Metals Update 05/05/2021

Nighthawk receives land-use permit for Kim & Cass

Nighthawk Gold Corp. has received its water licence and land-use permit for the recently optioned Kim & Cass property (see press release dated Feb. 19, 2021). The Kim & Cass property consists of a total of 7,588 acres (31 square kilometres) that incorporate the historic Kim and Cass zones, and is located approximately 15 km southwest of the Colomac Main deposit, immediately adjacent to the main Indin Lake gold property claim group, Northwest Territories, Canada.

The Kim & Cass property is a high-priority target for this year’s exploration program as Cass already has a historical non-compliant resource and is located immediately adjacent to the company’s Albatross target. Cass, along with the Albatross target are part of a seven-kilometre-long favourable trend, which has seen limited drilling in the past. In addition, the Kim zone further to the northeast provides an additional three km of highly prospective and underexplored strike length. Exploration at Cass aligns with the strategy of identifying near-surface mineralization proximal to Colomac. Drilling will focus on preliminary testing of the northern and southern extension of the zone in an effort to extend mineralization along strike, while additional work will be conducted to bring the zone into compliance with National Instrument 43-101 standards.

Nighthawk’s president and chief executive officer, Keyvan Salehi, commented: “We are very pleased to have received our licences and permits to commence drilling at Cass, and the fifth drill will mobilize immediately. Given the higher-grade nature and continuity of mineralization encountered by historic drilling, along with a successful drill program by Nighthawk in 2014, we believe there is significant room for expansion of mineralization along strike and at depth. Together with our Albatross target, this is a highly prospective target area given its seven-kilometre-long trend with historic drilling and surface samples.”

Cass zone — highlights of historical resource and drilling

Cass has a historic non-compliant resource which outlined 2,857,093 tonnes at an average grade of 2.66 grams per tonne gold for 245,311 ounces of gold (see Nighthawk press release dated Dec. 18, 2013). The resource was estimated prior to the implementation of NI 43-101 standards, where previous work defined historic gold resource estimates that have yet to be fully evaluated, and therefore should not be relied upon. A qualified person has not done sufficient work to classify the historical estimates as current mineral resources or reserves. Furthermore, the company is not treating the historical estimates as current mineral resources or reserves as defined by NI 43-101 as the company is not able to assess the work required to upgrade to a compliant resource at this time.

Over 32,000 metres of historic drilling was completed on both Kim and Cass and a modest program by Nighthawk consisting of 2,926 metres of drilling in 2014 at Cass, which successfully extended the mineralized corridor by an additional 700 metres, where it remains open at depth and along strike.

Amerigo shareholders elect seven directors at AGM

Amerigo Resources Ltd. has released the results of voting at its 2021 annual general meeting of shareholders held on May 3, 2021.

A total of 126,544,736 common shares were voted at the AGM, representing 69.61 per cent of the votes attached to all outstanding common shares of the company. Shareholders voted in favour of all items of business before the AGM, including the election of all director nominees as shown in the attached table.

In addition, the ordinary resolution approving all unallocated options under the company’s stock option plan was approved, with 71.31 per cent of the votes cast in favour of such resolution, and the ordinary resolution reconfirming the company’s shareholder rights plan was approved, with 89.38 per cent of the votes cast in favour of such resolution.

Detailed voting results for the 2021 annual general meeting are available on SEDAR.

HPQ-Silicon, PyroGenesis to develop fumed Si process

HPQ-Silicon Resources Inc. and PyroGenesis Canada Inc. are actively evaluating the commercial opportunity of developing a plasma process that could convert silica (quartz, SiO2) into fumed silica (pyrogenic silica) in one step. This new process is a natural evolution from PyroGenesis’ unique plasma-based processes and would be a low-cost and environmentally friendly option. As conceived, the process is expected to eliminate the harmful chemicals presently generated by traditional flame pyrolysis of silicon tetrachloride that are currently used to make fumed silica.


Fumed silica (Pyrogenic Silica) is a white microscopic powder with high surface area and low bulk density. Its commercial applications encompass various industries including personal care, pharmaceuticals, agriculture (food & feed), adhesives, sealants, construction, batteries and automotive to name a few. Demand for Fumed Silica is growing at 6% CAGR, with a global addressable market of US$ 1,5 billion in 2016 expected to grow to US$ 2,2 billion in 2022.


