The proceeds will be primarily used for pilot plant completion, spinout of gold/copper assets and rare earth mineral property, as well as for general working capital.

All securities issued pursuant to the offering will be subject to resale restrictions for a period of four months from the closing date. This offering is subject to the approval of the regulatory authorities and finders’ fees may be paid in accordance with the TSX Venture Exchange policies.

             REVISED FEASIBILITY STUDY HIGHLIGHTS (100-PER-CENT BASIS)
  
Probable reserves                                     79.94 million tonnes at 1.11 g/t
                                                               for 2.85 million ounces
Average annual production                                                                          
First seven years                                      5.8 million tonnes per annum at
                                                            1.49 g/t averaging 228,000 
                                                                    ounces Au per year
Life of mine (LOM)                                          167,000 ounces Au per year
Mine life                                                                   13.6 years
Cash costs                                                                                         
LOM                                                                     $676 per ounce
All-in sustaining costs (AISC)                                          $751 per ounce
Base-case gold price                                                  $1,350 per ounce
After-tax net present value (NPV) 
(discount rate: 5%)                                                       $607-million                                 
After-tax internal rate of return (IRR)                                  33.3 per cent
Payback period                                                               2.9 years
Preproduction capital                                                     $321-million
Sustaining capital                                                        $179-million
Final permitting                                                           In progress   

Notes:
All amounts stated are in U.S. dollars. 
Economic parameters are shown on a 100-per-cent basis.

“The revised feasibility study clearly demonstrates the improved economics and scope of the proposed evelopment and operation at Block 14 following the early works engineering and selection of LNG [liquefied natural gas] to fuel the power station. At a production rate of almost 230,000 ounces of gold per annum for the first seven years, a low production cash cost per ounce and a significant exploration upside, this project stands out on an international scale,” commented Richard P. Clark, chief executive officer of Orca. “With positive political change in Sudan progressing, the company is confident of securing development financing in the coming months; discussions are ongoing.”

                            KEY OPERATING PARAMETERS

                           Revised feasibility study         Feasibility study
                                    (September, 2020)          (November, 2018)

Milling capacity                            6.0 Mtpa                  6.0 Mtpa
Probable reserves
Tonnes (000s)                                 79,943                    79,943
Grade (Au g/t)                                  1.11                      1.11
Mine life                                 13.6 years                13.6 years
LOM
Average annual
production (oz)                              167,000                   167,000
Recovery (%)                                     82%                       82%
Cash costs ($/oz)                               $676                      $707
AISC ($/oz)                                     $751                      $783
Strip ratio                                   1.49:1                    1.49:1
Years 1 to 7
Average annual
production (oz)                              228,000                   228,000
Grade (g/t)                                     1.49                      1.49
Cash costs ($/oz)                               $673                      $697
AISC ($/oz)                                     $759                      $792

Notes: 
All amounts stated are in U.S. dollars. 
Economic parameters are shown on a 100-per-cent basis.

  
        MINERAL RESOURCE STATEMENT -- SEPT. 19, 2018                   

Classification        Tonnes       Grade    Contained ounces 
                   (millions)    (g/t Au)              (000s)

Indicated               79.9        1.30               3,342                 
Inferred                18.5         1.2                 711     

Notes:
(1) CIM definition standards were followed for the 
classification of mineral resources.
(2) Mineral resources are inclusive of mineral reserves.
(3) Mineral resources are reported above a cut-off 
grade of 0.6 g/t.

Technical report

The results of the revised feasibility study will be published in a technical report prepared pursuant to the Canadian Securities Administrators’ National Instrument 43-101 which can be viewed on the company’s website and posted under the company’s profile on SEDAR today.

Feasibility study details

   
         MINERAL RESERVE STATEMENT -- NOV. 7, 2018
                         
Classification        Tonnes       Grade    Contained ounces 
                   (millions)    (g/t Au)              (000s)

Probable reserves     79.943        1.11               2,853 

Notes:
(1) CIM definition standards were followed for the 
classification of mineral reserves.
(2) Mineral reserves were optimized using a gold price 
of $1,100.
(3) Mining cut-off grades vary between 0.32 g/t and 
0.90 g/t.

Capital costs

Preproduction capital costs are estimated at $321-million (November, 2018: $328-million), including $34-million (November, 2018: $36-million) in contingency and $179-million (November, 2018: $181-million) for LOM sustaining capital.

The construction period is estimated at 27 months. The pipeline and generator supply fall on the critical path.

                                September, 2020                November, 2018
                           Preproduction   Sustaining     Preproduction    Sustaining
                                 capital      capital           capital       capital

Mine                                $ 15         $  -              $ 15          $  -
Process plant                        169           35               164            35
Generator                              7           63                 4            66
Water pipeline                        12            -                26             -
Tailings storage
facility                              17           54                17            54
Camp                                   3           14                 3            14
Infrastructure                        12            -                12             -
EPCM                                  27            -                31             -
Owner                                 25            -                21             -
Closure                                -           13                 -            12
Contingency                           34            -                36             -
Total                                321          179               328           181

Generator and camp will be financed through BOOT (build/own/operate/transfer) contracts.

Mining and processing

The preferred mining option for Block 14 is a conventional truck-and-shovel open-pit operation feeding a mineral processing circuit incorporating primary crushing, SAG (semi-autogenous grinding) and ball-mill grinding followed by carbon-in-pulp leaching, stripping and electrowinning.

Preproduction will enable the training of the mining crews and is estimated to produce 900,000 tonnes of waste stripping and 350,000 tonnes of ore, which will be stockpiled. The mining will be completed in eight years at an average mining rate of 22 million tonnes per annum. A low-grade stockpile (average 0.71 gram per tonne) will be created, which enables processing of higher-grade ore for the first seven years of the mine life with an average grade of 1.49 grams per tonne. The stockpiled ore will be treated over the last 6.6 years.

A total of 77.3 million tonnes at 1.07 grams per tonne will be mined from the GSS group of pits adjacent the processing plant. A total of 2.6 million tonnes at 2.36 grams per tonne will be mined from the Wadi Doum satellite deposit and trucked 65 kilometres to the processing plant during the first five years of the mine life.

Operating costs are based on assumed fuel prices of 60 cents per litre (November, 2018: 70 cents per litre) for diesel and LNG price $9.70 per million thermal units delivered to site (November, 2018: 52.5 cents per litre for HFO380). LOM power costs used equate to 10.83 cents per kilowatt-hour (November, 2018: 13.6 cents per kilowatt-hour).

                           All-IN SUSTAINING COSTS
  
                              September, 2020              November, 2018           
                        LOM ($/oz)   LOM ($/tonne)   LOM ($/oz)   LOM ($/tonne)

Mining                      $ 233          $ 6.81        $ 237          $ 6.94         
SP rehandle                    15            0.44           15            0.44         
Processing                    279            8.16          311            9.12         
G&A                            59            1.71           59            1.72         
Refining                        6            0.18            6            0.18         
Silver credit                 (10)          (0.29)          (9)          (0.26)       
Royalties                   95 (2)           2.77        88 (3)           2.57         
Total cash costs              676           19.78          707           20.69        
Sustaining capital             71            2.08           72            2.11         
Closure                         4            0.13            4            0.12         
All-in sustaining   
costs (1)                     751           21.99          783           22.92        

Notes:
(1) Quoted all-in sustaining costs are presented as defined by the 
World Gold Council and include total cash costs, G&A, sustaining capital 
and closure costs.
(2) Gold price of $1,350.
(3) Gold price of $1,250.

                      GOLD PRICE SENSITIVITY ANALYSIS
 
                            Low      Base    Three-year             Spot   
                                               trailing   (Aug. 31, 2020)

Gold price ($/oz)        $1,250     $1,350       $1,410           $1,950             
Posttax NPV 5% ($M)        $467       $607         $691           $1,445             
Posttax IRR (%)           27.5%      33.3%        36.8%            66.0%             
Cash cost ($/oz)           $669       $676         $679             $713               
AISC ($/oz)                $745       $751         $755             $789

The feasibility study was completed by Lycopodium Minerals Pty. Ltd. of Australia, with inputs from discipline-specific qualified persons. The qualified persons are independent and have reviewed and approved this news release. The areas of responsibility for each qualified person involved in preparing the revised feasibility study are as follows.

