Heliostar Files Technical Reports on Mines and Development Project Recently Acquired in Mexico Company Overview on La Colorada:
TSX.V: HSTR OTCQX: HSTXF
Heliostar Files Technical Reports on Mines and Development Project Recently Acquired in Mexico
Company Overview on La Colorada:
- La Colorada Operations show US$25.9M NPV5, 11.9% IRR, US$53.9M CAPEX and 287k total ounces
produced at a US$2,000/oz gold price
- New mineral reserve at Junkyard Stockpile supports restart of mining at La Colorada that has
commenced this month
- El Crestón expansion at La Colorada is expected to produce over 50,000 ounces of gold per year
- Current drill program (five drill rigs) is targeting lower CAPEX and increased production for updated
technical report planned for mid-2025
| Au Price (US$/oz Au) | Net Cash Flow (US$M) | After-Tax NPV @ 5.0% Discount Rate (US$M) | IRR (%) | Payback Period (years) | Payback Multiple | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2,000 1 | 54.92 | 25.93 | 11.9 | 2.2 | 1.4 | ||||||
| 2,600 2 | 158.32 | 110.03 | 34.7 | 1.4 | 2.3 |
1. Base Gold Price assumption used in the La Colorada technical report.
2. Comparison gold price.
Company Overview on San Agustin:
- San Agustin Operations show US$12.7M NPV5, 156.1% IRR, US$4.2M CAPEX and 45k total ounces
produced at a US$2,100/oz gold price
- Receiving the Phase 4 Permit will allow for strong cash flow generation from San Agustin including
funding San Agustin rehabilitation costs
- Upon receipt of permit, expected in 2025, the Company will undertake drilling to potentially extend
the mine life from oxide gold production and is reviewing the projects sulphide potential
| Au Price (US$/oz Au) | Net Cash Flow (US$M) | After-Tax NPV @ 5.0% Discount Rate (US$M) | IRR (%) | Payback Period (years) | Payback Multiple | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2,100 1 | 14.83 | 12.67 | 156.1 | 0.8 | 1.1 | ||||||
| 2,600 2 | 28.84 | 25.22 | 365.0 | 0.3 | 2.2 |
1. Base Gold Price assumption used in the San Agustin technical report..
2. Comparison gold price.
Company Overview on San Antonio:
- San Antonio Project Preliminary Economic Assessment (PEA) shows US$398.7M NPV5, 40.7% IRR,
US$131.3M CAPEX and 1.1 million total ounces produced at a US$1,900/oz gold price
- Mineral resource of 1.6 million ounces of gold at San Antonio project creates attractive optionality
with high grade, low CAPEX, sub-US$1,100/oz ASIC and long mine life
| Au Price (US$/oz Au) | Net Cash Flow (US$M) | After-Tax NPV @ 5% Discount Rate (US$M) | IRR (%) | Payback Period (years) | Payback Multiple | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 1,900 1 | 651.21 | 398.66 | 40.7 | 2.0 | 5.2 | ||||||
| 2,600 2 | 1,135.42 | 715.05 | 58.8 | 1.5 | 8.3 |
1. Base Gold Price assumption used in the San Antonio technical report..
2. Comparison gold price.
Vancouver, Canada, January 13, 2025 – Heliostar Metals Ltd. (TSX.V: HSTR, OTCQX: HSTXF, FRA: RGG1) (“Heliostar” or the “Company”) advises that it has filed technical reports on the La Colorada Operations, the San Agustin Operations and the San Antonio Project. The technical reports were prepared on material projects acquired in 2024.
The technical reports are available on SEDAR+ (www.sedarplus.ca) and on the Company's website (www.heliostarmetals.com).
Heliostar CEO, Charles Funk, commented “Heliostar has filed technical reports for three of its recently acquired Mexican projects. At La Colorada, we have restarted production this month with 2025 focused on the newly defined Junkyard Stockpile and then expanding to over 50,000 ounces of gold per year with the El Crestón expansion. At San Agustin, the Phase 4 Permit area can generate strong cash flow and reduce closure costs. More importantly receiving expansion permits will provide the trigger to restart drilling, targeting further mine life expansion at the mine which has upside oxide and sulphide potential. The PEA at San Antonio demonstrates a rare, 1.0 Au g/t heap leach deposit with low CAPEX, low ASIC and a long mine life. It provides attractive optionality for our long-term growth. The combined projects have positive economics at conservative gold prices and significantly stronger returns at today’s gold prices. In 2025, the Company will focus on reducing front-end capital requirements for El Crestón to improve the project economics for the expansion decision and will continue to advance Ana Paula through its Feasibility Study.”
