Virginia Mines Inc VGMNF

TODAY'S UPDATE ON THE ÉLÉONORE PROJECT

[netgenx]

QUEBEC, JANUARY 23, 2013 (TSX:VGQ) --- Virginia Mines Inc. (“Virginia”) is pleased to provide an update on the latest developments of the Éléonore gold project. As announced in Goldcorp Inc.’s (“Goldcorp”) January 8, 2014 press release, construction continues on schedule with first gold production on track for the fourth quarter of 2014. Gold production is expected to be between 40,000 and 60,000 ounces in 2014. The overall surface construction has now reached 69%. The beginning of operations at Éléonore will be a very important milestone in Virginia’s history. It is to be noted that Virginia owns a 2.2% royalty on the first 3 million ounces of gold produced at the Éléonore mine. This royalty will increase according to the number of ounces of gold produced and shall not exceed 3.5%. The first royalty payments paid to Virginia will be applied against the US$100,000 monthly, contractual payments (for a total of US$5 million) already paid by Goldcorp. Virginia expects to receive its first payments during the second quarter of 2015. Goldcorp estimates a production of 4,000 t/d (about 300,000 oz/yr), at the start, to reach a rate of 7,000 t/d (600,000 oz/yr) following ramp-up to full capacity. The exploration shaft is completed at a depth of 650 metres and the ramp has now reached over 4,300 metres in length. As for the main shaft, it now reaches more than 700 metres at depth and it is planned to lower it down to a depth of 1,500 metres.