Project manager qualified person

Study manager:   Dr. Geoff Duckworth, Lycopodium Minerals

Discipline-specific qualified persons

Mineral resource:  Nicholas Johnson, consulting geologist, MPR Geological Consultants Pty. Ltd.

Mining:  Chris Reardon, country manager, Orca Gold (previously consultant, Deswik Europe Ltd.)

Metallurgy:  Mike Hallewell, consultant, MPH Minerals Consultancy Ltd.

Hydrogeology:  Pieter Labuschagne, consultant, GCS Pty. Ltd.

Environment:   Carl Nicholas, consultant, Mineesia Ltd.

“We are starting to realize the district-scale potential of the Posse trend,” said Mike Mutchler, Amarillo’s chief executive officer. “These exciting results are consistent with the results of our successful November, 2019, to February, 2020, drill program, which showed the potential for satellite gold deposits at Mara Rosa.

“A new resource would give us the option to extend the planned life of the Posse mine, expand the plant throughput or some combination of both. This would significantly increase the project’s expected returns.”

The surface exploration program focused on three targets. Pastinho, Lambari and Estrela are located 3.5 kilometres, 4.5 km, and eight km northeast of the Posse gold deposit along the Posse North trend.

Posse North is a northeast-trending potassium-radiometric anomaly with coincident gold-in-soil anomalies greater than 50 parts per billion defined by previous work. Structural features found by airborne magnetics were also useful guides for targeting.

A mechanical backhoe loader dug three-metre-deep trenches generally at every 200 m. Chip channel samples were taken at one m intervals for each trench, which were oriented in a northwest-southeast direction and perpendicular to the main trend of the gold deposits.

The key findings of the surface exploration program are:

• Surface trenching and auger drilling confirm the up-dip extension of the Pastinho gold target;
• The surface soil anomaly at Pastinho has been defined over a strike length of 1.5 km and remains open along strike to the northeast;
• There appear to be subparallel gold structures with up to five mineralized gold zones trending northeast along the Pastinho target;
• Lambari and Estrela have defined gold anomalies that require follow-up work.

The Pastinho target

Pastinho is 3.5 km northeast of the Posse deposit on 6,000 hectares of new exploration tenements that Amarillo gained access to in December, 2019. It is a gold-mineralized structure approximately 800 m to 900 m long oriented in a northeast-southwest direction along the same structural trend as the Posse gold deposit. The apparent thickness varies from 10 m to 20 m and dips about 60 degrees northwest.

Geologically, Pastinho is similar to Posse. It is characterized by a hydrothermally altered thrusted shear zone developed along the contact between a biotite microcline gneiss (granodiorite composition) and metagabbo and/or amphibolite mafic rocks. There are structural fabrics including mylonites together with hydrothermal alteration minerals like silicification (quartz), biotite, sericite and carbonate with associated disseminated sulphides that are typically 1 per cent to 3 per cent pyrite.

The results of Amarillo’s most recent diamond drilling are interpreted to have increased the strike extent to 900 m from the 150 m long zone of near-surface gold mineralization defined by a previous operator. Examples from these drill results include:

• Hole LMR007A — 18.7 m grading 0.84 gram per tonne gold; it was oriented with an azimuth of 109.1 degrees and a dip of minus 50 degrees;
• Hole 20P109 — 11 m grading 0.74 g/t gold; it was oriented with an azimuth of 125 degrees and a dip of minus 59 degrees.

Nine trenches were dug totalling 791.6 m and 850 samples were tested over a strike length of 1.5 km (see included table). Highlights of the results include:

• Trench 20TCH001 — 20 m grading 1.034 g/t Au;
• Trench 20TCH002 — 11 m grading 0.95 g/t Au;
• Trench 20TCH003 — 10 m grading 1.22 g/t Au;
• Trench 20TCH004 — 5.1 m grading 3.27 g/t Au;
• Trench 20TCH009 — 17 m grading 1.46 g/t Au.

Significantly, the surface trench work has extended the strike length of the Pastinho gold target to 1.5 km. The current interpretation is that the surface trenching program has outlined the up-dip extension of Pastinho. There appear to be up to five subparallel gold structures dipping northwest approximately 50 to 60 degrees. Pastinho, which has been drill tested to a depth of approximately 100 m, remains open at depth.

Lambari

Lambari is located approximately one km northeast of Pastinho and 4.5 km north of Posse. The geological setting of Lambari is similar to the Posse gold deposit and Pastinho.

Surface work consisted primarily of shallow auger drilling, which defined two gold-in-soil anomalies. The first anomaly is located along strike and parallel to Pastinho, and has a strike length of approximately one km. The second gold-in-soil anomaly occurs to the northeast and is parallel to the first anomaly. It has been defined over a distance 1.5 km.

Estrela

Estrela is located about 3.5 km northeast and along trend from Pastinho, and approximately eight km northeast of Posse. Estrela is interpreted to occur along the same structural corridor as Posse and Lambari, and shares similar geology. Work consisted primarily of shallow surface auger drilling and defined a northeast-trending gold-in-soil anomaly over a strike length of 900 m.

Future exploration program

The surface exploration work at Mara Rosa has been successful in better defining the Pastinho, Lombari and Estrela gold exploration targets.

In addition to continuing surface trenching and auger drilling of selected targets, next steps will also include completing a detailed induced polarization ground geophysical survey over each of the targets and a diamond drill program.

Ground geophysics is expected to begin in late September or early October, with a diamond drilling program planned to begin in late 2020 or early 2021. Approximately $1.75-million has been budgeted for exploration at Mara Rosa to the end of 2021.

                                   TRENCHING RESULTS
 
Trench No.  Number of samples  Gold structure  From (m)  To (m)  Length (m)  Gold grade (g/t)

20TCH001                   96               1     23.00   43.00       20.00             1.034      
                                            2     55.00   59.00        4.00             0.320      
20TCH002                   92               1     23.00   34.00       11.00             0.950      
                                            2     54.00   58.00        4.00             0.222      
20TCH003                   98               1     31.00   41.00       10.00             1.220      
                                            2     44.00   55.00       11.00             0.341      
                                            3     72.00   80.00        8.00             0.196      
                                            4     83.00   84.00        1.00             0.705      
                                            5     94.00   95.00        1.00             0.246      
20TCH004                   89               1     20.90   26.00        5.10             3.265      
                                            2     39.00   43.00        4.00             0.271      
                                            3     52.00   53.00        1.00             0.491      
                                            4     55.00   56.00        1.00             5.435      
                                            5     65.00   66.00        1.00             7.275      
20TCH005                   99               1     31.20   39.10        7.90             1.524      
                                            2     50.00   52.00        2.00             0.242      
                                            3     60.00   63.00        3.00             0.544      
                                            4     68.00   71.00        3.00             0.388      
                                            5     80.00   82.00        2.00             1.070      
20TCH006                   76               1     53.30   56.00        2.70             0.919      
20TCH007                   66               1     58.00   59.80        1.80             0.393      
20TCH007A                  32               1      0.00   19.00       19.00             1.431      
20TCH008                   62               1     47.00   55.65        8.65             0.918      
20TCH008A                  30               1     22.00   23.00        1.00             1.642      
20TCH009                  110               1      7.00   24.00       17.00             1.461      
                                            2     29.00   31.00        2.00             0.280      
                                            3     43.10   43.90        0.80             0.686      

As a result of the acquisition, Mr. Sprott now beneficially owns and controls 24,079,796 common shares and 7,439,898 common share purchase warrants representing approximately 19.3 per cent of the outstanding common shares on a non-diluted basis and approximately 23.8 per cent on a partially diluted basis assuming the exercise of all such warrants. Prior to the acquisition of these shares, Mr. Sprott beneficially owned and controlled 14,879,796 common shares and 7,439,898 warrants representing approximately 15.1 per cent of the outstanding common shares on a non-diluted basis and approximately 21.1 per cent on a partially diluted basis assuming the exercise of all such warrants.

The acquisition (together with Aftermath Silver’s intervening common share issuances from treasury) resulted in a partially diluted beneficial ownership decrease of approximately 2.9 per cent of the outstanding common shares from the date of the last early warning report and, therefore, the filing of an update to the early warning report.

The securities noted are held for investment purposes. Mr. Sprott has a long-term view of the investment and may acquire additional securities including on the open market or through private acquisitions or sell the securities including on the open market or through private dispositions in the future depending on market conditions, reformulation of plans and/or other relevant factors.