LA COLORADA MINE
Mineral Resource and Mineral Reserve estimates and a life-of-mine (LOM) plan were completed for the 100% owned La Colorada Operations (La Colorada) located in the state of Sonora, Mexico. The LOM plan in the La Colorada technical report is based on continued production from three sequentially-staged deposits: the Junkyard Stockpile (La Chatarrera), the El Crestón pit expansion (El Crestón), and the Veta Madre pit expansion (Veta Madre). The La Colorada technical report that is the subject of this news release supersedes a technical report that was prepared on the La Colorada Mine by Argonaut Gold Inc., which had an effective date of October 1, 2021.
The La Colorada technical report includes first-time disclosure of a Mineral Resource and Mineral Reserve estimate for the Junkyard and updated Mineral Resource and Mineral Reserve estimates for El Crestón and Veta Madre. The LOM plan indicates a Probable Mineral Reserve of 377k ounces of gold exploited with two years of pre-strip and 4.1 years of mine life, from the effective date of the La Colorada technical report, at production rates up to the 13,000 t/d nameplate throughput capacity of the mine at an all-in sustaining capital cost of US$1,763/oz Au.
Key Highlights
| La Colorada - Mineral Reserve & Production Highlights | ||
|---|---|---|
| Mineral Reserves (kt) 1 | 18,159 | |
| Gold Grade (g/t Au) | 0.65 | |
| Contained Gold (koz Au) | 377 | |
| Processing Rate (t/d average) 2 | 8,292 | |
| Life of Mine (years) 3 | 4.1 | |
| Annual Production (oz Au per year, 2026) | 14,564 | |
| Annual Production (oz Au per year, average 2027-2030) | 64,309 |
1. Probable Mineral Reserve.
2. Processing throughput rates vary over the Life of Mine, up to the nameplate capacity of about 13,000 t/d.
3. Excludes 2 years of metals production from the Junkyard (2025) and from near-surface ore extracted during pre-stripping (2026).
| La Colorada - Financial Highlights | ||
|---|---|---|
| Average Cash Costs (US$ per oz AuEq) 1 | 1,549 | |
| Average AISC (US$ per oz AuEq) 1 | 1,763 | |
| Total Initial Capital Cost (US$M) 2 | 53.9 | |
| Total Sustainable Capital Cost (US$M) | 9.8 | |
| Total LOM Capital Cost (US$M ) | 63.7 |
1. Non-International Financial Reporting Standards (IFRS) measures. All-in sustaining costs (AISC) were first issued by the World Gold Council (WGC) in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance note in 2018.
2. Reflects capital investment before first metals production from El Crestón. Further expenditure will be required after first metals production for pre-stripping. A maximum negative cash flow of US$139 million is projected at the base assumptions used in the La Colorada technical report.
| La Colorada Return Estimates based on Gold Price 1 | ||||
|---|---|---|---|---|
| US$2,000/oz 2 | US$2,600/oz 3 | |||
| IRR (%) | 11.9 | 34.7 | ||
| NPV @ 5.0% discount (US$M) | 25.9 | 110.0 | ||
| NPV @ 7.5% discount (US$M) | 15.0 | 91.2 | ||
| Payback (years) | 2.2 | 1.4 |
3. All other key parameters set at base assumptions, including the 5% discount rate used. More detailed analysis is presented in the La Colorada technical report.
4. Base Gold Price assumption used in the La Colorada technical report.
5. Comparison gold price with reference to US$2,687.45 London Bullion Market Association (LBMA) PM gold price on trading day January 10, 2025.
La Colorada Mineral Resource Estimates
Mineral Resources were estimated at La Colorada for three deposits: El Crestón, Veta Madre and the Junkyard, and are summarized in the following tables by deposit.
