Mr. Clynton Nauman reports
ALEXCO EXPANDS BERMINGHAM INDICATED RESOURCE TO 17 MILLION OUNCES SILVER, REMAINS OPEN
Alexco Resource Corp. has released an updated mineral resource estimate for the Bermingham deposit, located within the Keno Hill silver district (KHSD) in Canada's
Yukon territory. The Bermingham indicated mineral resources are expanded from 5.2 million ounces to 17.3 million ounces of contained silver, while inferred mineral resources increased from approximately 700,000 ounces to 5.5 million ounces of contained silver. As a result, Alexco's districtwide indicated mineral resources at Keno Hill increased approximately 22 per cent from 55.4 million ounces to 67.5 million ounces of contained silver.
The Bermingham deposit comprises a westerly Etta zone and a fault-separated larger easterly Arctic zone. Recent work (2015 to 2016) has focused on the northeasterly extension of the Arctic zone, where several structurally controlled sets of subparallel moderately to steeply southeast-dipping veins, including the Bermingham, Bermingham footwall and Bear veins, splay and rejoin in a manner controlled by the host rock stratigraphy. A westerly and shallower-dipping conjugate vein set (West Dipper vein) is also present. All vein sets in the northeasterly Arctic zone are closely associated, connected either laterally or vertically within the wider Bermingham vein-fault structural corridor that is silver enriched over a 660-metre strike length, with mineralization extending from between 90 m to 160 m below surface to a depth of approximately 350 m where veining remains open.
The updated mineral resource estimate was prepared by SRK Consulting (Canada) Inc. and is summarized in the table.
BERMINGHAM RESOURCE ESTIMATE
Zone Class Vein Tonnage Ag Pb Zn Au Ag
(g/t) (%) (%) (g/t) (oz)
Arctic Indicated Bermingham 248,000 376 1.47 1.33 0.12 3,001,000
Bear 148,000 1,376 4.51 1.76 0.22 6,532,000
Bermingham footwall 122,000 717 3.63 1.33 0.20 2,823,000
West Dipper 21,000 729 2.47 2.32 0.12 502,000
Total Arctic indicated 539,000 12,858,000
Etta Indicated Bermingham 124,000 421 2.26 2.20 0.07 1,681,000
Bermingham footwall 195,000 444 1.28 1.76 0.06 2,779,000
Total Etta indicated 319,000 4,460,000
Total Indicated 858,000 628 2.40 1.65 0.13 17,318,000
Arctic Inferred Bermingham 46,000 460 1.92 2.21 0.12 680,000
Bear 68,000 522 2.62 1.15 0.14 1,146,000
Bermingham footwall 72,000 1,276 1.24 3.06 0.18 2,961,000
West Dipper 4,000 1,802 17.19 8.23 0.54 246,000
Total Arctic inferred 191,000 5,033,000
Etta Inferred Bermingham 3,000 474 2.12 2.36 0.07 47,000
Bermingham footwall 26,000 436 1.24 1.69 0.07 371,000
Total Etta inferred 30,000 418,000
Total Inferred 220,000 770 2.13 2.21 0.15 5,451,000
1. The effective date of this mineral resource estimate is Jan. 3, 2017.
2. Mineral resources are not mineral reserves and do not have demonstrated economic
viability. All numbers have been rounded to reflect the relative accuracy of the
estimate.
3. Reported at a contained metal value cut-off grade of $185.00/tonne (80 U.S. cents
equals $1) using consensus long-term metal prices and recoveries developed for the nearby
Bellekeno deposit (silver: $20.00 (U.S.)/ounce, recovery 96 per cent; lead: 95 U.S.
cents/pound, recovery 97 per cent; zinc: $1.00 (U.S.)/pound, recovery 88 per cent; gold:
$1,300 (U.S.)/ounce, recovery 72 per cent).
4. Ag grades capped at 1,500 grams per tonne, Zn capped at 9.5 per cent and Pb capped at
9 per cent for the Bermingham vein.
5. Ag grades capped at 11,000 g/t, Zn capped at 7 per cent and Pb capped at 20 per cent
for the Bear vein.
6. Ag grades capped at 3,000 g/t, Zn capped at 9 per cent and Pb capped at 30 per cent
for the Bermingham footwall vein.
7. Ag grades capped at 2,000 g/t, Zn capped at 12 per cent and Pb capped at 20 per cent
for the West Dipper vein.
