Metals Update 26/04/2021

Osisko Metals drills 32 m of 20.2% Zn, 12% Pb at Pine

Osisko Metals Inc. has released additional results from the current drilling program at its Pine Point project located in the Northwest Territories.

Results are reported for two drill holes at the X25 deposit located in the West zone of the project as well as one confirmation hole in the Central zone. The X25 deposit is characterized by two prismatic zones connected by tabular mineralization, and its extensions remain open along strike. The infill holes are located within the deposit (one hole to be used for hydrogeological testwork as well):

  • Drill hole X25-21-PP-001 intersected 21.0 metres grading 9.40 per cent zinc and 3.76 per cent lead (13.16 per cent Zn-Pb). Mineralization is of prismatic type and extends below the level of the associated tabular horizon.
  • Drill hole X25-21-PP-002 intersected 32.0 metres grading 20.28 per cent Zn and 12.02 per cent Pb (32.31 per cent Zn-Pb) in a second vertical prismatic, the base of which is located at the level of the tabular horizon.

Both drill holes met expectations with respect to the current resource block model and provided infill spacing required in their immediate area of the X25 deposit for indicated resource definition under the 2020 PEA (preliminary economic assessment). The holes also confirmed historical data.

Additionally, a combined hydrogeological and exploration hole confirmed mineralization reported in an isolated historical Cominco drill hole at the western extremity of the Central zone. The tabular mineralization intersected in hole HG-21-PP-008 is within a nine-metre mineralized interval that included a continuous section returning 6.0 metres grading 3.72 per cent Zn and 0.79 per cent Pb (4.51 per cent Zn-Pb). The historical orphan hole contained similar grades, and mineralization at this site remains open in all directions, up to distances of between 150 and 250 metres where other historical drill holes are located.

                               DRILL HOLE COMPOSITE ASSAY RESULTS
 
Hole name             From          To       Width     True width          Zn          Pb       Pb-Zn
                       (m)         (m)         (m)            (m)         (%)         (%)         (%)

HG-21-PP-008        102.00      103.00        1.00           1.00        6.38        1.47        7.85
and                 105.00      111.00        6.00           6.00        3.72        0.79        4.51
X25-21-PP-001       135.00      156.00       21.00          21.00        9.40        3.76       13.16
and                 168.00      177.00        9.00           9.00        4.78        0.29        5.08
X25-21-PP-002        73.00       76.30        3.30           3.30        6.18        2.83        9.01
and                 100.00      132.00       32.00          32.00       20.28       12.02       32.31

Lastly, one hydrogeological drill hole was completed 2.3 kilometres south of X25 to investigate hydrogeological characteristics within the Sulphur Point formation, but off the mineralized trend to the southeast. This hole did not encounter mineralization.

Robert Wares, chairman and chief executive officer, commented: “Once more, I am impressed to see the high-grade mineralization being confirmed or surpassed within the western prismatic deposits at Pine Point. Importantly, many of these deposits blend laterally into tabular mineralization and remain open along strike. These will be a priority for follow-up drilling this summer as part of our resource expansion program, as will areas of mineralized orphan holes across the property. The $5-million flow-through capital raise currently under way will allow us to continue as well as to accelerate our drill program slated for a restart in June.”

Hydrogeological and infill program update

Eighteen holes of the planned 20-hole program have been completed, and drilling will soon be suspended for spring breakup.

Hydrogeological holes have perforated PVC (polyvinyl chloride) casing installed prior to flow tracing and pumping tests that are slated for this summer. All completed holes will be monitored for water outflow; of the 18 holes drilled to date only two are making water to surface, and these are located in the northernmost area of the property, outside the mineralized trends. Encouragingly, the remainder is dry at surface.

Canada Silver drills 0.41 m of 51,612 g/t Ag at Castle

Canada Silver Cobalt Works Inc. has released the additional wedge intercept of the second high-grade silver vein (vein 2) within 60 metres of the Robinson zone discovery hole CA-1108. The Robinson zone project is 100 per cent owned by the company in the 78-square-kilometre Castle silver mine property in Gowganda in Ontario, Canada.

Highlights and updates:

  • A new intersection of vein 2 assays 51,612 grams per tonne (1,506 ounces per ton) over 0.41 metre from 561.73 to 562.44 m with a true width of four to six centimetres and included in a wider interval of 30,931 grams per tonne (902 ounces per ton) over 0.71 m in CS-20-39W2.
  • This is a follow-up from CS-20-39, the highest-grade silver to date at Robinson zone at 89,853 grams per tonne silver (2,621 ounces per ton) over a true width of five to seven cm (Jan. 29, 2021). The wedge 2 intercept was about six metres from the original hole.
  • There was a visually highly mineralized core interval approximately 13 m from wedge 2 in hole CS-20-39W4. The interval is over 0.95 metre including wallrock silver at a downhole depth of 550 metres. The vein has an approximate true width of two to three cm.
  • Core from CS-20-39 wedge 4 intersections and bordering core are split, and samples have been sent to the lab for assaying. Assays are pending.
                    CS-20-39W2 SAMPLE DETAILS       
                                          
Hole ID       Sample     From       To   Length       Ag       Ag
                          (m)      (m)      (m)    (g/t)   (oz/t)

CS-20-39W2             561.73   562.44     0.71   30,931      902
including      13247   561.73   562.14     0.41   51,612    1,506
               13248   562.14   562.44     0.30    2,668       78

* True width is four to six cm.
  

