VANCOUVER, British Columbia,
June 5, 2018 /PRNewswire/ --
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$7 million
2018 exploration program. Further drilling is anticipated in
2019.
Table 1 - Estimate of All MNFWZ Mineral Resources by Class and COG as at March 31, 2018
Copper Silver Zinc Lead
NSR Tonnes NSR Copper Silver Zinc Lead Metal Metal Metal Metal
COG (kt) (US$) (%) (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$42 NSR COG*
Copper Silver Zinc Lead
Domain Tonnes NSR Copper Silver Zinc Lead Metal Metal Metal Metal
(kt) (US$) (%) (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$42 NSR COG*
Copper Silver Zinc Lead
Classification Tonnes Copper Silver Zinc Lead Metal Metal Metal Metal
(kt) (%) (g/t) (%) (%) (kt) (koz) (kt) (kt)
Copper Zone - MNV San Roberto
Measured (M) 409 1.23 53 1.23 0.40 5 696 5 2
Indicated (I) 3,233 0.99 43 1.60 0.38 32 4,478 52 12
Total M + I 3,642 1.02 44 1.56 0.38 37 5,174 57 14
Inferred 4,534 0.63 36 1.49 0.14 29 5,178 68 6
MNFWZ
Measured (M) - - - - - - - - -
Indicated (I) 9,350 1.93 43 0.54 0.07 180 12,896 50 6
Total M + I 9,350 1.93 43 0.54 0.07 180 12,896 50 6
Inferred 5,354 1.59 44 1.03 0.41 85 7,584 55 22
Total - Copper Zones
Measured (M) 409 1.23 53 1.23 0.40 5 696 5 2
Indicated (I) 12,583 1.69 43 0.81 0.15 212 17,374 102 18
Total M + I 12,992 1.67 43 0.83 0.16 217 18,070 107 20
Inferred 9,888 1.15 40 1.24 0.29 114 12,762 123 28
Mineral resources reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in US$) 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$42 NSR COG*
Copper Silver Zinc Lead
Classification Tonnes Copper Silver Zinc Lead Metal Metal Metal Metal
(kt) (%) (g/t) (%) (%) (kt) (koz) (kt) (kt)
Total - MNV Zinc Zones (San Rafael and San Roberto Zinc)
Measured (M) - - - - - - - - -
Indicated (I) 2,676 0.26 42 3.56 0.55 7 3,608 95 15
Total M + I 2,676 0.26 42 3.56 0.55 7 3,608 95 15
Inferred 4,681 0.20 32 3.06 0.33 9 4,817 143 15
Mineral resources reported using NSR2018 formula:
Cu*61.676+Ag*0.354+Zn*14.521+Pb*11.208. Metal price assumptions (in US$) 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
MineSight[TM] 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
http://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 http://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.
Cindy Burnett
VP, Investor Relations and Communications
+1-604-637-8157
cburnett@capstonemining.com