Highlights

DDH K-196 (860.5 m) — 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 undercut 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.

DDH K-197 (419.0 m) — 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 farther in that direction.

DDH K-198 (target depth: 1,000 m) — 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 465 m RL elevation, westward to the Pinchi fault;
• Will scissor K-62 which intersected 610 metres grading 0.74 per cent copper and 0.78 gram per tonne Au from 2008 drilling (see press release dated March 28, 2008, available at SEDAR).

David Moore, president and chief executive officer 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.

1. 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;
2. 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;
3. 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;
4. K-20-N1: test an area south-southeast of prior hole K-122 which intersected 76 metres grading 0.64 per cent Cu and 0.08 g/t Au (see press release dated Oct. 15, 2008, available at SEDAR);
5. 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 600 m southwest of the Central zone;
6. 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 financing this year’s Kwanika program. As a consequence, the company’s ownership of KCC will increase to approximately 67 per cent, with POSCO International Corp. holding about 33 per cent. Prior to the commencement of field activities in June, Serengeti and its majority-owned subsidiary Kwanika Copper Corp.’s (KCC) combined cash position was in excess of $2.3-million. These funds are sufficient to finance 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 24-hour basis. The drilling rigs are undertaking a program of infill and extensional drilling at the ATO1 and 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 nine holes from the 2020 drilling program.

Highlighted results for the 2019 drilling program include the following.

ATO4 deposit

• ATO-357 — 22 m at 2.4 g/t gold from 85 metres;
• ATO-367 — 10 m at 4.59 g/t gold from 219 metres.

Mungu discovery

• MG-122 — 34.3 m at 7.6 g/t gold and 24.11 g/t silver from 259.7 metres;
• MG-130 — 33.5 m at 2.07 g/t gold and 181 g/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 — 6.48 m at 0.46 g/t gold, 40.69 g/t silver, 1.39 per cent copper, 4.66 per cent lead and 20.88 per cent zinc.

Better results from the 2020 drilling program received to date at the Mungu discovery include:

MG-139 — 19.3 m at 6.77 g/t gold and 28.6 g/t silver from 219.2 metres;

MG-140 — 22.9 m at 4.73 g/t gold and 87.10 g/t silver from 205.1 metres;

MG-141 — 11 m at 4.83 g/t gold and 249.03 g/t silver from 168 metres;

MG-142 — 21 m at 3.77 g/t gold and 8.7 g/t silver from 269 metres;

MG-143 — 38 m at 1.32 g/t gold and 78.44 g/t silver from 257 metres;

MG-144 — 32 m at 1.59 g/t gold and 115.8 g/t silver from 238 metres, 19.3 m at 6.26 g/t gold and 15.01 g/t silver from 300 metres, and 15 m at 7.81 g/t gold and 6.07 g/t silver from 331 metres.

Drilling programs at the ATO gold project will be continuing for the remainder of 2020 and a substantial amount of results are pending that will be reported in the next 30 days.

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 become 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 (carbon in leach) facility and remaining infrastructure, to allow for commencement of construction by mid-2021.

Uudam Khundii project

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 continuing with more trenching planned across all four prospects discovered.

At the Milky Way prospect initial trenching results have highlighted a mineralized system of at least 700 metres in length and up to 12 metres wide with individual metre sampling results up to 1.49 g/t gold, 450 g/t silver, 2.98 per cent copper, 3.98 per cent lead and 0.31 per cent 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.

About Steppe Gold Ltd.

Steppe Gold is Mongolia’s premier precious metals company.

                                          2019 DRILLING PROGRAM RESULTS

                                                     Core
Drill hole    Depth (m)   From (m)     To (m)   length (m)   Au (g/t)   Ag (g/t)     Cu (%)     Pb (%)     Zn (%)

ATO-356         332.00     292.00     294.00          2.0       0.51      34.15       0.45       2.19       7.77
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
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
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
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
ATO-361         221.50      65.00      67.00          2.0       0.43      82.70       0.02       0.07       0.15
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
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
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
ATO-365         350.00                         no significant intercepts
ATO-366          92.00                         no significant intercepts
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
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
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
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
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
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
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
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
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
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
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
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
MG-121          329.00     224.00     225.00          1.0       0.40       0.60       0.00       0.01       0.02
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
MG-123          380.00                         no significant intercepts
MG-124          146.00       1.80      57.00         55.2       1.21      61.45       0.00       0.01       0.01
MG-125          290.00      91.05     116.50        25.45       0.84      36.11       0.00       0.00       0.01
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
MG-127          386.00                         no significant intercepts
MG-128          408.00     347.00     352.00          5.0       0.76       7.08       0.00       0.01       0.02
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
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
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
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
MG-133          287.00                         no significant intercepts
MG-134          300.00                         no significant intercepts
MG-135          305.00     272.00     275.00          3.0       1.43      63.60       0.00       0.01       0.02
MG-136          332.00     309.60     310.60          1.0       0.54      14.10       0.00       0.00       0.02

                                         2020 DRILLING PROGRAM RESULTS

                                                   Core
Drill hole    Depth (m)   From (m)     To (m) length (m)   Au (g/t)   Ag (g/t)     Cu (%)     Pb (%)     Zn (%)

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
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
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
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
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
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
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
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
MG-145          314.00                       results pending
MG-146          470.00                       results pending
MG-147          287.00                       results pending
MG-148          452.00                       results pending
MG-149          389.00                       results pending
MG-150          381.00                       results pending
MG-151          446.00                       results pending
MG-152          473.00                       results pending
MG-153          560.00                       results pending
MG-154          470.00                       results pending
MG-155          207.00                       results pending
MG-156          491.00                       results pending
MG-157          419.00                       results pending
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
ATO-380         461.00                       results pending
       
* Mineralization occurring at the mines, deposits and discoveries listed in the tables owned by third parties is 
  not necessarily representative of mineralization that may be found on projects held by Steppe Gold described 
  within.