8. Table numbers may not add up due to rounding.
Alexco president and chief executive officer Clynt Nauman said: "The majority of the tonnage in the Bermingham deposit resides in the Arctic zone. The northeastern extension of the Arctic zone is defined by higher-grade mineralization primarily in the closely juxtaposed Bear and West Dipper veins which on a consolidated basis contain:
Indicated: 169,000 tonnes of 1,296 grams per tonne silver, including 49,000 tonnes of 2,543 g/t silver, in the Bear vein
Inferred: 72,000 tonnes of 593 g/t silver, including 4,000 tonnes of 1,818 g/t silver, in the West Dipper vein
Importantly, the veins and structures hosting this higher-grade mineralization remain largely untested at depth. Finally, the discovery of a West Dipper vein set is particularly significant as both R.W. Boyle (1965) and R.J. Cathro (2006), pre-eminent geologists in the understanding of the geology of the KHSD, document the importance of shallower west-dipping conjugate veins in the highest-grade deposits in the district, most notably the nearby historical Elsa mine. Looked at in total, the Bermingham deposit is emerging as a fairly large discovery, now characterized by more than 850,000 tonnes of indicated mineralization with an average silver grade approximately 25 per cent higher than our Flame and Moth deposit."
Bermingham deposit
Alexco conducted surface diamond drilling programs at Bermingham between 2009 and 2012, and again in 2014, with 61 holes drilled totalling 18,699 metres. In 2015 and 2016, a further 19,977 m were drilled in 58 holes such that the entire database at Bermingham now includes 119 holes for 38,676 m. All of this drilling was inclined northwesterly except for five holes (1,729 m) drilled southeasterly (parallel to the dominant vein dip direction) to identify and define the newly discovered west-dipping conjugate vein set. The resource estimation presented here incorporates the results from 275 composite assay intervals from 93 holes compared with those from 38 holes that were used in the April, 2015, estimation.
Drilling in 2016 was focused on obtaining resource definition intercept spacings, particularly on the high-grade Bear vein that ranges in true width up to 6.4 m at 182 ounces per tonne silver (K-14-0537) and in grade up to 240 ounces per tonne silver over five m true width (K-15-0580), and that has now been traced over a downplunge extent of 270 m (over a vertical range of 230 m) and a plunge width of up to 100 m, with the top of the deposit in this vicinity being approximately 160 m below surface.
Interpretation of the consolidated drilling results has identified four mineralized veins that splay and change orientation along strike within the north-northeast-striking and moderately to steeply southeast-dipping Bermingham vein-fault structural corridor. This structural corridor is divided into the Etta zone that lies in the hangingwall of the postmineral Mastiff fault and the Artic zone in its footwall. The main through-going Bermingham and Bermingham footwall veins occur in both the Etta and Arctic zones, while the Bear vein and associated newly identified conjugate West Dipper vein set occur only within the Arctic zone in a position controlled by a flexure in the Bermingham vein fault. The resource estimate update incorporates both the Bermingham and Bermingham footwall vein previously reported within the Etta and Arctic zones, with a significant extension of the Arctic zone within the known veins and the two newly discovered veins.
The Bermingham deposit veins typically occur in structurally complex zones as discrete veins 0.5 m to more than five m wide with a five to 10 m wide structurally damaged vein margin. The discrete veins exhibit heavily disseminated to massive mineralization while mineralization in the vein margins is commonly more stringer like. The Bermingham resource has been separately estimated in terms of these mineralization categories as shown in the table. Regardless of category, higher-grade Bermingham mineralization is generally characterized by the presence of a complex silver-bearing mineral assemblage, including pyrargyrite (ruby silver), freibergite, argentiferous galena, stephanite, polybasite and wire silver in a dominantly sideritic gangue.
Metallurgical testwork has demonstrated that silver and lead recoveries are expected to be in the range of 94 per cent to 96 per cent, while producing a lead concentrate grading in excess of 60 per cent lead and 30,000 g/t silver. Zinc recovery is predicted to be in the range of 70 per cent to 75 per cent to a zinc concentrate grading in excess of 50 per cent zinc.
The Bermingham mineral resource was estimated using 3-D Gemcom block modelling software in multiple passes in three by three by three m blocks by ordinary kriging. Grade estimates were based on capped one m composited assay data. Capping levels were set to 1,500 g/t for silver for the Bermingham vein, 3,000 g/t for the footwall vein, 2,000 for the West Dipper vein and 11,000 for the Bear vein; lead was capped at 9.5 per cent for the Bermingham vein, 30 per cent for the footwall vein, 20 per cent for the West Dipper vein and at 30 per cent for the Bear vein. Zinc was capped at 9 per cent for the Bermingham and footwall veins, at 7 per cent for the Bear vein and at 12 per cent for the West Dipper vein. Blocks were classified as indicated mineral resources if at least three drill holes and five composites were found within the first-pass search ellipse. All other interpolated blocks were classified as inferred mineral resources.
A summary of all of Alexco's KHSD mineral resources incorporating the updated mineral resource estimates for Bermingham is contained in the table and is available for review on the company's website.