This new high-grade vein panel is being expanded using wedge drilling. Additional assays and expanded panel size will be updated as results become available. The potential of the Robinson zone has significantly increased with the development of this second, distinct, high-grade silver vein. With follow-up drilling, the existing resource panels reported in a press release dated May 28, 2020, will be expanded. In that release, a maiden resource estimate identified zones 1A and 1B of the Robinson zone had an average silver grade of 8,582 g/t (250 oz/t) in a combined 27,400 tonnes of material for a total of 7.56 million inferred ounces of silver using a cut-off grade of 258 g/t AgEq (mineral resources that are not mineral reserves do not have demonstrated economic viability).

Notably, hole CS-20-39 also intersected a 17-metre zone (downhole from 502 to 519 m) with several narrow veins mineralized with both silver and cobalt-arsenides. With the additional data from the current wedges these veins look to be a group of en echelon veins. Assays are pending for this zone intersected in several holes.

Matt Halliday, PGeo, president, commented: “Vein 2, or Big Silver, is evolving significantly with the ongoing wedge drilling and is shaping up to be even nicer than vein 1, or Robinson vein. Further drilling is expected to continue to enlarge this zone.”

Location

The Castle property is 15 km east of Aris Gold Corp.’s Juby gold deposit, 30 km due south of Alamos Gold’s Young-Davidson mine, 75 km southwest of Kirkland Lake Gold’s Macassa complex and 100 km southeast of new gold discoveries in the Timmins West area.

Fenixoro starts moving to Abriaqui for phase 2 drilling

Mobilization has commenced for the start-up of the phase 2 drilling program at Fenixoro Gold Corp.’s Abriaqui gold project in Antioquia, Colombia.

Following a very successful phase 1 program (see dated press release dated March 17, 2021) the planned minimum 4,000-metre phase 2 drilling will primarily focus on building upon the discoveries along the Northwest vein corridor (NWC). This corridor represents the most immediate opportunity to both increase the potential resource blocks that have been developing and to convert potential to resource categories.

Holes are also planned to better understand significant intercepts from phase 1 that have not been included in any potential resource model calculations. Several significant intercepts, including 7.7 metres at 8.6 grams per tonne gold in hole P006, were not included in the March 17, 2021, model exercise, and the company is eager to add these to its model.

At least one deep hole will focus on delineating depth potential for additional resources on all veins below the 1,500-metre elevation. The model indicates that the mesothermal veins continue beyond the deepest intercept from phase 1 drilling. Increasing the depth of known mineralization will have a significant impact on the resource model calculation

Drill holes are also planned for the highly prospective southern block around the area that hosts the highest-grade mine sample found to date (146 g/t gold), a significant magnetic anomaly and a large area of soil sampling that returned significant gold values. To date, the soil sampling program has been an extremely accurate leading indicator for finding additional, previously unknown vein structures during drilling.

Fenixoro chief executive officer John Carlesso commented: “Our entire exploration team is very pleased to be starting the phase 2 drilling campaign. Phase 1 verified a significant gold discovery at Abriaqui, and we hold high expectations that phase 2 will build on this success. We have identified priority targets that we anticipate will demonstrate further potential for growth of our resource model, both by expanding existing blocks and drilling previously untested areas. This will be a very active and important phase in the growth and development of Fenixoro.”

A table on the company’s website summarizes the results of the resource potential calculations (as detailed in the March 17, 2021, press release). On these four veins alone there is an estimated minimum resource potential of 1.6 million to 2.4 million ounces down to the 1,500-metre level. There is downside risk to this preliminary form of analysis. Most veins around the world are not homogeneous blocks of ore-grade material, and there may be low-grade spots in some areas. Also the grades and thicknesses assumed are based on relatively few data points. Additionally, time and drilling will be required to convert potential resources into National Instrument 43-101-compliant resources. The upside potential is excellent, however, as this analysis includes only four of the over 100 known gold-mineralized veins on the property and all veins are open at depth.

The company also announces that it has granted stock options to acquire a total of 2.3 million common shares of the company to certain officers, directors and consultants of the company. The options are exercisable at a price of 30 cents per share and expire five years from the date of grant.

Technical information

Stuart Moller, vice-president, exploration, and director of the company and a qualified person for the purposes of NI 43-101 (PGeo, British Colombia), has prepared or supervised the preparation of the technical information contained in this press release. Mr. Moller has more than 40 years of experience in exploration for precious and other metals including 10 in Colombia and is a fellow of the Society of Economic Geologists.