Results for all previous sampling programs (2016, 2017, and 2018) are also included in this release for reference (see “Head assays of Colomac samples (including previous programs)” table). 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 and chief executive officer, 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 10 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 [the “Metallurgical test results (including previous programs)” table] 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 Gold Crest sills are relatively homogeneous (see “Colomac SAGDesign ore hardness test work results (including previous programs)” table).
• 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 (the “Metallurgical test results (including previous programs)” table).
  • A combination of gravity and cyanide leach recovery processes (gravity plus cyanidation), as well as whole ore cyanidation methods, have given exceptional results with recoveries ranging in average from 95.1 per cent to 98.0 per cent and 91.3 per cent to 97.2 per cent, respectively (the “Metallurgical test results (including previous programs)” table), representing a significant increase in recovery over historical production results of 88.1 per cent (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 per cent to 66.0 per cent (107-day run) and up to 69.7 per cent (206-day run) (the “Metallurgical test results (including previous programs)” table).
  • Bottle roll leach tests performed to date resulted in recoveries ranging from 22.0 per cent to 81.8 per cent (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, B.C., and audited by Starkey & Associates Inc., in Oakville, Ont. 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 Feb. 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 the “Head assays of Colomac samples (including previous programs),” “Colomac SAGDesign ore hardness test work results (including previous programs)” and “Metallurgical test results (including previous programs)” tables, 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. All programs to date collected approximately 70 kilograms 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 (see the “Head assays of Colomac samples (including previous programs)” table).

                    HEAD ASSAYS OF COLOMAC SAMPLES (INCLUDING PREVIOUS PROGRAMS)
                                    
                                                              Au grade (g/mt)
                                    
Sample ID                       Zone     Fire assay      Metallics    Screen analysis        Average

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  Gold Crest           1.34           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                 NA           4.99
Colomac 2016 *South zone     3.0-3.5           1.16           1.32                 NA           1.24
Colomac 2016 North zone      1.5-2.0           0.35           0.90                 NA           0.63
Colomac 2016 *Deep           1.5-2.0           0.65           1.69                 NA           1.17
Colomac master composite        2016           1.80           2.58                 NA           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).

            COLOMAC SAGDESIGN ORE HARDNESS TEST WORK RESULTS (INCLUDING PREVIOUS PROGRAMS)

Zone           Sample information                 SG solids          WSDT (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
Gold Crest     Gold Crest 2018 sample 4                2.61                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

                   METALLURGICAL TEST RESULTS (INCLUDING PREVIOUS PROGRAMS)

                                                      Gold recovery %

                                          Column   Column
                                   Heap  cyanide* cyanide*                              Whole
                                 bottle     ~107     +206                                 ore
Process routes                     roll     days     days (1)        Flotation        cyanide

Particle size P80 (microm)       12,700   12,700   12,700       75      106      150      150

2019 MET-1                         42.6     66.0       NA     90.0     92.8     84.2     93.4
2019 MET-2                         22.0     43.6              88.2     88.8     85.8     95.2
2019 MET-3                         72.4     60.3              95.7     93.4     87.4     94.4
2019 MET-4                         47.7     21.3              86.3     82.6     75.6     91.3
Average Colomac 2019               46.1     47.8      TBC     90.1     89.4     83.3     93.6
Colomac 2018 sample 1              31.5     45.6     57.4     94.9     94.5     92.8     97.1
Colomac 2018 sample 2              49.1     46.4     55.5     94.8     94.5     94.2     96.8
Colomac 2018 sample 3              47.1     46.1     54.9     92.1     88.6     84.8     96.7
Gold Crest 2018 sample 4           49.6     61.1     69.7     98.1     94.9     95.5     97.2
Average Colomac 2018               44.3     49.8     59.4     95.0     93.1     91.9     97.0
Colomac 2017 high-grade            57.5     34.3       NA     94.6     93.5     90.7     96.4
Colomac master composite 2016      81.8       NA       NA     94.9     94.1     95.5     96.4


     METALLURGICAL TEST RESULTS (INCLUDING PREVIOUS PROGRAMS)

                                         Gold recovery %

                                                           Gravity
                                                              plus
Process routes                              Gravity        cyanide*

Particle size P80 (microm)           75      106      150      106

2019 MET-1                         72.5     84.1     91.4     93.8
2019 MET-2                         82.2     39.0     52.9     96.0
2019 MET-3                         74.9     78.7     74.8     95.9
2019 MET-4                         53.6     59.0     50.9     94.6
Average Colomac 2019               70.8     65.2     67.5     95.1
Colomac 2018 sample 1              76.6     75.4     64.0     98.0
Colomac 2018 sample 2              75.8     75.0     69.0     97.3
Colomac 2018 sample 3              63.3     58.7     53.6     96.3
Gold Crest 2018 sample 4           83.0     76.3     74.9     96.8
Average Colomac 2018               74.7     71.4     65.4     97.1
Colomac 2017 high-grade            77.6     74.7     74.9     98.0
Colomac master composite 2016      65.4     74.1     76.3     96.5

* Column cyanide refers to the column cyanidation test, whole ore 
  cyanide refers to the whole ore cyanidation test and gravity plus 
  cyanide refers to the gravity plus cyanidation test.

(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 flow sheet alternatives would be required to conclusively determine the capital expenditures/operating expenditures for each flow sheet 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 flow sheets 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 the “Metallurgical test results (including previous programs)” table.

Test results are summarized chronologically as tabulated in the “Metallurgical test results (including previous programs)” table.

