Mr. Mark Child reports
MINERAL RESOURCE UPDATE ON LA INDIA PROJECT, NICARAGUA, INCLUDING INITIAL DECLARATION OF NEW OPEN PIT MINERAL RESOURCE AT MESTIZA
Condor Gold PLC has released the results of an updated mineral resource estimate on its 100-per-cent-owned La India project in Nicaragua. The MRE as at Jan. 25, 2019, is 9.85 million tonnes at 3.6 grams per tonne gold for 1.14 million ounces gold in the indicated category and 8.48 million tonnes at 4.3 g/t gold for 1,179,000 oz gold in the inferred category.
The MRE was prepared by SRK Consulting (U.K.) Ltd. and uses the terminology, definitions and guidelines given in the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on mineral resources and mineral reserves (May, 2014).
Highlights of mineral resource estimate:
- Total indicated mineral resources of 9.85 million tonnes at a grade of 3.6 g/t gold, for a total contained ounces of 1.14 million oz gold;
- Total inferred mineral resources of 8.48 million tonnes at a grade of 4.3 g/t gold, for a total contained ounces of 1,179,000 oz gold;
- Total open-pit mineral resource of 8.58 million tonnes at a grade of 3.3 g/t gold, for 902,000 oz gold in the indicated category and 3.01 million tonnes at a grade of 3.0 g/t gold, for 290,000 oz gold in the inferred category;
- New open-pit mineral resource on Mestiza of 92,000 tonnes at a grade of 12.1 g/t (36,000 oz contained gold) in the indicated category and 341,000 tonnes at a grade of 7.7 g/t gold (85,000 oz contained gold) in the inferred category;
- Total underground mineral resources of 1.27 million tonnes at a grade of 5.8 g/t gold, for 238,000 oz gold in the indicated category and 5.47 million tonnes at a grade of 5.1 g/t gold, for 889,000 oz gold in the inferred category.
Mark Child, chairman and chief executive officer of Condor Gold, commented:
"The mineral resource update on La India project totals 9.85 million tonnes at 3.6 g/t gold for 1.14 million oz gold in the indicated category and 8.48 million tonnes at 4.3 g/t gold for 1,179,000 oz gold in the inferred category and is a timely reminder of the high-grade nature of this gold deposit. The mineral resource update includes 8,222 m drilling completed since the previous mineral resource update in September, 2014. The higher level of confidence, the indicated category of mineral resource, has increased by 57,000 oz.
"Most importantly, the drilling has proved two new satellite open-pit resources. Of note is the new open-pit mineral resource on Mestiza of 92,000 t at a grade of 12.1 g/t for 36,000 oz contained gold in the indicated category and 341,000 t at a grade of 7.7 g/t gold for 85,000 oz contained gold in the inferred category. The four satellite open pits outside the main, permitted La India open pit have combined open-pit resources of 206,000 t at 9.9 g/t gold for 66,000 oz gold in the indicated category and 2,127,000 t at 3.23 g/t gold for 221,000 oz gold in the inferred category. The company will conduct mining studies to determine the possibility of adding the contained gold within the satellite pits to a mine schedule to supplement the ore feed from the permitted La India open pit to the processing plant. This has the possibility to either increase annual production and/or extend the life of mine."
Summary of updated mineral resource estimate
The MRE includes an additional 8,222 m drilling since September, 2014, and is 9.85 million t at 3.6 g/t gold for 1.14 million oz gold in the indicated category and 8,479,000 t at 4.3 g/t gold for 1,179,000 oz gold in the inferred category. This compares with the mineral resource estimate on Sept. 30, 2014, which reported 9,557,000 t at 3.5 g/t gold for 1,083,000 oz gold in the indicated category and 8,526,000 t at 4.5 g/t gold for 1,231,000 oz gold in the inferred category.
The 8,222 m of additional drilling, and the updated part of the mineral resource, are in three areas at the core of the La India project, all of which now contain open-pit mineral resources reported within an optimized Whittle pit shell, applying parameters considered in line with the criteria of reporting mineral resources with reasonable potential for economic extraction:
- Five thousand eight hundred ninety-five m of infill drilling for a total of 42 drill holes on the Mestiza vein set has converted inferred mineral resource to the indicated category and delineated a maiden open-pit mineral resource of 92,000 t at 12.1 g/t gold for 36,000 oz gold in the indicated category and 341,000 t at 7.7 g/t gold in the inferred category. The Mestiza vein set also hosts an underground mineral resource of 118,000 t at 5.5 g/t gold in the indicated category and 984,000 t at 5.3 g/t gold for 169,000 oz gold in the inferred category.
