Levon Resources has built Cordero into one of Mexico's premier porphyry targets for silver, gold, zinc and lead. Following completion of a successful PEA in April 2018, the current indicated and inferred resources, combined with the project's eight large-scale mineral targets on more than 370 square kilometres, have established Cordero as a world-class property and a district-scale discovery ready for pre-feasibility studies.
Cordero's host rocks, geology, metal assemblage and size are all analogous to some of Mexico's largest world-class, bulk-tonnage silver deposits including Penasquito (Goldcorp), Camino Rojo (Goldcorp) and Pitarilla (Silver Standard). These deposits are all situated within the same emerging Chihuahua-Zacatecas silver-gold belt in northern Mexico.
Through more than 133,000 meters of drilling, Levon has established a resource* with:
Silver: 407.8 M oz indicated, 187.5 M oz inferred Gold: 1.27 M oz indicated, 363,000 oz inferred Zinc: 8.03 B lbs indicated, 4.66 B lbs inferred Lead: 3.77 B lbs indicated, 1.86 B lbs inferred
Here are tonnage and grade details based on a Net Smelter Return cut-off of US$6.00 per tonne (as announced in Levon's news release dated March 5, 2018). The resource is within an open pit geometry generated by a floating cone algorithm using metal prices and recoveries of: Lead, $1.00/lb and 80% recovery; Zinc, $1.20/lb and 81% recovery; Silver, $20.00/oz with 85% recovery, gold $1,250/oz, 18.00% recovery to a lead concentrate and 15% recovery to a zinc concentrate:*
31.1034768 grams in one troy ounce, reported as oz/t (where t= tonne)
* The Cordero updated resource estimate is tabulated within a revised open pit geometry and was developed from 292 drill holes encompassing 133,620 meters of core drilling. The current resource remains open to expansion through step out delineation and infill drilling, on strike and beneath the modeled open pit.
The updated Cordero resource estimate presented was prepared under the direction of Herb Welhner (SME registered member #3434330), Vice President of IMC, who is a qualified person under NI 43-101. IMC has utilized updated metal price projections, estimated metallurgical recoveries, production and processing cost estimates from M3 Engineering & Technology ("M3"), Tucson, Arizona. The 2018 Cordero PEA supersedes the 2013 PEA update, which was written before Levon consolidated the current 100% ownership of all claims in the district to complete 2014 drilling and a 2014 resource update (news release of October 20, 2014). The 2018 PEA includes the 2018 resource and re-evaluates the Cordero Project in the context of a long-term silver, zinc, lead, gold project designed to world standards.
The 2018 PEA includes a refined geologic model, the updated 2018 Mineral Resource estimate, updated process recovery, and revised mining and processing costs. The tailings disposal facilities remain unchanged. While a portion of the data generated for the 2013 PEA Update study provided support for some of the assumptions incorporated into the 2018 PEA, the mining, processing, geotechnical, hydrological, social, and capital and operating cost parameters are revised and reported in the 2018 PEA report (which will be available for public viewing within 45 days of the March 5, 2018 News Release.
The Cordero resource, located on just one of the property's eight large-scale targets, now ranks amongst the world's largest silver resources.
Preliminary Economic Assessment**
A successful Preliminary Economic Assessment (PEA), updated in April 2018, has established Cordero's potential economic viability based on just 30% of the outcropping, open-pit resource.
As noted in the PEA: "The project, as it is currently scoped, is
taking shape as a major open pittable project with projected mineral resources supporting 29 years of production at 40,000 mtpd. Levon is now in a position to advance the Cordero Project to the pre-feasibility study..."
An additional 20 to 60 holes of infill drilling is now in the planning stages to provide better definition of the mineral resource and bring Inferred mineralization into the Measured and Indicated categories.
Here are the base case figures from the 2018 PEA (conducted by Independent Mining Consultants and M3 Engineering):
Silver Price: US$20 Internal Rate of Return (IRR): 15.7% Mine Life: 29 years (to complete four stages of a planned eight-stage open pit) Mill Capacity: 40,000 tpd Strip Ratio: 0.98/1 Payback: 4.84 years
**A Preliminary Economic Assessment should not be considered to be a prefeasibility or feasibility study, as the economics and technical viability of the Project have not been demonstrated at this time. The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Furthermore, there is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
The Technical Report: Cordero Project, Preliminary Economic Assessment was authored and approved by Herbert E. Welhener, MMSA-QPM, SME Registered Member #3434330RM who is the Qualified Person for purposes of this Preliminary Economic Assessment and the associated updated resource calculation.
Cordero hosts at least eight large-scale targets on two distinct porphyry belts and a third mineralized volcanic center. The current resource is open to expansion on strike and at depth beyond the 2.8km x 2km conceptual open pit.
The following risk issue has been identified for the Cordero project:
1) Cordero as currently understood is a low grade, bulk tonnage deposit which will need favorable metal recoveries, metal prices and low operating costs to be developed.
Drill hole composited assays, drill maps, cross sections:
Reported for all 24 holes (C13-251 through C14-274, Aida Claim)*
Cordero Project, Chihuahua State, Mexico