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Coro Mining Corp
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Coro releases Marimaca NI 43-101 resource estimate

2017-01-12 13:20 ET - News Release

Mr. Alan Stephens reports


Coro Mining Corp. has released the results of a maiden resource estimate completed at its Marimaca copper project, located 22 kilometres east of the port of Mejillones in the II Region of Chile. As announced on Aug. 4, 2016, Coro is finalizing the acquisition of Minera Rayrock Ltda., the owner of the Ivan 10,000-tonne-copper-per-year capacity solvent extraction/electrowinning (SXEW) processing plant, and this initial Marimaca estimate was completed with the objective of defining sufficient resources to confirm the merits of completing this acquisition.

Alan Stephens, president and chief executive officer of Coro, commented: "We are delighted by the results of this first resource estimate for the Marimaca deposit, which, in combination with the acquisition of the Ivan plant, indicates a very robust project. In particular, the presence of a high-grade core should enhance the economics of the project, and the deposit remains open in all directions except to the west. The current drill spacing has resulted in a significant tonnage of mineralization that fell into the inferred category or that could not be categorized as a resource. We now intend to complete the acquisition of Rayrock and continue the expansion and further definition of the Marimaca deposit. The resource estimate will form the basis of a feasibility study, which we will initiate shortly."

Resource estimate

The estimate was completed at a variety of cut-off grades by NCL Ingenieria y Construccion SA of Santiago, Chile, and details are presented in the attached table, where CuT means total copper and CuS means acid-soluble copper.

                   Measured                   Indicated          Measured plus indicated           Inferred
Cut-off   000s t    % CuT     %CuS   000s t    % CuT     %CuS   000s t    % CuT     %CuS   000s t    % CuT     %CuS

>1.0       1,177     1.36     1.06    2,355     1.24      0.9    3,532     1.28     0.95    1,320     1.19     0.75
0.9        1,482     1.28        1    3,284     1.16     0.84    4,766      1.2     0.89    2,027     1.11     0.72
0.8        1,878     1.19     0.93    4,508     1.08     0.79    6,385     1.11     0.83    3,085     1.02     0.69
0.7        2,359      1.1     0.86    6,137     0.99     0.73    8,496     1.02     0.76    4,615     0.93     0.64
0.6        2,950     1.01     0.79    7,928     0.91     0.67   10,878     0.94      0.7    6,920     0.83     0.59
0.5        3,661     0.92     0.72   10,190     0.83     0.62   13,851     0.85     0.65   10,728     0.73     0.53
0.4        4,365     0.84     0.66   12,738     0.75     0.56   17,103     0.78     0.59   15,251     0.65     0.47
0.3        4,986     0.78     0.61   15,192     0.69     0.52   20,178     0.71     0.54   20,753     0.57     0.41
0.2        5,453     0.74     0.58   16,833     0.65     0.48   22,286     0.67     0.51   26,979     0.49     0.35
0.1        5,689     0.71     0.56   17,551     0.63     0.47   23,241     0.65     0.49   31,844     0.44     0.31
>0         5,761      0.7     0.56   18,052     0.61     0.46   23,814     0.63     0.48   39,456     0.36     0.33

Approximately 20 million additional tonnes of potential mineralization were identified during the modelling which could not be classified as a resource, based on the currently available drill hole information.

Pit-constrained resource

In order to demonstrate the potential economic viability of the Marimaca resource, a series of Whittle pit optimizations was completed utilizing appropriate operating costs, results obtained from preliminary metallurgical test work and a variety of copper prices. The resources were estimated only for oxide and mixed copper mineralization, which can be processed by heap leaching (HL) and run-of-mine (ROM) leaching to produce cathode copper. No resources were estimated for enriched and primary sulphide mineralization occurring in deeper portions of the deposit.

At a $3.20-per-pound long-term copper price, the in-pit resource, all of which is HL material, was estimated as shown in the attached table.

                   Measured                   Indicated          Measured plus indicated           Inferred
Cut-off   000s t    % CuT     %CuS   000s t    % CuT     %CuS   000s t    % CuT     %CuS   000s t    % CuT     %CuS

0.2        5,301     0.74     0.59   16,198     0.66     0.49   21,499     0.68     0.51   18,769     0.53     0.39

Contained Cu       000s t   000s t            000s t   000s t            000s t   000s t            000s t   000s t
                      CuT      CuS               CuT      CuS               CuT      CuS               CuT      CuS

                     39.4     31.0             106.1     79.4             145.5    110.4              99.3     72.8

The pit resource is constrained by the Marimaca property limits, such that all blocks occurring outside the property were assigned a CuT grade of 0 per cent. The Chilean mining code permits sufficient push-back of pit walls onto adjacent properties to allow for the extraction of resources present on the property. The pit contains a total of 54,436,000 tonnes of waste, including mineralized blocks that did not fall into a resource category; low-grade ROM material; and blocks outside the property limits, for an overall strip ratio of 1.31:1.

