Americas Silver Corporation (TSX: USA) (NYSE “American”: USAS)
(“Americas Silver” or the “Company”) is pleased to provide an
update of the mineral resource estimate at the San Felipe
zinc-silver‐lead project (“San Felipe”). San Felipe is located 130
km northeast of Hermosillo, Sonora, Mexico. In 2017, Americas
Silver acquired an option on San Felipe giving it the right to
acquire a 100% interest in the property without any underlying
third-party royalties.
Mineral Resource Highlights:
- Indicated mineral resources are
estimated to contain 4.7 million tonnes of ore, including 560
million pounds of zinc, 256 million pounds of lead and 9.1 million
ounces of silver.
- Inferred mineral resources are
estimated to contain 2.0 million tonnes, including 158 million
pounds of zinc, 63 million pounds of lead and 3.1 million ounces of
silver.
- Contained zinc and silver increased by
258% and 236% respectively in the indicated mineral resource.
San Felipe Indicated and Inferred Mineral Resources as at March
21, 2018
Classification
Tonnes(kt)
Zn(%)
Pb(%)
Ag(g/t)
Zn(Mlbs)
Pb(Mlbs)
Ag (Moz)
Indicated 4,685 5.4 2.5 61 560 256 9.1 Inferred 2,008 3.6 1.4 48
158 63 3.1
Notes:1. CIM Definition Standards were followed for mineral
resource estimates.2. Mineral resources are fully diluted to the
2mx3mx2m block size and estimated at a cut-off grade of 2.5% zinc
equivalent which incorporate metal recoveries.3. Mineral resources
are estimated using metal prices of US$18.00/oz Ag, US$3.00/lb Cu,
US$1.05/lb Pb, and US$1.05/lb Zn.4. Numbers may not add due to
rounding.5. The current or previous San Felipe resource estimates
are not included in the Company’s June 30, 2017 reserve and
resource estimates.6. Increase is based on comparison to the
previous resource estimate from the technical report titled “2014
Resource Estimate and PEA”, San Felipe Project, Sonora, Mexico”,
with an effective date of September 4, 2014 and amended date of
June 29, 2016, completed for the previous option holder, Santacruz
Silver Mining Ltd.
“With the significant increase in contained zinc and silver in
the indicated resource, San Felipe now becomes a more substantial
project in the current zinc market,” stated Darren Blasutti,
President and CEO of Americas Silver Corporation. “The updated
estimate at San Felipe highlights potential for another low-capital
project for the Company, after our successful start-up of the San
Rafael mine and the rapid resource expansion of the silver-rich
Zone 120 deposit. We will continue to evaluate San Felipe for its
economic merits and strategic fit ahead of making the final
payments for the option on the property by the end of the
year.”
Work during the past year on the San Felipe property included a
six-hole, twinning diamond drill hole program to provide
confirmation of historical drilling data, an updated interpretation
of the mineralization and mineral resource estimate by Mine
Development Associates (“MDA”), and a preliminary geotechnical
review of the property by Adiuvare GE. Both MDA and Adiuvare GE are
independent consulting firms. The twinning program confirmed the
historical drilling data and provided increased confidence in the
existing dataset. Three holes were drilled into each of the La
Ventana and San Felipe zones. These two zones are the most
significant mineral occurrences identified on the property in terms
of contained metals, contributing 100% of the indicated mineral
resources and approximately 50% of the inferred mineral resources
on a tonnage basis.
Geology and Mineralization
There are four deposits that contribute to the current mineral
resource estimate: La Ventana, San Felipe, Transversales and Las
Lamas. The Zn-Ag-Pb mineralization occurs as skarn-related massive
sulfide replacement veins, often cut by late quartz veins. It
appears that the late quartz is associated with increased silver,
copper and gold.
The potentially economic sulfide veins (>2.5% ZnEq) are
usually 2 to 10 meters wide and occur within much wider
near-vertical structural zones marked by strongly silicified,
weakly brecciated, andesite country rock. There is significant
faulting sub-parallel to the structural and mineral zones while
cross-faults off-set the mineralized structures.
A granitic batholith borders the south side of property and cuts
off the southwestern extension of the Las Lamas zone. The
granodiorite is also encountered at depth within the San Felipe and
La Ventana deposits and in the latter deposit appears to form the
footwall boundary to the mineralized structural zone. The
granodiorite is likely pre-mineral, or possibly contemporaneous,
with the early massive sulfide skarn, though is not as amenable to
skarn alteration as the andesite. Mineralization within the
granodiorite occurs primarily within narrow fractures and thin
veins. Rhyolite intrusives, often significantly faulted and
dismembered, occur within the andesite and like the granodiorite
are not as amenable to skarn alteration but can be host to more
fracture-controlled mineralization.