El Crestón Mineral Resource Statement
| Category | Tonnes (kt) | Gold Grade (g/t) | Silver Grade (g/t) | Gold Contained Metal (koz) | Silver Contained Metal (koz) |
|---|---|---|---|---|---|
| Indicated | 12,393 | 0.91 | 11.94 | 364 | 4,758 |
| Inferred | 202 | 0.70 | 6.07 | 5 | 39 |
Notes to accompany El Crestón Mineral Resource table:
1. Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 31 October 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., Associate Mineral Resource Estimator with Mine Technical Services.
2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
3. Mineral Resource estimates use the end of month October 2024 topography.
4. Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; rock mining cost of US$2.66/t mined; backfill mining cost of US$2.0/t mined; crushing and conveying cost of US$1.33/t processed; process and leaching cost of US$4.54/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 79%; silver metallurgical recovery of 13%; and pit slope angles from 22º (pad), 35–42º (pit).
5. Mineral Resources are reported at a gold equivalent cut-off of 0.14 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:502.51.
6. Totals may not sum due to rounding.
Veta Madre Mineral Resource Statement
| Category | Tonnes (kt) | Gold Grade (g/t) | Silver Grade (g/t) | Gold Contained Metal (koz) | Silver Contained Metal (koz) |
|---|---|---|---|---|---|
| Indicated | 2,724 | 0.73 | 3.5 | 64 | 309 |
| Inferred | 77 | 0.53 | 2.5 | 1 | 6 |
Notes to accompany Veta Madre Mineral Resource table:
1. Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 31 October, 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., Associate Mineral Resource Estimator with Mine Technical Services.
2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
3. Mineral Resource estimates use the end of month October 2024 topography.
4. Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; mining rock costs of US$2.55/t mined; crushing and conveying cost of US$1.33/t processed; process and leaching cost of US$4.54/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 72%; silver metallurgical recovery 9.0%; and pit slope angles averaging 45º.
5. Mineral Resources are reported at a gold equivalent cut-off of 0.15 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:661.54.
6. Totals may not sum due to rounding.
La Chatarrera Mineral Resource Statement
| Category | Tonnes (kt) | Gold Grade (g/t) | Silver Grade (g/t) | Gold Contained Metal (koz) | Silver Contained Metal (koz) |
|---|---|---|---|---|---|
| Indicated | 3,504 | 0.20 | 6.8 | 23 | 763 |
| Inferred | 1,220 | 0.41 | 33.29 | 16 | 1,305 |
Notes to accompany the Junkyard Stockpile Mineral Resource table:
1. Mineral Resources are reported in stockpiles, using the 2014 CIM Definition Standards, and have an effective date of 31 October, 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., of Mine Technical Services.
2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
3. Mineral Resource estimates use the end of month October 2024 topography.
4. Mineral Resources are reported using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; a stockpile rehandle cost of US$1.30/t mined; crushing and conveying cost of US$1.72/t processed; process and leaching cost of US$3.10/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 66%; and a silver metallurgical recovery of 27%.
5. Mineral Resources are reported at a gold equivalent cut-off of 0.17 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:202.14.
6. Totals may not sum due to rounding.
La Colorada Mineral Reserve Estimates
Mineral Resources were converted to Mineral Reserves for El Crestón, Veta Madre and the Junkyard.
The Mineral Reserve estimate is based on operation of the existing crusher and conveyor system having a nameplate throughput capacity of about 13,000 t/d, and continued operation of the heap leach and carbonin-circuit (CIC) process circuit and refinery to process ore from the three deposits. The Mineral Reserve estimate is presented in the following table.
Mineral Reserves Statement
| Classification | Zone | AuEq Cut-off (g/t) | Tonnes (kt) | Gold Grade (g/t Au) | Silver Grade (g/t Ag) | Contained Gold (koz) | Contained Silver (koz) |
|---|---|---|---|---|---|---|---|
| Probable | El Crestón | 0.160 | 12,841 | 0.76 | 10.1 | 312 | 4,181 |
| Veta Madre | 0.175 | 1,905 | 0.70 | 3.1 | 43 | 189 | |
| La Chatarrera | 0.164 | 3,413 | 0.20 | 6.4 | 22 | 704 | |
| Total | 18,159 | 0.65 | 8.69 | 377 | 5,074 |
Notes to accompany Mineral Reserves table:
1. Mineral Reserves are reported at the point of delivery to the process plant, using the 2014 CIM Definition Standards.
2. Mineral Reserves have an effective date of 30 November 2024. The Qualified Person for the estimate is Mr. Jeffrey Choquette, P.E., of Hard Rock Consulting.
