PROPERTY:

GEOLOGY

Mineral Reserve Estimates

• Silver mineralization on the Nieves property is classified as low-sulphidation epidermal and is the primary target.

 

• Epidermal silver veins are dominant in the Altiplano Region of Mexico that include world-class examples such as Pachuca, Zacatecas, Fresnillo, and Guanajuato.

 

• The closest example is the Fresnillo deposit, the source of the largest producing silver mine in the world, located 90 km to the south of the Nieves property. The Fresnillo deposit include mantos, and chimneys, stockworks, disseminated mineralization, and veins that show vertical mineralogical zonation.

 

• Three major east-northeast striking silver and gold braided vein systems known as the California, Concordia-San Gregorio-Dolores (sometimes referred to herein as the “Concordia” or “CSD Vein System”), and Santa Rita are the known principal silver and gold mineralization structures located on the Property.

 

• The California Vein System is marked by a shaft and a series of cuts over a distance of 300 m. The California Vein System shows a large 150-600 meter wide alteration zone extending about 2.7 km along the strike. The California Vein was intercepted in Kennecott hole NV08 in two intervals at depths of 108m and 116m that returned assays of 367 g/t over 2m and 795 g/t over 2 m respectively.


• The Concordia-San Gregorio-Dolores Vein System has a known strike length of nearly 1.8 km in two vein sub-systems, the San Gregorio and Dolores. The CDS Systems are composed of carbonate to quartz-sulphide veins. The Concordia Vein can be traced in shaft and mine workings for approximately 600 m to the southwest of the San Gregorio. The San Gregorio Vein can be traced in some small open cuts for 500 m. Surface samples from

10 cm-40 cm wide calcite to quartz veinlets returned silver assays of 945 g/t.

 

• The Delores Vein interpreted to be a splay of the Concordia vein is traceable for nearly 500 m on the surface by numerous small cuts and at least 5 shafts. A stockwork zone of thin calcite to quartz and oxide veinlets extend on the surface for 250 m. Samples of the veinlets from this zone returned silver assays of up to 553 g/t.

 

• The Santa Rita Vein System, located on the southern portion of the Property, can be recognized in shafts and in short drifts over 500 m. Last production during 1970-1985 came from lower levels of the mine. The Santa Rita was deepened over the decades to nine levels (282 m) and yielded bonanza grades, up to 4,000 g/t silver.

 

• In the Santa Rita and Concordia-San Gregorio-Delores Veins, the silver mineralization is hosted in two- to ten-meter thick shear zones. Cabonate-quartz-sulfide veins contain the best grades of silver, gold, lead and zinc and constitute the majority of past production.

 

• 2015-2016 airborne and ground based geophysical surveys of the Property indicate that each of  the three major braided vein systems extend for at least 10 kilometers east to west, much further to the west (>8 km) than was known and mined previously.

 

• The mineralization contained in the three major vein systems is open at depth and laterally. Expansion of the mineralization in all three systems is likely. Multiple veins within the three known systems, three veins identified by IP south of the Santa Rita Vein System, and two currently identified vein systems 10 km west of the Concordia Vein System remain unexplored.

Mineral Resource Statement

Mineral resources for Nieves were classified by Mr. Jason Baker, P.Eng, an appropriate independent qualified person. Classification was done in accordance with the CIM Standard Definition for Mineral Resources and Mineral Reserves (December 2005) guidelines. The

mineral resources for the Nieves Project are reported at a cut-off grade of 15 g/t Ag. The Mineral Resource Statement for the Nieves Project is summarized in Table B4.

Mineral Resource Statement (Caracle Creek, June 22, 2012)

Table B4

Metallurgy

In May, 2010, G&T Metallurgical Services Ltd. completed a metallurgical assessment on behalf of Quaterra and Blackberry. The tests were performed on a composite sample consisting of approximately 100 kg of crushed material. The main objectives of the tests were to determine the chemical and mineral content of the composite, assess the ore hardness and develop an outline of a treatment process to recover silver using conventional mineral processing techniques.

 

The sample contained 79 g/t silver with minor amounts of copper (0.08%), lead (0.14%) and zinc (0.1%). The minerals included quartz, micas, feldspar, pyrite, goethite, sphalerite, galena, silver sulfides (0.07%) and chalcopyrite, in decreasing order of abundance. The silver minerals were polybasite, freibergite and stromeyerite. The ore hardness was determined to be 10.8 kWh/tonne (moderately soft) using a Bond ball mill work index test procedure.

Open circuit flotation testing indicated that about 86% of the silver can be recovered into a final concentrate containing 2.3 kg/tonne silver. It was recommended that future test work should investigate coarser primary grind sizes.

 

The test also suggested that regrinding the rougher concentrate to a nominal 20 μm K80 had no significant benefit on concentrate grade or silver recovery. Increasing the pH level of the cleaner circuit to 10 significantly improved the grade of silver in the final concentrate.

 

Gravity concentration and cyanidation were ruled out as potential processing methods for the PEA due to the low silver recovery. The results of the open circuit kinetic rougher and batch cleaner tests were performed on ore with a silver grade of 79 grams per tonne and indicated that a silver recovery of 86% was achievable.

  • Nieves has been known throughout history as a silver property. Since 2003 Blackberry Ventures and its former partner Quaterra Resources has spent approximately $21,000,000 fully burdened to:

    • Acquire the Nieves Mineral Concessions

    • Maintain the concessions

    • Support the Mexican subsidiary

    • Support the parent LLC

    • Execute eleven carefully planned drilling campaigns totaling 62,500 meters, 172 core holes

    • Conduct 2003 Geophysical Survey consisting of 10 lines (6.6 km in length) of CSAMT

    • Conduct 2010 Geophysical Survey

    • Conduct 2015-2016 comprehensive airborne VTEMplus and companion IP ground geophysical survey of the eastern half of the Nieves Silver Property.

    • Acquire 100% working interest in the Nieves Silver Property

  • Quaterra/Blackberry dilled extensively 2.7km along 2 of the 7 three known veins within one of three known vein systems, each system approximately 10 km in length; discovered and assessed a reported 109,899,808 oz. silver and 116,007 oz. gold — 119,760,403 ounces of silver equivalent — with an average silver ore grade of 40.1 g/t using a 15 g/t silver ore grade cutoff.​

  • The property wide airborne VTEMplus magnetic survey with a follow-on IP ground based survey over the eastern half of the Property has…

    • Extended each of the three known major vein systems up to 8 km to the west (approximately 10km laterally east to west)

    • Found  three additional mineralized veins south of the southernmost known vein in the Santa Rita Vein System

    • Found two additional vein systems 10km west of the central Concordia Vein System

    • Found the possible source or sources of the extensive mineralization encountered and exploited throughout the last five centuries in the Nieves Silver Property.

  • Stats:

    • 181 drill holes

    • Finding costs of < $0.10/ounce silver

    • 662,983 ounces of 40.1 g/t silver equivalent per hole drilled

    • 62,500 meters of holes

    • 1,904 ounces of 40.1 g/t silver equivalent discovered and assessed for each meter drilled

    • Estimated average cost of $44,000 per hole

Silver Resource Finding Metrics — Historical