Name of the Project
Island Gold mine.

Location
The project is located in northern Ontario, Canada.

Client
Richmont Mines.

Project Description
An expansion case preliminary economic assessment (PEA) on the project has confirmed that the increase in underground mine and mill productivity to 1 100 t/d will support strong production growth of 22% at low industry cash costs and a robust cash flow stream over the eight-year Phase 1 period.

The operation is expected to produce an average of 125 000 oz/y of gold, excluding the 2017 and 2018 ramp-up period, or 115 000 oz over the eight-year period considered in the PEA.

The PEA primarily considers longhole mining over four mining horizons, down to a maximum depth of 1 000 m, using the current dual ramp system. Alimak mining is also considered in the study for the small isolated western reserve block.

Richmont is advancing the development of the dual ramp system, which will support multistope mining, beginning in 2018. The PEA considers the use of the dual ramp system over the eight-year period, with no additional infrastructure required.

Additional opportunities remain for further expansion scenarios and mine life extension as the PEA only incorporates about 24% of the current total inferred resources as at December 31, 2016, which excludes more than 750 000 oz of inferred resources and does not take into consideration the most recent drilling success laterally to the east and at depth below the 1 000 m level.

The project has current proven and probable reserves of 2.6-million tonnes grading 9.17 g/t gold, and measured and indicated resources of 500 000 t grading 5.94 g/t gold and inferred resources of three-million tonnes grading
10.18 g/t gold.

Jobs to Be Created
Not stated.

Net Present Value/Internal Rate of Return
At the expansion case PEA gold price of $1 700/oz, the project has a net present value, at a 5% discount rate, of C$580-million

Value
The expanded PEA indicates a minimal incremental capital investment of C$28.2-million to support a productivity increase from 900 t/d to 1 100 t/d.

Duration
The ramp-up to 1 100 t/d is under way and the operation is expected to achieve the target run rate in the latter part of 2018.

Latest Developments
None stated.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Richmont Mines VP investor relations Anne Day, tel + 1 416 368 0291 ext 105, fax +1 416 397 8620 or  email aday@richmont-mines.com.