3. A 0.16 g/t AuEq cut-off is used for reporting the Mineral Reserves at El Crestón, and a 0.175 g/t AuEq cut-off is used for reporting Mineral Reserves at Veta Madre. Cut-offs were calculated based on a gold price of US$1,900/oz Au, silver price of US$23/oz Ag, processing costs of US$5.87/t, general and administrative costs of US$1.15/t, refining and selling costs of US$0.66/t, gold recovery of 79% for El Crestón and 72% for Veta Madre and a silver recovery of 13% for El Crestón and 9% for Veta Madre. The AuEq cut-off for the Junkyard Stockpile is 0.164 g/t AuEq based on metal prices of US$1,900/oz Au, and US$23/oz Ag, processing costs of US$4.82/t, general and administrative costs of US$1.15/t, refining and selling costs of US$0.66/t, gold recovery of 66% and a silver recovery of 27%. The AuEq calculation uses the formula AuEq = (Au + Ag/equivalency factor) where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)).
4. Mineral Reserves are reported within the ultimate reserve pit design. An external dilution factor of 10% and a metal loss of 5% were factored into the Mineral Reserves estimates.
5. Tonnage and grade estimates are in metric units.
6. Mineral Reserve tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding.
The LOM plan outlines sequential exploitation of the three deposits with two years of pre-production from the Junkyard (2025) and from near-surface ore extracted during pre-stripping (2026), before a production LOM of 4.1 years.
Figure 1 - Ore Mined by Pit Phase
Note: Figure prepared by Hard Rock Consulting, 2024
La Colorada Operating Cost Estimates
The existing mining and process circuit at the La Colorada Mine remains unchanged for the proposed LOM plan in the La Colorada technical report, with exploitation of the three deposits benefitting from the installed capacity. The expected operating performance and operating cost forecasts were compiled with the benefit of benchmarking historical performance at La Colorada and the input of seasoned professionals knowledgeable of the conventional technologies being used at La Colorada, the expected consumption quantities of key supplies, and commercial pricing for goods and services in Mexico.
Total Operating Cost Summary
| Operating Costs | Operating Cos ($/oz AuEq) | t | Operating Cost ($/t ore) | Operating Cost ($/t mined) | |
|---|---|---|---|---|---|
| Total mining | 1,038.63 | 17.02 | 2.06 | ||
| Total processing | 368.21 | 6.04 |
| Total site general and administrative | 68.40 | 1.12 |
| Refinery and transport | 26.37 | 0.43 |
| Cash operating costs | 1,501.61 | 24.61 |
| Production taxes | 27.14 | 0.44 |
| Royalties | 20.00 | 0.33 |
| Total cash costs | 1,548.74 | 25.39 |
| Capital costs | 214.11 | 3.51 |
| Total AISC | 1,762.86 | 28.90 |
La Colorada Capital Cost Estimates
The Junkyard only requires working capital to bring the deposit into production.
The initial capital cost for El Crestón is estimated at US$54.0M, including US$9.0M capital for pad expansion and US$43.4M mining pre-stripping costs until first production. A significant pre-strip is required to fully exploit the El Crestón deposit, comprising both capitalized and expensed pre-stripping costs.
The LOM plan includes US$6.8M for reclamation work at the end of the mine life.
Capital Cost Summary
| Capital Costs | Initial (US$ M) | Sustaining (US$ M) | Total LOM (US$ M) |
|---|---|---|---|
| Mine pre-production development | 43.40 | 0.00 | 43.40 |
| Contractor mobilization | 0.21 | 0.00 | 0.21 |
| Slope radar system | 0.00 | 0.50 | 0.50 |
| Leach pad expansion | 8.97 | 2.13 | 11.10 |
| Total direct costs | 52.58 | 2.63 | 55.21 |
| Owner costs and reclamation | 0.00 | 6.80 | 6.80 |
| Indirects and contingency | 1.35 | 0.37 | 1.72 |
| Total indirect costs | 1.35 | 7.17 | 8.52 |
| Total | 53.93 | 9.80 | 63.73 |
La Colorada Economic Analysis
The financial analysis shows an after-tax net present value at a discount rate of 5% of US$25.9 M, an after-tax internal rate of return of 11.9%, and a payback period of 2.2 years. The forecast total lifespan of the Project is 4.1 years with two years of pre-production, although some metals production is planned in these two years. Approximately 377,000 oz of gold is projected to be mined, with 287,000 oz of gold recovered and produced for sale.