Gravity concentration

All Colomac samples responded well to gravity concentration:

• Colomac (2019): yielding gravity rougher concentrates containing on average 70.7 per cent of the gold in 3.6 per cent of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 36.6-per-cent gold recovery in 0.09 per cent of feed mass.
• Colomac (2018): yielding gravity rougher concentrates containing on average 70.5 per cent of the gold in 3.4 per cent of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 40.6-per-cent gold recovery in 0.08 per cent of feed mass.
• High grade (2017): yielding gravity rougher concentrates containing on average 75.7 per cent of the gold in 3.8 per cent of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 45.9-per-cent gold recovery in 0.12 per cent of feed mass.
• Master composite (2016): yielding gravity rougher concentrates containing on average 71.9 per cent of the gold in 3.4 per cent of the feed mass. Upgrading of the rougher gravity concentrates by panning produced cleaner concentrates averaging 34.7-per-cent gold recovery in 0.09 per cent of feed mass.

Whole ore cyanidation

Seventy-two hours baseline cyanidation test results conducted on P80 150-micrometre ground whole ore samples at 40 per cent solids in 1.0 gram per litre NaCN. All Colomac samples responded well as follows:

• Colomac (2019): yielding an average gold recovery of 93.6 per cent at an average cyanide and lime consumption of 1.7 kilograms per tonne and 0.33 kg/t respectively;
• Colomac (2018): yielding an average gold recovery of 96.9 per cent 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 per cent 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 per cent (also in 72 hours) at an average cyanide consumption of 1.73 kg/t and 0.24 kg/t lime respectively.

Bottle roll leach of half inch (one-half inch)

Colomac bottle roll leach test results are summarized as follows:

• Colomac (2019): Bottle roll leaching of half inch (one-half inch) crushed materials for 10 days resulted in 46.1-per-cent gold extraction average.
• Colomac (2018): Bottle roll leaching of one-half-inch crushed materials for 10 days resulted in 44.3-per-cent gold extraction average.
• High grade (2017): Bottle roll leaching of one-half-inch crushed materials for 10 days resulted in 57.5-per-cent gold extraction average.
• Master composite (2016): Bottle roll leaching of one-half-inch crushed materials for 10 days resulted in 81.8-per-cent gold extraction average.

Column cyanide leach of half inch (one-half-inch)

Colomac column leach test results are summarized as follows:

• Colomac (2019): Gold extractions from 107-day column leaching of one-half-inch crushed samples varied from 21.30 per cent (2019 MET-4) to 66.10 per cent (2019 MET-1), averaging 47.80 per cent.
• Colomac (2018): The test results showed gold extractions varying from 46.10 per cent (Colomac 2018 sample 3) to 61.10 per cent (Gold Crest 2018 sample 4) in 107 days. Further cyanidation resulted in final gold extractions varying from 54.90 per cent (Colomac 2018 sample 3) to 69.70 per cent (Gold Crest 2018 sample 4) in 200-plus days.
• High grade (2017): The test results showed gold recovery of 34.3 per cent in 107 days with a residue grade of 3.15 grams per tonne Au.

Sulphide flotation

Flotation was proven effective for all Colomac samples at grind sizes ranging from 75 micrometres to 150 micrometres as summarized below:

• Colomac (2019): Eighty-seven point six per cent of gold was recovered on average into around 4.8 per cent of feed mass.
• Colomac (2018): Ninety-three point three per cent93 of gold was recovered into around 9.0 per cent of feed mass.
• High grade (2017): Ninety-two point nine per cent of gold was recovered into around 6.8 per cent of feed mass.
• Master composite (2016): Ninety-four point eight per cent of gold was recovered into around 7.4 per cent of feed mass.

Gravity plus cyanidation

A combination of gravity preconcentration followed by cyanidation of gravity tailings at P80 105-micrometre grind was proven effective for all Colomac samples:

• Colomac (2019): achieved gold recovery of 95.1 per cent;
• Colomac (2018): achieved gold recovery of 97.2 per cent;
• High grade (2017): achieved gold recovery of 98.0 per cent;
• Master composite (2016): achieved gold recovery of 96.4 per cent.

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

Hole ID            Year        Type of drilling       From m         To m Interval** m       Au g/t

86065              1986     Reverse circulation        16.76        30.48        13.72         3.11
86065              1986     Reverse circulation        60.96       135.64        74.68         1.87
93002              1993     Reverse circulation         1.52       181.36       179.83         1.81
including          1993     Reverse circulation        28.96        45.72        16.76         4.07
including          1993     Reverse circulation        59.44       117.35        57.91         4.09
93005              1993     Reverse circulation         3.05       196.60       193.55         1.80
including          1993     Reverse circulation        80.77       155.45        74.68         3.20

** Intervals are core length. True width is estimated between 70 and 90 per cent of core length.

Will Randall, president and chief executive officer, commented: “When Freeman acquired the Lemhi gold project management was cognizant that two transactions were required to substantially derisk the project’s property package. The first item was to extinguish the back-in rights (please refer to announcement dated Sept. 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-per-cent ownership of the Moon claims pursuant to a purchase and sale agreement between Freeman and the previous owner of the Moon claims, pursuant to which Freeman paid the seller cash consideration of $150,000 (U.S.) 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 chief executive officer. “With the company’s 3-D IP program now under way 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 stepout 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 focused within the central area of the project’s North zone, phase 1.1 of the definition drill program, certain infill and stepout 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 on Jan. 15, 2021. The financing is subject to TSX Venture Exchange approval.

Finders’ fees of $6,000 are to be paid to Pertinax Capital BVBA and 575,000 finders’ 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 60 cents per share. The exercise period for the finder’s fee warrants may be accelerated to 30 days if, at any time after the first six 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.

