Canadian miner Pure Gold is making headway with its operational turnaround plan, but the company says it will require additional capital to transition to a state of positive site-level cash flow by the third quarter of this year.

CFO and VP of business development Chris Haubrich said on Friday that the company was evaluating a wide range of strategic, potential financing alternatives.

These would be in addition to the $6-million debt facility from Sprott Resource Lending and the planned $5-million equity raise that the company announced on Friday.

Haubrich said the support from Sprott would provide Pure Gold with the liquidity and time needed to maintain the momentum of its operational turnaround and optimisation initiatives currently under way.

The company, which operates a namesake mine in the Red Lake district, also on Friday announced the departure of CEO Troy Fierro, citing personal health issues. He will remain a director of the company.

Fierro assumed the position of CEO in January as part of a series of executive appointments to boost operations at the PureGold complex.

Director Mark O’Dea will assume the role of interim president and CEO with immediate effect.

O’Dea commented that the benefits of some of the key initiatives that Fierro started several months ago were now being realised, leading to reduced costs and increased revenue.

“As interim CEO, I look forward to working more closely with the new team to complete the stabilisation plan and get our operation on solid footing,” he said.

Since February, the company has reduced its workforce by about 20% from 340 employees to 275.

In April, Pure Gold transitioned to a campaign milling schedule, which would see the mill operating for two out of every four weeks temporarily to save costs by aligning with near-term mine production forecasts. The mill would gradually return to a full-time schedule as mining production increases.

The company said drilling had been scaled back to two rigs, which was sufficient to continue growth of inventory of high-confidence stopes ahead of mining.

Lastly, development of the main ramp has been temporarily paused with resources reallocated to near-term production and development areas.

To date, the operating plus sustaining capital cost saving initiatives already in effect represent about $4-million, or 30%, in monthly savings for the second quarter, compared with the first quarter.

In the first half of the year, Pure Gold expects to further reduce costs by another $1-million a month by realising savings associated with the installation of the on-site camp, renegotiating key supply agreements, and further optimisation of the workforce and overtime management.

Meanwhile, Pure Gold also announced a new “high-confidence” six-month mine plan, which would see the mine produce ore at a rate of 615 t/d and average grade of 5.4 g/t gold, yielding 2 500 oz to 4 100 oz a month of trending upward over the period.