Summary Economic Results
| Project Valuation Overview | Units | After Tax | Before Tax |
|---|---|---|---|
| Total cashflow | US$ M | 54.92 | 86.51 |
| NPV @ 5.0% (base case) | US$ M | 25.93 | 49.77 |
| NPV @ 7.5%; | US$ M | 14.99 | 35.82 |
| NPV @ 10.0%; | US$ M | 5.90 | 24.14 |
| Internal rate of return | % | 11.9 | 17.2 |
| Payback period | Years | 2.15 | 2.04 |
| Payback multiple | 1.35 | 1.55 | |
| Total initial capital | US$ M | 53.93 | 53.93 |
Metal Prices
The La Colorada technical report includes a sensitivity analysis for key parameters impacting the forecast economic returns for La Colorada. The LOM plan and Mineral Reserves estimates are most sensitive to changes in the gold price, and gold grade. Since silver is projected to contribute only about 4% to the revenues. LOM variations in the silver price have limited impact on the cashflow forecast. The LOM plan and Mineral Reserves estimates are less sensitive to operating cost changes, and least sensitive to changes in capital costs.
Gold Price Sensitivity Analysis
| Au Price (US$/oz Au) | Net Cash Flow (US$ M) | After-Tax NPV @ 5.0% Discount Rate (US$ M) | IRR (%) | Payback Period (years) | Payback Multiple | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 1,000 | -235.88 | -203.08 | — | 0.0 | 0.0 | ||||||
| 1,200 | -167.30 | -149.64 | — | 0.0 | 0.2 | ||||||
| 1,400 | -99.10 | -96.46 | -31.1 | 0.0 | 0.5 | ||||||
| 1,600 | -30.90 | -43.29 | -7.0 | 0.0 | 0.8 | ||||||
| 1,800 | 19.43 | -3.17 | 4.2 | 2.7 | 1.1 | ||||||
| 2,000 | 54.92 | 25.93 | 11.9 | 2.2 | 1.4 | ||||||
| 2,200 | 89.39 | 53.96 | 19.4 | 1.8 | 1.6 | ||||||
| 2,400 | 123.85 | 82.00 | 27.0 | 1.6 | 1.9 | ||||||
| 2,600 | 158.32 | 110.03 | 34.7 | 1.4 | 2.3 | ||||||
| 2,800 | 192.79 | 137.88 | 42.3 | 1.2 | 2.7 | ||||||
| 3,000 | 227.26 | 165.60 | 49.7 | 1.1 | 3.2 |
Commentary by the Company on Relevant Matters
The results from ongoing drilling and other technical studies being performed at El Crestón are excluded from the La Colorada technical report but will be incorporated into a mineral resource model and will support a Mineral Reserve update that will be published with an updated technical report in mid-2025.
A total initial capital of $53.9M is a required, predominantly from waste stripping prior to the reaching the lifeof-mine strip ratio. Further stripping is required after reaching the life-of-mine strip ratio and a maximum negative cash flow of US$139 million is projected at the base assumptions used in the La Colorada technical report (US$117M at US$2,600 gold).
The La Colorada technical report presents cash flows based on the base gold price used. With exploitation of the Junkyard starting this month, the project will generate revenues from sales based on current gold prices which are expected to be higher than the base gold price used in the La Colorada technical report.
The gold market has experienced significant upward price movement in the past few years and, considering that the gold price at the effective date of the La Colorada technical report is about 34% above the base gold price used in the La Colorada technical report. The sensitivity analysis presents gold price scenarios up to US$3,000/oz Au to understand the potential impact. From the base case price of $2,000/oz (years 2026–2031), a change in the average gold price of US$200/oz Au would change the NPV at a 5% discount rate by 108%, or approximately $28.0 M
Commentary by the Company on Next Steps and Permitting
Restart of mining activities at La Colorada has commenced at the Junkyard this month. The Company will provide production and cost guidance for 2025 later in January.
The Company will be continuing the current drill program and conducting other technical programs at El Crestón and plans to complete updated technical study in mid-2025.
The drill program includes shallow infill drilling designed to support short-term mine planning, and a program of infill and expansion drilling deeper in the pit to include in the future update to Mineral Resource and Mineral Reserve estimate.