                               LA PLATA DRILLING HIGHLIGHTS
  
Hole             From (m)    To  (m)   Int. (m)  Au  (g/t)   Ag (g/t)     Cu (%)     Zn (%)

CMLP-20-118        15.00      26.05      11.05       1.03      11.47       1.62       0.20
and                32.31      49.54      17.23       3.42      53.97       3.23       1.65
and                52.60      55.30       2.70       8.71      34.00       4.64       4.50
and                62.18      66.10       3.92       4.37      25.15       3.95       2.38
and                68.00      78.53      10.53       1.35      12.11       1.85       0.65
CMLP-20-123       136.00     141.33       5.33       8.62      73.43      10.89       5.64

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

Joseph Salas, Atico’s vice-president of 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: This hole was planned to infill the southern upper portion of the North block. It reported over 63 metres of mineralization which represents a significant increase in thickness testing the southern limit. This mineralized zone can be split into five zones presenting different layers of semi-massive to massive sulphides cut by narrow dikes of dolerite and old mine workings. Mineralization starts close to surface at just 15 m and extending to a depth of 78.53 metres.
• CMLP-20-119, CMLP-20-120 and 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 sulphide within a larger zone of stockwork.
• CMLP-20-122: The drill hole reported two intercepts of massive sulphide composed of chalcopyrite within 13.72 metres of disseminated mineralization.
• CMLP-20-123: This hole was designed to test the lower edge of the North block and reported 5.33 metres of high-grade gold and copper mineralization ending with disseminated mineralization. This intercept continues to show continuity of high-grade mineralization as the North Block mineralization 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. The company anticipates that with the additional drilling, the team will be able to continue delivering positive results while in parallel, providing fresh samples to further optimize 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
 
                                            Intercept *
                  Total
Hole ID       length (m)    From (m)      To (m)    Int. (m)    Au (g/t)    Ag (g/t)      Cu (%)      Pb (%)      Zn (%)

CMLP-20-118       85.00       15.00       26.05       11.05        1.03       11.47        1.62        0.03        0.20
and                           32.31       49.54       17.23        3.42       53.97        3.23        0.10        1.65
and                           52.60       55.30        2.70        8.71       34.00        4.64        0.04        4.50
and                           62.18       66.10        3.92        4.37       25.15        3.95        0.18        2.38
and                           68.00       78.53       10.53        1.35       12.11        1.85        0.06        0.65
CMLP-20-119      120.56      108.40      109.00        0.60        1.09       11.00        2.74        0.10        1.01
CMLP-20-120       56.45                       No significant intercept
CMLP-20-121      120.89                       No significant intercept
CMLP-20-122       50.35       16.52       18.29        1.77        2.79       24.00        4.98        0.07        1.05
and                           24.29       30.24        5.95        6.45       40.36        4.52        0.32        7.15
CMLP-20-123      162.65      136.00      141.33        5.33        8.62    73.43  1        0.89        0.79        5.64

* True widths are dependent on uncertainties in the local strike and dip of the mineralization and are estimated to be 
  between 76 per cent and 83 per cent 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 mineralized 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 (volcanogenic massive sulphide) 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 favourable for hosting additional VMS lenses. The recent drilling results in the southern portion of the deposit have encountered deeper mineralization, and an extension of mineralization to the north has been discovered by recent trenching results.

The La Plata independent amended and restated National Instrument 43-101 preliminary economic assessment of the La Mina VMS project Cotopaxi province, Ecuador, originally dated March 30, 2019, amended and restated July 17, 2019, was prepared by SGS Canada Inc. mineral services, Daniel Leroux, MSc, PGeo; Brian Wolfe, MSc, MAIG; David Orava, PEng; Simon Meik, FAusIMM (CP); Qinghua (Jason) Jin, PE; and pursuant to National Instrument 43-101, and reports the La Plata inferred resources at 1.9 million tons at an average grade of 4.1 grams per tonne Au, 49.4 g/t silver, 3.3 per cent Cu, 4.5 per cent Zn and 0.6 per cent 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 nine-kilometre 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 per cent in the La Plata project, of which the first option to acquire the initial 60-per-cent ownership has been exercised. Please refer to the company’s management’s discussion and analysis for the year ended Dec. 31, 2019, for further details.

In July, 2020, the Company resumed mining of its 10,000 tonne bulk sample at the Moroy Project. The Moroy project is 900 metres south of the old Bachelor Mine, and the Company uses the underground infrastructure of the Bachelor Mine to access the Moroy Project. In August 2020, the Company emptied the old material inventory in the underground muck handling circuit to make room for the material coming from the bulk sample at Moroy. The old material was stockpiled in the silos, and on the ore pad on surface. On September 8, 2020, Bonterra began to process the material stored on surface from the old Bachelor Mine and will continue to process the old material until September 21, 2020.

On Sept. 29, 2020, the Company plans to start processing the material from the bulk sample at Moroy and expects to complete the bulk sample around the end of October, 2020. An independent consulting engineering firm is supervising the processing of the bulk sample at the Bachelor Mill. The consulting firm will produce a report after the bulk sample is completed. The company will publish the report once available, and it will be incorporated into an eventual preliminary economic assessment.

The bulk sample program at the Moroy project is being undertaken in order to verify the grade continuity within the mineralized structure and reconcile the resource grade to the recovered ounces following processing. The bulk sample is focused on the M1 shear zone on level 11,440 metres (“m”) below surface. The M1 structure is sub-vertical and the company plans to extract it via a sub-level long-hole stoping method at 15 m intervals.

Exploration update

In July 2020, the Company announced the beginning of a 56,000 m drill campaign. The Company ramped up the campaign during July and August 2020, and now has seven diamond drill rigs fully staffed active on the projects. There are now six drill rigs between the Moroy, Barry, and Gladiator projects. The seventh drill rig is targeting potential sectors in the Desmaraisville camp just outside the Bachelor/Moroy area. The Company will add an eighth drill rig on regional targets in the Urban-Barry camp before the end of September 2020.

Pascal Hamelin, Interim CEO and VP, Operations commented: “I’m very happy to see that we have safely ramped up the rigs from zero to seven rigs in 6 weeks. With the selective assaying of the material from the bulk sample expected to be completed by the end of this month, we will be able to switch our assay lab’s focus to our cut drill core assay backlog and release those results when available.”

