VANCOUVER, June 5, 2018 /CNW/ - Capstone Mining Corp.
("Capstone" or the "Company") (TSX: CS) today announced the results
of an updated National Instrument 43-101 ("NI 43-101") compliant
Mineral Resource estimate for the Cozamin Mine in Zacatecas, Mexico (Table 1 below). Compared to
the Mineral Resources as at December 31,
2017, this latest estimate converted or added an additional
115 thousand tonnes of copper in the Indicated category in the Mala
Noche Footwall Zone ("MNFWZ"), reflecting all drilling for which
assays have been received up to March 19,
2018. At a US$42 net smelter
return ("NSR") cut-off grade ("COG"), the Cozamin Mine's total
Measured and Indicated ("M&I") copper Mineral Resources,
including adjustments for mining to March
31, 2018, were 217 thousand tonnes of contained copper
(Table 3 below).
"We are extremely pleased with our recent drilling success in
the MNFWZ at Cozamin," said Brad
Mercer, Senior Vice President of Exploration at Capstone.
"This new resource estimate, the culmination of over a year of
intensive drilling, nearly triples the ore tonnes and doubles the
contained copper in the MNFWZ M&I classification."
"We remain optimistic about the extension of operations at
Cozamin well into the future," said Darren
Pylot, President and CEO of Capstone. "The increasing copper
resource creates the potential for a mine expansion and utilization
of surplus mill capacity that is currently being partially filled
using ore from the San Rafael zinc
zone (Resource estimate in table 4 below). The additional 115
thousand tonnes of contained copper added to the M&I class in
the MNFWZ will be targeted by mine engineering for potential
conversion into mineral reserves in 2018, and Inferred resources
will be targeted in 2018 and 2019 for a potential classification
upgrade to M&I (Table 2 below). All resources in Table 2 will
provide the basis for a materials handling study, kicking off in
mid-2018, to evaluate potential infrastructure needs to leverage
upon our drilling success."
Subsequent to this resource estimate a further 31 holes have
been drilled in the MNFWZ and the zone remains open up dip and to
the southeast, where we are continuing 40,000 metres of step-out
and infill drilling this year on the Inferred class resource (Table
2 below), part of our US$7 million
2018 exploration program. Further drilling is anticipated in
2019.
Table 1 - Estimate
of All
MNFWZ Mineral Resources by
Class and COG as at March 31,
2018
|
NSR
|
Tonnes
|
NSR
|
Copper
|
Silver
|
Zinc
|
Lead
|
Copper
Metal
|
Silver
Metal
|
Zinc
Metal
|
Lead
Metal
|
COG
|
(kt)
|
(US$)
|
(%)
|
(g/t)
|
(%)
|
(%)
|
(kt)
|
(koz)
|
(kt)
|
(kt)
|
Indicated
Classification
|
56
|
8,741
|
148.05
|
2.02
|
45
|
0.54
|
0.06
|
177
|
12,561
|
47
|
6
|
49
|
9,112
|
144.14
|
1.97
|
44
|
0.53
|
0.07
|
179
|
12,769
|
49
|
6
|
42
|
9,350
|
141.62
|
1.93
|
43
|
0.54
|
0.07
|
180
|
12,896
|
50
|
6
|
35
|
9,485
|
140.15
|
1.91
|
43
|
0.54
|
0.07
|
181
|
12,963
|
51
|
6
|
28
|
9,594
|
138.91
|
1.89
|
42
|
0.53
|
0.07
|
181
|
13,008
|
51
|
7
|
Inferred
Classification
|
56
|
4,883
|
135.52
|
1.7
|
46
|
1.02
|
0.43
|
83
|
7,156
|
50
|
21
|
49
|
5,127
|
131.54
|
1.64
|
45
|
1.03
|
0.42
|
84
|
7,357
|
53
|
22
|
42
|
5,354
|
127.88
|
1.59
|
44
|
1.03
|
0.41
|
85
|
7,584
|
55
|
22
|
35
|
5,506
|
125.4
|
1.56
|
44
|
1.03
|
0.4
|
86
|
7,742
|
57
|
22
|
28
|
5,621
|
123.47
|
1.53
|
44
|
1.04
|
0.39
|
86
|
7,861
|
58
|
22
|
Mineral resources
reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in
US$) used to calculate the NSR for all deposits are: Cu = $3.50/lb,
Ag = $18.00/oz, Zn = $1.20/lb, and Pb = $1.00/lb. An exchange rate
of MX$18.50 per US$1 is assumed. The following metal recoveries are
used: 90% Cu, 74% Ag, 79% Zn, 76% Pb. Resources are reported above
US$42/t NSR cut-off. Totals may not sum exactly due to
rounding.
