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8-K - FORM 8-K - SOLITARIO ZINC CORP. | slr_8k.htm |
Exhibit
99.1
Solitario
Files New NI 43-101 Technical Report for Its Florida Canyon Zinc
Project Detailing a Significant Increase in Mineral
Resources
DENVER, CO – April 7, 2021 - Solitario Zinc Corp.
(“Solitario”) (NYSE American: XPL; TSX: SLR) is pleased to announce that it has
filed on SEDAR the independent NI 43-101 Technical Report (the
“Report”) detailing the updated Mineral Resource
Estimate for the Florida Canyon Project located in northern Peru,
as described in the Company’s news release dated February 23,
2021. The Report was prepared by Gustavson Associates LLC
(“Gustavson”), an independent international engineering
firm specializing in mining and mineral exploration engineering and
evaluation. The Report is available on SEDAR under the
Company’s profile, and on the Company’s website at:
Florida
Canyon NI 43-101 Technical Report.
The
Report filed today incorporates technical information from 39 new
drill holes completed at Florida Canyon in 2018 and 2019, along
with information from 506 previously drilled core holes. The Report
shows a substantial increase in inferred resources dominated by
zinc sulfide mineralization. Highlights include the
following:
●
Inferred
zinc-equivalent (“Zn-Eq”) sulfide resource up 105% from
2017 estimate.
●
Inferred
Zn-Eq sulfide-mixed-oxide resource estimate up 64% from 2017
estimate.
●
Total
contained metal - Measured and Indicated: 0.65 billion pounds
Zn-Eq.
●
Total
contained metal – Inferred: 3.39 billion pounds Zn-Eq at
10.9% Zn-Eq.
●
Total
contained silver – Inferred: 5.39 million oz.; Meas. &
Ind: 1.2 million oz.
Solitario’s
joint venture partner, Nexa Resources S.A. (NYSE: NEXA; TSX: NEXA)
(“Nexa”), completed the new resource estimate
incorporating the results of the 2018/2019 drilling program and
reinterpreting portions of the previous resource model. Solitario,
through the work of Gustavson, verified Nexa’s resource
estimate. Nexa is the world’s fourth largest zinc miner and
operates three underground zinc mines in Peru, a major zinc smelter
also in Peru and two zinc mines and two zinc smelters in
Brazil.
The
2021 Mineral Resource Estimate is a mine plan constrained resource
that takes into consideration various NSR cutoff grades and planned
dilution, depending on mining method. All 2021 additions to the
resource were in the Inferred Resource Category. The table below
provides summary estimates for all resource
categories.
2021 Florida Canyon Mineral Resource Estimate
Category
|
Tonnes
Millions
|
Zinc
%
|
Lead
%
|
Silver
g/t
|
ZnEq
%
|
Contained Metal
Zinc-Equivalent
Billion Lbs.
|
Contained Silver
Million Ozs.
|
Measured
|
0.81
|
11.32
|
1.40
|
15.4
|
12.78
|
0.29
|
0.40
|
Indicated
|
1.63
|
10.28
|
1.31
|
14.9
|
11.66
|
0.42
|
0.78
|
M + I
|
2.44
|
10.63
|
1.34
|
15.05
|
12.04
|
0.65
|
1.18
|
Inferred
|
14.86
|
9.63
|
1.26
|
11.3
|
10.89
|
3.57
|
5.39
|
Notes to Mineral Resource Table:
1. CIM
(2014) definitions were followed for Mineral
Resources.
2.
Mineral Resources have an effective date as of February 2,
2021.
3.
Mineral Resources are reported using mining cut off values of
US$41.40/t NSR for Sub-Level Stoping, US$42.93/t for Cut and Fill
and US$40.61/t for Room and Pillar mining methods.
4.
Forecast long term metal prices used for the NSR and Zn-Eq
calculations are: Zn: US$2,816/t (US$1.27/lb); Pb: US$ 2,249/t
(US$1.02/lb) and Ag: US$19.40/oz. Zn-Eq calculations do not take
into account metallurgical recoveries.