- One thousand six hundred seven m of drilling for a total of five drill holes on the La India vein set extended the mineral resource at depth and increased the underground mineral resource associated with the mineralized southern ore shoot. There was no drilling within the volume associated to the La India open-pit mineral resource. The La India vein set hosts an open-pit mineral resource of 8,377,000 t at 3.1 g/t gold for 837,000 oz gold in the indicated category and 887,000 t at 2.4 g/t gold for 69,000 oz gold in the inferred category and an underground mineral resource estimate of 678,000 t at 4.9 g/t gold for 107,000 oz gold in the indicated category and 1,718,000 t at 5.6 g/t gold for 309,000 oz gold in the inferred category.
- Seven hundred nineteen m of follow-up drilling for a total of four drill holes on El Cacao successfully confirmed the presence of a wide structure in drill hole CCDC025 of 17.1 m at 1.74 g/t gold (see the release dated Jan. 17, 2017) and defined an open-pit mineral resource of 188,000 t at 2.3 g/t gold for 14,000 oz gold in the inferred category and underground mineral resource of 474,000 t at 3.0 g/t gold for 46,000 oz gold in the inferred category.
The MRE does not show a material change in the number of ounces of gold reported, being 1.14 million oz in the indicated category and 1,179,000 oz in the inferred category. Notwithstanding that already mentioned in this news release, the MRE reports an increase of 57,000 oz in the number of gold ounces in the indicated category, a 40,000 oz increase in the open-pit mineral resources reported in the indicated category and a 56,000 oz increase in the open-pit mineral resources in the inferred category.
The MRE continues to demonstrate that there is potential to enhance the La India project with additional material conducive to open-pit mining methods. In addition to the main La India open pit, there are now four satellite pits that have the potential to act as feeder pits, to provide mineralized material to the permitted plant and to supplement feed from the main La India open pit. These satellite pits (Mestiza, America, Central Breccia and Cacao) in aggregate represent 206,000 t at 9.9 g/t Au for 66,000 oz in the indicated category and 2,127,000 t at 3.2 g/t gold for 221,000 oz in the inferred category.
Given that there has been no material change to the La India open-pit mineral resource estimate, the mineral reserve referenced in the 2014 prefeasibility study will not be materially impacted by this update. It is the company's intention to continue to evaluate the mining strategy for the La India deposit as it progresses toward an infill drill program and subsequent feasibility study.
Summary of SRK mineral resource estimate statement as of Jan. 25, 2019, with subtotals for the mineral resource estimate in the indicated and inferred categories.
SRK MINERAL RESOURCE STATEMENT AS OF JAN. 25, 2019 (4), (5), (6)
Category Area name Vein name Cut-off Gold Silver
Tonnes (kt) Au grade (g/t) Au (Koz) Ag grade (g/t) Ag (Koz) (7)
indicated Grand total All veins 0.5 g/t (OP) (1) 8,583 3.3 902 5.6 1,535
2.0 g/t (UG) (2) 1,267 5.8 238 8.5 345
Subtotal Indicated 9,850 3.6 1,140 5.9 1,880
inferred Grand total All veins 0.5 g/t (OP) (1) 3,014 3.0 290 6.0 341
2.0 g/t (UG) (2) 3,714 5.1 609 9.6 860
1.5 g/t (3) 1,751 5.0 280
Subtotal Inferred 8,479 4.3 1,179 8.2 1,201
(1) The methods applied to conducting the geological modelling and estimation have not changed from those
described in the technical report. The La India, America, Central Breccia, Mestiza and Cacao pits are
amenable to open-pit mining and the mineral resource estimates are constrained within Whittle optimized
pits, which SRK based on the following parameters: A gold price of $1,500 (U.S.) per ounce of gold with no
adjustments. Prices are based on experience gained from other SRK projects. Metallurgical recovery
assumptions are between 91 to 96 per cent for gold based on testwork conducted to date. Marginal costs of $19.36
(U.S.)/tonne for processing, $5.69 (U.S.)/t G&A and $2.35 (U.S.)/t for mining, slope angles defined by the
company geotechnical study, which range from 40 degrees to 48 degrees, a haul cost of $1.25 (U.S.)/t was added
to the Mestiza ore tonnes to consider transportation to the processing plant.