|
The current Mineral Reserves at the MNFWZ are primarily located
in two sub-domains called Vein 10 and Vein 20 that are actively
being mined. These two veins, of the five MNFWZ veins, are best
suited to the current mining method and are the target of the
upcoming reserve evaluation. The potential of the remaining three
veins will be examined in the future by looking at possible changes
in mining method and the possibility of introducing ore sorting
technology underground.
Table 2 - Targeted
MNFWZ Mineral Resource Estimate by
Class as at March 31,
2018, at
a US$42 NSR COG*
|
Domain
|
Tonnes
|
NSR
|
Copper
|
Silver
|
Zinc
|
Lead
|
Copper
Metal
|
Silver
Metal
|
Zinc
Metal
|
Lead
Metal
|
|
(kt)
|
(US$)
|
(%)
|
(g/t)
|
(%)
|
(%)
|
(kt)
|
(koz)
|
(kt)
|
(kt)
|
MNFWZ Resources
Targeted for Conversion to Reserve in 2018
|
Vein 10
Indicated
|
1,517
|
123.33
|
1.68
|
34
|
0.67
|
0.04
|
25
|
1,651
|
10
|
1
|
Vein 20
Indicated
|
5,368
|
168.79
|
2.42
|
52
|
0.44
|
0.04
|
130
|
8,947
|
24
|
2
|
Vein 10 + Vein 20
Indicated
|
6,885
|
158.77
|
2.26
|
48
|
0.49
|
0.04
|
155
|
10,599
|
34
|
3
|
MNFWZ Resources
Targeted for Infill Drilling in 2018/2019
|
Vein 10
Inferred
|
771
|
120.49
|
1.61
|
34
|
0.74
|
0.05
|
12
|
848
|
6
|
0
|
Vein 20
Inferred
|
3,347
|
138.85
|
1.90
|
48
|
0.57
|
0.04
|
64
|
5,176
|
19
|
1
|
Vein 10 + Vein 20
Inferred
|
4,119
|
135.42
|
1.84
|
45
|
0.6
|
0.05
|
76
|
6,024
|
25
|
2
|
Mineral resources
reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in
US$) used to calculate the NSR for all deposits are: Cu = $3.50/lb,
Ag = $18.00/oz, Zn = $1.20/lb, and Pb = $1.00/lb. An exchange rate
of MX$18.50 per US$1 is assumed. The following metal recoveries are
used: 90% Cu, 74% Ag, 79% Zn, 76% Pb. Resources are reported above
US$42/t NSR cut-off. Totals may not sum exactly due to
rounding.