Manufacturing fumed silica is a hazardous process that is both capital intensive and energy consuming. It causes significant air pollution due to 1) the carbon dioxide emission associated with the current processes and 2) the hydrogen chloride gas produced and released during the manufacturing process, a highly regulated gas with stringent regulations associated with its production in North America.

Combining HPQ Silicon High Purity Quartz initiatives with PyroGenesis industry leading knowhow in the development of commercial plasma processes, this new process could revolutionize the manufacturing of Fumed Silica, give HPQ and PyroGenesis a market leadership in its green manufacturing and pivot production back to North America, all the while allowing end users to improve their environmental footprint.

“We are very excited to work with PyroGenesis on this new venture. With over 25 years of expertise in torch plasma applications PyroGenesis is a market leader in plasma technology. This expertise will be applied to transform Silica (Quartz, SiO 2 ) into Fumed Silica (Pyrogenic Silica) in one step, similar to the successful work with our PUREVAP.

QRR system the venerable Quartz Reduction Reactor” said Bernard Tourillon, President and CEO HPQ Silicon. “Over US$50 billion in capital flowed in US ESG funds in 2020, and these are the types of investment they are looking for, so our timing could not be better. Our market research has identified several sectors wishing to improve their environmental footprint, and HPQ’s innovative silicon solutions is prepared to meet this demand.”

“This opportunity is a natural extension of the work we are doing with HPQ and aligns with both what PyroGenesis is targeting and environmental initiatives currently taking place worldwide” said Peter Pascali, President and CEO of PyroGenesis Canada Inc. “This underscores the potential of what we are doing with HPQ, and the reason why we are excited about how things are developing. We were always taken by the myriad of exciting and potentially lucrative off-shoots possible form our initial project with HPQ. We are looking forward to evaluating this opportunity in detail.”

Klondike Gold begins 2021 exploration program

Klondike Gold Corp. has commenced 2021 exploration, beginning at the Virgin target area on the company’s wholly owned 586-square-kilometre Klondike district property near Dawson City in the Yukon.

Program highlights:

  • 2021 exploration/resource drilling program of approximately 6,500 metres will be distributed over three phases and test multiple target areas;
  • Phase 1 exploration drilling to focus on discovering bedrock sources of gold at the historic the Virgin/Lindow target areas;
  • Phase 2 drilling to focus on expanding the discovery at the Stander zone;
  • Phase 3 drilling to focus on outlining a maiden resource on targets within the Lone Star zone.

Peter Tallman, Klondike Gold’s chief executive officer, stated: “The steady and thorough exploration programs of the past several years is now paying off. We’re confident in our geologic understanding of the processes that formed widespread gold mineralization in the Klondike district, both placer and hard rock, and we’re now set to capitalize on those efforts and insights. We have an abundance of targets to test with our 2021 drilling, some that will build toward our goal of completing a maiden resource estimate at Lone Star and some that may surprise with new discoveries proximal to historic placer mines. It’s going to be an exciting season.”

The 2021 phase 1 diamond drill program is expected to begin shortly. The phase 1 program comprising approximately 1,000 metres will launch at the Virgin target area, located 10 kilometres north of the Lone Star and Stander zones, and six kilometres from the company’s Dawson City office (see news release dated Feb. 3, 2021). The Virgin target area comprises the Virgin mine and the Lindow showing, located two kilometres apart along Bear Creek, one of the significant placer-gold-producing creeks during the Klondike gold rush.

Visible gold in quartz veins at the Virgin mine was originally discovered in 1902. Underground development consisting of two shafts and two adits was completed by 1913. A stamp mill was installed in that year, which reportedly processed 265 ounces gold from the workings. In 1934, the stamp mill was upgraded from steam to electrical power, but little further work ensued and the claims ultimately lapsed (source: Yukon Geological Survey mineral occurrence data). The area was restaked by Frank Burkhard in 1976 and Klondike Gold purchased the property directly from the Burkhard family in 2017.