Some ancillary permitting work is planned at El Crestón and is expected to be completed by mid-2025. A change of land use permit is required to enable exploitation of Veta Madre.
Since the development plan for La Colorada represents a continuation of the historical operations, minimal capital investment is required for new equipment and facilities; however, pre-stripping at El Crestón and Veta Madre will need to be financed. Subject to satisfactory conclusion of the planned work programs and arranging financing, the Company is anticipating making an investment decision at El Crestón in 2H 2025.
Qualified Persons
The technical report for the La Colorado Mine was prepared for Heliostar Metals Inc. by Mr. Todd Wakefield, RM SME, Mr. David Thomas, P.Geo., Mr. Jeffrey Choquette, P.E., Mr. Carl Defilippi, RM SME, and Ms. Dawn Garcia, CPG. Each of these Qualified Persons has reviewed and approved the technical information contained in this news release that was abstracted from the La Colorada technical report in their area of expertise and are independent of the Company.
.
SAN AGUSTIN MINE
Mineral Resource and Mineral Reserve estimates and a LOM plan were completed for the 100% owned San Agustin Operations (San Agustin) located in the state of Durango, Mexico. The LOM plan in the San Agustin technical report is based on an expansion of the existing open pit. The San Agustin technical report that is the subject of this news release supersedes a technical report that was prepared on the San Agustin Mine by Florida Canyon Gold Inc., which had an effective date of June 20, 2024.
The San Agustin technical report includes an updated Mineral Resource and Mineral Reserve estimate. The LOM plan indicates that a Probable Mineral Reserve of 68k ounces of gold can be exploited based on 1.2 years of mine life at an all-in sustaining capital cost of US$1,990/oz Au.
Key Highlights
| San Agustin - Mineral Reserve & Production Highlights | ||
|---|---|---|
| Mineral Reserves (kt) 1 | 7,358 | |
| Grade (g/t Au) | 0.29 | |
| Contained Gold (koz Au) | 68 | |
| Processing Rate (t/d) 2 | 17,100 | |
| Life of Mine (years) 3 | 1.2 | |
| Annual Production (oz Au per year, average 2026-2027) 4 | 19,091 |
1. Probable Mineral Reserve.
2. Processing throughput rates will vary over the Life of Mine, up to the nameplate capacity of about 30,000 t/d.
3. Excludes one year of metals production from ongoing re-leaching of heap leach piles.
4. Gold production in 2026 is 32,625 ounces.
| San Agustin - Financial Highlights | ||
|---|---|---|
| Average Unit Costs (US$ per oz AuEq) 1 | 1,605 | |
| Average AISC (US$ per oz AuEq) 1, 2 | 1,990 | |
| Total Initial Capital Cost (US$M) | 4.2 | |
| Total Sustainable Capital Cost (US$M) 2 | 14.3 | |
| Total LOM Capital Cost (US$M) | 18.5 |
1. Non-IFRS measures. AISC were first issued by the WGC in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance note in 2018.
2. Includes reclamation costs for San Agustin mine.
| San Agustin Return Estimates based on Gold Price 1 | |||
|---|---|---|---|
| US$2,100/oz 2 | US$2,600/oz 3 | ||
| IRR (%) | 156.1 | 365.0 | |
| NPV @ 5.0% discount (US$M) | 12.7 | 25.2 | |
| NPV @ 7.5% discount (US$M) | 11.7 | 23.6 | |
| Payback (years) | 0.8 | 0.3 |
1. All other key parameters set at base assumptions, including the 5% discount rate used. More detailed analysis is presented in the LSan Agustin technical report.
2. Base Gold Price assumption used in the San Agustin technical report.
3. Comparison gold price with reference to US$2,687.45 LBMA PM gold price on trading day January 10, 2025.
San Agustin Mineral Resource Estimates
Mineral Resources were estimated for San Agustin as summarized in the following table.