|
Table 3 -
Mineral Resource Estimate by
Class for all Copper Zones
as at March 31, 2018, at
a US$42 NSR COG*
|
Classification
|
Tonnes
|
Copper
|
Silver
|
Zinc
|
Lead
|
Copper
Metal
|
Silver
Metal
|
Zinc
Metal
|
Lead
Metal
|
|
(kt)
|
(%)
|
(g/t)
|
(%)
|
(%)
|
(kt)
|
(koz)
|
(kt)
|
(kt)
|
Copper Zone – MNV San
Roberto
|
Measured
(M)
|
409
|
1.23
|
53
|
1.23
|
0.40
|
5
|
696
|
5
|
2
|
Indicated
(I)
|
3,233
|
0.99
|
43
|
1.60
|
0.38
|
32
|
4,478
|
52
|
12
|
Total M +
I
|
3,642
|
1.02
|
44
|
1.56
|
0.38
|
37
|
5,174
|
57
|
14
|
Inferred
|
4,534
|
0.63
|
36
|
1.49
|
0.14
|
29
|
5,178
|
68
|
6
|
MNFWZ
|
Measured
(M)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Indicated
(I)
|
9,350
|
1.93
|
43
|
0.54
|
0.07
|
180
|
12,896
|
50
|
6
|
Total M +
I
|
9,350
|
1.93
|
43
|
0.54
|
0.07
|
180
|
12,896
|
50
|
6
|
Inferred
|
5,354
|
1.59
|
44
|
1.03
|
0.41
|
85
|
7,584
|
55
|
22
|
Total - Copper
Zones
|
Measured
(M)
|
409
|
1.23
|
53
|
1.23
|
0.40
|
5
|
696
|
5
|
2
|
Indicated
(I)
|
12,583
|
1.69
|
43
|
0.81
|
0.15
|
212
|
17,374
|
102
|
18
|
Total M +
I
|
12,992
|
1.67
|
43
|
0.83
|
0.16
|
217
|
18,070
|
107
|
20
|
Inferred
|
9,888
|
1.15
|
40
|
1.24
|
0.29
|
114
|
12,762
|
123
|
28
|
Mineral resources
reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in
US$) used to calculate the NSR for all deposits are: Cu = $3.50/lb,
Ag = $18.00/oz, Zn = $1.20/lb, and Pb = $1.00/lb. An exchange rate
of MX$18.50 per US$1 is assumed. The following metal recoveries are
used: 90% Cu, 74% Ag, 79% Zn, 76% Pb. Totals may not sum exactly
due to rounding.
|
The Zinc Mineral Resources of the Mala Noche Vein ("MNV"),
updated with the NSR formula used for MNFWZ, are reported in Table
4. No additional drilling for zinc resources was performed in
2018.
Table 4 -
Mineral Resource Estimate by
Class for MNV Zinc Zones
as at March 31, 2018, at
a US$42 NSR COG*
|
Classification
|
Tonnes
|
Copper
|
Silver
|
Zinc
|
Lead
|
Copper
Metal
|
Silver
Metal
|
Zinc
Metal
|
Lead
Metal
|
|
(kt)
|
(%)
|
(g/t)
|
(%)
|
(%)
|
(kt)
|
(koz)
|
(kt)
|
(kt)
|
Total – MNV Zinc
Zones (San Rafael and San Roberto Zinc)
|
Measured
(M)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Indicated
(I)
|
2,676
|
0.26
|
42
|
3.56
|
0.55
|
7
|
3,608
|
95
|
15
|
Total M +
I
|
2,676
|
0.26
|
42
|
3.56
|
0.55
|
7
|
3,608
|
95
|
15
|
Inferred
|
4,681
|
0.20
|
32
|
3.06
|
0.33
|
9
|
4,817
|
143
|
15
|
Mineral resources
reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in
US$) used to calculate the NSR for all deposits are: Cu = $3.50/lb,
Ag = $18.00/oz, Zn = $1.20/lb, and Pb = $1.00/lb. An exchange rate
of MX$18.50 per US$1 is assumed. The following metal recoveries are
used: 90% Cu, 74% Ag, 79% Zn, 76% Pb. Totals may not sum exactly
due to rounding.
|
Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability. Mineral Resource estimates do not
account for mineability, selectivity, mining loss and dilution.
