Southern Silver Exploration Corp. (TSX-V: SSV) reports that Kirkham Geosystems Ltd. has completed an update of its independent Mineral Resource Estimate on the Cerro Las Minitas project in Durango State, Mexico, operated on a joint venture basis by SSV(40%) as operator and Electrum Global Holdings LP(60%).
This Mineral Resource Estimate showcases the continuity of the mineralization and continued expansion of the Cerro Las Minitas project and updates the previously reported March 2016 estimate. The new Resource Estimate incorporates additional data from drilling conducted in 2016 and 2017 that has successfully delineated a major new deposit on the project and significantly increased the resource base in both the Indicated and Inferred Resource categories as well as improving the overall grade of the resource, most significantly in the Indicated category.
Resource Model Highlights
In comparison to the 2016 Mineral Resource estimate, the 2017 update, at a 175g/t AgEq cut-off, features:
|·||a 318% increase in Indicated Mineral resources to|
|–||10.1Mt averaging 102g/t Ag, 0.1g/t Au, 0.15% Cu, 1.4% Pb and 3.6% Zn (356g/t AgEq, 7.6% ZnEq);|
|·||an 18% increase in Inferred Mineral resources to|
|–||8.7Mt averaging 74g/t Ag, 0.04g/t Au, 0.15% Cu, 0.7% Pb and 4.5% Zn (332g/t AgEq, 7.0% ZnEq);|
|·||the utilization of a higher cut- off (175g/t AgEq) to reflect potential mining costs and metal recoveries;|
|·||an increase in the average grade, as denoted in AgEq, of the Indicated Resources; and|
|·||the newly delineated Skarn Front zone which now forms the single largest mineral deposit in the Cerro Las Minitas Project area.|
Table 1: Base-case Mineral Resource Estimate for CLM Project Utilizing a 175g/t AgEq cut-off value:
|Zone||Tonnes||Ag||Au||Pb||Zn||Cu||AgEq||ZnEq||Ag TrOz||Au TrOz||Pb||Zn||Cu||AgEq TrOz||ZnEq|
|Zone||Tonnes||Ag||Au||Pb||Zn||Cu||AgEq||ZnEq||Ag TrOz||Au TrOz||Pb||Zn||Cu||AgEq TrOz||ZnEq|
Notes: The 175g/t AgEq cut-off value was calculated using average long-term prices of $16/oz. silver, $1,200/oz. gold, $2.75/lb. copper, $1.0/lb. lead and $1.10/lb. zinc and metal recoveries of 82% silver, 86% lead, 80% zinc and 80% copper were used to define the cut-off grades. The base case cut-off grade assumed $75/tonne operating and sustaining costs. All prices are stated in $USD.
Table2: Mineral Resource Cut-off Sensitivities at the CLM Project, Durango State, Mexico
|Tonnes||Ag||Au||Pb||Zn||Cu||AgEq||ZnEq||Ag TrOz||Au TrOz||Pb||Zn||Cu||AgEq TrOz||ZnEq|
|150g/t AgEq Cut-off|
|175g/t AgEq Cut-Off|
|250g/t AgEq Cut-Off|
|350g/t AgEq Cut-Off|
|1)||The current Resource Estimate was prepared by Garth Kirkham, P.Geo., of Kirkham Geosystems Ltd.|
|2)||All mineral resources have been estimated in accordance with Canadian Institute of Mining and Metallurgy and Petroleum (“CIM”) definitions, as required under National Instrument 43-101 (“NI43-101”).|
|3)||Mineral resources were constrained using mainly geological constraints and approximate 10g/t AgEq grade domains.|
|4)||AgEq cut-off values were calculated using average long-term prices of $16/oz silver, $1,200/oz gold, $2.75/lb Copper, $1.00/lb lead and $1.10/lb zinc and metal recoveries of 82% silver, 86% lead, 80% copper and 80% zinc. Base case cut-off grade assumed $75/tonne operating and sustaining costs. All prices are stated in $USD.|
|5)||All contained metal content values (including equivalencies) were calculated assuming 100% recoveries.|
|6)||Mineral resources are not mineral reserves until they have demonstrated economic viability. Mineral resource estimates do not account for a resource’s mineability, selectivity, mining loss, or dilution. All figures are rounded to reflect the relative accuracy of the estimate and therefore numbers may not appear to add precisely.|
Four separate mineral deposits were modelled in the resource update with the Blind, the El Sol and the Las Victorias deposits forming sets of sub-parallel, northwest-trending and steeply dipping mineralized zones which extend for over 1000 metres strike and up to 600 metres depth. The fourth deposit known as the Skarn Front, forms beneath the Blind, El Sol and Las Victorias deposits and is localized on the outer edge of the skarn alteration zone surrounding the Central Monzonite Intrusion. Thick zones of higher-grade mineralization cluster at the projected intersections of the Blind and El Sol zones and the Skarn Front, the outline of which forms an extensive “higher-grade” target area which rakes for over 800 metres diagonally and ranges from 300 to 600 metres in width. Significantly, this target region and other targets along the Skarn Front zone have been only partially drill tested to date. More detailed drilling is required, particularly to delineate the extent of the higher-grade lenses. Analyses of the block model has identified several new target areas for drill testing in 2018 as well as the previously described extensions of the Skarn Front in the Las Victorias and North Skarn Target areas (see NR-18-17, November 6th, 2017).
