Fortuna Silver Mines, Inc. (NYSE: FSM)
(TSX: FVI) is pleased to
report pre-production mining reconciliation results at the Lindero
Mine located in the Province of Salta, Argentina. In the fourth
quarter of 2019, an estimated 452,000 tonnes of mineralized
material was stockpiled averaging 0.58 g/t Au containing 8,400
ounces of gold, representing 12 percent more gold ounces than was
predicted in the reserve block model. The operation also benefitted
from handling five percent less waste tonnes than expected.
Eric Chapman, Vice-President Technical Services,
commented, “The encouraging maiden reconciliation results reflect a
good correlation in gold grade between the mine and the reserve
model.” Mr. Chapman continued, “In the first quarter of 2020, the
mining rate is planned to increase as mining activities expose
higher grade mineralized areas located in the southeast of the
deposit for direct feeding to the crushing circuit.”
In September 2019, pre-production mining
activities commenced at Lindero with blasting and the development
of production platforms. A total of 452,000 tonnes of mineralized
material and 929,000 tonnes of waste were mined in the fourth
quarter of 2019.
The table below details material movements from
the pit as estimated from the grade control model versus the
Mineral Reserve block model for comparable volumes.
Location |
Parameter |
Grade Control Model1,
3 |
Mineral Reserve Model2, 3 |
Difference |
|
|
|
|
|
|
|
Stockpile |
Tonnes |
452,000 |
|
397,000 |
|
13.9% |
|
|
|
|
|
|
|
|
Au (g/t) |
0.58 |
|
0.59 |
|
-0.9% |
|
|
|
|
|
|
|
|
Au (oz) |
8,400 |
|
7,500 |
|
12.0% |
|
|
|
|
|
|
|
Waste Dump |
Tonnes |
929,000 |
|
974,000 |
|
-4.6% |
Notes:
- Grade control model numbers are based on estimates from blast
holes
- Mineral Reserve model numbers are based on the Mineral Reserve
estimates as of March 31, 2019 (refer to Fortuna news release dated
April 4, 2019). See also the Technical Report entitled “Fortuna
Silver Mines Inc.: Lindero Property, Salta Province, Argentina”
with an effective date of October 31, 2017 prepared by Eric
Chapman, Edwin Gutierrez, Geoff Allard and Denys Parra Murrugarra.
The updated Mineral Reserve estimate does not materially change the
information presented in the Technical Report.
- Based on a cut-off grade of 0.26 g/t Au
The increase in mineralized tonnes and gold
ounces mined is primarily due to variations in the geological
boundary between the post-mineralized intrusive and the mineralized
crowded porphyry diorite and mingled diorite porphyry units. The
boundary variation is near surface and is not expected to extend at
depth.
Quality Assurance & Quality
Control
Grade control estimates are based on blast hole
chip samples submitted to Lindero’s on-site laboratory for
preparation and assaying for gold, using fire assay with an atomic
absorption finish. The QA-QC program includes the blind insertion
of certified reference standards and assay blanks at a frequency of
approximately 1 per 20 normal samples as well as the submission of
duplicate samples for verification of sampling and assay precision
levels by an ISO 9001:2000 certified umpire laboratory. ALS Global
Laboratory in Mendoza, Argentina prepared the samples for assaying
and then forwarded the samples to ALS Global Laboratory in Lima,
Peru for assay by standard fire assay methods.
Qualified Person
Eric Chapman, Vice President of Technical
Services, is a Professional Geoscientist of the Association of
Professional Engineers and Geoscientists of the Province of British
Columbia (Registration Number 36328). Mr. Chapman has reviewed and
verified the reconciliation data disclosed in this news release and
has approved the scientific and technical information contained in
this news release.
About the Lindero gold Project,
Argentina
In September 2017, the commencement of
construction at Lindero was officially launched (see Fortuna news
releases dated September 21, 2017 and December 21, 2017). Lindero
has been designed as an 18,750 tonnes per day owner operated open
pit mine with a pit life of 13 years based on current Mineral
Reserves. Crushed ore will be placed on a leach pad with the
pregnant solution pumped to SART and ADR plants prior to
electrowinning and refining where gold will be poured to doré
bars.
About Fortuna Silver Mines
Inc.
Fortuna is a growth oriented, precious metal
producer with its primary assets being the Caylloma silver mine in
southern Peru, the San Jose silver-gold mine in Mexico and the
Lindero gold Project, currently under construction, in Argentina.
The Company is selectively pursuing acquisition opportunities
throughout the Americas and in select other areas. For more
information, please visit its website at www.fortunasilver.com.
ON BEHALF OF THE BOARD
Jorge A. Ganoza President, CEO and
DirectorFortuna Silver Mines Inc.
Trading symbols: NYSE: FSM | TSX: FVI
Investor Relations:
Carlos Baca- T (Peru): +51.1.616.6060, ext.
0
Forward looking Statements
This news release contains forward looking
statements which constitute “forward looking information” within
the meaning of applicable Canadian securities legislation and
“forward looking statements” within the meaning of the “safe
harbor” provisions of the Private Securities Litigation Reform Act
of 1995 (collectively, “Forward looking Statements”). All
statements included herein, other than statements of historical
fact, are Forward looking Statements and are subject to a variety
of known and unknown risks and uncertainties which could cause
actual events or results to differ materially from those reflected
in the Forward looking Statements. The Forward looking Statements
in this news release may include, without limitation, statements
about the Company’s plans for its mines and mineral properties; the
Company’s business strategy, plans and outlook; the merit of the
Company’s mines and mineral properties; mineral resource and
reserve estimates; timelines; production at the mines, including
planned production at the Lindero Project in the first year of its
commercial production; the future financial or operating
performance of the Company; expenditures; approvals and other
matters. Often, but not always, these Forward looking Statements
can be identified by the use of words such as “estimated”,
“potential”, “open”, “future”, “assumed”, “projected”, “used”,
“detailed”, “has been”, “gain”, “planned”, “reflecting”, “will”,
“containing”, “remaining”, “to be”, or statements that events,
“could” or “should” occur or be achieved and similar expressions,
including negative variations.