These Mineral Resource estimates include Inferred Mineral Resources
considered too speculative geologically to apply economic
considerations for categorization as mineral reserves. Even though
mining has been undertaken in areas of the MNFWZ with Proven and
Probable class mineral reserves there is no certainty that Inferred
mineral resources will be converted to Measured and Indicated
categories through further drilling, or into Mineral Reserves, once
economic considerations are applied.
Mineral Resource Estimate Methodology
The mineral
resource estimate reported herein was prepared by Garth Kirkham of Kirkham Geosystems Ltd. of
Burnaby, BC, Canada, an Independent Qualified Person under
Canadian Securities Administrators' National Instrument 43-101 ("NI
43-101"). The mineral resources presented herein have been
estimated in conformity with generally accepted CIM "Estimation of
Mineral Resource and Mineral Reserves Best Practices" guidelines
and are reported in accordance with NI 43-101. Mineral resources
are not mineral reserves and do not have demonstrated economic
viability. The estimate was completed using MineSightTM
software using a three-dimensional block model (12 metre by 5 metre
by 10 metre block size with 4 metre by 0.5 metre by 5 metre
sub-blocks). The MNFWZ model is comprised of seven interpreted
three-dimensional wireframes which were the primary estimation
domain and hard boundaries were used to constrain the interpolation
of grades into the block model. Interpolation parameters have been
derived based on geostatistical analysis conducted on 1 metre
composited drill hole. Block grades have been estimated using
Ordinary Kriging (OK) methodology and the mineral resources have
been classified based on proximity to sample data and the
continuity of mineralization in accordance with CIM Definition
Standards and Estimation Best Practices. The MNFWZ resource has
been estimated using a total of 833 diamond drill holes with 2382
sample composites.
About Capstone Mining Corp.
Capstone Mining Corp. is a
Canadian base metals mining company, focused on copper. We are
committed to the responsible development of our assets and the
environments in which we operate. Our three producing mines are the
Pinto Valley copper mine located in Arizona, US, the Cozamin polymetallic mine in
Zacatecas State, Mexico and the
Minto copper mine in Yukon, Canada. In addition, Capstone has the
large scale 70% owned copper-iron Santo
Domingo development project in Region III, Chile, in partnership with Korea Resources
Corporation, as well as a portfolio of exploration properties.
Capstone's strategy is to focus on the optimization of operations
and assets in politically stable, mining-friendly regions, centred
in the Americas. Our headquarters are in Vancouver, Canada and we are listed on the
Toronto Stock Exchange (TSX). Further information is available at
www.capstonemining.com.
Quality Assurance
The technical
information in this news release has been prepared in accordance
with Canadian regulatory requirements set out in National
Instrument 43-101 Standards of Disclosure for
Mineral Projects of the Canadian Securities Administrators ("NI
43-101") and supervised and reviewed by Brad Mercer, P. Geol., Capstone's Senior Vice
President, Exploration, a "Qualified Person" as defined in National
Instrument 43-101 and the person who oversees exploration
activities on the Cozamin Mine property. In addition, Gregg Bush, Capstone's Senior Vice President and
Chief Operating Officer, reviewed and approved this news
release.
Analyses for copper, zinc, lead, and silver were completed by
ALS Minerals laboratory using the following method. The entire
sample is crushed to a minimum of 70% passing a 2mm screen. A 250g
subsample of the crushed material is then pulverized to 85% passing
75 micron. Copper, zinc, lead and silver are determined by ICP
analysis after 4 acid digestion of a 0.25g subsample of the
pulverized material. Cozamin Mine Laboratory analyzed 7.5% of the
samples since 2012. The entire sample was crushed to a minimum of
80% passing 9.5mm. A 200g subsample is then pulverized to 100%
passing 74 micron. Copper, zinc, lead and silver are determined by
ICP analysis after 3 acid digestion of a 0.2g subsample of
pulverized material. Blank, standard and duplicate samples are used
for quality assurance and quality control at both laboratories.
