Prime Mining posts resource estimate for Los Reyes, Mexico

Prime Mining Corp. [PRYM-TSXV; PRMNF-OTCQX; 04V3-FSE] released an updated mineral resource estimate (MRE) for its Los Reyes gold-silver project, located in Sinaloa state, Mexico.

Resource highlights: The addition of 100,000 metres of Prime drilling has doubled the current MRE compared with the April 2020, resource, with a discovery cost of approximately US$25 per gold equivalent (AuEq) ounce (oz).

At the resource gold cut-off grade of 0.22 g/t, Prime’s updated open-pit MRE contains 1.47 million indicated AuEq ounces at a 1.68 g/t average grade. This represents a 73% increase in measured and indicated AuEq ounces and 26% increase in AuEq grade. This is one million ounces of gold at 1.16 g/t and 35 million ounces of silver at 40.4 g/t; 0.73 million inferred AuEq ounces at a 1.26 g/t average grade. This represents a 175% increase in AuEq ounces and 8% increase in AuEq grade. This is 500,000 ounces of gold at 0.85 g/t and 18.4 million ounces of silver at 31.5 g/t.

Using a higher one g/t gold cut-off grade, the MRE highlights a robust, extremely high-grade open-pit resource that contains in excess of one million AuEq indicated ounces at an average AuEq grade of 3.70 g/t.

The MRE has a high-grade open-pit mill resource and a lower-grade heap leach portion. The MRE includes drilling completed before Dec. 31, 2022, from only the three main zones at Los Reyes: Guadalupe, Z-T and Central.

This MRE does not include positive results from Mariposa, Las Primas and Fresnillo; highly prospective exploration targets outlined in Prime’s February 27 news release; over 20,000 metres drilled to date during 2023.

CEO Daniel Kunz commented: “Congratulations to our exploration team for doubling the known gold-silver resource at Los Reyes while simultaneously increasing the average grade and improving the quality and confidence in the mineral resource estimate. Included in the open-pit resource tonnes and grade is a notable high-grade mill feed component. The key elements of our continuing discoveries made over the past two years are the size and scale of the high-grade mineralization. Ongoing metallurgical test work is confirming the relatively simple, high-recovery nature of the resources. With the additional proceeds from the early warrant exercise, we will have the flexibility to increase the drill program as we maintain our success-based approach to exploration.”

Scott Smith, executive vice-president of exploration, added: “We remain hard at work drilling known extensions to the resource and new generative exploration areas highlighted earlier this year. We are targeting yet another doubling of our mineral resource. Since the MRE year-end drilling cut-off, we have already drilled an additional 20,000 metres at Los Reyes that are not included in today’s mineral resource estimate. In the majority of the mineral envelopes, our resource pits pull right to the extent of our drilling – these represent immediate expansion opportunities with our ongoing 2023 drilling. Prime has already increased its 2023 drill program to 45,000 m and the team is already planning for an expanded fall drill program.”

With continuing drilling success, the company believes there is significant potential to expand the MRE.

The Los Reyes resource is composed of three main areas: Guadalupe, Z-T and Central. Resources were estimated assuming a gold price of $1,700 and silver price of $22 and various processing, operating cost and other economic parameters. Resources are reported from blocks within an economically constrained pit, containing gold grades greater than 0.22 g/t. The resource areas remain open along strike and at depth.

The majority of the Los Reyes resource is contained within a high-grade envelope. For example, at a one g/t gold cut-off, the Los Reyes MRE contains in excess of one million gold equivalent ounces at an average grade of 3.70 g/t AuEq in the indicated category and 374,000 ounces at a grade of 3.07 g/t AuEq in the inferred category.

For the purposes of this MRE, all resources are assumed to be mined using conventional open-pit methods.

The MRE was estimated using a drilling cut-off date of Dec. 31, 2022. It is based on a resource block model developed from almost 50,000 metres of drilling completed by previous property owners and over 100,000 m of drilling completed by Prime, of which more than 90 per cent is diamond drill core.

With the resource areas remaining open along strike and at depth, Prime will complete an increased 45,000-metre exploration drilling program at Los Reyes in 2023.

Los Reyes is a high-grade, low-sulphidation epithermal gold-silver project located in Sinaloa state, Mexico. Historic operating results indicate that an estimated one million ounces of gold and 60 million ounces of silver were recovered from five separate operations at Los Reyes between 1770 and 1990.

Since acquiring Los Reyes in 2019, Prime has spent approximately US$30-million on direct exploration activities and has completed two phases of comprehensive drilling totalling over 100,000 metres.