Forward looking Statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to be
materially different from any results, performance or achievements
expressed or implied by the Forward looking Statements. Such
uncertainties and factors include, among others, whether the
Company’s activities at its properties will proceed as planned;
delays in construction at the Lindero Project; delays in
commissioning of the mine at Lindero; delays in the commencement of
commercial production; changes in general economic conditions and
financial markets; changes in prices for silver, gold and other
metals; technological and operational hazards in Fortuna’s mining
and mine development activities; risks inherent in mineral
exploration; uncertainties inherent in the estimation of mineral
reserves, mineral resources, and metal recoveries; governmental and
other approvals; political unrest or instability in countries where
Fortuna is active; labor relations issues; as well as those factors
discussed under “Risk Factors” in the Company's Annual Information
Form. 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
Statements, there may be other factors that cause actions, events
or results to differ from those anticipated, estimated or
intended.
Forward looking Statements contained herein are
based on the assumptions, beliefs, expectations and opinions of
management, including but not limited to: that the Company’s
activities at its properties will proceed as planned; expectations
regarding mine production costs; doré production guidance for the
first year of commercial production is based on certain estimates
and assumptions, including but not limited to: construction at the
Lindero Project continues according to current time and cost
scheduling, Mineral Resources and Mineral Reserves, geological
formations, grade and continuity of deposits and metallurgical
characteristics; expected trends in mineral prices and currency
exchange rates; the accuracy of the Company’s current mineral
resource and reserve estimates; that the Company’s activities will
be in accordance with the Company’s public statements and stated
goals; that there will be no material adverse change affecting the
Company or its properties; that all required approvals will be
obtained; that there will be no significant disruptions affecting
operations and such other assumptions as set out herein. Forward
looking Statements are made as of the date hereof and the Company
disclaims any obligation to update any Forward looking Statements,
whether as a result of new information, future events or results or
otherwise, except as required by law. There can be no assurance
that Forward looking Statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, investors should not
place undue reliance on Forward looking Statements.
Cautionary Note to United States
Investors Concerning Estimates of Reserves and
Resources
Reserve and resource estimates included in this
news release have been prepared in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI
43-101") and the Canadian Institute of Mining, Metallurgy, and
Petroleum Definition Standards on Mineral Resources and Mineral
Reserves. NI 43-101 is a rule developed by the Canadian Securities
Administrators that establishes standards for public disclosure by
a Canadian company of scientific and technical information
concerning mineral projects. Equivalent U.S. reporting requirements
are currently governed by the United States Securities and Exchange
Commission ("SEC") Industry Guide 7 (“Industry Guide 7”) under the
U.S. Securities Act of 1933, as amended. Canadian standards,
including NI 43-101, differ significantly from the requirements of
the SEC currently in effect under Industry Guide 7, and reserve and
resource information contained in this news release may not be
comparable to similar information disclosed by U.S. companies. In
particular, the term "resource" does not equate to the term
"reserves". Under the SEC's disclosure standards currently in
effect under Industry Guide 7, mineralization may not be classified
as a "reserve" unless the determination has been made that the
mineralization could be economically and legally produced or
extracted at the time the reserve determination is made. The SEC
has not recognized the reporting of mineral deposits which do not
meet the Industry Guide 7 definition of “reserve” prior to the
adoption of the Modernization of Property Disclosures for Mining
Registrants, which rules will be required to be complied with in
the first fiscal year beginning on or after January 1, 2021. As a
result, the SEC's disclosure standards currently in effect normally
do not permit the inclusion of information concerning "measured
mineral resources", "indicated mineral resources" or "inferred
mineral resources" or other descriptions of the amount of
mineralization in mineral deposits that do not constitute
"reserves" by U.S. standards in documents filed with the SEC. You
are cautioned not to assume that resources will ever be converted
into reserves. You should also understand that "inferred mineral
resources" have a great amount of uncertainty as to their existence
and great uncertainty as to their economic and legal feasibility.
You should also not assume that all or any part of an "inferred
mineral resource" will ever be upgraded to a higher category. Under
Canadian rules, estimated "inferred mineral resources" may not form
the basis of feasibility or pre-feasibility studies except in rare
cases. You are cautioned not to assume that all or any part of an
"inferred mineral resource" exists or is economically or legally
mineable. Disclosure of "contained ounces" in a resource is
permitted disclosure under Canadian regulations; however, the SEC's
disclosure standards currently in effect under Industry Guide 7
normally only permit issuers to report mineralization that does not
constitute "reserves" by such standards as in-place tonnage and
grade without reference to unit measures. The requirements of NI
43-101 for identification of "reserves" are also not the same as
those of the SEC's disclosure standards currently in effect under
Industry Guide 7, and reserves reported in compliance with NI
43-101 may not qualify as "reserves" under such SEC standards.
Accordingly, information concerning mineral deposits set forth in
this news release may not be comparable with information made
public by companies that report in accordance with U.S.
standards.
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