Cautionary Note Regarding Forward-Looking
Information
This document may contain "forward-looking
information" within the meaning of Canadian securities legislation
and "forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995
(collectively, "forward-looking statements"). These forward-looking
statements are made as of the date of this document and Capstone
does not intend, and does not assume any obligation, to update
these forward-looking statements, except as required under
applicable securities legislation.
Forward-looking statements relate to future events or future
performance and reflect our expectations or beliefs regarding
future events. Forward-looking statements include, but are not
limited to, statements with respect to the estimation of mineral
resources and mineral reserves, the realization of mineral reserve
estimates, the timing and amount of estimated future production,
costs of production and capital expenditures, the success of our
mining operations, environmental risks, unanticipated reclamation
expenses and title disputes. In certain cases, forward-looking
statements can be identified by the use of words such as "plans",
"expects", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", "believes" or variations of such words
and phrases, or statements that certain actions, events or results
"may", "could", "would", "might" or "will be taken", "occur" or "be
achieved" or the negative of these terms or comparable terminology.
In this document certain forward-looking statements are identified
by words including "optimistic", "targeted", "potential" and
"possibility". By their very nature, forward-looking statements
involve known and unknown risks, uncertainties and other factors
that may cause our actual results, performance or achievements to
be materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Such factors include, amongst others, risks related to
actual results of current exploration activities, inherent hazards
associated with mining operations, future prices of copper and
other metals, compliance with financial covenants, surety bonding,
our ability to raise capital, Capstone's ability to acquire
properties for growth, counterparty risks associated with sales of
our metals, use of financial derivative instruments and associated
counterparty risks, foreign currency exchange rate fluctuations,
changes in general economic conditions, accuracy of mineral
resource and mineral reserve estimates, operating in foreign
jurisdictions with risk of changes to governmental regulation,
compliance with governmental regulations, compliance with
environmental laws and regulations, reliance on approvals, licences
and permits from governmental authorities, impact of climatic
conditions, aboriginal title claims and rights to consultation and
accommodation, land reclamation and mine closure obligations,
increased operating and capital costs, challenges to title to our
mineral properties, maintaining ongoing social license to operate,
dependence on key management personnel, potential conflicts of
interest involving our directors and officers, corruption and
bribery, limitations inherent in our insurance coverage, labour
relations, increasing energy prices, competition in the mining
industry, cybersecurity threats, legal proceedings and other risks
of the mining industry as well as those factors detailed from time
to time in the Company's interim and annual financial statements
and management's discussion and analysis of those statements, all
of which are filed and available for review under the Company's
profile on SEDAR at www.sedar.com. Although the Company has
attempted to identify important factors that could cause our actual
results, performance or achievements to differ materially from
those described in our forward-looking statements, there may be
other factors that cause our results, performance or achievements
not to be as anticipated, estimated or intended. There can be no
assurance that our forward-looking statements will prove to be
accurate, as our actual results, performance or achievements could
differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on our
forward-looking statements.
Cautionary Note to United States Investors
This news
release contains disclosure that has been prepared in accordance
with the requirements of Canadian securities laws, which differ
from the requirements of US securities laws. Without limiting the
foregoing, this news release may refer to technical reports that
use the terms "indicated" and "inferred" resources. US investors
are cautioned that, while such terms are recognized and required by
Canadian securities laws, the SEC does not recognize them. Under US
standards, 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. US investors are cautioned not
to assume that all or any part of indicated resources will ever be
converted into reserves. US investors should also understand that
"inferred resources" have a great amount of uncertainty as to their
existence and as to whether they can be mined legally or
economically. It cannot be assumed that all or any part of
"inferred resources" will ever be upgraded to a higher category.
Therefore, US investors are also cautioned not to assume that all
or any part of inferred resources exist, or that they can be mined
legally or economically. Accordingly, information concerning
descriptions of mineralization and resources contained in this news
release may not be comparable to information made public by US
companies subject to the reporting and disclosure requirements of
the SEC.
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SOURCE Capstone Mining Corp.