Flow-through (FT) shares

Number of FT shares:  3.5 million flow-through shares

Purchase price:  64.5 cents per flow-through share

Warrants:  3.5 million share purchase warrants to purchase 3.5 million shares

Warrant initial exercise price:  80 cents

Warrant term to expiry:  two years

Non-flow-through (NFT) shares

Number of NFT shares:  2,559,444 non-flow-through shares

Purchase price:  45 cents per non-flow-through share

Warrants:  2,559,444 share purchase warrants to purchase 2,559,444 shares

Warrant initial exercise price:  80 cents

Warrant term to expiry:  two years

Number of placees:  22 placees

Total pro group involvement:  150,000 (two placees)

Note that in certain circumstances the exchange may later extend the expiry date of the warrants, if they are less than the maximum permitted term.

Number of shares:  12.1 million shares

Purchase price:  60 cents per share

Warrants:  6.05 million share purchase warrants to purchase 6.05 million shares

Warrant initial exercise price:  90 cents

Warrant term to expiry:  two years

Number of placees:  107 placees

Finders’ fees:  Mariusz Skonieczny, 575,000 warrants; Pertinax Capital BVBA, $5,994 cash

Finder’s warrant initial exercise price:  60 cents

Finder’s warrant term to expiry:  24 months

Note that in certain circumstances the exchange may later extend the expiry date of the warrants, if they are less than the maximum permitted term.

Number of shares:  1.2 million shares

Purchase price:  38 cents per share

Warrants:  1.2 million share purchase warrants to purchase 1.2 million shares

Warrant initial exercise price:  50 cents

Warrant term to expiry:  three years

Number of placees:  one placee

Note that in certain circumstances the exchange may later extend the expiry date of the warrants, if they are less than the maximum permitted term.

Highlights:

• Altus selling a 100-per-cent interest in two Ivory Coast gold projects;
• Altus to receive an initial payment of:
  • A 2.5-per-cent NSR (net smelter return) royalty on the projects;
  • 2.5 million Stellar shares with a current market value of $125,000;
  • 2.5 million share purchase warrants, each exercisable to purchase a Stellar share for 24 months at seven cents;
• Subject to the progress of the projects, Altus will receive further equity-based payments;
• The transaction remains subject to TSX Venture Exchange approval.

Steven Poulton, chief executive officer of Altus, commented: “We are pleased to conclude this royalty and equity transaction with Stellar on our two prospective gold projects in Ivory Coast. Altus is focused on realizing value from a high-quality, diversified and precious metal-focused portfolio of royalty assets. This transaction further underscores our royalty generation strategy and we look forward to Stellar’s exploration progress on the projects.”

Transaction terms

Stellar has acquired a 100-per-cent interest in Aeos Resources Ltd., a formerly wholly owned Seychelles incorporated subsidiary of the company. Through its Ivorian subsidiary, Aucrest SARL, Aeos holds a 100-per-cent interest in the projects. The agreements have the following headline terms:

Part 1: consideration:

• Upon signing of the agreements by the parties, Stellar will:
  • Within 14 days and subject to any regulatory or shareholder approvals as may be required, issue 2.5 million units of Stellar to Altus. Each unit will consist of one Stellar share and one 24-month share purchase warrant, with each warrant granting the holder the right but not the obligation to purchase one Stellar share at a price of seven cents.

Part 2: milestone payments:

• Upon the definition of a resource, confirmed by an independent National Instrument 43-101 report, which exceeds 500,000 ounces of gold (including at least 250,000 ounces within the indicated category), Stellar will (in respect of the first 500,000 ounces on each project):
  • Within 14 days and subject to any regulatory or shareholder approvals as may be required, issue Stellar shares valued (at the time of issuance) at $250,000 (U.S.) to Altus.
• Upon the completion of a definitive feasibility study on either project, Stellar will:
  • Within 14 days and subject to any regulatory or shareholder approvals as may be required, issue Stellar shares valued (at the time of issuance) at $250,000 (U.S.) to Altus.

Part 3: project royalties:

• Altus will retain a 2.5-per-cent NSR royalty on each of the projects.
• Stellar will have the right to repurchase up to 1.0 per cent of each NSR for $500,000 (U.S.) for each 0.5 per cent repurchased.

Prikro project

The Prikro project comprises a single 369.5-square-kilometre exploration licence in the Prikro and Koun-Fao departments in eastern Ivory Coast, approximately 240 km northeast of the capital of Abidjan. The project is located 40 km northwest of the town of Agnibilekrou and 25 km west of the town of Koun-Fao, both of which can be accessed by asphalt roads from Abidjan. The licence was selected due to the presence of historically reported gold occurrences, prospective geology and the existence of artisanal workings in the surrounding areas including along strike of a major northeast-southwest-trending shear zone, which is interpreted to traverse the licence area. Birimian-age greenstone rocks reportedly crop out extensively across the Prikro licence and represent Paleoproterozoic metasedimentary units, with associated granite to diorite intrusives, which are the dominant host setting for gold deposits across West Africa.

Zenoula project

The Zenoula project comprises a single 400-square-kilometre licence application, which is currently pending grant in the Marahoue department in central Ivory Coast, approximately 300 km north of Abidjan. The project is located 100 km northwest of the city of Yamoussoukro, which can be accessed by asphalt roads from Abidjan. Zenoula is centred within a north-northeast-trending Birimian-age granite greenstone belt, 65 km along strike from the Abujar project of Australian Securities Exchange-listed Tietto Minerals Ltd. Mineralization hosted on this property is not necessarily indicative of the Zenoula project. Zenoula targets a 22 km long oblique east-northeast-trending structure, interpreted by historic air magnetic data. Geologically, the project reportedly comprises metasediments, metabasalts and syntectonic granitoid intrusives.