(2) Underground mineral resources beneath the open pit are reported at a cut-off grade of 2.0 grams per tonne
over a minimum width of 1.0 metre. Cut-off grades are based on a price of $1,500 (U.S.) per ounce of gold and
gold recoveries of 91 per cent for resources, costs of $19.36 (U.S.)/t for processing, $4.5 (U.S.)/t G&A and $50.0
(U.S.)/t for mining, without considering revenues from other metals.
(3) Mineral resources as previously quoted by SRK (Dec. 22, 2011) are reported at a cut-off grade of 1.5 g/t, and
have not been updated as part of the current study due to no further detailed exploration.
(4) Mineral resources are not mineral reserves and do not have demonstrated economic viability. All figures
are rounded to reflect the relative accuracy of the estimate and have been used to derive subtotals, totals
and weighted averages. Such calculations inherently involve a degree of rounding and consequently introduce
a margin of error. Where these occur, SRK does not consider them to be material. All composites have been
capped where appropriate. The concession is wholly owned by and exploration is operated by Condor Gold.
(5) The MRE uses the terminology, definitions and guidelines given in the Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Standards on mineral resources and mineral reserves (May, 2014).
(6) SRK completed a site inspection to the deposit by Benjamin Parsons, MSc (MAusIMM (CP), membership
No. 222568, a "qualified person" as defined by National Instrument 43-101.
(7) Back calculated inferred silver grade based on a total tonnage of 4,569 kilotons as no silver estimates for
Teresa, Central Breccia, Arizona, Auga Caliente, Guapinol, San Lucas, Cristalito-Tatescame or El Cacao.
Summary of mineral resource estimate statement as of Jan. 25, 2019, for the indicated and inferred categories split per vein.
SRK MINERAL RESOURCE STATEMENT SPLIT PER VEIN AS OF JAN. 25, 2019 (4), (5), (6)
Category Area name Vein name Cut-off Gold Silver
Tonnes (kt) Au grade Au (Koz) Ag grade (g/t) Ag (Koz)
(g/t)
Indicated La India
veinset La India/California (1) 0.5 g/t (OP) 8,377 3.1 837 5.4 1,459
La India/California (2) 2.0 g/t (UG) 678 4.9 107 10.6 231
America
veinset America Mine (1) 0.5 g/t (OP) 114 8.1 30 4.9 18
America Mine (2) 2.0 g/t (UG) 470 7.3 110 4.7 71
Mestiza
veinset Tatiana 0.5 g/t (OP) 92 12.1 36 19.5 57
Tatiana 2.0 g/t (UG) 118 5.5 21 11.3 43
Inferred La India
veinset La India/California (1) 0.5 g/t (OP) 883 2.4 68 4.4 124
Teresa (3) 0.5 g/t (OP) 3 6.5 1
La India/California (2) 2.0 g/t (UG) 1,165 5.6 209 12.4 464
Teresa (2) 2.0 g/t (UG) 82 11.0 29
Arizona (3) 1.5 g/t 430 4.2 58
Agua Caliente (3) 1.5 g/t 40 9.0 13
America
veinset America Mine (1) 0.5 g/t (OP) 677 3.1 67 5.5 120
America Mine (2) 2.0 g/t (UG) 1,008 4.8 156 6.8 221
Guapinol (3) 1.5 g/t 751 4.8 116
Mestiza
veinset Tatiana (1) 0.5 g/t (OP) 220 6.6 47 13.6 97
Tatiana (2) 2.0 g/t (UG) 615 3.9 77 8.8 174
Buenos Aires (1) 0.5 g/t (OP) 120 9.8 38
Buenos Aires (2) 2.0 g/t (UG) 188 7.1 43
Espenito (2) 2.0 g/t (UG) 181 8.4 49
Central
Breccia Central Breccia (1) 0.5 g/t (OP) 922 1.9 56
San Lucas San Lucas (3) 1.5 g/t 330 5.6 59
Cristalito-
Tatescame Cristalito-Tatescame (3) 1.5 g/t 200 5.3 34
El Cacao El Cacao (1) 0.5 g/t (OP) 188 2.3 14
El Cacao (2) 2.0 g/t (UG) 474 3.0 46
(1) The methods applied to conducting the geological modelling and estimation have not changed from those
described in the technical report. The La India, America, Central Breccia, Mestiza and Cacao pits are
amenable to open-pit mining and the mineral resource estimates are constrained within Whittle optimized
pits, which SRK based on the following parameters: A gold price of $1,500 (U.S.) per ounce of gold with no
adjustments. Prices are based on experience gained from other SRK projects. Metallurgical recovery
assumptions are between 91 to 96 per cent for gold based on testwork conducted to date. Marginal costs of $19.36
(U.S.)/tonne for processing, $5.69 (U.S.)/t G&A and $2.35 (U.S.)/t for mining, slope angles defined by the
company geotechnical study, which range from 40 degrees to 48 degrees, a haul cost of $1.25 (U.S.)/t was added
to the Mestiza ore tonnes to consider transportation to the processing plant.