Aftermath Silver is located at suite 1500, 409 Granville St., Vancouver, B.C., V6C 1T2. A copy of the early warning report with respect to the foregoing will appear on the company’s profile on SEDAR and may also be obtained by calling Mr. Sprott’s office at 416-945-3294 (2176423 Ontario Ltd., 200 Bay St., suite 2600, Royal Bank Plaza, South Tower, Toronto, Ont., M5J 2J1).

The company has issued 10,278,000 units at a price of 43 cents per unit for gross proceeds of $4,419,540.

Each unit consists of one common share of the company and one-half of one transferable common share purchase warrant. Each warrant will entitle the holder to acquire one additional common share of the company at a price of 60 cents per share for a period of three years. The securities issued in connection with the financing are subject to a hold period expiring Jan. 15, 2021. In connection with the financing, the company paid a finder’s fee of $86,000 in cash, equal to 5 per cent of aggregate gross subscription proceeds received by the company from purchasers introduced to the company by the finder.

Net proceeds from the financing are expected to be used to update the National Instrument 43-101 technical report on the company’s interest in the Entree/Oyu Tolgoi joint venture (JV) property in Mongolia and for general corporate purposes.

Stephen Scott, president and chief executive officer, commented: “We are very pleased that we had such high demand for the Entree financing at this time of great uncertainty particularly as the overwhelming majority of subscribers were existing shareholders. Capital is not always available to the junior mining sector and seizing the opportunity now has put Entree in a very strong financial position as development of the Oyu Tolgoi underground project moves towards sustained production.”

Insiders of the company acquired an aggregate 4,437,000 units, including 2.4 million units acquired by Sandstorm Gold Ltd., 875,000 units acquired by Rio Tinto International Holdings Ltd. and 740,000 units acquired by Turquoise Hill Resources Ltd. Following closing, Sandstorm Gold holds 39,790,880 common shares of the company, or 21.4 per cent of the company’s issued and outstanding shares, Rio Tinto holds 17,441,796 common shares of the company, or 9.4 per cent of the company’s issued and outstanding shares, and Turquoise Hill holds 14,539,333 common shares of the company, or 7.8 per cent of the company’s issued and outstanding shares. Directors and officers of the company and their associates acquired an aggregate 422,000 units on the same terms and conditions as other subscribers.

Mr. Scott added, “We greatly appreciate the ongoing support of all of our shareholders and are particularly pleased that our three largest strategic shareholders participated in the financing at approximately existing proportional levels.”

The insiders’ participation is exempt from the formal valuation and shareholder approval requirements provided under Multilateral Instrument 61-101, Protection of Minority Holders in Special Transactions. The exemption is based on the fact that the market value of the insiders’ participation or the consideration paid by such insiders does not exceed 25 per cent of the market value of the company.

The company will be filing a material change report in connection with the transaction less than 21 days before the expected date of the closing of the transaction, and considers the shorter period to be reasonable given the nature of the transaction and the fact that all necessary approvals have been obtained.

Each unit will consist of one common share in the capital of the company and one-half of one common share purchase warrant of the company. Each warrant shall be exercisable to acquire one common share at a price per warrant share of $2.10 for a period of 24 months from the closing date of the offering, subject to an accelerated expiry option whereby the company can trigger an accelerated 30-day expiry of the warrants if the closing price of the company’s common shares listed on the TSX Venture Exchange remain higher than $3.25 for 20 consecutive trading days. On the 20th consecutive trading day above $3.25, the warrant expiry date may be accelerated to 30 trading days after the acceleration trigger date by the issuance of a news release announcing such acceleration, within two trading days of the acceleration trigger date.

The net proceeds from the sale of the units will be used to finance feasibility study work through 2021 on the company’s Crawford nickel-cobalt sulphide project, to accelerate exploration on the company’s option properties and for working capital purposes. The gross proceeds received by the company from the sale of the FT shares will be used to incur Canadian exploration expenses (CEE) that are flow-through mining expenditures (as such terms are defined in the Income Tax Act (Canada)) on the company’s properties in Ontario, which will be renounced to the subscribers with an effective date no later than Dec. 31, 2020, in the aggregate amount of not less than the total amount of the gross proceeds raised from the issue of FT shares.

The offering is expected to close on or about Sept. 30, 2020, and is subject to certain conditions, including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX Venture Exchange and the applicable securities regulatory authorities. The offered securities to be issued under the offering will be subject to a hold period in Canada expiring four months and one day from the closing date of the offering.

In connection with the offering, the underwriters will receive a cash commission of 6.0 per cent of the gross proceeds of the offering and that number of non-transferable compensation options as is equal to 6.0 per cent of the aggregate number of offered securities sold under the offering. Each compensation option is exercisable into one unit of the company at the unit issue price for a period of 24 months from the closing date of the offering.

Highlights:

DDH K-196 (860.5 m; 268/-60) {֠ –} Completed

Central Zone / Central Fault {؄ –} North Target

Drilled to follow up on a broad halo of anomalous gold from 2016 drilling above a deep geophysical target.

Intersected two intervals of strong potassic alteration in intrusive rocks with presence of copper sulphides confirmed by XRF, including within a new interval at depth.

A follow-up under-cut hole is planned for 2020 (K-20-O1) which will test for continuation of the eastward-directed mineralization vector observed between K123,178 and 196 and seek to extend the mineralized envelope, shown on the attached cross-section , below.

DDH K-197 (419.0m; 268/-70) {॥ –} Completed

Central Zone / Central Fault {৉ –} South Target

Drilled to follow up on near-surface mineralized intrusives intersected in K23 and K190.

Intersected an interval of strong potassic alteration in intrusive rocks with the presence of disseminated and vein-hosted copper-sulphides confirmed by XRF, extending Central zone style mineralization.

A follow-up hole is planned in the current program and will drill from the pad of K190 toward the south along the mineralized trend to seek extend the mineralization further in that direction.

DDH K-198 (Target depth: 1000m; 240/-55) {౪ –} In Progress

Central Zone West Deep Extraction Level Target

In progress: Designed to drill through the known zone and test for grade and continuity of mineralization beneath the proposed underground extraction level at 465m RL elevation, westward to the Pinchi Fault.

Will scissor K-62 which intersected 610 metres grading 0.74% Cu and 0.78 g/t Au from 2008 drilling (see press release dated March 28, 2008 available at Sedar.com).

David Moore, President and CEO of Serengeti commented, “I look forward to getting the results on these new mineralized intervals and the information gained so far is showing a larger target at depth to the north of the deposit as well as potential extension towards the south. The current drilling is starting to demonstrate the full potential of the property and positive results should add blue sky potential and value to an already advanced copper gold resource on the Kwanika Project.”

As a result of geological observations made in the course of the current program, Serengeti has modified the drill plan to follow up on both holes completed to date as well as testing a number of other targets as outlined below. The location of completed and planned holes for the balance of the program is shown on the attached plan map .

K-20-O1: Drill a follow-up hole from the same pad as K-196, with a steeper dip, to seek to expand mineralized envelope toward the east;

K-20-C10: Drill a follow-up south-directed hole from the K-190 site in order to expand the mineralized envelope toward the south;

K-20-G3: Drill a short hole on the west edge of the South Zone mineralized envelope in order to test for the continuity of better grade mineralization observed in prior holes in this area;

K-20-N1: Test an area south-southeast of prior hole K-122 which intersected 76 metres grading 0.64% Cu and 0.08 g/t Au (see press release dated October 15, 2008 available at Sedar.com);

K-20-L1: Test a geological and geophysical target/fault-offset concept developed by recently completed deep penetrating IP and interpretation of prior airborne surveying; the target lies 600m southwest of the Central Zone;

K-20-M2: Designed to drill west from prior K08-88 across the southern extension of the Central Fault beneath an interpreted sedimentary basin with similar characteristics to those observed adjacent to the Central Zone.

*Serengeti is sole funding this year’s Kwanika program. As a consequence, the Company’s ownership of KCC will increase to approximately 67%, with POSCO International Corp. holding ~33%. Prior to the commencement of field activities in June, Serengeti’s and its majority owned subsidiary Kwanika Copper Corporation’s (“KCC”) combined cash position was in excess of $2.3 million. These funds are sufficient to fund the planned 2020 program, along with general and administrative expenses for the balance of the year.