Drill core sampling is done in accordance with industry standards. The HQ- and NQ-diameter core is sawed, and half-core samples are submitted to the laboratory. The other half core along with laboratory coarse reject material and sample pulps are stored in secure facilities on site and/or in the sample prep lab. Following strict chain-of-custody protocols, the samples are driven to the ISO (International Organization for Standardization) 17025:2017-certified ALS laboratory sample preparation facility in Medellin, and ALS ships the prepared pulps to its assay laboratory in Lima, Peru. Blanks, duplicates and certified reference standards totalling 15 per cent of the total samples are inserted into the sample stream. To date, no material quality control issues have been detected. Gold is analyzed by fire assay with 50-gram charges for grades in excess of 10 grams per tonne, and the additional elements are analyzed by ICP (inductively coupled plasma) with appropriate follow-up for overlimits.

Reported grade intervals are calculated using uncut gold values. Maximum sample length is one metre. Intervals that include multiple samples are calculated using the full geologic interval of mineralization and are not subject to specific rules for cut-off grades and internal low grade. As such, quoted thickness and grade of these intervals do not necessarily represent optimized economic intervals in a potential future mine. Reported sample and interval widths are based on lengths of individual samples in core and do not necessarily represent true widths of mineralization. True widths will sometimes be less than the quoted interval lengths.

There are currently no NI 43-101-compliant resources or reserves in the project area. The analysis of phase 1 drill results is intended to estimate the potential for future resources, which will require significant additional drilling to define.

The comparison between Abriaqui and the nearby Buritica project is meant only to indicate the similarities between the two in terms of geological setting. Fenixoro does not imply that exploration results and/or economic characteristics of a potential future mine at Abriaqui will be similar to those seen at Buritica.

Plateau Energy reminds shareholders of voting deadline

Plateau Energy Metals Inc. would like to remind all eligible shareholders and optionholders of the company that the deadline to vote their common shares and stock options in advance of the special meeting of securityholders is 10 a.m. (Toronto time) on April 29, 2021. The special meeting will be held in virtual format on May 3, 2021, at 10 a.m. (Toronto time) to approve the company’s business combination with American Lithium Corp. announced Feb. 9, 2021.

Securityholders are encouraged to review and consider the information circular in connection with the special meeting. A copy of the information circular and all other meeting materials is available on SEDAR and on the Plateau website.

The directors and management of Plateau recommend that eligible Plateau securityholders vote for the arrangement.

Closing of the arrangement is anticipated to occur on or about May 11, 2021, subject to the receipt of applicable regulatory approvals and the satisfaction of certain other closing conditions customary in transactions of this nature, including, without limitation, final approval of the Ontario Superior Court of Justice and the TSX Venture Exchange.

Additional background to the arrangement

special committee

In connection with the arrangement, the company formed a special committee of the board of directors (the “board”) on January 22, 2021. The special committee was mandated, among other things, to:

  • Examine and review, from the point of view of the best interests of the company, the merits and fairness of any proposed strategic transactions in conjunction with management and financial and legal advisers;
  • To consider, assess, examine and advise the board regarding any and all alternatives to the proposed transactions which may be available to the company to enhance shareholder value including, without limitation, in the context of a change of control or sale of the company’s assets or soliciting competing offers from third parties;
  • To consider and advise the board as to whether the proposed transactions are in the best interests of the company and its shareholders and whether the proposed transactions should be pursued by the company and, if necessary or appropriate, recommended to its shareholders;
  • To the extent necessary or appropriate, supervise the negotiation by management of the terms of the proposed transactions and any agreements necessary to give effect thereto;
  • To report to the board on its activities and recommendations from time to time and to provide such advice as requested by the board in respect of any value enhancement initiative which may be proposed;
  • To oversee and assist with:
    • (i) The procedures necessary to obtain all necessary or appropriate regulatory, shareholder or other approvals of the proposed transactions and comply with applicable corporate and securities requirements;
    • (ii) The preparation of all necessary or appropriate disclosure in respect of the proposed transactions, including such materials as are necessary in connection with obtaining shareholder approval of the final terms of any proposed transactions, including the arrangement;
  • Ensure such process is fair and equitable.

At the request of the special committee, Alex Holmes (as chief executive officer of the company at the time) and Dr. Laurence Stefan negotiated terms of the arrangement with American Lithium, on behalf of the company, and to report back to the special committee on a regular basis. The special committee provided direction and oversaw the negotiations.

Haywood fairness opinion

The special committee determined that Haywood Securities Inc. would be engaged to provide a fairness opinion with respect to the arrangement.

In preparation of the fairness opinion, Haywood relied upon: due diligence reporting by management of Plateau without independent verification; public disclosure documents and technical reports of both parties; audited and unaudited financial statements of both parties; discussions with management of Plateau and internal reports, models and documents; sector financial due diligence including, but not limited to, peer valuations, industry analysis, analyst research reports and precedent transaction analysis; and review of the draft transaction documents with respect to the arrangement.

