Jim's Mining Letter - June 20, 2024

Blackrock Silver (BRC.V BKRRF AHZ0.F) announced the return of drills to the company’s Tonopah West project located immediately adjacent to Tonopah, Nevada, within the Walker Lane gold and silver mineral trend. Blackrock has commenced the preparation of drill sites on Tonopah West for a 20,000 metre, fully-funded drill program set to commence in July 2024. Tonopah West is said to be one of the highest-grade undeveloped large silver projects globally with 100 million silver equivalent inferred ounces grading 508.5 grams per tonne. The Merten and Bermuda vein systems located at the southern edge of the DPB deposit will be the focal point for the resource conversion program as they represent the shallowest targets and would be the first structures encountered based on the conceptual underground mining plan. Expansion drilling will focus on the 1 kilometre vein corridor between the DPB and NW Step-out deposits, aiming to connect the entire 4 kilometre silver-gold system and unlock substantial tonnage potential. Major long lead project de-risking initiatives have been underway at Tonopah West since the start of the year and are expected to generate news over the coming months across such areas as engineering, hydrologic and environmental studies. Advanced metallurgical test work is well underway with results anticipated in August of this year. The multifaceted work program is claimed to be the most pivotal one yet in terms of demonstrating Tonopah West’s potential. The reverse circulation drill is expected to complete fifty pre-collar holes ranging from 50 metres to 300 metres deep. The core drills will use the pre-collars holes to finish core tails to the target depth. The core tails will range from 80 metres to 450 metres below the pre-collar depth. The first objective is to convert approximately one million tonnes of high-grade silver and gold from the inferred resource category to the measured and indicated resource category. The program will target high grades within the Bermuda and Merten vein systems which are located at the southern end of the DPB area where the veins are at their shallowest depth below the surface. Drilling will be on 25 metre centers within an area that is 270 metres in an EastWest direction by 550 metres in a NorthSouth direction. The resource conversion focus of the Tonopah West drill program is expected to consist of 41 pre-collar holes with corresponding core tails. The combined drillholes will range from 200 to 380 metres in total length. A total of 12,000 metres of combined RC and core drilling is planned for this portion of the program. The second objective will be to connect the DPB zone to the NW target area which is approximately 1,000 metres NW of DPB. Eleven holes are planned with nine new pre-collars being completed and two existing pre-collars being used for the resource expansion portion of the Tonopah West drill program. A total of 8,000 metres of drilling is planned on widely spaced drillholes for this portion of the drill program. The company has engaged Kappes, Cassidy & Associates to complete additional metallurgical test work on the Tonopah West vein material. A total of nine additional composites were delivered to KCA in April 2024. This material along with the twelve original composites will be used to provide additional information to refine the estimated metallurgical recoveries by zone, assist in recommending a processing plant flowsheet, processing parameters and processing capital expenditures, and operating expenditures, with the aim of helping to de-risk Tonopah West. The results from the metallurgical test work are expected in August 2024.

B2Gold (BTO.TO BTG 5BG.F) announced the results of a positive Preliminary Economic Assessment on its 100% owned Gramalote gold project located in the Department of Antioquia, Colombia. The project has a significant gold production profile with a low-cost structure and favorable metallurgical characteristics. Life of project gold production is estimated at approximately 2.3 million ounces with an average gold recovery of 95.9% from conventional milling, flotation and cyanide leach of the flotation concentrate. Average annual gold production is estimated at approximately 234,000 ounces per year for the first five years of production, with an average annual gold production of approximately 185,000 ounces per year over the life of project. Projected lowest quartile all-in sustaining costs are $886 per gold ounce over the life of project, with an annual processing rate of 6 million tonnes per annum. Life of project after-tax free cash flow is $1.38 billion and the estimated pre-production capital cost is $807 million, including approximately $93 million for mining equipment and $63 million for contingency. At a discount rate of 5%, net present value after-tax is $778 million, generating an after-tax internal rate of return of 20.6%, with a project payback on pre-production capital of 3.1 years. A robust amount of historical drilling and engineering studies have been completed on Gramalote, which significantly de-risks future project development. B2Gold now is to commence feasibility work with the goal of completing a feasibility study by mid-2025.

Robex Resources (RBX.V RSRBF RB4A.F) announced that is has increased the size of its previously announced best efforts public offering, which has been upsized to 50,691,200 units of the company at a price of C$2.17 per unit for gross proceeds increasing to C$109,999,904. Each unit will be comprised of one common share and one common share purchase warrant. Each warrant will entitle the holder to acquire one common share of the company at an exercise price of C$2.55 per common share, until two years following the closing date of the offering, provided that in the event the common shares trade at a volume weighted average price of C$3.50 or higher over a period of 10 consecutive trading days, the company can accelerate the exercise of the warrants. The agents have been granted an over-allotment option to purchase from the company up to an additional number of units as is equal to 15% of the number of the units issued pursuant to the offering. Robex intends to use all the net proceeds from the equity financing for the development of the Kiniero Project, partial payment to Taurus of $15 million under the $35 million bridge loan facility, infilling the Mansounia project and other exploration expenditures, funding the Kiniero updated feasibility study to include the Mansounia property and further pit and process optimization, plus general and administrative as well as working capital…more

Collective Mining (CNL.TO CNLMF GG1.F) announced that a comprehensive airborne geophysical survey covering the company’s Guayabales Project in Caldas, Colombia will commence in the coming days. The company is fully funded for its 2024 budget with $23.6 million in its treasury as of May 16, 2024. Additionally, a sixth drill rig is being mobilized to the Guayabales Project as part of its fully funded 40,000 metres drill program for 2024. Drill rigs are currently operating at the Apollo, Box, Olympus and Trap targets with the sixth rig to commence drilling for the first time at the grassroot generated X target located in the southern portion of the project area. Drill cores from multiple holes are currently being assayed at ALS Laboratory in Lima, Peru with results expected soon. The airborne geophysical program will be undertaken by Geotech and will cover a total area of 74 km² with 1,449 flight line kilometres with 100 metre line spacing. This includes helicopter borne Versatile Time-domain Electromagnetic and Z-Axis Tipper Electromagnetic system surveys. The primary objective of the program is to detect conductive sulphide bearing ore bodies, similar to the Apollo system, at depths beginning directly below the surficial cover to up to 2,000 metres depth. The company’s exploration team has recently completed petrophysical measurements on 13 kilometres of drill core from the Apollo system, which highlights a strong and distinctive conductivity signature related to the sulphide minerals and associated alteration. The airborne surveys will be completed in July 2024 with processing of data and interpretation expected before the end of Q3 2024. Drilling on new targets generated from the survey could commence as early as Q4, 2024…more

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