ATO GOLD MINE

Steppe Gold currently has three diamond core drilling rigs operating at the ATO Gold project on a 24hr basis. The drilling rigs are undertaking a program of infill and extensional drilling at the ATO1, ATO4 Deposits and the Mungu Discovery. The aim of the drilling program is to deliver resource upgrades on the existing ATO Deposits and to deliver a maiden resource on the Mungu Discovery before the end of 2020.

To date in 2020 Steppe Gold has drilled 23 diamond drill holes for a total of over 9,482 metres. The Company has now received results for infill drilling completed in 2019 and 9 holes from the 2020 drilling program.

Highlighted results for the 2019 drilling program include:

ATO4 Deposit

ATO-357 22m at 2.4g/t gold from 85 metresATO-367 10m at 4.59g/t gold from 219 metres

Mungu DiscoveryMG-122 34.3m at 7.6g/t gold, 24.11g/t silver from 259.7 metresMG-130 33.5m at 2.07g/t gold, 181g/t silver from 286 metres

A new, very high-grade base metal zone has also been discovered underneath the ATO1 Deposit which is now subject to additional drilling in the 2020 drilling program.

ATO-364 6.48m at 0.46g/t gold, 40.69g/t silver, 1.39% copper, 4.66% lead and 20.88% zinc.

Better results from the 2020 drilling program received to date at the Mungu Discovery include:MG-139 19.3m at 6.77g/t gold, 28.6g/t silver from 219.2 metresMG-140 22.9m at 4.73g/t gold, 87.10g/t silver from 205.1 metresMG-141 11m at 4.83g/t gold, 249.03g/t silver from 168 metresMG-142 21m at 3.77g/t gold, 8.7g/t silver from 269 metresMG-143 38m at 1.32g/t gold, 78.44g/t silver from 257 metresMG-144 32m at 1.59g/t gold, 115.8g/t silver from 238 metres 19.3m at 6.26g/t gold, 15.01g/t silver from 300 metres 15m at 7.81g/t gold, 6.07g/t silver from 331 metres

Drilling programs at the ATO Gold Project will be ongoing for the remainder of 2020 and a substantial amount of results are pending that will be reported in the next 30 days. Figure 1To view an enhanced version of this graphic, please visit:https://orders.newsfilecorp.com/files/6562/63843_63487059a4cfeb46_001full.jpgFigure 2To view an enhanced version of this graphic, please visit:https://orders.newsfilecorp.com/files/6562/63843_63487059a4cfeb46_002full.jpg

The Company is also actively progressing its bankable feasibility study (“BFS”) in the Expansion of the ATO Gold Mine into fresh rock ores. The Company plans to provide regular updates on the BFS progress as data becomes available. External project finance advisers have been retained and discussions have already commenced with lending groups to enable the financing to progress in tandem with the BFS. Supported by a strong working capital position and regular cash flow from ATO operations, the Company is optimistic in concluding project finance for the construction of the CIL facility and remaining infrastructure, to allow for commencement of construction by mid 2021.

UUDAM KHUNDII PROJECTFigure 3To view an enhanced version of this graphic, please visit:https://orders.newsfilecorp.com/files/6562/63843_63487059a4cfeb46_003full.jpg

The Company has also commenced exploration programs at its Uudam Khundii Gold Project located in the exciting Bayankhongor Gold Belt of Southern Mongolia. To date Steppe Gold has completed 18 trenches for 933 metres in 2020 at the Milky Way Prospect and the Altan Sum Prospect. This work is ongoing with more trenching planned across all four prospects discovered.

At the Milky Way Prospect initial trenching results have highlighted a mineralised system of at least 700 metres in length and up to 12 metres wide with individual meter sampling results up to 1.49g/t gold, 450g/t silver, 2.98% copper, 3.98% lead and 0.31% Zinc. These are exciting early results and the Company is expanding its exploration efforts with a geophysical crew and drilling rig planned to be mobilized to site in the coming month.

Bataa Tumur-Ochir, President and Chief Executive Officer of Steppe Gold, stated, “The ATO Gold Project continues to delivery exciting and high-grade drilling results that demonstrate the robust nature of the ATO Gold Mine fresh rock deposits, which underpin the long-life nature of this exciting project. Early showings at the UK project are also positive and we look forward to updating all our stakeholders and shareholders on our progress.”

Qualified Person The technical content of this news release has been reviewed and approved by Enkhtuvshin Khishigsuren as the Qualified Person.

Steppe Gold Limited

Steppe Gold is Mongolia’s premier precious metals company.