The fairness opinion was based upon a selection of methodologies deemed appropriate in the circumstances by Haywood, including: premium analysis (including both the share and warrant consideration) relative to precedent transactions and Plateau’s historic trading price range; multiscenario net asset value analysis; analysis of comparable public companies; analysis of the public market trading liquidity of each company; review of strategic alternatives; and an assessment of risk diversification.

Drawing on the conclusions of its analysis, Haywood determined in its fairness opinion that, as of the date of the arrangement, and based upon and subject to the assumptions, limitations and qualifications stated therein, the consideration to be received by the shareholders of Plateau under the arrangement is fair, from a financial point to view, to such shareholders.

Locked-up shareholders

In connection with the arrangement, each of the directors and senior officers of the company, as well as certain significant shareholders representing in aggregate approximately 17 per cent of Plateau’s outstanding common shares as at the date of announcement, have entered into voting and support agreements with American Lithium pursuant to which they have agreed to vote, or cause to be voted, all of the securities of the company held or controlled by them in favour of the arrangement. The attached table sets out the name of each locked-up shareholder and the number of securities of the company beneficially owned or controlled by each.

Additional information regarding the special meeting

Securityholder vote

Each common share and stock option entitled to be voted at the special meeting will entitle the holder to one vote at the special meeting. In order to become effective, the arrangement must be approved by at least 66-2/3 per cent of the votes cast by holders of common shares present in person or represented by proxy at the special meeting; (ii) 66-2/3 per cent of the votes cast by securityholders, voting together as a single class, present in person or represented by proxy at the special meeting; and (iii) a majority of the votes cast by holders of common shares other than votes attached to common shares required to be excluded pursuant to Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions.

As required by MI 61-101, the shares held by Terrence O’Connor, a director of the company, and the common shares held by Dr. Stefan, interim chief executive officer, chief operating officer, president and director of the company, will be excluded from the shareholder vote required at the special meeting pursuant to MI 61-101.

The securities Mr. O’Connor and Dr. Stefan beneficially own or have control over are included in the attached table.

FPX Nickel begins metallurgical pilot test at Baptiste

FPX Nickel Corp. has initiated a metallurgical pilot test program to support the continued development of the company’s Baptiste nickel project in central British Columbia. This metallurgical program will be the largest and most comprehensive program conducted to-date on Baptiste mineralization, and is designed to validate and optimize the flowsheet parameters outlined in the Company’s September 2020 Preliminary Economic Assessment (“PEA”).

“This year’s bench- and pilot-scale metallurgical studies are focused on confirming and improving upon the results of previous bench-scale testing conducted in support of the 2020 PEA,” commented Martin Turenne, FPX’s President and CEO. “We have identified opportunities to improve several aspects of the metallurgical process at Baptiste which have the potential to increase recoveries and/or lower processing costs, and also to generate saleable iron and cobalt by-products which could materially improve the Project’s economics.”

Background

The processing flowsheet developed for the PEA is based on conventional grinding, magnetic separation and flotation processes to produce a concentrate grading 63% nickel and 1% cobalt. Previous testing and market evaluations have demonstrated that this clean, high-grade nickel concentrate could be an excellent feedstock for direct sale to end users in the stainless steel and electric vehicle (“EV”) battery sectors. The PEA flowsheet also produces a magnetite-rich tailings stream which has the potential to be sold or further valorized as a saleable iron ore product. For the PEA, no by-product revenues were recognized for the sale of this magnetite-rich iron ore product, but the Company believes that further testing and market evaluations could potentially support the inclusion of this product stream into the Project’s economics.

2021 Program

The overall objective of the 2021 metallurgical test program is to support the eventual production of a Preliminary Feasibility Study (“PFS”) for the Project, with testing focused on achieving the following:

Confirm the PEA metallurgical results using materials representative of the life-of-mine production

Expand the grindability and comminution parameter database, including conducting pilot-scale tests of the high-pressure grinding rolls (“HPGR”) circuit

Confirming primary grade-recovery relationships defined by previous test work

Confirm and optimize flotation parameters and nickel recoveries, and investigate possible improvements to the flotation process design

Producing sufficient high-grade nickel concentrate for additional testing to produce nickel sulphate for the EV battery market

Conducting mineralogical and particle size evaluations of the magnetite iron ore by-product to support further market evaluations of this product stream

Generating baseline data on tailings characterization and settling characteristics to support the Company’s strategy for tailings management, including the potential for sequestration of carbon dioxide in tailings

Testing will be conducted on approximately three tonnes of representative drill core and coarse assay reject sample material, drawn from deposit areas across all phases of the PEA life-of-mine plan. The test program will be executed in multiple stages at laboratories including ALS Metallurgy in Kamloops, British Columbia, Koeppern/UBC facilities in Vancouver, SGS Mineral Services in Lakefield, Ontario and COREM Laboratories in Quebec City. The Company expects to report on the results of the metallurgical program in the third quarter of 2021.

