PIT

OPTIMIZATION

PIT RESOURCE

EXPANSION

FURTHER

EXPLORATION

EXIT

STRATEGY

Pit Resource Expansion Plan

Goals and objectives of Pit Resource Expansion Plan

 

• “Once you find ore, stay in it.”

• Increase Nieves’ reported and assessed resource that can be mined using an open pit to plus 200,000,000 ounces of silver;

• With an average reported silver ore grade of 85.05 g/t;

• With a reported and assessed resource capable of hosting a open pit mine producing 5,000,000 -10,000,000 ounces of silver a year for 10-20 years.

Pit Resource Expansion Drilling Program

• Systematic drilling laterally along and within the 10km strike length of the three major braided vein systems and at depth in targeted veins with known mineralization: San Gregorio; California; Dolores; Orion; Nino and Santa Rita Veins.

• Drill 300 core holes averaging 270 meters in depth on 100 meter centers, up to 100 drill holes west along the 10km California Vein System, up to 100 drill holes west along and within the 10km Concordia Vein System and up to 100 drill holes west along and within the 10km Santa Rita Vein System.

• Number of holes in each vein system to be determined by drilling results.

 

Third party resource report

Secure an update Form 43-101 PEA Technical Report upon assessing results of the Pit Resource Expansion Program

 

Budget

$10,000,000 fully burdened

 

Timeline

12 months

Time frame

January 2021 - December 31, 2021

Case for Nieves’ Pit Resource Expansion Using Geophysical Data with Drilling

• A detailed analysis of the geophysics data acquired to date has resulted in the identification of 21 interpreted vein targets (conductors) within the three known braided veins systems located within the eastern portion of the Property with an estimated cumulative length east to west of 185 km. To date, 10.7 km — less than 6% — have been tested with a drill.

 

• The primary focus of the resource delineation work to date has been on two veins within the Central Vein System, the San Gregorio and La Quinta Veins, which remain open to the east, west and at depth.

 

• The 10.7 km of silver mineralized veins drilled to date have yielded a reported 91,064,721 tonnes of silver ore with an average grade of 40.1 g/t with 109,899,818 ounces of silver and 116,007 ounces of gold.

 

• With a reported 110 million ounces of silver, 116 thousand ounces of gold and approximately 6% of the known mineralized veins drill-tested, one can assume that the resource potential for the known vein systems could approach 1 billion or more ounces of silver.

 

• However, we first plan to configure a viable open pit resource with an minimized stripping ratio, maximize ore grade using deposits in close geographical proximity to

assure viability and economic feasibility at today’s silver prices to de-risk future delineation and exploration.

 

• The 2005 Inman Deposition Model on Nieves and his 2015-2016 Geophysical Mapping of Nieves indicates drill locations for higher grade silver and gold resources. We believe that these will expand the pit resource to 200 million ounces silver while increasing the ore grade, and maintaining geographical proximity to the starter pit, the central braided vein system, the Concordia-San Gregorio-Delores.

 

• The Central Vein System has been tested 2.7km along its indicated 10km strike and only two of its veins, the Concordia and La Quinta, have been extensively drilled along a small segment of their 2.7 km strike length. The system remains open to the east and west and at depth. Geophysical mapping shows the system extending up to 8 km to the west. Ore grades have generally improved westward and at depth. The Delores Vein, Gregorio Vein, Nino Vein, and Orion Vein, with its high grade shows have remained generally unexplored with the drill.

 

• The northern vein system, the California, and the southern-most vein system, the Santa Rita, remain largely unexplored with the drill.

Known Eastern Vein Systems From 2012 43-101 Technical Report

This image shows the eastern region of the Nieves property. The 2012 proposed pit is outlined in dark red.

Value Proposition Pit Resource Expansion

Value Proposition

• Funding Required for  Pit Resource Expansion:  $   10,000,000

• Pit Valuation Pre-Pit Resource Expansion:           $ 103,500,000

• Pit Valuation Post-Resource Expansion:              $ 300,000,000

• Uplift:                                                                   $ 186,500,000

 

Pit Expansion Timeline

18 months/30 months cumulative

 

Goals  and Objectives  Pit Resource Expansion

• Increase the size of the open pit’s silver ore body tonnage from 23,000,000 tonnes to 66,666,667 tonnes.

• Maintain the average silver ore grade at > 85.05 g/t

• Increase the size of the reported silver resource contained within the expanded pit < 3-fold from 69,000,000 ounces  to 200,000,000 ounces.

• Increase the resource classifications/categories from indicated and inferred to measured, indicated, and inferred.

• Equal or exceed the reported resource, resource classification, and average ore grade of the La Preciosa at the time of its sale to Coeur D’ Alenes Mining for $373,000,000.

• Maintain pit development economic feasibility at current silver prices.

• Increase marketability and desirability of Nieves’ silver and gold resource to silver miners by delineating a resource capable of hosting a 10-20 year LOM producing 5,000,000 -10,000,000 ounces silver equivalent per year.

• De-risk further exploration of the Nieves Silver Property.

 

Use of Funds

• $  9,000,000   to drill 300, core holes averaging 270 meters

• $     500,000  to sustain BBV and Nieves through Pit Expansion Phase

•$     250,000  to update Form 43-101 PEA post-pit resource expansion

•$     250,000  contingency

 

Anticipated Value of Nieves Pit Resource Post Expansion

Assuming a found, reported and assessed resource of 200,000,000 ounces of silver equivalent, $15 average silver price over life of mine, $2.50 estimated value of a ounce of mineable silver resource in the ground, we get a fair value of $500,000,000 for the Nieves Expanded Pit Resource.

Nieves Compared to La Preciosa Sale