Prospecting grab samples or mapping samples of host rocks collected by the company (2014 to 2020) have yielded five samples between 5.0 to 14.2 grams per tonne (g/t) gold (Au), one sample of 0.9 g/t Au, and 14 samples with no significant assay. (Prospecting samples are selective in nature, non-representative rock grab samples of bedrock or boulders collected to test for the presence or absence of gold and other economic minerals.) The high assays come from quartz vein material in the main shaft and adjacent workings or from the stamp mill dump pile.

Gold in quartz veins was discovered at the Lindow showing in 1911, located two kilometres south of the Virgin mine. Underground development consisted of two (or three) shafts and one adit, however, no contemporary records are known and the workings were obscured by subsequent placer mining.

In 2018, prospecting and mapping by the company located a bedrock occurrence of visible gold in quartz veins. Twelve prospecting grab samples were collected from outcrop of veining and host rock, with eight assaying between 0.2 g/t Au and 4.1 g/t Au, and four samples with no significant assay. Recent recompilation and upgraded description of the Lindow showing published by Yukon Geological Survey led to the company’s realization that part of the lost Lindow showing had been relocated by the 2018 outcrop sampling.

COVID-19 update

Klondike Gold continues to take pro-active measures to protect the health and safety of its local host community, its contractors and its employees from COVID-19, and exploration activities in 2021 will have additional safety measures in place, following and exceeding all the recommendations made by the Yukon’s chief medical officer. Additionally, the company has received Yukon government approval for its 2021 alternative isolation plan (AIP), which mandates protocols and stringent isolation safety measures, permitting essential personnel to transit to/from Yukon.

Radisson drills 8.2 m of 13.9 g/t Au at O’Brien

Radisson Mining Resources Inc. has released significant high-grade gold intercepts from the continuing 130,000-metre exploration drill program at its 100-per-cent-owned O’Brien gold project located along the Larder Lake-Cadillac Break, halfway between Rouyn-Noranda and Val d’Or in Quebec, Canada.

Key highlights:

  • Notable intercepts from expansion drilling at depth along high-grade trend No. 2:
    • OB-21-185: 14.94 grams per tonne gold over 1.60 metres, including 36.80 g/t Au over 0.60 m;
    • OB-21-187: 8.87 g/t Au over 5.00 m, including 14.15 g/t Au over 2.00 m;
    • OB-21-191: 5.09 g/t Au over 6.10 m, including 11.75 g/t Au over 1.00 m;
    • OB-21-193: 18.87 g/t Au over 2.10 m, including 43.80 g/t Au over 0.90 m;
    • OB-21-201: 11.13 g/t Au over 10.70 m, including 13.90 g/t Au over 8.20 m;
    • Visible gold was observed in OB-21-187, OB-21-191 and OB-21-201.
  • Drill results thus far have traced high-grade gold mineralization down to 800 m vertical depth in this sector where the majority of currently defined resources are within a vertical depth of 400 m from surface.
  • Results continue to demonstrate continuity of mineralization below 400 m, within an area measuring approximately 400 m vertically and up to a minimum of 120 m laterally.
  • Several relatively broad high-grade intercepts from holes OB-21-187, OB-21-191, OB-21-201, OB-20-124 (8.35 g/t Au over 6.00 m), OB-20-180 (18.42 g/t Au over 5.00 m), OB-20-156 (11.32 g/t Au over 11.80 m) and OB-20-156W2 (5.77 g/t Au over 7.10 m) suggest potential for wider mineralized zones (well in excess of average widths of approximately 2.90 m in the current resource), between 400 and 700 m vertical depth, where multiple veins are interpreted to intersect each other.
  • A 130,000 m drill program (commenced August, 2019) is under way at O’Brien. The company has completed 79,776 m thus far with results pending for 13,760 m.
  • The company’s cash balance is approximately $12.5-million.
                        HIGHLIGHT DRILL RESULTS
Hole                From            To        Core length   Au -- uncut
                     (m)           (m)                (m)         (g/t Au)

