Open Pit Mine – El Pilar Oxide Deposit

Potential Gold-Copper

The El Pilar copper-gold porphyry deposit has a 60m to 80m overlying oxide deposit with high grade gold and copper domains that is expected to be developed as a low cap-ex open pit mine to produce gold and copper concentrates.

Assays from historic drilling by a Canadian mining company in the 1990s indicated an Upper Exploration Target for the outcropping gold domain of 1.4 Mt of ore containing 221,000 oz of gold at a grade of 4.8 g/t Au, and 1.7Mt of ore containing 52.7 lb of copper at a grade of 1.41% Cu in the underlying copper domain ( advised to ASX on 5 July 2022 ).

Based on these ore quantities and grades being confirmed by exploration, it is anticipated that a mine could be developed at a cost of approximately US$25M to produce around 400,000tpa of ore, and be able to be fully funded by part of the surplus cash generated by the La Demajagua mine. The low capital costs reflect the flat mine site, availability of highway and rail access, local labour and accommodation, and HT power and water supply.

Assuming normal recoveries for gold and copper through a flotation circuit, and typical industry payables for the concentrates, a 7 year operation would result in a significant project cash surplus being generated at current metal prices.

A two stage exploration program – 2,000 m in 2022, and 7,000 m in early 2023 will allow JORC Resources and a Scoping Study for the proposed project to be established by mid 2023 after which the deposit could be transferred to the existing joint venture mining company for development by mid 2025.