Santacruz Silver completes Zimapan asset acquisition

Santacruz Silver Mining Ltd. has completed the previously announced acquisition of the Zimapan mine assets from Minera Cedros SA de CV, a wholly owned subsidiary of Grupo Penoles. The transaction was financed in part by a $17.6-million (U.S.) loan facility provided by Trafigura Mexico SA de CV.

As noted in the company’s press release of Feb. 25, 2021, total consideration paid by Santacruz to Minera Cedros was $20-million (U.S.) plus applicable Mexican value-added tax of $3.2-million (U.S.). Pursuant to the Feb. 24, 2021, definitive purchase agreement between the company’s wholly owned subsidiary, Carrizal Mining SA de CV, and Minera Cedros, at closing of the acquisition of the Zimapan mine, Carrizal paid Minera Cedros $15-million (U.S.), financed through the Trafigura loan facility. The $2.6-million (U.S.) balance of the Trafigura loan facility represents the refinancing of existing debt owing to Trafigura Mexico by Carrizal and an affiliate (Impulsora Minera Santacruz SA de CV). Carrizal had previously made payments to Minera Cedros totalling $5-million (U.S.), leaving an outstanding balance for the Zimapan acquisition of $3.2-million (U.S.), which is payable to Minera Cedros on or before Sept. 23, 2021, in accordance with the terms of the purchase agreement. Santacruz will make this payment from cash on hand or from cash flow from the Zimapan mine.

Pursuant to the terms of the Trafigura loan facility, at the closing, the company issued an aggregate of 28 million warrants to Trafigura Mexico, with each warrant being exercisable to purchase one common share of the company at a price of 39.5 cents per share for a period of 12 months with respect to 26 per cent (7.28 million warrants) and 42 months with respect to the remaining 74 per cent (20.72 million warrants). In accordance with the policies of the TSX Venture Exchange and other applicable legislation, shares issued pursuant to the exercise of warrants will be subject to a hold period expiring Aug. 24, 2021.

Carlos Silva, chief executive officer of Santacruz, stated: “Closing the transaction and acquiring outright ownership of the Zimapan mine marks a new era for Santacruz that will help pave the road for the continuation of the company’s growth. Beyond the mineralized zones currently being mined, management believes there is great untapped potential contained in the Zimapan mine’s 5,000 hectares of mining claims. We have already identified several priority areas for exploration, which we expect will allow the mine to maintain its historical yearly production levels of plus five million silver equivalent ounces for many years.” Mr. Silva continued: “I want to thank everyone at Grupo Penoles for demonstrating constant support and professionalism throughout this process. I also want to thank Trafigura for supporting Santacruz and providing the loan facility that expedited the closing of the transaction.”

Omineca Mining receives drill permit for Wingdam

Omineca Mining and Metals Ltd. has completed a helicopter-borne triaxial magnetic gradiometer survey over the Wingdam project approximately 40 kilometres east of Quesnel in the Cariboo mining district of British Columbia. Survey analysis has identified further drill targets expanding along the series of NW-SE trending structures that are the focus of the ongoing maiden drill program at Wingdam. Omineca has applied for, and has received, a multi-area/multi-year drill permit from the BC Government, expanding the program initially to 60 drill pads and extending the permit over 5 years. Omineca’s second drill program is anticipated to follow immediately after completing the analysis from the initial drill program and its correlation with new geophysical data.

The survey consisted of 2,278 line-kms, covering approximately 209 square kilometers of Omineca’s 500 square kilometer land package. The survey runs generally over a 25 km NW-SE trending zone from approximately 8 km northwest of the 2012 placer project bulk sample site to the southern end of the Wingdam property.

The new survey has identified several more NW striking fault features that appear to intersect NE trending faults first identified in the magnetic survey completed in 2018. The recent geophysical data provides both further detail and definition as well as expanded exploration targets along the trend. This structural control pattern is indicative of Riedel style strike-slip deformation known to produce sub-vertical ore shoots at the Osisko Development Corps’ Cariboo Gold Project, located 25 kilometers to the east. The Wingdam and Cariboo Gold projects share similar lithology and structure; two of the main ingredients for mineralization in the gold producing Barkerville Terrane. The western portion of the survey spans an underexplored area west of the Eureka Thrust Fault along the NW trending Quesnel Terrane. The Quesnel Terrane is the longest mineral belt in Canada and is known for hosting copper-gold porphyry deposits as well as several types of gold deposits.

Tudor releases NI 43-101 Treaty Creek resource estimate

Tudor Gold Corp. has filed a technical report, which includes the initial mineral resource estimate for the Goldstorm and Copper Belle zones at the Treaty Creek project, located within the heart of the Golden Triangle of northwestern British Columbia and on trend from Seabridge’s KSM project located five kilometres southwest. The report is titled “Technical Report and Initial Mineral Resource Estimate of the Treaty Creek Gold Property, Skeena Mining Division, British Columbia, Canada,” dated April 23, 2021, with an effective date of March 1, 2021. The summary results of the report were previously announced in the company’s news release dated March 9, 2021, and there are no material differences in the mineral resources between the report and the previous news release.