5.
Minimum mining thickness is 3 meters for Sub-Level Stoping and Cut
and Fill, and 4 meters for Room and Pillar mining
methods.
6.
Mineral Resources are not Mineral Reserves and do not have
demonstrated economic viability.
7.
Project Resources are reported on a 100% ownership
basis.
8.
Numbers may not add due to rounding.
Inferred Sulfide Resource Doubles
The
2018/2019 drilling program was specifically designed to identify
new NI 43-101 compliant sulfide resources at Florida Canyon. This
objective was achieved with an overall 105% gain in Inferred Zn-Eq
contained metal in sulfide resources compared to the 2017 Inferred
Zn-Eq sulfide resource estimate. Approximately 78% of the Zn-Eq
resources are sulfide-dominate in the overall 2021 resource
estimate.
Sulfide Mineralization is Important
The
2017 Preliminary Economic Assessment (“PEA” see SEDAR
Filing dated August 8, 2017) demonstrated that mining and
processing of Florida Canyon sulfide resources are much more
profitable than for oxide and mixed resources. Cash flow estimates
in the PEA for its 12.5-year mine life, based on the 2017 resource,
illustrated that years 2-7 (mostly sulfide ore) generated
approximately $75 million in annual free cash flow, while years
8-12 (mostly oxide+mixed ore) averaged approximately $30 million in
annual free cash flow.
In
addition to an increased mine life and cash flow, the current,
larger resource will also provide the opportunity to assess
increasing the production rate from the 2,500 tonnes per day
assumed in the PEA, further improving project
profitability.
Recommendations
The
Report contains several important recommendations for advancing the
Florida Canyon Project. One of the more impacting recommendations,
is to conduct new metallurgical testing on sulfide-dominant ores.
The updated resource model demonstrates that the majority of
mineralization at Florida Canyon is sulfide dominant, however,
previously conducted metallurgy did not assess sulfide-only ore.
The Report suggests that metallurgical zinc recoveries and zinc
concentrate grades were underestimated in the 2017 Preliminary
Economic Analysis. Higher zinc recoveries and concentrate grade,
along with a larger resource base would substantially benefit
project economics.
Another
important recommendation includes additional surface and
underground exploration. Included in this is 1,250 meters of
underground tunnel development in two different zones, 15,000
meters of underground drilling and 10,000 meters of surface
drilling. The objective of these programs is to increase the
confidence level of a portion of the inferred resource to measured
and indicated categories.
Signed by Qualified Persons:
The
technical information contained in the Report has been verified and
approved by the following Gustavson Qualified Persons pursuant to
the meaning of such terms in National Instrument 43-101 Standards
of Disclosure for Mineral Projects.
Mr.
Donald Hulse, P.E., SME-RM (Mining, Resources)
Deepak
Malhotra, PhD., SME-RM (Metallurgy)
Mr.
Simon Mortimer, MSc., MAIG (Geology)
Information
contained within this release is reported under Nexa’s
quality control program reviewed by Mr. Walt Hunt, COO for
Solitario Zinc Corp., who is a qualified person as defined by
National Instrument 43-101.
Terms of the Florida Canyon Joint Venture
Solitario
owns a 39% interest and Nexa owns a 61% indirect interest in the
Florida Canyon project. Nexa can earn a 70% interest in the Florida
Canyon project by continuing to fund all project expenditures and
committing to place the project into production based upon a
positive feasibility study. After earning 70%, and at the request
of Solitario, Nexa has further agreed to finance Solitario's 30%
participating interest for construction through a project loan.
Solitario will repay the loan facility through 50% of its net cash
flow distributions from production.
About Solitario
Solitario
is an emerging zinc exploration and development company traded on
the NYSE American (“XPL”) and on the Toronto Stock
Exchange (“SLR”). Solitario holds a 50% joint venture
interest in the high-grade, open-pittable Lik zinc deposit in
Alaska and a 39% joint venture interest (Nexa Resources holds the
remaining 61% interest) in the high-grade Florida Canyon zinc
project in Peru. Solitario’s Management and Directors hold
approximately 9.6% (excluding options) of the Company’s 58.4
million shares outstanding. Solitario’s cash balance and
marketable securities stand at approximately US$7.7 million.