Project Database
The project database contains collar, downhole survey, assay,
and geology data for the four primary drilling campaigns: Boliden
(27 drill holes in 1998-2000), Hochschild (183 drill holes in
2006-2008), Santacruz (126 drill holes in 2013 and 2014), and
Americas Silver (six drill holes in 2017). Of the 342 total project
drill holes in the database, 294 are within the four deposit areas
and contribute to the geologic models and grade estimates.
In preparation for the updated mineral resource estimate, MDA
audited the project database by validating the collar, survey and
assay data against available original surveys and assay
certificates. MDA made minor adjustments to some of the historical
drill collar locations and corrected some rounding inconsistencies
in the assay data. As part of the data validation, the historical
quality assurance/quality control programs were evaluated. The
assay database is considered appropriate for use in the current
mineral resource estimate.
Estimation Methodology
Separate orthogonal block models were created for each zone. All
have a 2m by 2m by 3m block size that is appropriate for the
application of underground mining methods.
Zinc mineral-domain interpretations were used to code the drill
samples. Quantile plots, along with domain statistics and spatial
location of higher-grade samples, were made to assess validity of
these domains and to determine capping levels for the individual
mineral domain metal populations. Compositing was done to 1.5m
down-hole lengths using the capped assays and honouring all
mineral-domain boundaries.
The mineral domains were also used to code the block models with
the percent of block in each mineral domain. Density values are
based on 875 density measurements which are grouped and assigned to
the block model by zinc mineral domains. The final block-diluted
metal grade and density value for each model block is a
volume-weighted average based on the proportion of each domain
within the block.
Mineral domains aid in controlling the grade distribution, and
the estimation used inverse distance to the third power (“ID3”) to
interpolate grades into the domains. Estimation search distances
were determined from zinc variograms while the different search
ellipses reflected the unique deposit orientations.
Estimation Comparison
The current estimate is based on an updated interpretation of
336 drill holes completed by previous operators on the project
since 1998, including 21 that were completed after the last mineral
resource estimate was published for the project in 2014, and 6 new
drill holes completed by Americas Silver in 2017. The contained
zinc, silver and lead increased by 258%, 236%, and 320%
respectively in the indicated mineral resources and decreased by
52% in the inferred mineral resources. The change in estimate is in
comparison to the previous estimate from the technical report
titled “2014 Resource Estimate and PEA, San Felipe Project, Sonora,
Mexico”, with an effective date of September 4, 2014 and amended
date of June 29, 2016, completed for the previous option holder,
Santacruz Silver Mining Ltd. Some of the differences between the
current estimate and the previous estimate are a result of a
reinterpretation of the project as a zinc deposit compared to a
silver deposit. The current mineral resource cut-off value of 2.5%
zinc equivalent, as compared to a combination of 75 gram per tonne
(g/t) and 150 g/t silver equivalent cut-off values used in the 2014
resource estimate, brought in additional material into both the
indicated and inferred categories. The use of more liberal zinc
variogram distances in determining classification criteria, versus
the more restrictive silver variogram distances in 2014, also
resulted in converting a portion of the 2014 inferred mineral
resources into current Indicated mineral resources.
Updated San Felipe Technical Report
MDA was retained by Americas Silver to prepare the updated
mineral resource estimate for San Felipe. An updated Technical
Report will be prepared and filed on SEDAR (www.sedar.com) within
45 days of this news release.
San Felipe Option Agreement
As announced in a release dated March 2, 2017 the Company
purchased an option granting it the right to acquire a 100%
interest in San Felipe for total consideration of US$15 million
(plus applicable VAT), payable in two payments. The initial payment
of US$7 million plus VAT was made in March 2017. Subsequently, the
Company agreed to terms with Minera Hochschild Mexico S.A. de C.V.
(“Hochschild”) to amend the timing of payments under its option
agreement on the San Felipe project. A further US$0.5 million was
paid on January 1, 2018 with the remaining payments due as follows:
April 1, 2018 US$0.5 million; July 1, 2018 US$1 million; and
balance of US$6 million on or before December 31, 2018. The Company
expects to make the remaining payments with cash on hand.
