Highlights

• Study work has progressed following the excellent high-grade maiden resource estimate delivered in November 2021¹

• High gold and silver extraction achieved in further test work on El Refugio core sample composite
  • Cyanide leaching test work completed on the flotation concentrate and tailings (flotation results reported 18 January news release)
  • High final overall recoveries after leaching of the flotation products – 96.5% for gold and 91% for silver

• Mining concepts design work has been completed with AMC Consulting finalising the report in within the next week

• Exploration drilling and field work in progress further east of El Refugio following the confirmation of El Refugio’s western extension reported in January 2022. Awaiting assays

Mithril Resources Ltd (ASX: MTH) (Mithril or the Company) is pleased to release further results from its Copalquin Gold Silver District, Mexico.

Mithril CEO and Managing Director, John Skeet, commented:

“Building on the excellent high-grade gold and silver maiden mineral resource estimate, the high recoveries of gold and silver from the flotation and leaching test work reinforce attractive project metrics for our Copalquin District in Mexico. As our study work progresses for a future development at El Refugio, we continue to see excellent results as we seek to optimise the value from this high-grade gold-silver resource. Exploration drilling to the east of the maiden mineral resource area is in progress as part of the first quarter 2022 drill program and mapping and sampling are progressing in the district, expanding our drill targets and reinforcing the district potential for multi- million-ounce gold-silver resources.  We await assay results from this work.”

HIGH GOLD AND SILVER RECOVERIES – EL REFUGIO COMPOSITE SAMPLE

A metallurgical test work program following the maiden mineral resource estimate (MRE) has been completed by SGS Laboratories. The high-grade maiden MRE released 17 November 2021 is given below.

• 2,416,000 tonnes @ 4.80 g/t gold, 141 g/t silver for 373,000 oz gold plus 10,953,000 oz silver (Total 529,000 oz AuEq*) using a cut-off grade of 2.0 g/t AuEq*
• 28.6% of the resource tonnage is classified as indicated

*AuEq. = gold equivalent calculated using and gold:silver price ratio of 70:1. That is, 70 g/t silver = 1 g/t gold. The metal prices used to determine the 70:1 ratio are the cumulative average prices for 2021: gold USD1,798.34 and silver: USD25.32 (actual is 71:1) from kitco.com

The sample used for the test work is a composite sample from El Refugio crushed drill core. The average grade of the composite is similar to the average grade of the maiden resource estimate. The calculated composite grade from the flotation test work is 4.52 g/t gold and 124 g/t silver.

Flotation test work has been completed using the same reagent scheme determined for the Palmarejo deposit (located in the Sierra Madre Trend and north of the Copalquin District) test work, due to the similarities in geology and mineralogy between Palmarejo and El Refugio at Copalquin.

Intensive cyanide leaching of the flotation concentrate and low-level cyanide leaching of the flotation tailings allows high recovery of silver to be achieved. Cyanide leaching of silver is slower under the typical conditions used for gold only leaching. Recovering a high proportion of the silver into a concentrate (by flotation or gravity) allows the concentrate to leached under intensive conditions resulting in higher silver recovery. The overall recovery to solution is 96.5% for gold and 91% for silver. Gold and silver would be extracted from solution using the widely used Merrill-Crowe zinc precipitation method and then smelted to produce metal gold-silver ingots.

The process flowsheet for El Refugio-La Soledad resource material being tested is as shown below in Figure 1. This is the same flowsheet is used at similar deposits in the Sierra Madre Trend, Mexico including Palmarejo and SilverCrest Metals’ Las Chispas (under construction).

Further metallurgical test work will allow the crushing, grinding, thickening, flotation and filtration equipment sizes to be determined.

ABOUT THE COPALQUIN GOLD SILVER PROJECT

The Copalquin mining district is located in Durango State, Mexico and covers an entire mining district of 70km2 containing several dozen historic gold and silver mines and workings, ten of which had notable production. The district is within the Sierra Madre Gold Silver Trend which extends north-south along the western side of Mexico and hosts many world-class gold and silver deposits.

Multiple mineralisation events, young intrusives thought to be system-driving heat sources, widespread alteration together with extensive surface vein exposures and dozens of historic mine workings, identify the Copalquin mining district as a major epithermal centre for Gold and Silver.

Within 15 months of drilling in the Copalquin District, Mithril delivered a maiden JORC mineral resource estimate demonstrating the high-grade gold and silver resource potential for the district. This maiden resource is detailed below.

• 2,416,000 tonnes @ 4.80 g/t gold, 141 g/t silver for 373,000 oz gold plus 10,953,000 oz silver (Total 529,000 oz AuEq*) using a cut-off grade of 2.0 g/t AuEq*
• 28.6% of the resource tonnage is classified as indicated

Mithril Resources is earning 100% interest in the Copalquin District mining concessions via a purchase option agreement detailed in ASX announcement dated 25 November 2019.

-ENDS-

Released with the authority of the Board.

For further information contact:

John Skeet
Managing Director and CEO
[email protected]
+61 435 766 809

Mark Flynn
Investor Relations
[email protected]
+61 416 068 733

Competent Persons Statement

The information in this report that relates to sampling techniques and data, exploration results and geological interpretation has been compiled by Mr Hall Stewart who is Mithril’s Chief Geologist. Mr Stewart is a certified professional geologist of the American Institute of Professional Geologists. This is a Recognised Professional Organisation (RPO) under the Joint Ore Reserves Committee (JORC) Code.

Mr Stewart has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Stewart consents to the inclusion in this report of the matters based on information in the form and context in which it appears. The Australian Securities Exchange has not reviewed and does not accept responsibility for the accuracy or adequacy of this release.

The information in this report that relates to metallurgical test results, mineral processing and project development has been compiled by Mr John Skeet who is Mithril’s CEO and Managing Director. Mr Skeet is a Fellow of the Australasian Institute of Mining and Metallurgy. This is a Recognised Professional Organisation (RPO) under the Joint Ore Reserves Committee (JORC) Code.

Mr Skeet has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Skeet consents to the inclusion in this report of the matters based on information in the form and context in which it appears. The Australian Securities Exchange has not reviewed and does not accept responsibility for the accuracy or adequacy of this release.

Original Article: https://investi.com.au/api/announcements/mth/889beb4b-6da.pdf