Additional information about Solitario is available online at
www.solitariozinc.com
FOR
MORE INFORMATION ABOUT SOLITARIO, CONTACT:
Valerie
Kimball
Director
– Investor Relations
(720)
933-1150
(800)
229-6827
|
Christopher
E. Herald
President
& CEO
(303)
534-1030, Ext. 14
|
Cautionary Statement Regarding Forward Looking
Information
This press release contains forward-looking statements within the
meaning of the U.S. Securities Act of 1933 and the U.S. Securities
Exchange Act of 1934, and as defined in the United States Private
Securities Litigation Reform Act of 1995 (and the equivalent under
Canadian securities laws), that are intended to be
covered by the safe harbor created by such sections.
Forward-looking statements are statements that are not historical
fact. They are based on the beliefs, estimates and opinions of the
Company's management on the date the statements are made and
address activities, events or developments that Solitario expects
or anticipates will or may occur in the future, and are based on
current expectations and assumptions. Forward-looking statements
involve a number of risks and uncertainties. Consequently, there
can be no assurances that such statements will prove to be accurate
and actual results and future events could differ materially from
those anticipated in such statements. Such forward-looking
statements include, without limitation, statements regarding the
Company’s expectation of the projected timing and outcome of
engineering studies; expectations regarding the receipt of all
necessary permits and approvals to implement a mining plan, if any,
at Lik or Florida Canyon; the potential for confirming, upgrading
and expanding zinc, lead and silver mineralized material; future
operating and capital cost estimates may indicate that the stated
resources may not be economic; estimates of zinc, lead and silver
grades of resources provided are predicted and actual mining grade
could be substantially lower; estimates of recovery rates for could
be lower than estimated for establishing the cutoff grade; and
other statements that are not historical facts could vary
significantly from assumptions made in the Resources Estimate.
Mineral Resources are not Mineral Reserves and do not have
demonstrated economic viability. Although Solitario management
believes that its expectations are based on reasonable assumptions,
it can give no assurance that these expectations will prove
correct. Important factors that could cause actual results to
differ materially from those in the forward-looking statements
include, among others, risks relating to risks that
Solitario’s and its joint venture partners’ exploration
and property advancement efforts will not be successful; risks
relating to fluctuations in the price of zinc, lead and silver; the
inherently hazardous nature of mining-related activities;
uncertainties concerning reserve and resource estimates;
availability of outside contractors, and other activities;
uncertainties relating to obtaining approvals and permits from
governmental regulatory authorities; the possibility that
environmental laws and regulations will change over time and become
even more restrictive; and availability and timing of capital for
financing the Company’s exploration and development
activities, including uncertainty of being able to raise capital on
favorable terms or at all; as well as those factors discussed in
Solitario’s filings with the U.S. Securities and Exchange
Commission (the “SEC”)
including Solitario’s latest Annual Report on Form 10-K and
its other SEC filings (and Canadian filings) including, without
limitation, its latest Quarterly Report on Form 10-Q. The Company
does not intend to publicly update any forward-looking statements,
whether as a result of new information, future events, or
otherwise, except as may be required under applicable securities
laws.
Cautionary Note to U.S. Investors concerning Estimates of Measured,
Indicated and Inferred Resources
This news release has been prepared in accordance with the
requirements of the securities laws in effect in Canada, which
differ from the requirements of United States securities laws.
Canadian reporting requirements for disclosure of mineral
properties are governed by the Canadian Securities
Administrators’ National Instrument 43-101 Standards of
Disclosure for Mineral Projects (“NI 43-101”). For this
reason, information contained in this news release containing
descriptions of the Company’s mineral deposits may not be
comparable to similar information made public by United States
companies subject to the reporting and disclosure requirements
under the United States federal securities laws and the rules and
regulations thereunder.