Meridian Mining drills 5.2 g/t AuEq over 11 metres at Santa Helena, Brazil

Meridian Mining U.K. Societas [TSX-MNO; OTCQX-MRRDF] released its strategy to further advance multiple prospects within the Cabacal volcanogenic massive sulphide (VMS) belt in Brazil as part of a hub and spoke strategy to maximize value for shareholders. The Cabacal project’s current engineering and drill programs will be upgraded to complete a prefeasibility study (PFS) on an expanded production case, to delineate higher certainty of the core asset value.

Due to the continued success of drilling at the Santa Helena mine, the company has decided to advance the historical mine toward a resource estimate to maximize its optionality within the broader VMS belt. Santa Helena has the potential to be the first step towards the Hub and Spoke strategy envisaged for the development of the wider Cabacal Belt’s growth potential.

The company further announces that it has discovered a rich layer of Au-Cu-Ag and Zn VMS mineralization projecting below the main VMS mine horizon at Santa Helena, grading 11.0m of 5.2 g/t AuEq (CD-360) and 6.8m of 3.3g/t AuEq (CD-416). Further extensions of the VMS mine horizon have been intersected in CD-420, and CD-431, up to 510m to the east of the historical resource envelope. Further assay results from Cabacal and Santa Helena are pending.

Highlights: Cabacal’s work programs upgraded to produce a Pre-Feasibility Study in 2024 leading to higher project certainty. Santa Helena’s robust growth in resource potential to be advanced towards first resource in 2024.

Santa Helena’s drilling intercepts new Au-Cu-Ag and Zn rich VMS lens located below mine sequence. CD-360 returned 11.0m of 5.2g/t AuEq (0.9g/t Au, 2.2% Cu, 22.1 g/t Ag and 3.5% Zn) from 30.0m. CD-416 returned 16.6m of 2.1g/t AuEq (0.7g/t Au, 0.6% Cu, 14.7g/t Ag and 1.7% Zn) from 41.4m, including 6.8m of 3.3 g/t AuEq (1.3g/t Au, 1.1% Cu, 23.3 g/t Ag and 1.9% Zn) from 41.4m. Santa Helena’s prospective VMS mine sequence was extended by 0.51km to the east with multiple hits.

The Cabacal Mine area continues to return robust results of Au-Cu & Ag mineralization; CD-365: returned 50.5m of 1.0 g/t AuEq (0.7g/t Au, 0.3% Cu and 1.1g/t Ag) from 19.8 m. The Cabacal Purchase Agreement amended to reflect changes in Project timeline deliverables.

Gilbert Clark, CEO, commented: “2024 has started with an expansion of our strategy of developing satellite deposits “Spokes” in the Cabacal belt to feed a central processing “Hub” at Cabacal. By upgrading Cabacal’s current PEA1 to a PFS standard and removing all Inferred Resources from future financial and mining modelling, we will achieve a higher certainty on its hard asset value, with only a modest increase in the data and studies required. In 2024, Santa Helena’s programs will be firmly advancing towards its inaugural resource, with a strong focus on maximising the potential for open-pitable resources, and exposing it to the optionality of the hub and spoke strategy proposed for the Cabacal VMS belt.

Today’s results from Santa Helena have outperformed our expectations with robust assays from infill drilling, with a half a kilometre extension of the mine horizon eastwards beyond its historical resource limits, and with the identification of a strong layer of Au-Cu-Ag and Zn mineralization that projects below the mine horizon.

The PFS mine schedule and financial model will be focused on an initial throughput of 2.5Mt p.a. then expanded to reach a maximum throughput of 4.5Mt using project cash flow in year four.

Santa Helena is a Cu-Au-Ag & Zn VMS deposit located ~9km to the southeast of the Cabacal Mine. It has over 10,000m of historical drilling and is the most advanced of a series of exploration targets along the Cabacal Mine Corridor.

The Preliminary Economic Assessment technical report dated March 30, 2023, entitled: “Cabacal Gold-Copper Project NI 43-101 Technical Report and Preliminary Economic Assessment, Mato Grosso, Brazil” outlines a base case after-tax NPV5 of US$573 million and 58.4% IRR from a pre-production capital cost of US$180 million, leading to capital repayment in 10.6 months (assuming metals price scenario of US$1,650 per ounces of gold, US$3.59 per pound of copper, and US$21.35 per ounce of silver). Cabacal has a low All-in-Sustaining-Cost of US$671 per ounce gold equivalent for the first five years, driven by high metallurgical recovery, a low life-of-mine strip ratio of 2.1:1, and the low operating cost environment of Brazil.

The Cabacal Mineral Resource estimate consists of Indicated resources of 52.9 million tonnes at 0.6g/t gold, 0.3 per cent copper and 1.4 g/t silver and Inferred resources of 10.3 million tonnes at 0.7 g/t gold, 0.2% copper and 1.1 g/t silver (at a 0.3 g/t gold equivalent cut-off grade), including a higher-grade near-surface zone supporting a starter pit.