OB-20-183         425.10        427.10               2.00          5.29
                  425.10        426.10               1.00         10.55
OB-21-185         763.40        765.00               1.60         14.94
                  763.40        764.00               0.60         36.80
OB-21-187         704.70        709.70               5.00          8.87
                  705.70        707.70               2.00         14.15
OB-21-191         744.90        751.00               6.10          5.09
                  746.00        747.00               1.00         11.75
                  764.00        766.60               2.60          5.43
                  764.80        765.70               0.90         10.60
OB-21-193         573.40        575.50               2.10         18.87
                  573.40        574.30               0.90         43.80
OB-21-201         502.30        513.00              10.70         11.13
                  502.30        510.50               8.20         13.90
                  505.00        508.00               3.00         19.20

(1) Core length or downhole width: True widths are 
estimated at 70 per cent to 80 per cent of downhole width. To the 
extent possible, primary intercepts reflect minimum mining width 
(1.5 m true width) consistent with assumptions used in the 2019 
resource estimate.
(2) Assay grades are shown uncapped. A capping factor of 60 g/t Au 
was used in the 2019 resource estimate.
(3) The table includes only intercepts that meet five g/t Au cut-off 
and minimum mining width constraints used in the 2019 MRE. 

“Drill results continue to increase our confidence in the robust grade and scale potential at the O’Brien project. Results thus far suggest the potential to double the depth extent of resources in each trend, while also expanding mineralization laterally to the east and west. We are particularly impressed by several broad intercepts along trend No. 2 that highlight the potential for wider mineralized zones created by the intersection of multiple mineralized veins, between 400 m and 700 m from surface. Observed mineralized widths in these areas appear to be meaningfully higher than the average 2.90 m in currently modelled resource areas, in turn significantly enhancing the high-grade nature of the deposit.

“While the majority of our work program has been focused within one km along strike to the east of the historic O’Brien mine, we believe there is significantly more upside to be unlocked from a prospective land package that includes more than five km of strike length along the prolific Cadillac Break. We look forward to a steady stream of news flow as we step out systematically further along strike and deeper beyond the limits of drilling to date, including high-potential targets to the west of the old O’Brien mine,” commented Rahul Paul, president and interim chief executive officer.

Stepout drilling highlights resource growth potential up to 330 m below current resources in trend No. 2 (600 m east of the old O’Brien mine).

OB-21-183 (5.29 g/t Au over 2.00 m), OB-21-185 (14.94 g/t Au over 1.60 m), OB-21-187 (8.87 g/t Au over 5.00 m), OB-21-191 (5.09 g/t Au over 6.10 m), OB-21-193 (18.87 g/t Au over 2.10 m) and OB-21-201 (13.90 g/t Au over 8.20 m) demonstrate continuity of high-grade mineralization at depth along high-grade trend No. 2.

Newly released intercepts and previously released intercepts from holes have now traced mineralization down to a vertical depth of 800 m in this sector where the majority of defined resources are within 400 m from surface. These results also appear to align nicely with a historical intercept of 17.46 g/t Au over 1.00 m (KW-04-02W1) obtained more down plunge at a depth of approximately 1,100 m.

Several relatively broader intercepts from holes OB-21-187, OB-21-191, OB-21-201, OB-20-124 (8.35 g/t Au over 6.00 m), OB-20-180 (18.42 g/t Au over 5.00 m), OB-20-156 (11.32 g/t Au over 11.80 m) and OB-20-156W2 (5.77 g/t Au over 7.10 m) suggest potential for wider mineralized zones (five to 20 m wide) between 400 and 700 m vertical depth, likely highlighting the impact of crosscutting high-grade mineralized veins.

Mineralization in trend No. 2 is currently open for expansion below 800 m as well as laterally to the east and west. Drilling is currently continuing in this sector with additional results expected in the coming weeks.

Drilling at O’Brien continues to validate the litho-structural model while highlighting resource growth potential laterally and at depth.

Drilling to date has continued to define and expand three high-grade mineralized trends, located approximately 300 m, 600 m and 900 m, respectively, to the east of the old O’Brien mine. Mineralized trends identified bear similarities with structures previously mined at O’Brien down to a depth of 1,100 m (historical production of 587,000 ounces grading 15.25 g/t Au).

