Salazar Increases Indicated and Inferred Resources at El Domo Deposit
February 05 2014 - 7:00AM
Marketwired Canada
Salazar Resources Ltd. (the "Company") (TSX VENTURE:SRL)(FRANKFURT:CCG) is
pleased to report an updated National Instrument 43-101 Standards of Disclosure
for Mineral Projects ("NI 43-101") compliant mineral resource estimate for the
volcanogenic massive sulphide ("VMS") El Domo deposit on its 100% owned (30,327
ha) Curipamba project in Ecuador. Buenaventura Ingenieros S.A. ("BISA") of Lima,
Peru, an independent consultant, has prepared and authorized the release of the
mineral resource estimate.
Highlights of the updated mineral resource estimate include:
-- Indicated mineral resource of 6.080 million tonnes at an average grade
of 2.33% Cu, 3.06% Zn, 0.28% Pb, 2.99 g/t Au, and 55.81 g/t Ag,
containing 312.95 million pounds Cu, 409.56 million pounds Zn, 37.76
million pounds Pb, 584,457 ounces Au, and 10.91 million ounces Ag.
-- The current indicated mineral resource estimate shows the following
increases relative to the 2012 indicated mineral resource estimate: 7%
increase in contained copper, 34.4% increase in contained zinc, 17.4%
increase in contained gold, and 26.8% increase in contained silver.
-- The inferred mineral resource is 3.882 million tonnes at an average
grade of 1.56 % Cu, 2.19% Zn, 0.16 % Pb, 2.03 g/t Au, and 42.92 g/t Ag,
containing 133.46 million pounds Cu, 187.39 million pounds Zn, 13.96
million pounds Pb, 253,607 ounces Au and 5.36 million ounces Ag.
-- The current inferred mineral resource estimate shows the following
increases relative to the 2012 indicated mineral resource estimate:
118.1% increase in contained copper, 108.0% increase in contained zinc,
125.2% increase in contained gold and a 118.7% increase in contained
silver.
Mr. Fredy Salazar, President and CEO, stated "We are very pleased with this
significant increase to both resource categories. The updated mineral resource
estimate will form the basis of a Preliminary Economic Assessment (PEA)
scheduled to be released in the first quarter of this year."
Table 1. El Domo Project - Mineral Resource Estimate at an NSR cut-off of US$30
per tonne (December 2013), by Buenaventura Ingenieros-BISA
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Lithology
Unit Category Tonnes Copper Zinc Lead Gold Silver
--------------------------------------------------------
(Mt) (%) (%) (%) (g/t) (g/t)
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VMS Indicated 5.468 2.52 3.27 0.30 3.23 59.19
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Grainstone Indicated 0.216 0.92 1.01 0.12 1.09 27.91
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Breccia Indicated 0.345 0.49 1.33 0.13 0.76 26.91
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Gypsum Indicated 0.051 0.94 0.39 0.03 0.34 7.40
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Total Indicated 6.080 2.33 3.06 0.28 2.99 55.81
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VMS Inferred 3.093 1.75 2.59 0.19 2.38 49.45
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Grainstone Inferred 0.170 0.96 0.69 0.10 1.00 19.24
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Breccia Inferred 0.370 0.53 0.83 0.07 0.78 24.89
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Gypsum Inferred 0.249 1.13 0.26 0.01 0.27 4.80
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Total Inferred 3.882 1.56 2.19 0.16 2.03 42.92
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Lithology
Unit Category Copper Zinc Lead Gold Silver
--------------------------------------------------------
(Mlbs) (Mlbs) (Mlbs) (oz) (oz)
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VMS Indicated 303.78 394.2 36.16 567,898 10,406,782
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Grainstone Indicated 4.38 4.81 0.57 7,570 193,844
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Breccia Indicated 3.73 10.12 0.99 8,431 298,519
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Gypsum Indicated 1.06 0.44 0.03 558 12,135
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Total Indicated 312.95 409.56 37.76 584,457 10,911,281
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VMS Inferred 119.33 176.61 12.96 236,699 4,917,969
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Grainstone Inferred 3.60 2.59 0.37 5,466 105,170
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Breccia Inferred 4.32 6.77 0.57 9,280 296,119
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Gypsum Inferred 6.20 1.43 0.05 2,162 38,431
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Total Inferred 133.46 187.39 13.96 253,607 5,357,690
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Notes:
-- CIM definitions were followed for mineral resources.
