Drilling by Paramount Gold and Silver at San Miguel Continues to Find Higher Grades Than Predicted by Resource Model

Drilling by Paramount Gold and Silver at San Miguel Continues to Find Higher 
Grades Than Predicted by Resource Model 
Infill and step out core holes intercept up to 23.9 meters of 4.99
g/T gold and 336 g/T silver (10.6 g/T gold equivalent) 
WINNEMUCCA, NEVADA -- (Marketwired) -- 01/30/14 -- Paramount Gold and
("Paramount") today reported additional outstanding results from
ongoing core drilling on its 100%-owned San Miguel Project in
northern Mexico. Paramount has been drilling at San Miguel since late
last year with two core drill rigs. 
Three more holes were drilled into the Don Ese area to upgrade and
expand resources. Infill drill hole DS-13-040 intersected 23.9 m
grading 4.99 g/T of gold and 336 g/T of silver including individual
intercepts up to 59 g/T of gold and 2,793 g/T of silver (over 80
ounces of silver per ton). Step out hole DS-13-42,drilled about 140
meters down dip from DS-13-040, returned 24.3 meters of 4.82 g/T of
gold and 312 g/T of silver, including intercepts up to 13.2 g/T of
gold and 697 g/T of silver (see table below). These results are
expected to add ounces to the Don Ese resource and to improve the
confidence level of the resources from inferred to measured and
indicated (see cross section below). 
Commenting on these results, Paramount CEO Christopher Crupi noted
that "this drilling is reporting exceptional widths and grades which
are well in excess of what the Don Ese resource model predicted. The
greater widths are especially significant. Drill hole 13-040, with 24
meters of 10.6 g/T gold equivalent, was drilled across a block of
inferred resources where the high grade zone was estimated to be only
about 8 meters wide. We saw a similar trend in the results from the
previous six holes at Don Ese reported earlier this month (see
January 14, 2014 news release). I think we can now say that with this
new data, the current Don Ese model significantly understates the
size and grade of the Don Ese deposit. This data will be included in
our next resource estimate scheduled for the second quarter of this
After completion of this drill program and additional metallurgical
testing, Paramount plans to update its Preliminary Economic
Assessment (PEA) to reflect resource additions and improvements to
the project design including a likely heap leach component for lower
grade material not included in the original PEA. 
Results from three additional holes drilled at Don Ese in late 2013
are as follows: 

Hole #     Area           Total                                             
                         Length From (m)  To (m) Width (m)   Au g/T   Ag g/T
DS-13-040  DON ESE       466.25   354.45  378.35     23.90     4.99    335.9
                      including   361.10  367.85      6.75    12.80    741.8
                      including   363.00  364.65      1.65    37.13  1,883.9
                      including   363.95  364.65      0.70    59.70  2,793.0
                                  400.25  401.90      1.65     0.60     54.3
                                  413.85  414.55      0.70     0.66     55.0
DS-13-042  DON ESE        551.7   477.40  479.15      1.75     0.30     40.6
                                  480.85  484.80      3.95     0.86     47.3
                                  488.10  511.45     24.35     4.82    311.7
                      Including   488.10  491.80      3.70    13.21    697.4
                      Including   495.50  501.55      6.05     8.71    584.0
DS-13-043  DON ESE        438.7   343.50  351.30      7.80     0.60     93.7
                                  359.05  360.95      1.90     1.24    165.0
                                  371.95  373.20      1.25     0.88    191.0
                                  382.00  382.60      0.60     0.50    144.0
                                  418.05  421.60      3.55     0.70    119.1

True widths are expected to range from 60% to 95% of reported
To view the section view of block model of current resource and new
drill holes, indicating the large increase in width of the high grade
zone, click the following link:
NI 43-101 Disclosure 
Exploration activities at San Miguel are being conducted by Paramount
Gold de Mexico S.A de C.V personnel under the supervision of Glen van
Treek, Exploration Vice President of the Company and Bill Threlkeld,
a Qualified Person as defined by National Instrument 43-101, who have
both reviewed and approved this press release. An ongoing quality
control/quality assurance protocol is being employed for the program
including blank, duplicate and reference standards in every batch of
assays. Cross-check analyses are being conducted at a second external
laboratory on 10% of the samples. Samples are being assayed at ALS
Chemex and Acme Laboratories, Vancouver, B.C., using fire assay
atomic absorption methods for gold and aqua regia digestion ICP
methods for other elements.  
San Miguel Project PEA 
The PEA was prepared by Metal Mining Consultants ("MMC") of Denver,
Colorado incorporating a resource model developed by Mine Development
Associates (www.mdacorporation.com). The PEA confirms that the San
Miguel Project represents an unusually robust economic opportunity to
develop a low cost mine in the prolific Sierra Madre belt in Mexico.
In their analysis, MMC proposed a 4,000 tonnes per day mill fed by
open pits and underground mines, resulting in a projected 14 year
operation with total metal production of 803,000 ounces of gold and
43.2 million ounces of silver (1,637,000 ounces of gold equivalent at
the base case gold-to-silver price ratio of 51.7 to 1). 
Start-up capital costs including working capital are estimated at
$243 million. Sustaining capital costs over the project's life are
projected to be an additional $227 million. With $70.3 million in
contingencies, total life-of-mine capital costs are estimated at $540
million. Projected life-of-mine average cash operating costs are $512
per ounce of equivalent gold recovered. The total cost of production
(including cash operating costs and total capital and contingency
costs over the life of the mine) is estimated at US$842 per ounce of
gold equivalent, which compares favorably with current producers in
the region. At a gold price of $1500 per ounce and a silver price of
$29 per ounce (the 3 year trailing average of gold and silver prices
at the end of January 2013), the San Miguel PEA estimated a $1.1
billion pre-tax net cash flow, a $707 million pre-tax net present
value at a 5% discount rate and a highly accretive internal rate of
return of 33.2%.  
Note that the PEA incorporates inferred mineral resources which are
considered to be too geologically speculative to have the economic
considerations applied to them that would enable them to be
categorized as mineral reserves and, as such, do not have
demonstrated economic viability. There can be no certainty that the
estimates contained in the PEA will be realized. 
About Paramount 
Paramount is a U.S.-based exploration and development company with
multi-million ounce advanced stage precious metals projects in
northern Mexico (San Miguel) and Nevada (Sleeper). Fully-funded
exploration and engineering programs are now in progress at these two
core projects which are expected to generate substantial additional
value for our shareholders. 
The San Miguel Project consists of over 142,000 hectares (over
353,000 acres) in the Palmarejo District of northwest Mexico, making
Paramount the largest claim holder in this rapidly growing precious
metals mining camp. The San Miguel Project is ideally situated near
established, low cost production where the infrastructure already
exists for early, cost-effective exploitation. A PEA for San Miguel
was completed and announced on February 28, 2013. 
The Sleeper Gold Project is located off a main highway about 25 miles
from the town of Winnemucca. In 2010, Paramount acquired a 100%
interest in the project including the original Sleeper high-grade
open pit mine operated by Amax Gold from 1986 to 1996 as well as
staked and purchased lands now totaling 2,570 claims and covering
about 47,500 acres which stretch south down trend to Newmont's
Sandman project. This acquisition is consistent with the Company's
strategy of district-scale exploration near infrastructure in
established mining camps. A PEA was completed for Sleeper and
announced on July 30, 2012. 
Summary of PZG's Estimated NI 43-101 Compliant Resources  