(2) Underground mineral resources beneath the open pit are reported at a cut-off grade of 2.0 grams per tonne
over a minimum width of 1.0 metre. Cut-off grades are based on a price of $1,500 (U.S.) per ounce of gold and
gold recoveries of 91 per cent for resources, costs of $19.36 (U.S.)/t for processing, $4.5 (U.S.)/t G&A and $50.0
(U.S.)/t for mining, without considering revenues from other metals.
(3) Mineral resources as previously quoted by SRK (Dec. 22, 2011) are reported at a cut-off grade of 1.5 g/t, and
have not been updated as part of the current study due to no further detailed exploration.
(4) Mineral resources are not mineral reserves and do not have demonstrated economic viability. All figures
are rounded to reflect the relative accuracy of the estimate and have been used to derive subtotals, totals
and weighted averages. Such calculations inherently involve a degree of rounding and consequently introduce
a margin of error. Where these occur, SRK does not consider them to be material. All composites have been
capped where appropriate. The concession is wholly owned by and exploration is operated by Condor Gold.
(5) The MRE uses the terminology, definitions and guidelines given in the Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) Standards on mineral resources and mineral reserves (May, 2014).
(6) SRK completed a site inspection to the deposit by Benjamin Parsons, MSc (MAusIMM (CP), membership
No. 222568, a "qualified person" as defined by National Instrument 43-101.
About Condor Gold PLC
In August, 2018, the company announced that the Ministry of the Environment had granted the company the environmental permit (EP) for the development, construction and operation of a processing plant with capacity to process up to 2,800 tonnes per day at its wholly owned La India gold project in Nicaragua. Condor published a prefeasibility study on the La India project in December, 2014, as summarized in the technical report (as defined below). The PFS details an open-pit gold mineral reserve in the probable category of 6.9 million tonnes at 3.0 g/t gold for 675,000 oz gold, producing 80,000 oz gold per annum for seven years. The La India project contains a mineral resource in the indicated category of 9.6 Mt at 3.5 g/t for 1.08 million oz gold and a total mineral resource in the inferred category of 8.5 Mt at 4.5 g/t for 1.23 million oz gold.
Qualified persons
The mineral resource estimate has been completed by Ben Parsons, a principal consultant (resource geology) with SRK Consulting (U.S.), who is a member of the Australian Institute of Mining and Metallurgy, MAusIMM (CP). Mr. Parsons has about 18 years of experience in the exploration, definition and mining of precious and base metal mineral resources. Mr. Parsons is a full-time employee of SRK Consulting, an independent consultancy, and has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration, and to the type of activity which he is undertaking to qualify as a qualified person as defined by National Instrument 43-101 and as required by the June, 2009, edition of the Alternative Investment Market Note for Mining and Oil & Gas Companies. Mr. Parsons consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
The technical and scientific information in this press release has been reviewed, verified and approved by Andrew Cheatle, PGeo, who is a qualified person as defined by NI 43-101.
Technical information
Certain disclosure contained in this news release of a scientific or technical nature has been summarized or extracted from the technical report entitled "Technical Report on the La India Gold Project, Nicaragua, December 2014," dated Nov. 13, 2017, with an effective date of Dec. 21, 2014, prepared in accordance with National Instrument 43-101. The technical report was prepared by or under the supervision of Tim Lucks, principal consultant (geology and project management), Gabor Bacsfalusi, principal consultant (mining), Mr. Parsons, each of SRK Consulting (UK) Ltd., and Neil Lincoln of Lycopodium Minerals Canada Ltd., each of whom is an independent qualified person as such term is defined in NI 43-101.
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