-- The mineral resource estimate is based on a 3D geological modeling of
the volcanogenic massive sulphide deposit (VMS). Four lithology units
with a NSR cutoff of US$30 per tonne were considered as mineral
resource.
-- Metal prices used are US$2.95/lb Cu, US$0.91/lb Zn, US$0.91/lbPb,
US$1,200/oz Au, and US$20.00/oz Ag
-- Metallurgical recovery factors assumed were based on three domains
defined by the metal ratio Cu/(Zn+Pb):
Zinc Domain Cu/(Pb+Zn)less than 0.3: 15% Cu, 90% Zn, 40% Pb, 50% Au and
65% Ag
Mixed Domain 0.3less than or equal toCu/(Pb+Zn)less than or equal to3:
75% Cu, 50% Zn, 0% Pb, 55% Au and 65% Ag
Copper Domain Cu/(Pb+Zn)greater than 3.0: 90% Cu, 0% Zn, 0% Pb, 30% Au
and 40% Ag
-- Common industry smelter terms were assumed
-- Bulk density was estimated based on specific gravity determinations for
each lithology unit
The Government of Ecuador, in recent months, presented changes to the Mining Law
and has introduced a new medium-sized mining category. The government approval
process for production capacity up to 1,000 tonnes of ore per day for
underground operations, and up to 2,000 tonnes per day for open pit operations,
has been significantly simplified and will be governed by the Mining Law versus
having to negotiate taxation and royalty terms with the Government as is the
case for larger scale projects. This is of significant importance as these
medium sized mining companies will no longer be required to sign a Production
Contract with the State and, therefore, will not be subject to windfall taxes
but rather have a fixed 4 percent royalty rate. The scale of operations being
considered in the PEA for El Domo fall within this range and will be classified
as a medium sized mining operation. This will significantly benefit the Company
in the form of reduced tax rates. At the present time, the Ministry of Non
Renewable Natural Resources is drafting the regulations allowing for an
immediate application of these reforms. We are confident the regulations will
confirm the rules and provide encouragement for mining development in Ecuador.
As part of the PEA, additional studies are also being conducted to define and
refine metal recovery factors and metallurgical processes. The updated resource
estimate supports a mining-engineering study that includes both open-pit and
underground mining scenarios, as well as design alternatives for infrastructure
and support facilities. The Company anticipates having the PEA completed
shortly, and looks forward to announcing the results.
Mineral Resource Modeling and Estimation
The December 2013 mineral resource estimate for El Domo was completed by BISA on
behalf of Salazar. The mineral resources are classified as indicated and
inferred resources in accordance with the CIM Standards on Mineral Resources and
Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on
reserve definitions and adopted by CIM Council.
The mineral resource estimate in El Domo is derived from a total of 168 diamond
drill holes (31,770 metres). This updated mineral resource adds 51 new drill
holes (10,248 metres) to the 117 drill holes (21,522 metres) used in the January
2012 mineral resources estimate. The average drill hole spacing is approximately
50 meters within the El Domo area. A total of 7736 samples were assayed. A 3D
geological interpretation was performed with Leapfrog Mining and the block
modelling for the mineral resource estimation was carried out with Vulcan
software. The general methodology and parameters used are the following:
-- Four mineralized units have been considered for reporting purpose: VMS,
Grainstone, Breccia and Gypsum (see Figure 1 below).
-- Two structural domains have been defined at El Domo deposit: The Eastern
Domain and Western Domain.