MEASURED AND INDICATED RESOURCES                                      
PROJECT           Tonnes     Au g/T   Au Ounces     Ag g/T   Ag Ounces
San Miguel    23,918,000       0.83     639,000       70.0  53,559,000
Sleeper      326,963,000       0.33   3,479,000       3.86  40,606,000
Total                                 4,118,000             94,165,000
INFERRED RESOURCES                                                    
PROJECT           Tonnes     Au g/T   Au Ounces     Ag g/T   Ag Ounces
San Miguel    37,470,000       0.69     830,000      38.00  46,243,000
Sleeper      223,624,000       0.27   1,972,000       2.84  20,459,000
Total                                 2,802,000             66,702,000

For details on these resource estimates please see the following news
releases: San Miguel Resource Estimate, September 5, 2012; and
Sleeper Resource Estimate, July 30, 2012. 
Cautionary Note to U.S. Investors Concerning Estimates of Indicated
and Inferred Resources  
This news release uses the terms "measured and indicated resources"
and "inferred resources". We advise U.S. investors that while these
terms are defined in, and permitted by, Canadian regulations, these
terms are not defined terms under SEC Industry Guide 7 and not
normally permitted to be used in reports and registration statements
filed with the SEC. "Inferred resources" have a great amount of
uncertainty as to their existence, and great uncertainty as to their
economic and legal feasibility. It cannot be assumed that all or any
part of an inferred mineral resource will ever be upgraded to a
higher category. Under Canadian rules, estimates of inferred mineral
resources may not form the basis of a feasibility study or
prefeasibility studies, except in rare cases. The SEC normally only
permits issuers to report mineralization that does not constitute SEC
Industry Guide 7 compliant "reserves", as in-place tonnage and grade
without reference to unit measures. U.S. investors are cautioned not
to assume that any part or all of mineral deposits in this category
will ever be converted into reserves. U.S. investors are cautioned
not to assume that any part or all of an inferred resource exists or
is economically or legally minable. 
Safe Harbor for Forward-Looking Statements:  
This release and related documents may include "forward-looking
statements" including, but not limited to, statements related to the
interpretation of drilling results and potential mineralization,
future exploration work at the San Miguel Project and the expected
results of this work, estimates of resources including expected
volumes and grades and the economic projections included in the
project's PEA. Forward-looking statements are statements that are not
historical fact and are subject to a variety of risks and
uncertainties which could cause actual events to differ materially
from those reflected in the forward-looking statements including
fluctuations in the price of gold, inability to complete drill
programs on time and on budget, and future financing ability.
Paramount's future expectations, beliefs, goals, plans or prospects
constitute forward-looking statements within the meaning of the
United States Private Securities Litigation Reform Act of 1995 and
other applicable securities laws. Words such as "believes," "plans,"
"anticipates," "expects," "estimates" and similar expressions should
also be considered to be forward-looking statements. There are a
number of important factors that could cause actual results or events
to differ materially from those indicated by such forward-looking
statements, including, but not limited to: uncertainties involving
interpretation of drilling results, environmental matters, lack of
ability to obtain required permitting, equipment breakdown or
disruptions, and the other factors described in Paramount's Annual
Report on Form 10-K for the year ended June 30, 2013 and its most
recent quarterly reports filed with the SEC. 
Except as required by applicable law, Paramount disclaims any
intention or obligation to update any forward-looking statements as a
result of developments occurring after the date of this document.  
Paramount Gold and Silver Corp.
Glen Van Treek
VP Exploration
Paramount Gold and Silver Corp.
Chris Theodossiou
Investor Relations
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