Mineral Reserves and Resources

Mineral Resources

Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves (CIM (2014) definitions) were used for Mineral Resource classification. See Table 1‑1 for the Mineral Resource Estimate.

Table 1‑1:  Summary of Hammerdown Mineral Resources as of June 30, 2022

Notes:

1. Mineral Resource Estimate completed by Pierre Landry, P.Geo., of SLR Consulting (Canada) Ltd. (SLR), an independent qualified person (QP), as defined by NI 43-101.
2. Effective date: June 30, 2022. All Mineral Resources have been estimated in accordance with Canadian Institute of Mining and Metallurgy and Petroleum (CIM) definitions, as required under NI 43-101.
3. Open Pit Mineral Resources are inclusive of Mineral Reserves
4. Open Pit Mineral Resources are estimated at a cut-off grade of 0.50 g/t Au.
5. Open Pit Mineral Resources are reported at a block cut-off from whole blocks measuring 2.5 m x 1.0 m x 2.5 m.
6. Mineral Resources are estimated using a long-term gold price of US$1,800 per ounce, and a US$/C$ exchange rate of 0.75.
7. Bulk density is 2.84 t/m³ for rock and 1.90 t/m³ for mined out areas.
8. Underground Mineral Resources are estimated at a cut-off grade of 2.00 g/t Au.
9. Underground Resources are reported at a block cut-off from whole blocks measuring 2.5 m x 1.0 m x 2.5 m and have been subject to additional reporting shapes to remove isolated blocks.
10. Numbers may not add due to rounding.
11. Mineral Resources reported demonstrate reasonable prospect of eventual economic extraction, as required under NI 43-101.
12. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
13. The Mineral Resources would not be materially affected by environmental, permitting, legal, marketing, and other relevant issues based on information currently available.

Source: SLR (2022)

Mineral Reserves

The Mineral Reserve estimation has been constrained to the Hammerdown deposit for this FS. Both Open Pit and Underground mining methods were evaluated but, in the end, the project was designed as an Open Pit only based on the best expected economic outcome. The Mineral Resources were evaluated using open pit optimization software to identify an optimum shell which was then used as a basis for detailed design. The final design along with dilution and mine recovery estimates and a cut-off grade were then used to quantify the final Mineral Reserves. 

The mineral reserves for the Hammerdown deposit are reported below within the final pit design and based on cut-off grades of 0.73 g/t for Vein material and 1.06 g/t for the Wisteria zone. The effective date of the Mineral Reserve stated in this report is August 15, 2022.

The QPs have not identified any known legal, political, environmental, or other risks that would materially affect the potential development of the Mineral Reserves. The mine permitting is well advanced and is not seen as a significant risk.

Table 1‑2:  Hammerdown Mineral Reserve Estimate

Notes:

1. Mineral Reserve Estimate completed by Tysen Hantelmann, P.Eng. of JDS Energy & Mining Inc. (QP).
2. Mineral Reserves follow CIM definitions and are effective as of August 15, 2022.
3. Mineral Reserves are estimated at a cut-off of 0.73 g/t for Veins and 1.06 g/t for Wisteria Zone based on: Gold price of US$1650/oz; Exchange rate of 0.77 USD:CAD; combined transport, treatment, payables and royalties of US$25/oz; an overall metallurgical recovery (including ore sorting) of 90.25% for Veins and 85.5% for Wisteria; and an overall processing operating cost of C$45/t ore mined for Veins and C$62/t ore mined for Wisteria. 
4. The final FS pit design contains an additional 94 kt of Inferred resources above the economic cut-off grade at an average grade of 1.62 g/t.  Inferred Mineral Resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that any part of the Inferred Resources could be converted into Mineral Reserves.
5. Tonnages are rounded to the nearest 1,000 t, gold grades are rounded to two decimal places. Tonnage and grade measurements are in metric units; contained gold is reported as thousands of troy ounces.