KGL suggests that an underground mining scenario is appropriate for the project at this stage and has recommended a 175g/t AgEq cut-off value for the base-case resource estimate. Also listed are grade-tonnage sensitivities at 150g/t, 175g/t, 250g/t, and 350g/t AgEq cut-off values (see Table 2 above) which demonstrate both a significant increase in contained precious- and base-metals at lower cut-off values and good tonnage retention, at increasing overall grade, at incrementally higher cut-off values. A NI 43-101 Technical Report will be posted on SEDAR within 45 days.
Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be classified as Mineral Reserves. There is no assurance that any part of the Inferred Resource will be converted to Measured or Indicated Mineral Resources or ultimately converted to a Mineral Reserve.
President, Lawrence Page Q.C. stated “Since acquisition in September 2010, CLM continues to develop Mineral Resources with great potential to become a significant economic deposit. Exploration since 2016 has resulted in a 318 percent increase in Indicated Resources and an 18 percent increase in Inferred Resources, largely through the delineation of the new Skarn Front deposit which significantly remains open in several directions. We are confident that additional exploratory drilling during 2018 will continue adding great value to the present Resource”.
“Metal prices continue to enhance the value of the project with silver, lead and zinc; all industrial metals, increasing in demand as evidenced by their respective market prices with silver having a duality in value as a currency. The property is not burdened with royalties which enhances the prospects of mining and processing. Aggregate acquisition and exploration costs of $15.1 million, equate to a “finding” cost of approximately $0.07 per silver equivalent ounce with continued upside to add further resources.”
“During the past year, we have added at nominal cost 19,500 hectares of prospective ground to our property base, and have developed drill targets for exploration to begin here within the next few months.”
” ‘Location, location, location’ must be strongly emphasized when assessing the value of a resource. CLM is located in the middle of the Mexican silver district, in a “miner-friendly” jurisdiction surrounded by producing mines. Concurrently with the continued development of the resource, we continue to obtain independent reports on metallurgy and mining parameters to de-risk the project and increase value. Our shareholders will enjoy the continuing development of this Resource.”
2018 Exploration Program
Compilation and analysis of the 2016-17 results continues toward further drill targeting for the 2018 exploration program with Southern as the operator.
Exploration in 2018 will continue to define the overall size of the project and include:
The overall objective of the 2018-19 exploration program is to continue to increase the existing resource base and to identify and drill test new epithermal vein systems within the larger claim package.
CLM Resource Parameters
About Southern Silver Exploration Corp.
Southern Silver Exploration Corp. is a precious metal exploration and development company with a focus on the discovery of world-class mineral deposits in north-central Mexico and the southern USA. Our specific emphasis is the Cerro Las Minitas silver-lead-zinc project located in the heart of Mexico’s Faja de Plata, which hosts multiple world-class mineral deposits such as Penasquito, San Martin, Naica, Los Gatos and Pitarrilla. We have assembled a team of highly experienced technical, operational and transactional professionals to support our exploration efforts in developing, along with our partner, Electrum Global Holdings LP, the Cerro Las Minitas project into a premier, high-grade, silver-lead-zinc mine.
The Company engages in the acquisition, exploration and development either directly or through joint-venture relationships in mineral properties in major jurisdictions. Our property portfolio also includes the Oro porphyry copper-gold project located in southern New Mexico, USA. The Oro property consists of patented land, State leases and BLM located mineral claims which cover a highly prospective quartz-sericite-pyrite alteration zone, interpreted to overlie an unexposed porphyry center and distal sediment-hosted, oxide-gold target.
Robert Macdonald, MSc., P.Geo., is a Qualified Person as defined by National Instrument 43-101 and he is responsible for the supervision of the exploration on the Cerro Las Minitas Project and for the preparation and review of the technical results in this disclosure. Garth Kirkham, P.Geo., and Principal of Kirkham Geosystems Limited is an Independent Qualified Person responsible for the preparation and disclosure of the Mineral Resource Estimate.
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