-- Metal envelopes were built using grades greater than or equal to 0.3%
Cu, greater than or equal to0.2g/t Au, greater than or equal to0.3% Zn,
and greater than or equal to0.05% Pb.
-- Estimation domains ("ED") were defined considering geological and
statistical criteria.
-- Composites of 1.25 meters length were completed for each estimation
domain.
-- Prior to estimation of the block grades, copper, gold, zinc, silver, and
lead grades have been capped. This capping, generally at 98% of the
distribution, was applied on each ED.
-- Trend Analysis and variography by ED was computed by SAGE2001 software.
-- The Grade interpolation process was performed by ED. This process was
developed into a sub-cell type block model; then the blocks were
regularized into a 5mx5mx2.5 m standard block model.
-- Interpolation consists in three-pass search strategy of ordinary kriging
or inverse distance weighting methods as appropriate.
-- Tonnage factors applied were based on a total of 1140 specific gravity
measurements.
-- All blocks within the four mineralized units were classified as
resources. The criteria to assign the category of resources is defined
by a matrix that uses three copper domains and three zinc domains. These
domains were established by the following interpolation parameters: the
interpolation pass where the block was estimated, the average distance
from the block to available composites, and the number of composites per
drill hole used for the block. (see Figure 2 below).
The resource estimate and other technical information contained in this release
were prepared by or under the supervision of Mr. Gustavo Calvo, P. Geo. of
BISA., an independent "qualified person" for the purposes of NI 43-101.
The NI 43-101 technical report in respect of the resource estimate disclosed
herein will be filed on SEDAR within 45 days of the date of this news release.
On behalf of the Board of Salazar Resources Limited,
Fredy Salazar, President & CEO
About Salazar Resources Limited:
Salazar Resources Ltd. is a publicly-listed (TSX VENTURE:SRL)(FRANKFURT:CCG)
mineral resource company engaged in the exploration and development of new
highly prospective areas in Ecuador. Led by a senior Ecuadorian management team
and most notably by its namesake, Fredy Salazar, this team has been instrumental
in other major discoveries throughout Ecuador. Being based in Ecuador, thus have
thorough knowledge of local human and environmental issues, gives the company a
strategic advantage, enabling it to complete exploration at a rapid pace. With
an excellent property portfolio (3 projects- 42,900 hectares), good geopolitical
positioning and a number of strategic corporate and financial partnerships,
Salazar has positioned itself to be a strategic player in Ecuador and throughout
South America.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this news release.
Forward-Looking Statement
This press release contains "forward-looking information" within the meaning of
applicable Canadian securities laws. All statements included herein, other than
statements of historical fact, are forward-looking information and such
information involves various risks and uncertainties. Forward-looking
information herein includes, but is not limited to, statements that address
activities, events or developments that the Company expects or anticipates will
or may occur in the future, including such things as the successful completion
of the PEA and the timing of completion of the PEA. Such forward-looking
information is based on a number of material factors and assumptions, including
that contracted parties provide services on the agreed timeframes and that
laboratory and other related services are available and perform as contracted.
Although the Company has attempted to identify important factors that could
cause actual actions, events or results to differ materially from those
described in forward-looking information, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or intended.
There can be no assurance that such information will prove to be accurate, and
actual results and future events could differ materially from those anticipated
in such information. A description of assumptions used to develop such
forward-looking information and a description of risk factors that may cause
actual results to differ materially from forward-looking information can be
found in the Company's disclosure documents on the SEDAR website at
www.sedar.com. Accordingly, readers should not place undue reliance on
forward-looking information. The Company does not undertake to update any
forward-looking information except in accordance with applicable securities
laws.
Figure 1 - 3D View of the Lithology Model & Figure 2 - Plan View of Resource
Estimate are aavailable at the following address:
http://media3.marketwire.com/docs/140205_SRL_Fig1-Fig2.pdf
FOR FURTHER INFORMATION PLEASE CONTACT:
Marc Cernovitch
Advisory Board member
Salazar Resources Ltd.
647-203-7868
info@salazarresources.com
www.salazarresources.com