The initial two drill holes completed and released are in the Plomosas Mine Area, targeting expansion of the mineralization footprint along strike, and confirmation of attractive near surface mineralized zones. The results received confirm the presence of wide, shallow or near surface silver-gold-lead-zinc (polymetallic) veins and hydrothermal breccias. Our ongoing review and validation of historic data on the same sections indicates high grade silver and gold mineralization in low sulphidation epithermal veins outside of the polymetallic silver rich hydrothermal breccia zone. The drilling currently in progress has validated recent geological modelling, confirming near surface zones of wide Ag-Au-Zn-Pb mineralization. Recent access to historic workings near the area being drilled by the Company, together with historic and recently completed drill holes, is being integrated into a 3D model to support the expansion and potential delineation of near surface resources.

The drilling completed to date, together with recently announced results, has delineated a 700 m long mineralized system (Figure 1), consisting of multiple veins. It demonstrates the presence of, not only the polymetallic Pb-Zn-Ag rich hydrothermal breccia hosted on the N-S oriented low angle Plomosas Fault, but also a series of high angle, low sulphidation vein and stockwork systems, commonly on the hanging wall or cross cut by the former hydrothermal breccias.

The mineralized zones reported in this news release represent multiple mineralization styles, including wide, polymetallic Pb-Zn-Ag rich hydrothermal breccias, high grade Au in low sulphidation veins/stockworks and narrow high grade Ag low sulphidation veins. The definition of wide zones, or high grade zones close to the surface, represents a new opportunity for future shallow drilling along strike, aiding potential resource definition.

GR Silver Mining President and CEO, Marcio Fonseca, commented, “First assay results have now been received from GR Silver Mining’s own drilling program at Plomosas. We continue to encounter evidence of a large hydrothermal system at the Plomosas Mine Area with the identification of wide mineralized intervals or high grade zones representing mulltiple mineralization styles and events. Our 3D integration of the recent and historic drilling data has proved valuable in defining the Pb-Zn-Ag mineralized zones, as well as the discovery of several attractive near surface Ag-Au-Pb-Zn zones. The recent recommissioned access to the Plomosas underground mine, together with surface access provide a unique opportunity to guide our surface and underground drilling program in the upcoming months, aiming at further discoveries and delineation of a resource in the area.”

GR Silver Mining is currently advancing its surface drilling program on the two areas marked on Figure 1. The Company recently completed the integration of a previous ground geophysical survey (IP) in the area and has advanced its program of underground mapping and sampling.

The initial 4,500 m surface core drilling program is expected to continue through 2020 and has a dual focus: shallow drilling (up to 150 m below surface) to expand the known mineralized zones along strike at the Plomosas Mine and San Juan-La Colorada Areas, and follow-up drilling on several new high-grade Au-Ag low sulphidation epithermal vein occurrences at Yecora and El Saltito (see news release dated July 15, 2020 ).

The planned drill sites on the Plomosas Project are located in the Plomosas Mine Area and San Juan Trend areas where historic drilling was completed by previous owners, however GR Silver Mining have outlined un-drilled areas with additional multiple epithermal veins along strike and at shallow depth.

In addition to drill testing the areas with historic drill holes at the Plomosas Project, the Company will also commence initial reconnaissance and surface exploration on 11 priority targets identified as displaying potential for new discoveries.

Table 1 summarizes the most significant drill assay results for this set of drill holes released for the Plomosas Mine Area.

Table 1: Summary Surface Drill Hole Results - News Release September 16, 2020 (Plomosas Mine Area)
  
  
   SURFACE DRILLING PROGRAM 2020                                                                    
Hole No.From  (m)To  (m)Drilled  width (m)Est.  true  width  (m)Ag  g/tAu  g/tPb  %Zn  %AgEq  g/t
PLS20-018.0      16.5   8.5               6.0                   85     0.4    1.1  0.6  177      
includes11.5     15.0   3.5               2.5                   172    0.9    2.7  1.4  387      
PLS20-0272.4     98.1   25.7              22.3                  48     0.1    0.3  0.6  85       
        101.0    149.0  48.0              41.6                  na     na     0.1  0.5           
includes139.0    146.9  7.9               6.8                   na     na     0.4  1.4           


  

  
   HISTORIC DRILLING DATA                                                                       
Hole No.From  (m)To  (m)Drilled  width (m)Est.  true  width  (m)Ag g/tAu g/tPb %Zn %AgEq  g/t
PLS-3   74.2     88.3   14.1              12.2                  46    na    0.1 0.2 55       
        98.8     103.9  5.1               4.4                   16    19.2  0.1 0.1 1,986    
PLS-6   77.5     80.7   3.2               3.2                   74    0.2   0.2 0.3 87       
237     136.8    145.8  9.0               4.5                   na    na    0.4 1.0          
241     51.0     51.7   0.8               0.6                   163   0.3   0.6 0.7 232      
251     58.0     59.1   1.1               06                    136   na    0.9 1.1 251      
        119.3    123.7  4.4               2.5                   na    1.8   0.1 na           
261     206.5    226.5  20.0              15.3                  na    1.2   na  na           
268     163.0    168.9  5.9               4.5                   73    0.3   0.2 0.4 127      
315     21.0     39.0   18.0              16.9                  321   0.9   2.7 1.9 554      
318     36.0     50.0   14.0              9.0                   30    1.7   1.3 2.0 318      
PSD-1   77.8     101.5  23.7              20.5                  81    na    na  na           
PSD-2   75.0     88.7   13.7              11.9                  44    na    0.1 0.3          
        93.6     100.8  7.2               6.2                   na    na    0.3 1.0          
        121.7    132.6  10.9              9.4                   na    0.3   0.2 1.1          
PSD-3   95.1     108.0  12.9              11.2                  na    na    0.4 0.5          
PSD-5   84.3     91.3   7.0               7.0                   32    na    na  na           
PSD-7   63.3     65.6   2.4               2.2                   83    na    na  na           
        75.5     96.6   21.0              19.3                  27    na    na  na           
        109.7    125.0  15.3              14.0                  na    na    0.2 0.4          
PSD-11  89.3     103.3  14.0              13.8                  37    na    na  na           
SD-83   61.3     66.7   5.5               5.2                   18    na    0.1 0.2          