The report, prepared for Tudor Gold by P&E Mining Consultants Inc., is available under the company’s profile on SEDAR or from the company’s website.

Highlights of the March, 2021, mineral resource estimate:

  • A total of 19.41 million ounces of measured and indicated gold equivalent ounces at an average grade of 0.74 gram per tonne gold equivalent are estimated for the Goldstorm and Copper Belle deposits.
  • A total of 14.15 million ounces of measured and indicated gold equivalent ounces at an average grade of 0.72 gram per tonne gold equivalent are within a constraining open-pit shell and 5.26 million measured and indicated gold equivalent ounces at an average grade of 0.80 gram per tonne gold equivalent is for the out-of-pit mineral resources.
  • A cut-off grade of 0.30 gram per tonne gold equivalent was used inside the constraining open-pit shell mineral resource estimate and a higher cut-off grade of 0.46 gram per tonne gold equivalent was used for the out-of-pit mineral resource estimate, which includes underground constrained blocks.
  • The Goldstorm zone remains open to the northeast, to the southeast and down dip at depth to the northwest.
  • A total of 218 drill holes, totalling 105,658.8 metres, were reviewed for the mineral resource estimate completed by P&E. Many of these holes are outside the Goldstorm and Copper Belle deposits and were not used in the mineral resource estimate. The Goldstorm/Copper Belle area has 132 holes.
  • The classifications of measured, indicated and inferred mineral resources for gold, silver, copper and gold equivalent and their respective tonnages are listed in the attached table. In addition to the 17.33 million ounces of gold in measured and indicated mineral resources and 7.22 million ounces of gold in inferred mineral resources, there are 93.41 million ounces of silver estimated as measured and indicated mineral resources, with an additional 40.57 million ounces of silver in inferred mineral resources. The measured and indicated mineral resources are also estimated to contain 1,096 million pounds of copper, with an additional 330 million pounds of copper in inferred mineral resources.
  • A bulk density of 2.80 tonnes per cubic metre was based on measurements of samples collected by P&E during its field visits; five-metre-by-five-metre-by-five-metre three-dimensional block modelling was used for the mineral resource estimate.
  • Measured mineral resources are defined by four or more drill holes within 100 metres; indicated mineral resources are defined by four or more drill holes within 200 metres.

Treaty Creek initial mineral resource estimate summary

Notes:

  1. Mineral resources are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues. There is no certainty that mineral resources will be converted to mineral reserves.
  2. The inferred mineral resource in this estimate has a lower level of confidence than that applied to an indicated mineral resource and must not be converted to a mineral reserve. It is reasonably expected that the majority of the inferred mineral resource could be upgraded to an indicated mineral resource with continued exploration.
  3. The mineral resources in this news release were estimated in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) standards on mineral resources and reserves definitions (2014) and best practices guidelines (2019) prepared by the CIM standing committee on reserve definitions and adopted by the CIM council.
  4. Metal prices used were $1,625 (U.S.) per ounce gold, $19 (U.S.) per ounce silver and $2.80 (U.S.) per pound copper, with process recoveries of 88 per cent gold, 30 per cent silver and 80 per cent copper. A processing cost of $16.50 per tonne and a general and administrative cost of $2 per tonne were used.
  5. The constraining pit optimization parameters were $2.50 per tonne mineralized and waste material mining cost and 50-degree pit slopes with a 0.30-gram-per-tonne-gold-equivalent cut-off.
  6. The out-of-pit parameters were at a large-scale bulk mining cost of $10 (U.S.) per tonne. The out-of-pit mineral resource grade blocks were quantified above the 0.46-gram-per-tonne-gold-equivalent cut-off, below the constraining pit shell and within the constraining mineralized wire frames. Out-of-pit mineral resources exhibit continuity and reasonable potential for extraction by a bulk underground mining method.

Namibia Critical to survey Grootfontein project

Namibia Critical Metals Inc. has provided an update on exploration activities on its 95-per-cent-owned Grootfontein project.

The Grootfontein project consists of two large exclusive prospecting licences with a total area of 163,784 hectares (1,638 square kilometres) and covers ground prospective for orogenic gold, magmatic copper-nickel-PGE (platinum group elements) and sediment-hosted lead-zinc-silver-copper-vanadium mineralization. As previously announced (company press release March 26, 2021) a number of geophysical surveys have now been completed and the large-scale airborne electromagnetic survey will commence May 6. Initial geophysical results have already generated several drill targets. Additional targets will be tested upon completion of the airborne survey.

Highlights of the first results and activities

  • Ultra-high resolution UAV (unmanned aerial vehicle)-borne magnetic surveys generated several drill targets over fully covered Grootfontein shear zone and Waterberg fault.
  • First ground induced polarization survey delineated chargeability and resistivity trends along the first order Grootfontein shear zone and subparallel second order structures within the Grootfontein mafic complex.
  • Large-scale helicopter-borne EM survey by SkyTEM to commence on May 6, 2021.
  • Drilling campaign for multiple priority targets planned starting end of May, 2021.