Mineral Resource Statement
| Material Type | AuEq Cutoff (g/t AuEq) | Confidence Classification | Tonnes (kt) | Gold Grade (g/t Au) | Silver Grade (g/t Ag) | Contained Gold (koz) | Contained Silver (koz) |
|---|---|---|---|---|---|---|---|
| Oxide | 0.14 | Indicated | 17,154 | 0.30 | 11.5 | 165 | 6,333 |
| Transitional | 0.27 | 700 | 0.44 | 17.4 | 10 | 391 | |
| Sulphide argillic | 0.41 | 5,348 | 0.80 | 14.0 | 138 | 2,403 | |
| Sulphide silicified | 0.60 | 427 | 0.90 | 7.4 | 12 | 102 | |
| Total | 23,629 | 0.43 | 12.2 | 325 | 9,229 | ||
| Oxide | 0.14 | Inferred | 1,273 | 0.29 | 9.2 | 12 | 378 |
| Transitional | 0.27 | 5 | 0.32 | 25.6 | 0 | 4 | |
| Sulphide argillic | 0.41 | 121 | 0.64 | 9.6 | 2 | 38 | |
| Sulphide silicified | 0.60 | 2 | 0.68 | 6.0 | 0 | 0 | |
| Total | 1,401 | 0.32 | 9.4 | 14 | 421 |
Notes to accompany San Agustin Mineral Resource table:
1. Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 30 November, 2024. The Qualified Person for the estimate is Mr. David Thomas, PGeo., Associate Mineral Resource Estimator with Mine Technical Services.
2. Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
3. Mineral Resource estimates are defined by end of month July 2024 topography.
4. Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of $2,150/oz Au; a silver price of $26.0/oz Ag; mining cost of $2.0/t mined; oxide process and leaching cost of $4.23/t processed; transition process and leaching cost of $5.14/t processed; sulphide argillic process and leaching cost of $5.36/t processed; sulphide silicic process and leaching cost of $4.94/t processed; general and administrative cost of $1.4/t processed; selling cost of $0.66/t processed; gold metallurgical recoveries from 17- 66%; silver metallurgical recoveries from 9–10%; and pit slope angles of 45º.
5. Totals may not sum due to rounding.
San Agustin Mineral Reserve Estimates
The Mineral Reserve estimate at San Agustin is based on operation of the existing crusher and conveyor system having a nameplate throughput capacity of about 30,000 t/d and continued operation of the heap leach and CIC process circuit to processing ore from the expanded open pit. The Mineral Reserve estimate is presented in the following table.
Mineral Reserve Statement
| Classification | Material Type | AuEq Cut-off (g/t AuEq) | Tonnes (kt) | Gold Grade (Au g/t) | Silver Grade (Ag g/t) | Contained Gold (koz) | Contained Silver (koz) |
|---|---|---|---|---|---|---|---|
| Probable | Oxide | 0.156 | 7,281 | 0.29 | 16.24 | 67 | 3,803 |
| Transition | 0.310 | 77 | 0.39 | 31.39 | 1 | 77 | |
| Total | 7,358 | 0.29 | 16.40 | 68 | 3,880 |
Notes to accompany Mineral Reserves table:
1. Mineral Reserves are reported at the point of delivery to the process plant, using the 2014 CIM Definition Standards.
2. Mineral Reserves have an effective date of 30 November 2024. The Qualified Person for the estimate is Mr. Jeffrey Choquette, PE, of Hard Rock Consulting, LLC.
3. A 0.156 g/t AuEq cut-off is used for reporting the Mineral Reserves in oxide, and a 0.310 g/t AuEq cut-off is used for reporting Mineral Reserves in transitional material. Cut-offs were calculated based on a gold price of US$1,900/oz Au, silver price of US$23/oz Ag, processing costs of US$4.23/t for oxide, processing costs of US$5.14/t for transitional, general and administrative costs of US$1.40/t, refining and selling costs of US$0.66/t, gold recovery of 66% for oxide and 38% for transitional and a silver recovery of 10% for oxide and transitional. The AuEq calculation uses the formula AuEq = (Au + Ag/equivalency factor) where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)).
4. Mineral Reserves are reported within the ultimate reserve pit design. An external dilution factor of 5% and a metal loss of 3% have been factored into the Mineral Reserve estimate.
5. Tonnage and grade estimates are in metric units.
6. Mineral Reserve tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding
Figure 2 - Ore Mined by Pit Phase
Note: Figure prepared by Hard Rock Consulting, 2024
San Agustin Operating Cost Estimates
The existing mining and process circuit at San Agustin remains unchanged for the proposed LOM plan in the San Agustin technical report, with exploitation of the ore from the expanded open pit benefitting from the