and the related Management's Discussion and Analysis, both of which are available on www.sedar.com.

About Marathon

Marathon is a Toronto based gold exploration company rapidly advancing its 100% owned Valentine Lake Gold Camp located in Newfoundland, one of the top mining jurisdictions in the world. The Valentine Lake Gold Camp currently hosts four near-surface, mainly pit-shell constrained, deposits with measured and indicated resources totaling 1,388,200 oz. of gold at 1.91 g/t and inferred resources totaling 766,500 oz. of gold at 2.24 g/t. The majority of the resources occur in the Marathon and Leprechaun deposits, which also have resources below the pit shell. Both deposits are open to depth and on strike. Gold mineralization has been traced down over 350 metres vertically at Leprechaun and almost a kilometer at Marathon. The four deposits outlined to date occur over a 20-kilometer system of gold bearing veins, with much of the 24,000-hectare property having had little detailed exploration activity to date. Drilling in 2017 is continuing to focus on expanding the Marathon Deposit at surface and to depth.

The Valentine Lake Gold Camp is accessible by year-round roads and is located in close proximity to Newfoundland’s electrical grid. Marathon maintains a 50-person all-season camp at the property. Recent metallurgical tests have demonstrated 93% to 98% recoveries via conventional milling and 50% to 70% recoveries via low cost heap leaching at both the Leprechaun and Marathon Deposits.

To find out more information on the Valentine Lake Gold Camp please visit www.marathon-gold.com.

For more information, please contact:

Jim Kirke
Chief Financial Officer
(416) 987-0710

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

Except for statements of historical fact relating to Marathon Gold Corp., certain information contained herein constitutes "forward-looking statements". Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "plans", "believes", "considers", "intends", "targets", or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could". We provide forward-looking statements for the purpose of conveying information about our current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. These risks and uncertainties include but are not limited to those identified and reported in Marathon Gold Corp.'s public filings, which may be accessed at www.sedar.com. Other than as specifically required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results otherwise.