Darrin Campbell, president, stated: “We continue to be encouraged by early results and are excited to move our Grootfontein gold and base metal project to the next stage of exploration. Our technical team in Namibia has done a great job in early stage analysis of this large underexplored region and we look forward to getting drill ready as soon as possible.”

The company’s exclusive prospecting licenses are located in the central Namibian gold belt which hosts a number of significant orogenic gold deposits including the Otjikoto gold mine of B2Gold.

Copper-nickle-PGE prospectivity of the Grootfontein project

The Grootfontein area is one of the very few underexplored areas with geologically complex and prospective ground in Namibia. Historical exploration was limited and challenged due to the complete cover of the area with calcrete and Kalahari sands. Magnetic survey data delineated the covered the Meso-Proterozoic Grootfontein mafic complex (GMC) over an area of about 400 square kilometres.

Following geological reconnaissance by Anglo in the 1970s, the only drill program in the GMC by Gold Fields was in 1988 and was limited to six diamond boreholes along two lines. The drill logs describe layered and often strongly sheared mafic to ultramafic rocks as gabbroids, norites and pyroxenites with up to 1.1 per cent chromium.

Geophysical and geochemical studies by the Geological Survey of Namibia and international partner organizations revealed a depletion of the mafic silicate magma by copper and nickel which points to a likely earlier fractionation of a Cu-Ni-rich sulphide melt. This underlines the GMC’s prospectivity for Voisey’s Bay-type Cu-Ni-PGE mineralization which form part of the current exploration program.

Gold prospectivity on the Grootfontein project

Previous exploration activities by Namibia Critical Metals included geochemical soil surveys with a total of more than 8,000 soil samples which delineated the high-priority Highland gold target and several other gold and gold pathfinder anomalies in the periphery and contact zone of the Grootfontein mafic complex with Meso- and Neoproterozoic metasediments (press release Dec. 16, 2020, and March 26, 2021).

The company’s current structural interpretation of the Grootfontein project is based on the 200-metre line spacing magnetic survey data produced by the Geological Survey of Namibia. The structural setting is dominated by the major first order structure of the Grootfontein shear zone which 80 kilometres westward aligns with (and controls?) the Otjikoto orogenic gold deposit of B2Gold (2.8 million ounces Au).

Second order structures related to the Grootfontein shear zone form the key targets for gold exploration. With gold-in-soil anomalies related to second order shear structures in the contact and within the GMC, the company pioneers targeting of mafic/ultramafic rocks for gold in Namibia. The high-resolution heli-borne EM and magnetic data from the SkyTEM system will refine drill targeting for gold.

First results from UAV magnetic surveys

UAS Flightec completed two drone-borne magnetic surveys covering more than 1,500 line kilometres and mapping a total area of 7,405 hectares over two survey areas. The ultrahigh-resolution magnetic survey comprised a laser-pumped Caesium Vapor Sensor (Geometrics MagArrow) suspended below a UAV (DJI M600 Pro) travelling at less than 10 metres per second effectively generating a measurement every one centimetre. The high sample density allowed for excellent noise removal. The survey data reveal highly detailed magnetic anomalies which are assumed to be partly related to pyrrhotite mineralization.

The data of Area 1 covers a four-kilometre section of the regional-scale, multiply reactivated, deep-tapping structure of the Waterberg fault zone. Four profiles across the Waterberg fault were modelled by Earthmaps Consulting. The modelling methods include both magnetic forward modelling (manual, user-controlled modelling) as well as magnetic inversion modelling (software-controlled, automatic root mean square modelling). The resulting model shows the Waterberg fault zone to be likely associated with an intrusive dike-sill-complex of gabbroic-noritic composition. Four boreholes with a total of 800 metres are planned to test both the Waterberg fault zone and the intrusives for precious and base metal mineralization.

Area 2 targeted the eastern bend of the Grootfontein shear zone (GSZ). While completion of data modelling is pending, several high-priority drill targets are planned in the splay zone of the GSZ over remanent magnetic anomalies likely related to pyrrhotite.

IP surveys

A first area of ground induced polarization (gradient array IP) was completed over the central Rothof gold target by GSG Namibia. The first data set shows generally only low to moderate chargeability and conductivity anomalies which however clearly mark the Grootfontein shear zone and second order structures within the mafic rocks of the Grootfontein mafic complex. Direct correlation of the geophysical trends with the wide-spaced gold-in-soils anomaly is unclear but exhibits a subparallel trend. Drill targeting in this area will require closer spaced geochemical sampling.

SkyTEM survey

As previously announced (company press release March 26, 2021) an airborne EM survey with a total of more than 2,000 line kilometres at 200 m line spacing is planned over the bulk of the GMC on the company’s EPLs (exclusive prospecting licenses) and will cover the key structural corridors of the Grootfontein project area prospective for gold and base metal mineralization. The survey will cover the priority gold target at Highlands and also the prospective ground for sediment-hosted lead-zinc-silver-copper-vanadium mineralization in the Berg Aukas area. SkyTEM Surveys ApS Denmark has been contracted for the survey with its SkyTEM312FAST system.