Table 1. 2019 drilling program results

IDLocationDrill HoleDepth (m)         From (m)To (m)Core Length (m)Au (g/t)Ag (g/t)Cu (%)Pb (%)Zn (%)
1  ATO-1   ATO-356   332.00            292.00 294.00      2.0        0.51   34.15   0.45  2.19  7.77 
2  ATO-4   ATO-357   311.00            85.00  107.00     22.0        2.41    3.40   0.03  0.11  0.21 
                             including 98.00  102.00      4.0        7.00    2.75   0.02  0.04  0.04 
                             including 100.00 101.00      1.0       18.45    4.50   0.04  0.03  0.06 
3  ATO-4   ATO-358   119.00            70.00  85.00      15.0        0.82   76.64   0.01  0.03  0.06 
                             including 80.00  81.00       1.0        2.73   140.00  0.01  0.03  0.08 
                                       87.00  92.00       5.0        0.44   131.22  0.00  0.02  0.05 
4  ATO-4   ATO-359   326.00            161.00 166.40      5.4        0.58   10.10   0.00  0.01  0.01 
                                       268.00 272.00      4.0        0.60    7.98   0.03  0.58  1.28 
5  ATO-4   ATO-360   128.00            79.55  84.00       4.5        0.98   444.34  0.01  0.03  0.10 
                                       104.70 114.00      9.3        0.75   50.83   0.01  0.02  0.05 
                             including 107.00 108.00      1.0        2.26   114.00  0.01  0.06  0.17 
6  ATO-4   ATO-361   221.50            65.00  67.00       2.0        0.43   82.70   0.02  0.07  0.15 
7  ATO-4   ATO-362   321.90            129.00 135.00      6.0        0.65   116.98  0.01  0.08  0.24 
                                       273.00 289.00     16.0        1.20    2.97   0.10  0.39  0.74 
                             including 285.00 287.00      2.0        4.62   10.00   0.58  1.22  3.10 
8  ATO-4   ATO-363   275.00             0.00  27.00      27.0        0.92    5.28   0.08  0.37  0.06 
                                       82.00  90.00       8.0        0.49    1.55   0.00  0.00  0.01 
9  ATO-1   ATO-364   386.00            348.88 352.00      3.1        1.94   45.95   1.35  3.60 12.25 
                             including 350.00 352.00      2.0        2.80   57.80   1.67  3.97 15.85 
                                       353.00 359.48      6.5        0.46   40.69   1.39  4.66 20.88 
10 ATO-4   ATO-365   350.00                         no significant intercepts                        
11 ATO-4   ATO-366    92.00                         no significant intercepts                        
12 ATO-4   ATO-367   293.00            219.00 229.00     10.0        4.59    9.22   0.06  1.79  2.94 
                             including 222.00 223.00      1.0        5.80   19.40   0.16  6.20 11.75 
                             including 225.00 226.00      1.0       35.70   48.10   0.22  6.79  8.31 
13 ATO-4   ATO-368   197.00            120.00 128.00      8.0        1.53   15.51   0.01  0.07  0.12 
                                       150.00 171.00     21.0        0.68   29.01   0.01  0.02  0.05 
14 ATO-1   ATO-369   440.00            125.00 125.70      0.7        0.39    9.40   0.17  2.73  8.34 
                                       418.00 422.00      4.0        0.10    8.25   0.13  1.39  3.23 
15 ATO-4   ATO-371   305.00            80.22  87.65       7.4        0.95   265.24  0.01  0.11  0.35 
                                       93.00  97.00       4.0        0.42    2.95   0.00  0.00  0.00 
16 ATO-4   ATO-372   281.00            193.00 195.00      2.0        1.63   18.35   0.35  2.73  6.34 
                                       239.00 241.00      2.0        0.34   11.50   0.01  0.02  0.02 
17 ATO-4   ATO-373   263.00            179.00 180.00      1.0        0.33    8.10   0.00  0.00  0.01 
                                       187.00 196.75      9.7        0.81    7.59   0.01  0.03  0.05 
18 ATO-4   ATO-374   221.00            92.00  95.90       3.9        0.42   381.97  0.05  0.05  0.08 
                                       123.95 130.00      6.0        3.01   809.17  0.05  0.17  0.45 
                                       153.32 157.30     3.98        1.67   335.72  0.02  0.05  0.12 
19 ATO-4   ATO-375   296.00            230.75 239.00     8.25        0.34    1.55   0.01  0.06  0.09 
                                       271.00 273.00      2.0        0.43    7.15   0.13  1.62  2.72 
20 ATO-4   ATO-376   305.00            247.00 257.00     10.0        0.62   11.72   0.01  0.10  0.23 
                                       278.00 285.00      7.0        1.28   15.27   0.02  0.11  0.24 
21 ATO-4   ATO-377   212.00            104.00 112.00      8.0        1.27    4.03   0.05  0.41  0.90 
                                       158.57 172.00     13.43       0.82   12.14   0.01  0.06  0.10 
22 ATO-4   ATO-378   278.00            208.00 214.00      6.0        1.06   42.83   0.00  0.08  0.46 
                                       216.00 228.00     12.0        0.61   17.43   0.00  0.02  0.05 
                                       243.00 250.00      7.0        1.00   49.81   0.00  0.02  0.03 
23 Mungu    MG-120   356.00            128.40 152.50     24.1        0.90   43.65   0.00  0.01  0.02 
                                       236.50 242.50      6.0        1.00   26.88   0.00  0.00  0.03 
24 Mungu    MG-121   329.00            224.00 225.00      1.0        0.40    0.60   0.00  0.01  0.02 
25 Mungu    MG-122   401.00            190.00 205.00     15.0        0.74   235.73  0.01  0.04  0.09 
                                       212.00 230.00     18.0        0.64   110.61  0.00  0.01  0.03 
                                       244.00 257.50     13.5        0.78   85.22   0.00  0.01  0.03 
                                       259.70 294.00     34.3        7.60   24.11   0.03  0.15  0.25 
                             including 279.00 285.00      6.0       38.57   37.17   0.16  0.84  1.28 
                             including 279.00 283.00      4.0       55.90   53.05   0.19  1.20  1.76 
                             including 280.00 281.00      1.0       98.50   64.70   0.19  1.28  3.24 
                                       295.00 302.00      7.0        1.10    5.70   0.00  0.00  0.00 
                                       303.00 311.00      8.0        1.30    6.61   0.00  0.01  0.01 
                                       343.00 353.00     10.0        0.76    8.84   0.00  0.01  0.01 
26 Mungu    MG-123   380.00                         no significant intercepts                        
27 Mungu    MG-124   146.00             1.80  57.00      55.2        1.21   61.45   0.00  0.01  0.01 
28 Mungu    MG-125   290.00            91.05  116.50     25.45       0.84   36.11   0.00  0.00  0.01 
29 Mungu    MG-126   404.00            173.00 181.75     8.75        1.50   82.86   0.01  0.02  0.03 
                                       206.00 221.00     15.0        0.74   155.71  0.00  0.02  0.04 
                                       223.00 230.00      7.0        0.51   86.19   0.00  0.01  0.02 
                                       231.00 255.00     24.0        1.33   41.12   0.00  0.01  0.01 
30 Mungu    MG-127   386.00                         no significant intercepts                        
31 Mungu    MG-128   408.00            347.00 352.00      5.0        0.76    7.08   0.00  0.01  0.02 
32 Mungu    MG-129   335.00            242.00 246.00      4.0        0.53   84.45   0.00  0.01  0.05 
                                       247.00 265.80     18.8        0.99   109.08  0.00  0.02  0.04 
33 Mungu    MG-130   348.00            286.00 319.50     33.5        2.04   181.87  0.01  0.03  0.07 
                             including 295.00 296.00      1.0        6.30   383.00  0.01  0.03  0.07 
                             including 299.00 303.00      4.0        6.66   704.75  0.02  0.12  0.28 
                             including 309.00 311.00      2.0        2.89   411.50  0.01  0.06  0.14 
34 Mungu    MG-131   296.00            83.00  96.00      13.0        0.73   45.03   0.00  0.00  0.01 
                                       98.00  103.00      5.0        0.43   29.67   0.00  0.00  0.01 
                                       104.00 109.16     5.16        0.53   41.66   0.00  0.00  0.02 
35 Mungu    MG-132   335.00             1.00   5.00       4.0        0.52   41.92   0.00  0.01  0.00 
                                       141.00 147.00      6.0        0.89   31.05   0.00  0.00  0.01 
36 Mungu    MG-133   287.00                         no significant intercepts                        
37 Mungu    MG-134   300.00                         no significant intercepts                        
38 Mungu    MG-135   305.00            272.00 275.00      3.0        1.43   63.60   0.00  0.01  0.02 
39 Mungu    MG-136   332.00            309.60 310.60      1.0        0.54   14.10   0.00  0.00  0.02 

Table 2. 2020 drilling program results ID

LocationDrill HoleDepth (m)         From (m)To (m)Core Length (m)Au (g/t)Ag (g/t)Cu (%)Pb (%)Zn (%)
1  Mungu    MG-137   410.00            313.00 318.00      5.0        0.59    6.26   0.00  0.00  0.01 
                                       330.00 334.00      4.0        0.49    8.18   0.00  0.00  0.01 
2  Mungu    MG-138   453.00            166.00 177.20     11.2        1.19   52.88   0.00  0.01  0.03 
                                       221.00 258.30     37.3        1.40   10.49   0.00  0.01  0.01 
                                       270.60 281.00     10.4        3.34   47.21   0.01  0.03  0.07 
3  Mungu    MG-139   452.00            219.20 238.50     19.3        6.77   28.60   0.02  0.04  0.07 
                             including 224.65 226.50     1.85        8.13   39.89   0.02  0.05  0.14 
                             including 227.50 237.50     10.0       11.03   34.21   0.03  0.06  0.10 
4  Mungu    MG-140   305.00            205.10 228.00     22.9        4.73   87.10   0.01  0.02  0.04 
                             including 205.10 224.00     18.9        5.26   101.11  0.01  0.02  0.05 
5  Mungu    MG-141   375.60            153.00 164.00     11.0        2.40   33.48   0.00  0.01  0.01 
                             including 159.00 162.00      3.0        6.18   37.53   0.00  0.01  0.01 
                                       168.00 209.00     41.0        1.94   103.21  0.00  0.01  0.03 
                             including 168.00 179.00     11.0        4.83   249.03  0.01  0.03  0.07 
                                       272.00 288.00     16.0        1.78   357.81  0.01  0.05  0.08 
6  Mungu    MG-142   392.00            217.00 248.00     31.0        0.72   72.86   0.00  0.01  0.03 
                                       269.00 290.00     21.0        3.77    8.70   0.01  0.02  0.04 
                             including 272.00 280.00      8.0        8.01   13.83   0.01  0.04  0.06 
7  Mungu    MG-143   431.00            257.00 295.00     38.0        1.32   78.44   0.01  0.01  0.03 
                             including 281.00 284.00      3.0        2.76   171.67  0.01  0.02  0.06 
                                       297.00 306.00      9.0        4.60    6.50   0.00  0.02  0.03 
                             including 303.00 304.00      1.0       32.30   13.10   0.00  0.06  0.07 
                                       389.00 404.00     15.0        2.14   12.77   0.00  0.01  0.06 
8  Mungu    MG-144   443.00            238.00 270.00     32.0        1.59   115.80  0.01  0.02  0.05 
                                       272.00 285.00     13.0        1.07   247.52  0.01  0.04  0.10 
                                       300.00 319.30     19.3        6.26   15.01   0.01  0.04  0.05 
                             including 305.00 307.00      2.0       22.35   29.55   0.02  0.19  0.13 
                                       331.00 346.00     15.0        7.81    6.07   0.01  0.09  0.16 
                             including 344.00 346.00      2.0       32.95   17.00   0.03  0.34  0.73 
                                       368.00 375.00      7.0        1.98    3.36   0.00  0.01  0.01 
9  Mungu    MG-145   314.00                              results pending                             
10          MG-146   470.00                              results pending                             
11          MG-147   287.00                              results pending                             
12          MG-148   452.00                              results pending                             
13          MG-149   389.00                              results pending                             
14          MG-150   381.00                              results pending                             
15          MG-151   446.00                              results pending                             
16          MG-152   473.00                              results pending                             
17          MG-153   560.00                              results pending                             
18          MG-154   470.00                              results pending                             
19          MG-155   207.00                              results pending                             
20          MG-156   491.00                              results pending                             
21          MG-157   419.00                              results pending                             
22 ATO-1   ATO-379   401.00            296.00 302.00      6.0        0.80    7.68   0.43  0.51  3.26 
                                       307.00 312.00      5.0        0.35    1.26   0.02  0.05  0.18 
23 ATO-1   ATO-380   461.00                              results pending         

Results for all previous sampling programs (2016, 2017, and 2018) are also included in this release for reference (Table 1). Current test results are consistent with previous studies showing that Colomac rock performs exceptionally well in terms of its grind characteristics, gold recoveries, purity, and responsiveness to all standard gold recovery technologies. The Colomac test program is still at an early stage of evaluation, where it is reasonable to believe that further optimization should improve gold recovery in all process options. At this stage of the project, no further testing is required until a preferred process option has been decided upon. Once the preferred process option is defined, a comprehensive metallurgical study would be necessary to optimize process conditions.