Parameters used in the estimation of the mineral resource

The National Instrument 43-101 mineral resource estimate was based on a total of 13,681 metres of drilling in 60 holes, including 54 holes (11,660 metres) of reverse circulation drilling and six holes (2,021 metres) of diamond drill drilling. The mineral resource estimate has been generated from drill hole assay results and the interpretation of a geologic model which relates to the spatial distribution of copper in the deposit. Four leachable copper mineralization types were identified during geological mapping and drill hole logging, namely: brochantite, chrysocolla and copper wad dominant oxides, and mixed oxides and sulphide. Resources were estimated for each mineralization type and later combined for the reporting of the final resource estimate. Grades were capped according to the criteria shown in the attached table.

Grade capping           % CuT    % CuS

Brochantite               4.5      4.0 
Chrysocolla               3.5      3.2 
Copper wad                1.6      1.3 
Mixed oxide 
and sulphide              1.8      1.5

Grade estimates were made using ordinary kriging with nominal block size measuring five metres long, five metres wide and five metres in height. Resources have been classified by their proximity to sample locations and are reported according to CIM (Canadian Institute of Mining, Metallurgy and Petroleum) standards on mineral resources and reserves.

The in-pit mineral resource was constructed according to the technical and economic parameters shown in the attached table.

Mining cost                 $2.80/t    
HL processing cost, 
including G&A              $10.50/t   
ROM processing cost,
including G&A               $4.60/t    
Selling cost               $0.07/lb  
Heap-leach recovery      76% of CuT
ROM recovery             38% of CuT
Pit slope angle          45 degrees  

The pit slope is conservatively estimated at 45 degrees based on the limited geotechnical information currently available, but this is anticipated to improve as more data are generated. Further definition of measured and indicated resources will require drilling on 25-metre and 50-metre centres, respectively.

Qualified persons

The mineral resource estimates contained in this news have been prepared in accordance with National Instrument 43-101, Standards of Disclosure for Mineral Projects.

The technical information in this news release, including the information that relates to geology, drilling and mineralization of the Marimaca project, was prepared under the supervision of, or has been reviewed by, Sergio Rivera, vice-president of exploration, Coro Mining, a geologist with more than 35 years of experience and a member of the Colegio de Geologos de Chile and of the Institute of Mining Engineers of Chile, and who is the qualified person for the purposes of NI 43-101 responsible for the design and execution of the drilling program.

The qualified person responsible for the independent resource estimate at Marimaca is Luis Oviedo Hannig, a geologist with more than 40 years of experience of NCL Ingenieria y Construccion. He is a member of the Colegio de Geologos de Chile and the Institute of Mining Engineers of Chile and is registered with the Qualification Commission of Resources and Mining Reserves (CRISCO, CMC, membership No. 013), and has a postgraduate degree in certification and validation of mining assets from Queens University and PUVC.

The technical information has been included herein with the consent and prior review of the above-noted qualified persons, who have verified the data disclosed, including sampling, analytical and test data underlying the information or opinions contained herein.

Alan Stephens, FIMMM, president and chief executive officer of Coro Mining, a geologist with more than 40 years of experience, and a qualified person for the purposes of NI 43-101, is responsible for the contents of this news release.

Marimaca agreement terms

  • Coro has the right to earn a 75-per-cent interest in the property as follows:
    • 51-per-cent interest earned in Compania Minera Newco Marimaca (CMNM) with a $125,000 payment, together with completion of an NI 43-101 resource estimate and engineering study that demonstrates the technical and economic feasibility of producing a minimum of 1,500 tonnes copper cathode per year by Aug. 6, 2018, at Coro's cost;
    • Additional 24-per-cent interest in CMNM earned by Coro upon obtaining financing for the project construction.
  • The owners' interest will comprise a 15-per-cent interest free carried to commencement of commercial production and a 10-per-cent participating interest subject to dilution. The owners, at their election, may request Coro to lend them the equity portion corresponding to their 10-per-cent interest, if any, recoverable by Coro from 100 per cent of the project's free cash flow after debt repayments.
  • Coro retains a first right of refusal over the owners' interest.

Rayrock agreement terms

Coro may acquire Rayock for a total purchase price of $6.5-million (U.S.), of which a down payment of $250,000 (U.S.) has been paid. The sellers will retain a 2-per-cent net smelter return (NSR) on all production from the Rayrock mineral properties. Coro may acquire half the NSR for $2-million (U.S.) at any time and will have a right of first refusal over the NSR.

About Coro Mining

Coro's assets include its 65-per-cent interest in SCM Berta, including the Berta and Salvadora deposits; the Marimaca development project; the Planta Prat project; the Llancahue prospect; and a royalty on the San Jorge copper-gold project located in Argentina.

We seek Safe Harbor.

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