Drilling so far has demonstrated continuity of mineralization well below the boundary of defined resources in all three trends, which remain open for expansion laterally and at depth. In trend No. 1, drilling has highlighted continuity of mineralization down to a vertical depth of 950 m, while current resources are mostly limited to a vertical depth of approximately 600 m. In trend No. 2, drilling has highlighted continuity of mineralization down to a vertical depth of over 800 m, while current resources are mostly within 400 m from surface. In trend No. 3, drilling has traced mineralization down to 500 m vertical depth from surface. Current resources are mostly confined to within a vertical depth of 240 m.

Almost all drilling conducted as part of the continuing campaign has been within a strike length of approximately one kilometre to the east of the old O’Brien mine, representing only a small portion of more than 5.2 km of prospective strike that Radisson controls along the Cadillac Break. Given current geological understanding and the continuing validation of the litho-structural model, the company estimates there is strong exploration for additional high-grade gold trends along the whole 5.2 km prospective land package on the prolific Larder Lake-Cadillac Break.

79,776 m of drilling completed to date with assays pending for approximately 13,760 m

This release represents approximately 5,260 m of drilling in nine drill holes. Released results to date (since the commencement of drilling in August, 2019) represent approximately 45 per cent of the 130,000 m envisioned to be completed by the end of 2021. As of April 30, 2021, the company remains well financed with approximately $12.5-million in cash.

Reallocation of responsibilities related to exploration and technical services

As part of a reorganization of the team, Radisson is pleased to announce that Donald Trudel (previously senior project geologist for O’Brien) has been promoted exploration manager for Radisson Mining, while Nicolas Guivarch has been promoted to senior geologist — technical services (previously exploration manager). As exploration manager for the company, Mr. Trudel will be entrusted with oversight of day-to-day operational and administrative activities related to exploration. In his capacity as senior geologist, technical services, Mr. Guivarch will be responsible for oversight of technical services activities for the company including geological modelling and database management.

Mr. Trudel and Mr. Guivarch will continue to work closely with Ken Williamson, who, in his capacity as senior adviser, geology, will continue to play a broader supervisory role with the exploration group, overseeing both the exploration and technical services functions.

Orca Gold grants options for 4.65 million shares

Orca Gold Inc. has granted an aggregate of 4.65 million incentive stock options to certain officers, directors and other eligible persons of the company. The options are exercisable, subject to vesting provisions, over a period of three years at a price of 59 cents per share.

The company has also granted a total of 508,476 deferred share units (DSUs) to non-executive directors and 2,016,951 restricted share units (RSUs) to executives and senior management. The DSUs and RSUs are granted in accordance with the company’s deferred share unit plan and restricted share unit plan. The RSUs are subject to vesting provisions.

Highgold to spend $10M on exploring Johnson Tract

An initial $10-million exploration budget has been approved for Highgold Mining Inc. 750,000-ounce 10.9-gram-per-tonne-gold-equivalent (AuEq) Johnson Tract polymetallic gold project in south-central Alaska, United States.

2021 exploration program plans and strategy

  • Minimum 16,000 metres of drilling with three drill rigs;
  • Drilling to target both:
    • Expansion and infill to upgrade of the JT deposit plus adjacent target areas;
    • First-time testing of other Johnson district prospects, including the new one-kilometre-by-0.5-kilometre high-grade Ag-Au vein field discovered by prospecting in 2020 at the DC prospect four km northeast of the JT deposit.
  • Property-wide magnetic-electromagnetic (VTEM) airborne geophysical survey totalling 1,100 line km to identify major fault structures and prospective areas of subsurface mineralization;
  • Detailed IP resistivity (DCIP) ground geophysical surveys over several Johnson district regional prospects to detect prospective mineralized trends;
  • Geological mapping, prospecting, and soil and rock sampling programs to follow up and expand on the positive results generated from the 2020 program and refine drill targets.

“Our exploration team’s mandate in 2021 includes both establishing critical mass at the JT deposit and making new discoveries,” commented president and chief executive officer Darwin Green. “The JT deposit is open to expansion and a priority for this program is to continue tracking and expanding the deposit farther down plunge. We have high conviction in the potential to define a multideposit district at Johnson tract and are excited to be drill testing several of the priority regional prospects for the first time ever. With $17-million in working capital, Highgold is fully funded for the planned program.”