Dr. Michael Byron, President & CEO commented, "We are extremely pleased with the metallurgical results to-date, which continue to substantiate the consistently limited variability of Colomac rock in terms of its hardness and response to standard mineral processing studies. Heap leach testing, including bottle roll and column tests, are still at a preliminary stage; however, results show a favourable response to the deposit's heap leach potential. We now have a total of ten bottle roll and nine column leach tests that collectively shed considerable insight for the ongoing assessment of the deposit's heap leach and primary processing potential."

"Four metallurgical test programs have now been completed to-date on 12 Colomac bulk samples. Gold recoveries from all studies conducted to date, including the different process routes are summarized in Table 3 and confirm the host rock's remarkably uniform responses to all process options."

Testwork Highlights To-Date:Studies continue to note minimal variation in rock hardness for all test samples covering all zones and deposit depths, indicating that both the Colomac Main and Goldcrest sills are relatively homogeneous (Table 2).Based on the collective test results to-date, the Colomac deposit is amenable to all standard gold recovery technologies including, flotation, gravity concentration, cyanidation, and heap leaching (Table 3).A combination of gravity and cyanide leach recovery processes (gravity+cyanidation), as well as whole ore cyanidation methods, have given exceptional results with recoveries ranging in average from 95.1% to 98.0% and 91.3% to 97.2% respectively (Table 3), representing a significant increase in recovery over historical production results of 88.1% (1994 to 1997).Although additional studies are required to fully validate these findings, early indications based on metallurgical results received to-date suggest that a semi-autogenous grinding ("SAG") ball mill grinding circuit followed by a gravity concentrate leach, and a cyanide leach circuit on the resultant final ground product, represent a promising process route for recovering gold from Colomac rock.Based on the findings of all test work to-date, gold recoveries using heap leaching may be a viable process for low-grade material which would otherwise be discarded as waste.Column leach tests performed to-date resulted in recoveries ranging from 21.3% to 66.0% (107 day run) and up to 69.7% (206 day run) (Table 3).Bottle roll leach tests performed to-date resulted in recoveries ranging from 22.0% to 81.8% (minus half ( one-half) inch crushed material, 10 day run)At this time, no further studies are contemplated until a preferred process option has been decided upon.

Metallurgical Testwork

Testing was completed at Bureau Veritas in Richmond, BC, and audited by Starkey & Associates Inc., in Oakville, Ontario. Studies completed to-date include; the four latest 2019 composite samples (standard testing, four bottle roll and four column leach tests), four 2018 composite samples (that were submitted for the same tests, see press releases dated March 19, 2019 and April 23, 2020), one higher grade sample from Zone 1.5 (standard testing, two bottle roll and one column leach tests, see press releases dated February 21, 2018 and May 22, 2018), and three composite samples from lower-grade material (standard testing and one bottle roll leach test, (see press release dated April 19, 2017). All results received to-date are summarized in Tables 1, 2, and 3, and show that the materials tested responded favourably to the proposed process options.

The 2019 program sampled areas of the Colomac Main sill that had not been previously investigated and involved the selective sampling of 11 boreholes from Zones 2.0, 2.5, and 3.0 (Figure 1). All programs to-date collected approximately 70 kg of drill core material for each sample, which were then assayed for gold, tested for grindability using the SAGDesign methodology, and for amenability to several other commonly used gold recovery processes.

It has been well documented that the head grades of assayed Colomac samples show significant variability between fire assay and screened metallic assays (except the lower-grade Colomac 2019 samples). This is believed to be due to the nugget effect of gold in the deposit as material with nuggetty gold mineralization would be expected to result in erratic calculated heads for the various tests. Fire assay results are consistently lower while the metallic assays and screen analysis assays of all the size fractions gives a much better indication of the amount of gold present. This is evidenced by the extent to which gold is recovered in the tests completed (Table 1).

Table 1. Head Assays of Colomac Samples (Including Previous Programs)
Sample ID                Zone     Au Grade (g/mt)                          
                                  Fire AssayMetallicsScreen AnalysisAverage
2019 MET- 1              2.0      0.39      0.34     0.50           0.41   
2019 MET- 2              2.0      0.67      0.84     0.71           0.74   
2019 MET- 3              2.0      0.58      0.52     0.40           0.50   
2019 MET- 4              3.0      0.47      0.60     0.44           0.50   
Average-Colomac 2019              0.53      0.57     0.51           0.54   
Colomac 2018 Sample 1    1.0      1.67      2.28     3.77           2.57   
Colomac 2018 Sample 2    2.0-2.5  2.15      2.05     2.29           2.16   
Colomac 2018 Sample 3    3.0-3.5  2.38      2.41     2.82           2.53   
Gold Crest 2018 Sample 4 Goldcrest1.34      2.30     1.48           1.71   
Average-Colomac 2018              1.88      2.26     2.59           2.24   
Colomac 2017 High-grade (Zone 1.5)2.83      7.16     N.A            4.99   
Colomac 2016 *South Zone 3.0-3.5  1.16      1.32     N.A            1.24   
Colomac 2016 North Zone  1.5-2.0  0.35      0.90     N.A            0.63   
Colomac 2016 *Deep       1.5-2.0  0.65      1.69     N.A            1.17   
Colomac Master Composite 2016     1.80      2.58     N.A            2.19   

* Deep and South Zones Blended into a "Master Composite". The North Zone was excluded from gold recovery process testing due to unexpectedly low assay grades (see press release dated April 19, 2017).

Table 2. Colomac SAGDesign Ore Hardness Test Work Results (Including Previous Programs)
Zone     Sample Information      SG SolidsWSDT (kWh/t)Sd-BWI (kWh/t)
2.0      2019 MET-1              2.69     12.00       14.44         
2.0      2019 MET-2              2.74     12.84       14.22         
2.0      2019 MET-3              2.67     11.70       14.23         
3.0      2019 MET-4              2.75     12.59       14.61         
Average Colomac 2019             2.71     12.28       14.37         
1.0      Colomac 2018 Sample 1   2.70     13.49       15.43         
2.0-2.5  Colomac 2018 Sample 2   2.62     11.74       14.93         
3.0-3.5  Colomac 2018 Sample 3   2.71     11.48       13.90         
GoldcrestGold Crest 2018 Sample 42.61     16.45       14.88         
Average Colomac 2018             2.66     13.29       14.79         
3.0-3.5  South Zone              2.76     12.32       14.28         
1.5-2.0  North Zone              2.73     13.52       14.38         
1.5-2.0  Deep                    2.70     14.07       14.10         
Average Colomac 2016             2.73     13.30       14.25         
1.5      Colomac 2017 High-Grade 2.67     12.69       15.18         
Average-Overall                  2.69     12.91       14.55         

Table 3. Metallurgical Test Results (Including Previous Programs)

