Steppe Gold Commences Procurement of Long Lead Capital Items to Kick Start Phase 2 Fresh Rock Expansion

Steppe Gold Limited (TSX: STGO) (“Steppe Gold” or the “Company”) is pleased to provide an update on its Phase 2 fresh rock expansion.

The Company has now commenced procurement of major capital items for the Phase 2 fresh rock expansion, targeting annual production of 150,000 oz Au Eq, at the 100%-owned ATO Gold Mine.

The first major purchase is a new crushing plant. The new crusher will have a crushing capacity of 1,000t/hr, more than three times the current crusher capacity, and it will fully support planned mining rates for the fresh rock phase where we have estimated throughput rates of 2-2.5m t.p.a. Construction of foundations and installation of the new crusher will start in early April and it is scheduled to be operational by July 2021. The new crushing unit comprises 2 primary jaw crushers and a cone crushing circuit.

Sourced from a leading international supplier, the crushing plant will cost around US$5m in total, inclusive of civil construction work, installation and testing. The crushing plant purchase is being partly financed by a $2.9m loan from a leading Mongolian commercial bank.

In conjunction with the start of procurement of long lead items the Company continues discussions with Mongolian and international lenders on a multi-tranche project debt facility to finance the Phase 2 expansion, expected to include a grinding circuit, a leach/CIP plant, and a flotation circuit. Metallurgical testing is progressing well with encouraging results and the bankable feasibility study is on track for completion in summer 2021.

Steppe Gold President and CEO, Mr Bataa Tumur-Ochir commented, “We are very pleased to kick start the capital procurement program for our Stage 2 fresh rock expansion at the ATO Gold Mine. We have prioritised the expansion of crushing capacity as it will also significantly accelerate stacking rates at the heap leach phase of the project and this is expected to support increased gold production in late 2021 and 2022. We have also started design work to expand the camp capacity and plans are advancing for value added power solutions. With a strong balance sheet and encouraging demand from lenders we expect to accelerate capital works on our Phase 2 expansion through the second half of 2021 as we target fresh rock production of 150,000 oz Au Eq starting in 2023. “

Steppe Gold Limited

Steppe Gold is Mongolia’s premier precious metals company.

For Further information, please contact:

Bataa Tumur-Ochir, CEO and President

Shangri-La office, Suite 1201, Olympic street
19A, Sukhbaatar District 1,
Ulaanbaatar 14241, Mongolia
Tel: +976 7732 1914

Cautionary Note Regarding Forward-Looking Statements:

The above contains forward-looking statements that are subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in our forward-looking statements. Factors that could cause such differences include: changes in world commodity markets, equity markets, costs and supply of materials relevant to the mining industry, change in government and changes to regulations affecting the mining industry. Forward-looking statements in this release include, among other things, statements regarding the trading of the Common Shares and business, economic, and political conditions in Mongolia. Although we believe the expectations reflected in our forward-looking statements are reasonable, results may vary, and we cannot guarantee future results, levels of activity, performance or achievements. We disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

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