The survey is planned to commence on May 6, 2021, for a duration of eight days. Based on final data interpretation by the end of May, drill targeting is planned to be completed by the first week of June, in parallel with drill rig mobilization.

Atico produces 4.5 Mlb Cu, 2,134 oz Au in Q1 2021

Atico Mining Corp. has released its operating results for the three months ended March 31, 2021, from its El Roble mine. Production for the quarter totalled 4.50 million pounds of copper and 2,134 ounces of gold in concentrates, a decrease of 8 per cent and 22 per cent for copper and gold, respectively, over the same period in 2020.

“At the El Roble mine production faced significant challenges this quarter, as we experienced heavy rains during the dry season along with a week-long mill stoppage in February. Despite these challenges, the team was able to adjust and deliver within guidance for most metrics while setting a course to compensate for downtime,” said Fernando E. Ganoza, chief executive officer. “At the current metal price environment, the company anticipates robust financials to follow at these production levels. We remain committed to complying with COVID-19 guidelines and regulations from local authorities in the jurisdictions where we operate while putting tremendous emphasis on the health and safety of all of our employees.”

First quarter operational highlights:

  • Production of 4.5 million pounds of copper contained in concentrates, a decrease of 9 per cent over Q1 2020;
  • Production of 2,134 ounces of gold contained in concentrates, a decrease of 22 per cent over Q1 2020;
  • Average processed tonnes per day of 954, an increase of 9 per cent over Q1 2020;
  • Copper head grade of 3.23 per cent, a decrease of 2 per cent over Q1 2020;
  • Gold head grade of 1.71 grams per tonne, a decrease of 12 per cent over Q1 2020;
  • Copper and gold recovery of 92.4 per cent and 56.9 per cent, no significant change for copper and a decrease of 3 per cent for gold over Q1 2020.

First quarter operational review

Mined and processed ore was below company budget for the first quarter caused primarily by the temporary work stoppage as a result of a tailings pipe malfunction and, to a lesser extent, by a much heavier rainy season this year. The decrease for copper and gold output for the quarter relative to Q1 2020 is mostly explained by 7-per-cent decrease in processed ore, while for gold an additional factor was a 12-per-cent decrease in head grade. Copper recoveries slightly improved when compared with the same period last year, while gold recoveries during the quarter were in line with company projections. Gold recovery decrease is due to an increase in the copper content in the concentrate; this increase in the copper content in the concentrate provides a net economic benefit, especially at current copper prices, offsetting the decrease in gold recovery. The company will continue to explore improving the copper content in the concentrate in the following quarters while increasing the gold recovery.

                         FIRST QUARTER OPERATIONAL DETAILS
  
                                             Q1 2021        Q1 2020  % change
                                               total          total 
Production (contained in concentrates)                                       
Copper (000s pounds)                           4,503          4,926        -8% 
Gold (ounces)                                  2,134          2,736       -22% 
Mine                                                                         
Tonnes of ore mined                           64,101         72,777       -12% 
Mill                                                                         
Tonnes processed                              68,282         73,374        -7% 
Tonnes processed per day                         954            878         9% 
Copper grade (%)                                3.23           3.31        -2% 
Gold grade (g/t)                                1.71           1.96       -12% 
Recoveries                                                                   
Copper (%)                                      92.4           91.9       Nil 
Gold (%)                                        56.8           59.0        -3% 
Concentrates                                                                 
Copper and gold concentrates (dmt)            10,365         10,213         1% 
Payable copper produced (000s lb)              4,278          4,680        -9%

Note: Metal production figures are subject to adjustments based on final settlement.
      The reported results are preliminary in nature and are awaiting independent
      lab verification.

El Roble mine

The El Roble mine is a high-grade, underground copper and gold mine with nominal processing plant capacity of 1,000 tonnes per day, located in the department of Choco in Colombia. Its commercial product is a copper-gold concentrate.

Since obtaining control of the mine on Nov. 22, 2013, Atico has upgraded the operation from a historical nominal capacity of 400 tonnes per day.

El Roble has proven and probable reserves of 1.00 million tonnes grading 3.02 per cent copper and 1.76 g/t gold, at a cut-off grade of 1.3 per cent copper equivalent as of Sept. 30, 2020. Mineralization is open at depth and along strike, and the company plans to further test the limits of the deposit.

On the larger land package, the company has identified a prospective stratigraphic contact between volcanic rocks, and black and grey pelagic sediments and cherts that has been traced by Atico geologists for 10 kilometres. This contact has been determined to be an important control on VMS (volcanogenic massive sulphide) mineralization on which Atico has identified numerous target areas prospective for VMS-type mineralization occurrence, which is the focus of the current surface drill program at El Roble.