Technical Information
Drill core samples from the twin hole diamond drilling program
completed at the San Felipe Project were prepared at the Company’s
secure warehouse facility near San Felipe, Sonora. Assaying was
done by ALS Chemex Labs in Hermosillo, Mexico. The Company has a
QA/QC program supervised by a Qualified Person.
Daren Dell, Chief Operating Officer and a Qualified Person under
Canadian Securities Administrators guidelines, has approved the
applicable contents of this news release. For further information
please see SEDAR or americassilvercorp.com.
About Americas Silver Corporation
Americas Silver is a silver mining company focused on growth in
precious metals from its existing asset base and execution of
targeted accretive acquisitions. It owns and operates the Cosalá
Operations in Sinaloa, Mexico and the Galena Mine Complex in Idaho,
USA. The Company holds an option on the San Felipe development
project in Sonora, Mexico.
Cautionary Statement on Forward-Looking Information:
This news release contains “forward‐looking information” within
the meaning of applicable securities laws. Forward‐looking
information includes, but is not limited to, the Company’s
expectations intentions, plans, assumptions and beliefs with
respect to, among other things, the realization of exploration,
operational and development plans (including further exploration
and development of San Felipe), the Cosalá Operations and Galena
Complex as well as the Company’s financing efforts. Often, but not
always, forward‐looking information can be identified by
forward‐looking words such as “anticipate”, “believe”, “expect”,
“goal”, “plan”, “intend”, “estimate”, “may”, “assume” and “will” or
similar words suggesting future outcomes, or other expectations,
beliefs, plans, objectives, assumptions, intentions, or statements
about future events or performance. Forward‐looking information is
based on the opinions and estimates of the Company as of the date
such information is provided and is subject to known and unknown
risks, uncertainties, and other factors that may cause the actual
results, level of activity, performance, or achievements of the
Company to be materially different from those expressed or implied
by such forward looking information. This includes the ability to
develop and operate the Cosalá and Galena properties, risks
associated with the mining industry such as economic factors
(including future commodity prices, currency fluctuations and
energy prices), ground conditions and factors other factors
limiting mine access, failure of plant, equipment, processes and
transportation services to operate as anticipated, environmental
risks, government regulation, actual results of current exploration
and production activities, possible variations in ore grade or
recovery rates, permitting timelines, capital expenditures,
reclamation activities, social and political developments and other
risks of the mining industry. Although the Company has attempted to
identify important factors that could cause actual results to
differ materially from those contained in forward-looking
information, there may be other factors that cause results not to
be as anticipated, estimated, or intended. Readers are cautioned
not to place undue reliance on such information. By its nature,
forward-looking information involves numerous assumptions, inherent
risks and uncertainties, both general and specific that contribute
to the possibility that the predictions, forecasts, and projections
of various future events will not occur. The Company undertakes no
obligation to update publicly or otherwise revise any
forward-looking information whether as a result of new information,
future events or other such factors which affect this information,
except as required by law.
Cautionary Note to U.S. Investors regarding mineral
resources:
The terms “mineral resource”, “measured mineral resource”,
“indicated mineral resource”, “inferred mineral resource” used in
the press release are Canadian mining terms used in accordance with
National Instrument 43-101 - Standards of Disclosure for Mineral
Projects under the guidelines set out in the Canadian Institute of
Mining, Metallurgy and Petroleum Standards. Mineral resources which
are not mineral reserves do not have demonstrated economic
viability.
While the terms “mineral resource”, “measured mineral resource”,
“indicated mineral resource”, and “inferred mineral resource” are
recognized and required by Canadian regulations, they are not
defined terms under standards in the United States and normally are
not permitted to be used in reports and registration statements
filed with the Securities & Exchange Commission (“SEC”). As
such, information contained in the Company's disclosure concerning
descriptions of mineralization and resources under Canadian
standards may not be comparable to similar information made public
by U.S companies in SEC filings. With respect to “inferred mineral
resource” there is a great amount of uncertainty as to their
existence and a great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of an
“inferred mineral resource” will ever be upgraded to a higher
category. Investors are cautioned not to assume that any part or
all of mineral deposits in these categories will ever be converted
into reserves.
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version on businesswire.com: https://www.businesswire.com/news/home/20180321006090/en/
Americas Silver CorporationDarren Blasutti,
416‐848‐9503President and CEO
Americas Gold and Silver (AMEX:USAS)
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