Process Routes               Gold Recovery, %
                          Heap Bottle RollColumn   Column   Flotation   Whole Ore Cyanide*Gravity     Gravity + Cyanide*
                                             Cyanide* Cyanide*                                                
                                             ~107 days+206days1                                               
Particle Size P80(microm)        12700           12700    12700    75  106 150 150               75  106 150 106
2019 MET-1                   42.6            66.0     N.A      90.092.884.293.4              72.584.191.493.8
2019 MET-2                   22.0            43.6              88.288.885.895.2              82.239.052.996.0
2019 MET-3                   72.4            60.3              95.793.487.494.4              74.978.774.895.9
2019 MET-4                   47.7            21.3              86.382.675.691.3              53.659.050.994.6
Average Colomac 2019         46.1            47.8     TBC      90.189.483.393.6              70.865.267.595.1
Colomac 2018 Sample 1        31.5            45.6     57.4     94.994.592.897.1              76.675.464.098.0
Colomac 2018 Sample 2        49.1            46.4     55.5     94.894.594.296.8              75.875.069.097.3
Colomac 2018 Sample 3        47.1            46.1     54.9     92.188.684.896.7              63.358.753.696.3
Goldcrest 2018 Sample 4      49.6            61.1     69.7     98.194.995.597.2              83.076.374.996.8
Average Colomac 2018         44.3            49.8     59.4     95.093.191.997.0              74.771.465.497.1
Colomac 2017 High-Grade      57.5            34.3     N.A      94.693.590.796.4              77.674.774.998.0
Colomac Master Composite 201681.8            N.A      N.A      94.994.195.596.4              65.474.176.396.5

*Headers identified as "Column Cyanide", refers to the Column Cyanidation test, "Whole Ore Cyanide", refers to the Whole Ore Cyanidation test, and "Gravity + Cyanide", refers to the Gravity + Cyanidation test.Notes:1. Samples ran from 206 up to 213 days

Future Testing

Preliminary testwork indicates that the Colomac deposit is amenable to all standard recovery technologies, with no adverse materials detected. These preliminary metallurgical results indicate that a standard SAG ball mill grinding circuit with or without gravity concentrators on cyclone underflows, and followed by a gravity concentrate leach (if applicable), and a cyanide leach circuit on the resultant final ground product, would be the best process options to consider for recovering gold from Colomac.

At this time, no further testing is contemplated. Going forward, a preliminary economic analysis of the flowsheet alternatives would be required to conclusively determine the CAPEX/OPEX for each flowsheet considered. Such a study would allow for a more focused metallurgical test program to be developed for testing samples from future sampling campaigns. Such studies may contemplate broadening future sampling to include other satellite gold zones and other zones to depth within the mineralized sills, with the main objective to confirm that the metallurgical responses observed so far will apply over a broader range of head grades, zone locations, and depths within the deposit.

Metallurgical Findings To-Date – Detailed Summary

Preliminary metallurgical testing programs were conducted on composite samples collected from annual Colomac site visits since 2016, to confirm the deposit's amenability to conventional mineral processing flowsheets including gravity concentration, cyanidation and flotation. A comparison of gold recoveries from these different process routes including Bottle Roll and Column Leaching, are summarized in Table 3.

Test results are summarized chronologically as follows and tabulated in Table 3Gravity Concentration:

All Colomac samples responded well to gravity concentration:Colomac (2019): yielding gravity rougher concentrates containing on average 70.7% of the gold in 3.6% of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 36.6% gold recovery in 0.09% of feed mass.Colomac (2018): yielding gravity rougher concentrates containing on average 70.5% of the gold in 3.4% of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 40.6% gold recovery in 0.08% of feed mass.High Grade (2017): yielding gravity rougher concentrates containing on average 75.7% of the gold in 3.8% of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 45.9% gold recovery in 0.12% of feed mass.Master Composite (2016): yielding gravity rougher concentrates containing on average 71.9% of the gold in 3.4% of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 34.7% gold recovery in 0.09% of feed mass.

2. Whole Ore Cyanidation:

Seventy-two hours baseline cyanidation test results conducted on P80 150 microm ground whole-ore samples at 40% solids in 1.0 g/L NaCN. All Colomac samples responded well as follows:

Colomac (2019): yielding an average gold recovery of 93.6% at an average cyanide and lime consumption of 1.7 kg/t and 0.33 kg/t respectively;Colomac (2018): yielding an average gold recovery of 96.9% at an average cyanide consumption of 1.62 kg/t and 0.13 kg/t lime respectively;High Grade (2017): yielding a gold recovery of 96.4% at an average cyanide consumption of 1.86 kg/t and 0.26 kg/t lime respectively;Master Composite (2016): yielding a gold recovery of 96.9% (also in 72 hours) at an average cyanide consumption of 1.73 kg/t and 0.24 kg/t lime respectively.

3. Bottle roll leach of half inch ( one-half"):

Colomac bottle roll leach test results are summarized as follows:Colomac (2019): Bottle roll leaching of half inch ( one-half") crushed materials for 10 days resulted in 46.1% gold extraction averagely;Colomac (2018): Bottle roll leaching of one-half" crushed materials for 10 days resulted in 44.3% gold extraction averagely;High Grade (2017): Bottle roll leaching of one-half" crushed materials for 10 days resulted in 57.5 % gold extraction averagely;Master Composite (2016): Bottle roll leaching of one-half" crushed materials for 10 days resulted in 81.8% gold extraction averagely.

4. Column Cyanide Leach of half inch ( one-half"):

Colomac column leach test results are summarized as follows:Colomac (2019): Gold extractions from 107-day column leaching of one-half" crushed samples varied from 21.30% (2019 MET-4) to 66.10% (2019 MET-1), averaging 47.80%;Colomac (2018): The test results showed gold extractions varying from 46.10% (Colomac 2018 Sample 3) to 61.10% (Gold Crest 2018 Sample 4) in 107 days. Further cyanidation resulted in final gold extractions varying from 54.90% (Colomac 2018 Sample 3) to 69.70% (Gold Crest 2018 Sample 4) in 200-plus days;High Grade (2017): The test results showed gold recovery of 34.3% in 107 days with a residue grade of 3.15 gpt Au.

5. Sulphide Flotation:

Flotation was proven effective for all Colomac samples at grind sizes ranging from 75 microm to 150 microm as summarized below:Colomac (2019): 87.6% of gold was recovered on average into around 4.8% of feed mass;Colomac (2018): 93.3% of gold was recovered into around 9.0% of feed mass;High Grade (2017): 92.9% of gold was recovered into around 6.8% of feed mass;Master Composite (2016): 94.8% of gold was recovered into around 7.4% of feed mass.

6. Gravity + Cyanidation:

A combination of gravity pre-concentration followed by cyanidation of gravity tailings at P80 105 microm grind was proven effective for all Colomac samples:Colomac (2019): achieved gold recovery of 95.1%;Colomac (2018): achieved gold recovery of 97.2%;High Grade (2017): achieved gold recovery of 98.0%;Master Composite (2016): achieved gold recovery of 96.4%.

Figure 1. Drillhole locations sampled in Colomac metallurgical testwork to-date.Image: https://www.accesswire.com/users/newswire/images/606101/nighthawk.png

La Plata Drilling Highlights Include:

True widths are dependent on uncertainties in the local strike and dip of the mineralization and are estimated to be between 76% and 83% of the drill intercept.

Joseph Salas, Atico’s VP Exploration, commented: “These first results of our drilling campaign on the North Block have not only successfully hit high grades but have also intercepted significantly longer intervals of mineralization. This is very encouraging given that now we are continuing the same theme of high grade mineralization beyond the mineral resource polygon, just like we saw drilling the South Block.”

Detailed Results:

• CMLP-20-118: Was planned to infill the southern upper portion of the north block. It reported over 63 meters of mineralization which represents a significant increase in thickness testing the southern limit. This mineralized zone can be split into 5 zones presenting different layers of semi-massive to massive sulfides cut by narrow dikes of dolerite and old mine workings. Mineralization starts close to surface at just 15m and extending to a depth of 78.53 meters.
   
• CMLP-20-119, CMLP-20-120 & CMLP-20-121: The objective of these holes was to position the sequence to close off the drilling grid and allow infill of the North Block. All three holes reported mineralized intercepts composed of narrow to trace amounts of massive sulfide within a larger zone of stockwork.
   
• CMLP-20-122: The drill hole reported two intercepts of massive sulfide composed of chalcopyrite within 13.72 meters of disseminated mineralization.
   
• CMLP-20-123: This hole was designed to test the lower edge of the North Block and reported 5.33 meters of high-grade gold and copper mineralization ending with disseminated mineralization. This intercept continues to show continuity of high-grade mineralisation as the North Block mineralisation continues at depth.

