Capital Expenditures For Construction Of Phase 2 Heap Leach Pad At Florida Canyon Mine

VANCOUVER, BC - Alio Gold Inc. reported that the Florida Canyon Mine, in Nevada, produced 12,263 gold ounces and 8,648 silver ounces in Q1 2019. Gold production decreased as a result of the winter weather conditions in February and low overall equipment availability resulting in lower crusher production. Work continues to evaluate numerous opportunities to increase production and reduce costs from historic levels.  Areas of primary focus are improving mining and mine fleet efficiency, improved mine planning functions which are expected to result in more efficient mining practices and grade optimization, exploitation of low strip ratio ore, increased ore in process by improved efficiency in crushing and possible inclusion of run-of-mine ore to the heap leach pad. The Company expects to see improvement in production and costs over the course of this year but at this time formal guidance is not possible until further work is completed with respect to the mine plan and the ultimate outcome of improvement in mining equipment availability. Planned capital expenditures in 2019 total approximately $13.5 million and will primarily be employed for construction of Phase 2 of the heap leach pad and construction of a storm water diversion system to address permitting requirements.

The San Francisco Mine, in Mexico, in Q1 2019 produced 10,968 gold ounces and 6,274 silver ounces. Gold and silver production was lower as a result the cessation of open pit mining activity and low-grade stockpile material being processed through the crushing circuit. In January 2019, the Company made the decision to stop active mining in the San Francisco pit and focus on  processing the low grade stockpile, as a result of the San Francisco pit not meeting planned ore production rates at an acceptable strip ratio in the upper levels of the planned pit laybacks. The Company investigated a number of mine planning options to potentially restart active mining however, while the options were economic the Company does not have the ability to fund the capital required for the various options.  As a result the decision was made to continue leaching and processing low grade ore from the stockpiles until the end of the year at which time the stockpiles are expected to be depleted. Following the depletion of the stockpiles the operation will go into residual leach.

The company’s address is Suite 507, 700 West Pender Street, Vancouver BC V6C 1G8, (604) 682-4002, www.aliogold.com.