  

*AgEq is based on long term gold, silver, zinc and lead prices of US$1600 per ounce gold, US$16.50 per ounce silver, US$0.85 per pound zinc and US$0.95 per pound lead. The metallurgical recoveries are assumed as 90% Ag, 95% Au, 78% Pb and 70% Zn. “na” = no relevant assays. All numbers are rounded. Results are uncut and undiluted. UG: Underground Drill Hole, SURF: Surface Drill Hole

The drill holes in this news release were generated by a core drilling campaign initiated by the Company in Q3/2020 (PLS20-01 and PLS20-02), and historical drill holes completed by Grupo Mexico. Neither of the drill sets were previously released.

The area being drilled has a series of outcrops representing quartz stockwork veining and locally hydrothermal breccias hosted in a Tertiary volcanic bimodal andesitic-rhyolitic sequence commonly intruded by rhyolitic dykes. Structurally, the area is marked by a series of high angle NW trending faults which are commonly intersecting the N-S low angle Plomosas Fault, a common host structure for Ag-Au-Pb-Zn polymetallic hydrothermal breccias (link to cross section 1 , link to cross section 2). Alteration is mainly represented by a propylitic assemblage containing chlorite-epidote-quartz-pyrite and abundant specular hematite. Locally on surface, argillic alteration halos and large oxidized zones are observed, a result of previous accumulation of pyrite and other sulphides. The polymetallic mineralization is mainly represented by fine galena and sphalerite, common hematite-quartz cemented hydrothermal breccias and filling veins. Late stage quartz Ag-Au epithermal veining is commonly observed overprinting Ag-Pb-Zn mineralization in the hydrothermal breccias.

Table 2 lists the drill hole intervals previously not sampled (“NS”) for this group of released holes. The Company continues to investigate previous unsampled intervals for evidence of mineralization in the core that warrants additional sampling and assaying.

Additionally, Table 3 provides collar coordinates for the drill holes presented in this news release.

Table 2: Plomosas Mine Area - Drill Hole Intervals Not Sampled (Intervals greater than 20m)
  
  
   Hole No.From-To (m)       Sampling
PLS-3   0.00 m to 74.2m   NS      
PLS-6   0.00 m to 59.1 m  NS      
237     0.00 m to 18.95 m NS      
241     0.00 m to 18.05 m NS      
251     0.00 m to 24.35 m NS      
261     0.00 m to 152.15 mNS      
268     0.00 m to 99.45 m NS      
PSD-11  0.00 m to 89.3 m  NS      
SD-83   0.00 m to 61.3 m  NS      


  

All numbers are rounded. NS – Core not assayed

The Company believes that the Plomosas Mine Area is part of a much larger low sulphidation epithermal system as indicated by field evidence along 1.0 km of strike length, where only 400 m of that strike had previously been drilled. This represents an opportunity for the Company’s current surface drilling program to continue discovering new mineralized zones close to the surface.

Victory intends to use the proceeds of the private placement to advance its Iron Point vanadium project and for general working capital purposes.

All securities to be issued in connection with the private placement will be subject to a four-month-and-one-day statutory hold period in accordance with applicable securities laws. Completion of the private placement will be subject to the approval of the TSX Venture Exchange.

In 1954 Stratmat mapped the area and undertook a gravity survey followed by seven (7) drill holes totaling 590 metres on the resulting gravity anomaly. A subsequent report (Report on the National Management Limited Property (N.B.28A), Grassville NB, 1955) by K.O.J. Sidwell, reported 453,500 tonnes of manganese mineralization grading 11.0% Mn and 8.45% Fe to a depth of 80 metres in a body 250 metres long and approximately 10 metres wide. (Note: The resource calculation is historical and preliminary in nature and was undertaken prior to the implementation of NI 43-101 regulations, has not yet been verified by Globex nor its geological staff and thus, should not be relied upon.)

Sidwell suggested that there was poor correlation between the drill results and the gravity anomaly and our consulting geologist has indicated that the mineralized zone has a strike of approximately 15 degrees variance with the gravity anomaly. In other words, there is every chance that additional mineralization shouldn’t be ruled out. In addition, much of the area is blanketed by a deep cover which made exploration difficult.

Shareholders are probably aware of the current speculation regarding the development of a new type of battery containing manganese as a possible replacement for cobalt and the rise in the stock price of Manganese X (MN-TSX.V) over the last several days. The addition of another manganese property will allow Globex to take further advantage of the current interest in manganese as a potentially important battery metal by seeking to option this new asset.

This press release was written by Jack Stoch, Geo., President and CEO of Globex in his capacity as a Qualified Person (Q.P.) under NI 43-101.

March 15, 2021: US$2 million and common shares equal to US$2 million (based on the greater of the 20-day volume weighted average trading price of Southern Silver’s shares on the TSX Venture Exchange (“VWAP”) and the Discounted Market Price (as that term is defined in the policies of the TSX Venture Exchange) of the shares (the “DMP”)); and

September 15, 2021: US$2 million and common shares equal to US$2 million (based on the greater of the prior 20-day VWAP and the DMP).

The Company has the option to pay all cash in lieu of shares. To secure above noted payments, the Company has pledged to Electrum the shares representing Electrum’s 60% indirect working interest in the CLM Project. Southern Silver has received both shareholder and TSX Venture Exchange approval of the Transaction.