Program details

Preparations are under way to begin opening the JT camp and to commence the VTEM airborne geophysical survey in late May. Three drill rigs were secured on site at the end of the 2020 field season and are scheduled to be up and running in early June. The current drill plan contemplates approximately two-thirds of the total 16,000 metres dedicated to the JT deposit and adjacent targets, and one-third dedicated to the surrounding Johnson district prospects.

Initial plans are for all three drill rigs to start in the JT deposit area, completing systematic stepouts down plunge and along strike to the deposit, as well as testing the Footwall copper zone, Gap, revised fault offset and new VMS zone targets. Drilling at the JT district regional prospects is expected to commence in July, with a minimum of one drill rig dedicated for the remainder of the program. All the necessary permits are in hand to drill at each of the planned target areas. DCIP ground geophysical surveying will also start in July.

Nicola Mining Inc. Extends Gold and Silver Profit Share Agreement with Blue Lagoon for Dome Mountain Mine and Receives First Shipment

Vancouver, British Columbia–(Newsfile Corp. – May 5, 2021) – Nicola Mining Inc. (TSXV: NIM)(FSE: HLI), (the “Company” or “Nicola”) is pleased to announce that it and Blue Lagoon Resources Inc. (CSE: BLLG)┬áhave signed an amending agreement (the “Amending Agreement”) to the Milling and Smelting Profit Share Agreement dated March 31, 2017 (the “Original Agreement”). The Amending Agreement extends the Original Agreement by two years, through to March 31, 2023.

The Amending Agreement comes at a particularly exciting time, as Blue Lagoon has received permission allowing it to extract more than 6,000 tonnes1 of underground stockpiled material. Nicola has ordered spare parts, prepped its mill, and is in the process of hiring key employees2 prior to commencing production at its mill, which is located near Merritt, B.C.

On April 1, 2021 Blue Lagoon Inc. sent to Nicola the first truck of gold and silver mill feed from its Dome Mountain Gold-Silver Mine (See Diagram 1). After having considered various options, BLLG selected NIM’s Merritt Mill as the province’s top site to process gold and silver mill feed.

Nicola’s Merritt Mill site is a unique milling and processing facility because the Company owns the industrial-zoned site free-hold. The approximate $30.0 million facility is also the location of the historic Craigmont Copper Mine, which had a historic production grade of 1.3% Cu.

The Company and BLLG continue to monitor snowpack indices for BC, which is 113% of normal. Upon confirmation of the roads opening after spring runoff, BLLG expects to increase the daily trucking of stockpile to the Merritt Mill.

Cannot view this image? Visit:

Diagram 1: Truck unloads first shipment of material from Dome Mountain Gold-Silver Mine

To view an enhanced version of Diagram 1, please visit:

Peter Espig, CEO of Nicola, commented, “We are very excited to have signed the Amending Agreement with Blue Lagoon, a well-run company under the tutelage of Rana Vig. While the capital markets often focus on mineral exploration, it’s exciting to be part of a project that is focused on gold and silver production.”

Rana Vig, CEO of Blue Lagoon Resources commented, “Having reviewed several options, it became clear to us that Nicola’s modern milling facility and leadership team was a logical choice as a partner. We are excited about the prospect of commencing production and continuing a long term relationship with Nicola Mining Inc. as we shift from stockpile to mining.”

Amerigo Resources earns $10.9-million in Q1

Amerigo Resources Ltd. has released financial results for the three months ended March 31, 2021.

Amerigo posted net income of $10.9 million, earnings per share (“EPS”) of $0.06, EBITDA1 of $23.3 million and quarterly operating cash flow before changes in working capital of $20.0 million.

“We are pleased to report again strong operational and financial results at Amerigo Resources. At an average quarterly copper price of $4.08 per pound, the Company generated $20.0 million in operating cash flow, improving its ending cash position to $38.6 million while continuing to reduce debt. As of the date of this news release, the Company’s cash position now exceeds total debt outstanding”, said Aurora Davidson, Amerigo’s President and CEO.