Increasing the Drilling Budget

Given the encouraging results to date, management has decided to materially increase the initial budget of the La Plata drilling campaign. We anticipate that with the additional drilling, the team will be able to continue delivering positive results while in parallel, providing fresh samples to further optimise metallurgical testing as well as geotechnical investigations. When completed, these new findings and results will then be included in the upcoming feasibility study.

Infill Drill Program Assay Results:

True widths are dependent on uncertainties in the local strike and dip of the mineralization and are estimated to be between 76% and 83% of the drill intercept.

La Plata Project

Gold-bearing sulphide mineralization at La Plata occurs as compositional banding composed of chalcopyrite, sphalerite and pyrite laminae with barite occurring as clasts and also as layers. The mineralised lenses have also been dislocated by a few faults and dolerite dikes cutting the body.

The La Plata project is amongst the highest-grade gold-copper VMS deposits in which base and precious metal mineralization is interpreted to have formed as part of multiple volcanic episodes that created a stacked volcanic-exhalite hydrothermal sequence considered favorable for hosting additional VMS lenses. The recent drilling results in the southern portion of the deposit have encountered deeper mineralisation, and an extension of mineralisation to the north has been discovered by recent trenching results.

The La Plata independent Amended and restated NI 43-101 Preliminary Economic Assessment of the La Mina VMS Project Cotopaxi Province, Ecuador (“PEA”) originally dated March 30th, 2019, amended and restated July 17, 2019 was prepared by SGS Canada Inc. Mineral Services, Daniel Leroux, M.Sc., P.Geo. Brian Wolfe. M.Sc., MAIG, David Orava, P.Eng., Simon Meik, FAusIMM (CP), Qinghua (Jason) Jin, P.E and pursuant to National Instrument 43-101 (“NI 43-101”) and reports the La Plata inferred resources at 1.9 million tons at an average grade of 4.1 g/t Au, 49.4g/t silver, 3.3% Cu, 4.5% Zn, 0.6% Pb as available on SEDAR. Preliminary economic assessments are preliminary in nature, that include inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized. Such projects have increased uncertainty and risk of failure. Mineral resources that are not mineral reserves do not have demonstrated economic viability. 

The La Plata project consists of two concessions covering a total area of 2,300 hectares along its 9-kilometer length, which contains known mineralization in two VMS lenses and nine priority exploration targets.

The Company has a binding option agreement with a private Ecuadorean company to earn up to 75% in the La Plata project, of which the first option to acquire the initial 60% ownership has been exercised. Please refer to the Company’s MD&A for the year ended December 31, 2019 for further details.

Quality Assurance & Quality Control

Before sampling, a centreline, representing bottom of hole (or a reference line when this is not known) is marked on the drill core. The core is cut and sampled, always sampling the right-hand side of the drill core. Samples are selected based on logged geological features, such as rock type, mineralization, alteration, veining etc. Sample length does not exceed 2.5 m nor is smaller than 20 cm. A total of 10% of the samples submitted are certified blanks and standards and field duplicates with, as a minimum, one blank submitted at the beginning of each sample batch. Certified standards are submitted at an average of 6% of the samples submitted. Field duplicates are taken at a rate of 1 in 20 of the samples taken. For all drill holes, analysis was completed by ALS Chemex in North Vancouver with sample preparation completed in Quito. The lab is accredited with International Standards ISO/IEC 17025:2005 and ISO 9001:2015. All major ALS Geochemistry analytical laboratories are accredited to ISO/IEC 17025:2005 for specific analytical procedures.

Qualified Control

Dr. Michael Druecker, CPG, is a qualified person under NI 43-101 standards and independent of the company, is responsible for ensuring that the information contained in this news release is an accurate summary of the original reports and data provided to or developed by Atico Mining Corporation. Dr. Druecker has approved the scientific and technical content of this news release.

Mr. Juan Gavidia, Chief Executive Officer, Ms. Nuria Menendez, Chief Financial Officer, Mr. Raúl Álvarez, Director of Exploration and Mr. Binh Vu, VP Legal, will be participating in the Precious Metals Summit, from September 15-17, 2020.  The pre-recorded interview with Mr. Gavidia for the Precious Metals Summit is available on the Company’s website at https://www.orvana.com/English/investors/events-calendar/default.aspx

The Company will also be participating and presenting at the Gold Forum Americas/EXPL-DEV 2020, from September 20-23, 2020.  Mr. Gavidia will be presenting on Sunday, September 20, 2020 at 2:20 p.m. (MDT). The webcast will be available on Orvana’s website at https://www.orvana.com/English/investors/events-calendar/default.aspx

The Company’s updated September 2020 Presentation is available on Orvana’s website at https://www.orvana.com/English/investors/presentations/default.aspx

SELECT HISTORIC DRILL INTERCEPTS IN THE VICINITY OF THE MOON CLAIMS - LEMHI PROJECT

Hole_ID  YearType of Drilling   From m To m Interval** mg/t Au
86065    1986Reverse Circulation16.76 30.48    13.72     3.11 
86065    1986Reverse Circulation60.96 135.64   74.68     1.87 
93002    1993Reverse Circulation 1.52 181.36   179.83    1.81 
including1993Reverse Circulation28.96 45.72    16.76     4.07 
including1993Reverse Circulation59.44 117.35   57.91     4.09 
93005    1993Reverse Circulation 3.05 196.60   193.55    1.80 
including1993Reverse Circulation80.77 155.45   74.68     3.20 

**Intervals are core-length. True width is estimated between 70 to 90% of core length.

Will Randall, President & CEO, commented, “When Freeman acquired the Lemhi gold project management was cognizant that two transactions were required to substantially de-risk the Project’s property package. The first item was to extinguish the back-in rights (please refer to announcement dated September 8, 2020), and the second was to acquire the remaining unowned claims within the resource area. The acquisition of the Moon Claims achieves this objective and mitigates the risk of limiting future resource estimates by excluding any ounces contained within the claims and, just as importantly, limiting further ounces due to pit design constraints. The Moon Claims have historical drilling with significant intercepts within and in the immediate vicinity of the claims that we can now incorporate into future work. Freeman now has a complete property package without any back-in rights. As a result, we can focus on our ongoing drill campaign without property constraints to maximize the potential resource.”

Details of the Transaction

Freeman acquired 100% ownership of the Moon Claims pursuant to a Purchase and Sale Agreement between Freeman and the previous owner of the Moon Claims (the “Seller”), pursuant to which Freeman paid the Seller cash consideration of US$150,000.00 as well as issuing 375,000 common shares in the capital of Freeman to the Seller. The transaction was not subject to a finder’s fee or brokerage commission.

“There is no question that this financing provides a transformative opportunity for Oroco and the Santo Tomas Project,” said Craig Dalziel, Oroco’s CEO. “With the Company’s 3D IP program now underway and that program’s funding already in hand, Oroco is now in position to undertake its full Phase I Definition drill program which is intended to confirm certain historical drilling data. Thereafter, Oroco expects to initiate selective step-out drill targeting, with the overall objective being resource expansion and studies to demonstrate project viability.”

The proceeds of the Financing will be used to generally advance the Santo Tomas Project, including the acquisition of surface rights and permits, site preparation for a Definition drill program focussed within the central area of the project’s North Zone, Phase 1.1 of the Definition drill program, certain infill and step-out drilling relating to the Definition drill program, and general corporate purposes. In addition, certain contingent legal and data acquisition costs relating to the acquisition of the core Santo Tomas concessions are to be paid.

Pursuant to the policies of the TSX Venture Exchange, all shares issued by way of this Financing, and any shares issued pursuant to the exercise of the share purchase warrants, are subject to a hold period expiring January 15, 2021. The Financing is subject to TSX Venture Exchange approval.

Finder’s fees of $6,000 are to be paid to Pertinax Capital BVBA and 575,000 finder’s fee warrants issued to Mariusz Skonieczny in connection with the Financing. Each finder’s fee warrant will entitle the holder to purchase one common share of the Company for a period of 24 months from closing at a price of $0.60 per share. The exercise period for the finder’s fee warrants may be accelerated to 30 days if, at any time after the first 6 months of the warrant exercise period, the volume-weighted trading average of the Company’s shares exceeds $1.50 over a period of 20 consecutive trading days.