Mineral Reserves and Mineral Resources are as defined by the 2014 CIM Definition Standards for Mineral Resources and Mineral Reserves
Mineral Resources are exclusive of Mineral Reserves
Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
Factors that could materially affect the reported Mineral Resources or Mineral Reserves include: changes in metal price and exchange rate assumptions; changes in local interpretations of mineralization; changes to assumed metallurgical recoveries, mining dilution and recovery; and assumptions as to the continued ability to access the site, retain mineral and surface rights titles, maintain environmental and other regulatory permits, and maintain the social license to operate
Mineral Resources and Reserves Mineral are reported as of December 31, 2023
Mineral Reserves for the Caylloma Mine are reported above NSR breakeven cut-off values based on underground mining methods including: mechanized (breasting) that represents 91 % of Mineral Reserves planned for mining at $89.78/t, mechanized (uppers) at $79.70/t, semi-mechanized at $ 93.27/t, sub-level stoping at $88.81/t, and a conventional method at $170/t; using assumed metal prices of $21/oz Ag, $1,600/oz Au, $2,000/t Pb, and $2,600/t Zn; metallurgical recovery rates of 82 or 85 % for Ag, 22 or 55 % for Au, 87 or 89 % for Pb and 89 % for Zn. Mining, processing, and administrative costs used to determine NSR cut-off values were estimated based on actual operating costs incurred from July 2022 through June 2023. Mining recovery is estimated to average 94 % with average mining dilution of 17 % depending on the mining methodology. Mineral Resources are reported at an NSR cut-off grade of $75/t for veins classified as wide (Animas, Animas NE, Nancy, and San Cristobal) and $135/t for veins classified as narrow (all other veins) based on the same parameters used for Mineral Reserves, and a 15 % upside in metal prices
Mineral Reserves for the San Jose Mine are based on underground mining within optimized stope designs using an estimated NSR break-even cut-off grade of $96.54/t to $85.02/t equivalent to 154 to 132 g/t Ag Eq based on assumed metal prices of $23.90/oz Ag and $1,880/oz Au; estimated metallurgical recovery rates of 91 % for Ag and 90 % for Au and mining costs of $49.83/t (C&F) – $38.31/t (SLS); processing costs of $20.79/t; and other costs including distribution, general service costs of $25.92/t based on actual operating costs. Average mining recovery is estimated to 94 % (C&F) and 92 % (SLS) and average mining dilution 10 % (C&F) and 14 % (SLS). Mineral Resources are reported at a 130 g/t Ag Eq cut-off grade based on the same parameters used for Mineral Reserves
Mineral Reserves for the Lindero Mine are reported based on open pit mining within a designed pit shell based on variable gold cut-off grades and gold recoveries by metallurgical type: Met type 1 cut-off 0.28 g/t Au, recovery 75.4 %; Met type 2 cut-off 0.27 g/t Au, recovery 78.2 %; Met type 3 cut-off 0.27 g/t Au, recovery 78.5 %; and Met type 4 cut-off 0.31 g/t Au, recovery 68.5 %. Mining recovery and mining dilution have been accounted for during block regularization to 10-meter x 10-meter x 8-meter size. The cut-off grades and pit designs are considered appropriate for long term gold prices of $1,600/oz, estimated base mining costs of $1.36 per tonne of material, total processing and G&A costs of $9.78 per tonne of ore, and refinery costs net of pay factor of $12.20 per ounce gold. Reported Proven Reserves include 8.3 Mt averaging 0.44 g/t Au of stockpiled material. Mineral Resources are reported within a conceptual pit shell above a 0.24 g/t Au cut-off grade based on the same parameters used for Mineral Reserves and a 15 % upside in metal prices. Mineral Resources for Arizaro are reported within a conceptual pit shell above a 0.26 g/t Au cut-off grade using the same gold price and costs as Lindero with an additional $0.52 per tonne of ore to account for haulage costs between the deposit and plant. A slope angle of 47° was used for defining the pit
Mineral Reserves for the Yaramoko Mine are reported on a 100 % ownership basis at a cut-off grade of 1.57 g/t Au for the Zone 55 open pit, 0.86 g/t Au for the Zone 109 open pit, 4.5 g/t Au for Zone 55 underground, 3.8 g/t Au for Bagassi South QV Prime and Bagassi South underground based on an assumed gold price of $1,600/oz, metallurgical recovery rates of 96.8 %, underground mining costs of $154/t, processing cost of $28/t and G&A costs of $27/t, surface mining costs of $4.95/t, processing cost of $27/t, and G&A costs of $33/t. Underground average mining recovery is estimated at 90 % for Bagassi South QV Prime and Bagassi South underground, 93 % for Zone 55 SLS stopes, and 86 % for sill drift stopes. A mining dilution factor of 10 % has been applied for sill drift stopes, 0.7-meter and 0.4-meter dilution skin has been applied for sub-level stopes and shrinkage mining respectively. Surface mining recovery and mining dilution have been accounted for during block regularization to 5-meter x 5-meter x 5-meter size within an optimized pit shell and only Proven and Probable categories reported within the final pit designs. Yaramoko Mineral Resources are reported at a gold grade cut-off grade of 0.9 g/t Au for the Zone 55 open pit, 0.5 g/t Au for the Zone 109 open pit, and 2.7 g/t Au and 2.5 g/t Au for underground Zone 55 and Bagassi South respectively, based on an assumed gold price of $1,840/oz and the same costs, metallurgical recovery and constrained within an optimized pit shell. The Yaramoko Mine is subject to a 10 % carried interest held by the State of Burkina Faso
Mineral Reserves for the Séguéla Mine are reported on a 100 % ownership basis at an incremental gold grade cut-off of 0.65 g/t Au for Antenna, 0.72 g/t Au for Agouti, 0.69 g/t Au for Boulder, 0.66 g/t Au for Koula, 0.73 g/t Au for Ancien, and 0.66 g/t Au for Sunbird deposits based on a gold price of $1,600/ounce, metallurgical recovery rates of 94.5 %, surface mining costs of $3.12/t, processing cost of $15.42/t and G&A cost of $8.83/t, and only Proven and Probable categories reported within the final pit designs. The Mineral Reserves pit designs were completed based on overall slope angle recommendations of between 37° and 57° for Antenna, Koula, and Agouti deposits from oxide to fresh weathering profiles, between 34° and 56° for Ancien deposit from oxide to fresh weathering profiles, 37° and 60° for Boulder deposit from oxide to fresh weathering profiles and 37° and 58° for Sunbird deposit from oxide to fresh weathering profiles. The Mineral Reserves are reported with modifying factors of mining dilution and mining recovery represented by regularizing the block models to an appropriate selective mining unit block size. Mineral Resources for Séguéla are reported at a cut-off grade of 0.55 g/t Au for Antenna, 0.55 g/t Au for Sunbird, 0.60 g/t Au for Koula and Boulder, and 0.65 g/t Au for Ancien and Agouti deposits, based on an assumed gold price of $1,840/oz and constrained within preliminary pit shells. The Séguéla Mine is subject to a 10 % carried interest held by the State of Côte d’Ivoire
Eric Chapman, P. Geo. (EGBC #36328), is the Qualified Person responsible for Mineral Resources; Raul Espinoza (FAUSIMM (CP) #309581) is the Qualified Person responsible for Mineral Reserves; both being employees of Fortuna Mining Corp. (“Fortuna”)