Filo Mining Corp. (TSXV:FIL, Nasdaq Stockholm:FIL) (“Filo Mining” or the “Company”) is pleased to announce its results for three and six months ended June 30, 2018.
HIGHLIGHTS
Following the completion of an extensive 2017/2018 field program at its flagship Filo del Sol Project, the Company’s key objective during the second quarter of 2018 was the advancement of samples collected through testing and analysis. The field program included 9,411 metres of mixed reverse circulation (“RC”) and diamond drilling, and was designed to support the undertaking of a Preliminary Feasibility Study (“PFS”). Based on the complete assay results from the 2017/2018 drill program, the Company successfully updated the Mineral Resource estimate at the Filo del Sol Project, with an effective date of June 11, 2018 (see news release dated August 8, 2018). The Mineral Resource estimate confirms successful achievement by the Company of one of the key objectives of the most recent field program, which was to increase the tonnage and contained metal within the Indicated Mineral Resource. Specifically, this Mineral Resource update successfully increased:
- The total Indicated resource tonnes by 14% to 425.1 million tonnes;
- The total Indicated contained gold in all zones by 12% to 4.4 million ounces;
- The total Indicated contained copper in all zones by 12% to 3.1 billion pounds; and
- The total Indicated contained silver in all zones by 34% to 147 million ounces.
This resource update is comprised of four distinct mineral zones: an uppermost gold oxide (“AuOx”) zone, a copper-god oxide (“CuAuOx”) zone, and a silver zone, all of which is underlain by a copper-gold sulphide (“Sulphide”) zone. The updated Mineral Resource estimate, segregated by zone, is summarized in the following table.
| Zone | Cutoff | Category | Tonnes
(millions) |
Cu
(%) |
Au
(g/t) |
Ag
(g/t) |
lbs Cu
(millions) |
Ounces Au
(thousands) |
Ounces Ag
(thousands) |
| AuOx | 0.20 g/t Au | Indicated | 49.9 | 0.04 | 0.42 | 3.0 | 45 | 679 | 4,810 |
| Inferred | 20.8 | 0.08 | 0.34 | 2.4 | 35 | 226 | 1,580 | ||
| CuAuOx | 0.15 % CuEq | Indicated | 259.2 | 0.38 | 0.29 | 2.7 | 2,166 | 2,385 | 22,500 |
| Inferred | 74.3 | 0.29 | 0.31 | 2.1 | 481 | 735 | 5,040 | ||
| Ag | 20 g/t Ag | Indicated | 40.5 | 0.50 | 0.43 | 87.6 | 446 | 562 | 114,180 |
| Inferred | 8.8 | 0.36 | 0.43 | 79.3 | 70 | 121 | 22,400 | ||
| Sulphide | 0.30 % CuEq | Indicated | 75.5 | 0.27 | 0.34 | 2.2 | 451 | 813 | 5,370 |
| Inferred | 71.2 | 0.30 | 0.33 | 2.5 | 470 | 750 | 5,740 | ||
| Total | Indicated
Inferred |
425.1 | 0.33 | 0.32 | 10.7 | 3,108 | 4,439 | 146,860 | |
| 175.1 | 0.27 | 0.33 | 6.2 | 1,056 | 1,832 | 34,760 | |||
| 1 – CuAuOx copper equivalent (CuEq) assumes metallurgical recoveries of 82% for copper, 55% for gold and 71% for silver based on preliminary metallurgical testwork, and metal prices of US$3/lb copper, US$1300/oz gold, US$20/oz silver. The CuEq formula is: CuEq=Cu+Ag*0.0084+Au*0.4239; |
| 2 – Sulphide copper equivalent (CuEq) assumes metallurgical recoveries of 84% for copper, 70% for gold and 77% for silver based on similar deposits, as no metallurgical testwork has been done the Sulphide mineralization, and metal prices of US$3/lb copper, US$1300/oz gold, US$20/oz silver. The CuEq formula is: CuEq=Cu+Ag*0.0089+Au*0.5266; |
| 3 – The Qualified Person for the resource estimate is James N. Gray, P.Geo. of Advantage Geoservices Ltd.; |
| 4 – All figures are rounded to reflect the relative accuracy of the estimate; |
| 5 – Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability; |
| 6 – The resource was constrained by a Whittle® pit shell using the following parameters: Cu $3/lb, Ag $20/oz, Au $1300/oz, slope of 45°, a mining cost of $2.50/t and an average process cost of $13.26/t. |
The updated Mineral Resource estimate will be incorporated into the PFS currently underway, which is being led by Ausenco Engineering Canada Inc. and targeted for completion by the first quarter of 2019. Metallurgical testwork results will be the next integral input to the PFS. This next phase of metallurgical testwork, which commenced in early April 2018 and is based on samples collected during 2017/2018 diamond drilling and surface trenching, is expected to be completed in the third quarter of 2018.
Reflecting on the Company’s second quarter progress, Adam Lundin, President and CEO, commented, “Filo Mining has pushed forward as planned with the recent update to the Mineral Resource estimate for the Filo del Sol Project and kicking off the next phase of metallurgical testwork, all of which will support the PFS that is currently underway and planned for completion by Q1 2019. The update to the Mineral Resource not only demonstrates that our team was successful in obtaining another key PFS input, but also demonstrates the strength of the deposit at the Filo del Sol Project. The update to the Mineral Resource estimate resulted in a notable increase in both Indicated tonnage and contained metal, while the Project has maintained its considerable exploration potential with less than 20% of the project area explored to date and the resource remaining open for expansion in several directions and at depth. The Company is looking forward to the completion of the metallurgical testwork program, which the November 2017preliminary economic assessment had identified as having potential to create value at the Filo del Sol Project.”
OUTLOOK
The Company’s main focus for the remainder of 2018 will be the completion of the PFS, targeted for completion by the first quarter of 2019. The PFS will incorporate the updated Mineral Resources estimate and will explore several opportunities identified in the preliminary economic assessment (“PEA”) of the Filo del Sol Project, completed in November, 2017, including:
- Evaluating processing methods to take advantage of the fast leach kinetics noted in the metallurgical testwork completed to date, which could increase metals recoveries throughout the zones. If successful, this could lead to a smaller operating footprint, could eliminate the permanent copper and on/off leach pads and their associated materials handling systems, and saving on operating costs associated with these installations;
- Evaluating opportunities to optimize the mine plan and production schedules by smoothing out the production profile and bringing forward copper revenues; and
- Increasing metallurgical recoveries with further test work and optimization.
The analysis of alternative processing options and refinement of metallurgical recoveries began in April 2018 and is ongoing, using material collected during the 2017/2018 field program from diamond drill holes and surface trenches. The results …read more
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