Benefits to Southern Silver Shareholders:

Simplifies ownership structure of the CLM Project

Establishes full control over project timeline and removes perceived joint venture discount

Provides 100% ownership of a premier, polymetallic deposit in Mexico with substantial resource growth potential (with a focus on targeting high grade silver targets)

150% increase in attributable resources to current resource of Indicated: 134Mozs AgEq and Inferred: 138Mozs AgEq (1)

Highly accretive to Southern Silver shareholders

Electrum remains a supportive cornerstone investor

Southern Silver becomes a more attractive takeover target

Enhances the market profile of the Company relative to its peer group

Through the Transaction, Southern Silver will acquire an additional 49.9 million ounces silver and 1.35 billion pounds of combined lead and zinc to its account based on the current National Instrument 43-101 Mineral Resources estimate of the CLM Project. Additionally, Southern Silver will become more attractive on a corporate level with the Company’s market profile being enhanced by having ownership of one of the larger and highest grade, undeveloped silver projects in the world.

Lawrence Page, Q.C., Southern Silver’s President and Director, stated: “Sole ownership of the CLM Project inclusive of the significant resources developed to date allows us great latitude in developing the Project for substantial resource growth. The Transaction also provides a 150% increase in attributable resources which is highly accretive to Southern Silver shareholders. An extensive diamond drill program will begin within the next two weeks designed to develop previously identified mineralization east of the intrusion for ultimate inclusion into the existing resource calculation.”

Private Placements recently closed:

Brokered offering of 50,000,000 subscription receipts at a price of C$0.20 per subscription receipt for gross proceeds of C$10,000,000. Each subscription receipt has now been exchanged, for no additional consideration, into one unit of the Company. Each unit consists of one common share and one-half of one share purchase warrant, with each full warrant exercisable to purchase one additional common share at a price of C$0.25 during the first year, increasing to C$0.30 in year two and to C$0.35 in year three.

Non-brokered offering of 19,047,620 subscription receipts at a price of C$0.21 per subscription receipt for gross proceeds of C$4,000,000. Each subscription receipt has now been exchanged, for no additional consideration, into one unit of the Company. Each unit consists of one common share and one-half of one share purchase warrant, with each full warrant exercisable to purchase one additional common share at a price of C$0.28 during the first year, increasing to C$0.33 in year two and to C$0.38 in year three.

Non-brokered private placement of 1,200,000 units at a price of $0.38 per unit for gross proceeds of $456,000. Each unit consists of one common share and one share purchase warrant, with each warrant exercisable to purchase one additional common share at an exercise price of $0.50 per share for a period of three years.

Cerro Las Minitas Project

The CLM Project is an advanced exploration stage polymetallic Ag-Pb-Zn-Cu Skarn/CRD project located in southern Durango, Mexico.

The CLM Project as of May 9th, 2019 contains a Mineral Resource Estimate, at a 175g/t AgEq cut-off, of(1)

Indicated – 134Moz AgEq: 37.5Moz Ag, 40Mlb Cu, 303Mlb Pb and 897Mlb Zn

Inferred – 138Moz AgEq: 45.7Moz Ag, 76Mlb Cu, 253Mlb Pb and 796Mlb Zn

A total of 133 drill holes for 59,000 metres have now been completed on the CLM Project with exploration expenditures of approximately US$18.5 million equating to exploration discovery costs of approximately C$0.07 per AgEq ounce to the end of 2019.

Southern Silver has identified a further 10,000 metres in exploration drilling for 2020, targeting specific step-outs from strongly silver-enriched mineral intercepts in the Las Victorias, South Skarn and the Mina La Bocona targets. The targeting is designed to increase the current mineral resource estimate by approximately 30%. The CLM Project remains one of the larger undeveloped silver-lead-zinc projects in the world. It is fully permitted.

As reported by New Placer, drill-hole BL20-01, located in the South Mine Fault Zone, intersected 1.08 grams per tonne (g/t) gold and 26 g/t silver over 38.1 metres; including 1.80 g/t gold over 12.2 metres1 (Table 1). The BL20-01 intercept expands gold mineralization approximately 40 metres vertically below 2019 drill hole BL19-04 that intersected 122 metres of 1.2 g/t gold in hole BL19-041,2 and delivers on one of the key goals of the 2020 Bolo Project drill campaign, which is to test Carlin-style gold mineralization at depth in the South Mine Fault Zone where it remains open and untested.

To date, 8 RC drill holes totaling 2,301 metres have been drilled as part of the 2020 Bolo Project drill program currently underway. New Placer and Allegiant expect continued news flow over the coming weeks and months as assay results are received from the lab.

RC drilling at Bolo defines a 1.2 kilometer north-south trending corridor of gold-silver mineralization containing the South Mine Fault Zone, Uncle Sam, and Northeast Extension zones. Gold mineralization at Bolo exhibits characteristics of classic Carlin-type mineralization, including strong subvertical structural control in addition to evidence of gold mineralization extending laterally at low angles within favorable silty carbonate units. The relatively untested 500 m strike length South Mine Fault-Uncle Sam segment is particularly prospective and is the focus of New Placer Dome’s 2020 exploration designed to prove-out these compelling structural and stratigraphic gold targets.

Methodology and quality assurance/quality control

As reported by New Placer, the analytical work reported on herein was performed by ALS Global (ALS), Vancouver Canada. ALS is an ISO-IEC 17025:2017 and ISO 9001:2015 accredited geoanalytical laboratory and is independent of the New Placer Dome and the QP. RC drill samples were subject to crushing at a minimum of 70% passing 2 mm, followed by pulverizing of a 250 gram split to 85% passing 75 microns. Gold determination was via standard atomic absorption (AA) finish 30 gram fire-assay (FA) analysis, in addition to 48 element ICP-MS geochemistry. New Placer Dome follows industry standard procedures for the work carried out on the Bolo Gold-Silver Project, with a quality assurance/quality control (QA/QC) program. Blank, duplicate and standard samples were inserted into the sample sequence sent to the laboratory for analysis. New Placer Dome detected no significant QA/QC issues during review of the data. New Placer Dome is not aware of any drilling, sampling, recovery or other factors that could materially affect the accuracy or reliability of the data referred to herein.