The information and data contained in this news release should be read in conjunction with Amerigo’s interim consolidated financial statements and Management’s Discussion and Analysis (“MD&A) for the quarter ended March 31, 2021, available at the Company’s website at and at

Highlights and Significant Items

Q1-2021 net income was $10.9 million (Q1-2020: net loss of $4.0 million), due to higher production, higher metal prices and $5.0 million in positive fair value adjustments to Q4-2020 copper receivables.

Q1-2021 EPS was $0.06 (Q1-2020: loss per share (“LPS”) of $0.02).

The Company generated quarterly operating cash flow before changes in non-cash working capital of $20.0 million (Q1-2020: negative operating cash flow $4.1 million). Q1-2021 net operating cash flow was $28.1 million (Q1-2020: negative net operating cash flow of $1.4 million).

Q1-2021 production from Amerigo’s Minera Valle Central (“MVC”) tailings processing facility in Chile was 15.5 million pounds of copper (Q1-2020: 12.1 million pounds) including 8.5 million pounds from Cauquenes (Q1-2020: 5.7 million pounds) and 7.0 million pounds from fresh tailings (Q1-2020: 5.1 million pounds). In Q1-2020, 1.2 million pounds of copper were produced from slag processing.

Molybdenum production during Q1-2021 was 0.4 million pounds (Q1-2020: 0.2 million pounds).

Q1-2021 cash cost2 (a non-GAAP measure equal to the aggregate of smelting and refining charges, tolling/production costs net of inventory adjustments and administration costs, net of by-product credits, decreased 3% to $1.88 per pound (“/lb”) (Q1-2020: $1.94/lb).

In Q1-2021, MVC’s average quarterly copper price was $4.08/lb, 74% higher than the Q1-2020 average quarterly copper price of $2.35/lb. MVC’s average quarterly molybdenum price was $10.88/lb, 18% higher than the Q1-2020 average quarterly price of $9.20/lb.

Revenue during Q1-2021 was $48.9 million (Q1-2020: $15.6 million), including copper tolling revenue of $45.4 million (Q1-2020: $13.3 million) and molybdenum revenue of $3.5 million (Q1-2020: $1.7 million). In Q1-2020 slag processing revenue was $0.7 million.

Copper tolling revenue is calculated from MVC’s gross value of copper produced during Q1-2021 of $58.1 million (Q1-2020: $27.2 million) and fair value adjustments to settlement receivables of $8.5 million (Q1-2020: (negative $5.3 million)), less notional items including DET royalties of $16.0 million (Q1-2020: $5.2 million), smelting and refining of $4.7 million (Q1-2020: $3.0 million) and transportation of $0.5 million (Q1-2020: $0.3 million). The Q1-2021 settlement adjustments included $5.0 million in settlement adjustments in respect of Q4-2020 production, which are final adjustments.

MVC’s financial performance is very sensitive to changes in copper prices. MVC’s Q1-2021 provisional copper price was $4.08/lb, and final prices for January, February, and March sales will be the average London Metal Exchange (“LME”) prices for April, May, and June respectively. A 10% increase or decrease from the $4.08/lb provisional price used at March 31, 2021 would result in a $6.2 million change in revenue in Q2-2021 in respect of Q1-2021 production.

At March 31, 2021, the Company’s cash balance was $38.6 million (December 31, 2020: $14.1 million) and the Company had working capital of $11.5 million (December 31, 2020: working capital deficiency of $6.1 million).

In Q1-2021, the Company received $3.9 million in proceeds from the sale of investments.

In Q1-2021, the Company made scheduled debt payments of $6.5 million (Q1-2020: $4.7 million) and paid $0.6 million for plant and equipment (Q1-2020: $0.5 million). MVC’s debt balance with banks at March 31, 2021 was $41.5 million.

Investor Conference Call on May 6, 2021

Amerigo’s quarterly investor conference call will take place on Thursday, May 6, 2021 at 11:00 am Pacific Daylight Time/2:00 pm Eastern Daylight Time.

To join the call, please dial 1-888-664-6392 (Toll-Free North America) and enter confirmation number 84376564 to participate in the Amerigo Resources conference call.

The analyst and investment community are welcome to ask questions to management. Media can attend on a listen-only basis.