Technical report update, 2017 exploration plans
In March, 2017, Alexco plans to publish an updated preliminary economic assessment including technical support for the expanded Bermingham resource estimation presented here, as well as updated mine plans for the Flame and Moth, Bellekeno, and Lucky Queen deposits, and a preliminary mine plan for potentially minable tonnes from the Bermingham deposit.
Alexco is presently planning a minimum 5,000 m surface diamond drilling program at Bermingham in 2017 primarily to expand high-grade mineralization downplunge into an area where, as an outcome of 2016 drilling, the Bermingham vein system is observed to closely imitate the large-scale looping vein geometries observed at the largest past-producing mine in the district, the Hector-Calumet mine (96 million ounces of silver). Subject to permitting requirements, the company is also contemplating an underground exploration program at Bermingham to infill and upgrade the higher-grade areas in the shallower portion of the resource.
References
Mr. Boyle, 1965
"Geology, Geochemistry, and Origin of the Lead-Zinc-Silver Deposits of the Keno Hill - Galena Hill Area, Yukon Territory," Bulletin 111, Geological Survey of Canada.
Mr. Cathro, 2006,
"The History and Geology of the Keno Hill Silver Camp Yukon Territory," Geoscience Canada, Vol. 33, No. 3.
Qualified persons
SRK prepared the updated mineral resource estimate for the Bermingham deposit and is independent of Alexco for the purposes of National Instrument 43-101. The Bermingham mineral resource estimate was completed by Dr. Gilles Arseneau, PGeo, associate consultant (resource geology) with SRK, whom is qualified persons as defined by NI 43-101. Dr. Arseneau has reviewed, verified and approved the contents of this news release relating to the mineral resource estimate for the Bermingham deposit. All mineral resources are classified following the Candian Institute of Mining, Metallurgy and Petroleum definition standards for mineral resources and mineral reserves (May, 2014), in accordance with the CIM estimation of mineral resources and mineral reserves best practice guidelines and with NI 43-101 guidelines.
The metallurgical testing information in this news release has been reviewed and verified by Jeffrey B. Austin, PEng, president of International Metallurgical and Environmental Inc., a qualified person as defined by NI 43-101.
The disclosure of all other scientific and technical information in this news release regarding projects on Alexco's mineral properties has been reviewed and approved by Alan McOnie, FAusIMM, Alexco's vice-president, exploration, a qualified person as defined by NI 43-101.
The drill data and sampling protocols have been reviewed, verified and compiled by Alexco's geologic staff since 2011 under the supervision of Mr. McOnie and previously by Stan Dodd, vice-president, exploration, for Alexco and a qualified person as defined by National Instrument 43-101. A rigorous quality control and quality assurance protocol is used on the project, including blank, duplicate and standard reference samples in each batch of 20 samples delivered to the assay lab. Drill core samples included in the updated resource estimation were shipped to ALS Minerals Labs at Whitehorse, Yukon, for preparation, with fire assay, multielement ICP analyses and ore-grade overlimits completed at the ALS Minerals facility in North Vancouver, B.C.
Summary of resources
The table sets forth the estimated resources for Alexco's mineral properties within the Keno Hill silver district.
KENO HILL ESTIMATED RESOURCES
Category(1,2,11) Property Tonnes Ag Au Pb Zn Contained Ag
(g/t) (g/t) (oz)
Indicated Bellekeno deposit(3,4) 262,000 585 n/a 3.5% 5.3% 4,927,000
Lucky Queen deposit(3,5) 124,000 1,227 0.2 2.6% 1.7% 4,892,000
Flame and Moth deposit(3,6) 1,638,000 506 0.4 1.9% 5.4% 26,650,000
Onek(3,7) 654,000 200 0.6 1.3% 12.3% 4,205,000
Bermingham(3,8) 858,000 628 0.1 2.4% 1.7% 17,318,000
Total indicated -- subsurface 3,536,000 510 n/a 2.1% 5.6% 57,992,000
Elsa tailings(9) 2,490,000 119 0.1 1.0% 0.7% 9,527,000
Total indicated -- all deposits 6,026,000 349 n/a 1.6% 3.6% 67,519,000
Inferred Bellekeno deposit(3,4) 243,000 428 n/a 4.1% 5.1% 3,344,000
Lucky Queen deposit(3,5) 150,000 571 0.2 1.4% 0.9% 2,754,000
Flame and Moth deposit(3,6 348,000 366 0.3 0.5% 4.4% 4,095,000
Onek(3,7) 234,000 134 0.4 1.2% 8.9% 1,008,000
Bermingham(3,8) 220,000 770 0.2 2.1% 2.2% 5,451,000
Total inferred 1,027,000 433 n/a 1.8% 4.6% 16,652,000
Historical Silver King(10)
resources Proven, probable and indicated 98,998 1,354 n/a 1.6% 0.1% 4,310,000
Inferred 22,581 1,456 n/a 0.1% n/a 1,057,000
Keno Hill estimated resources table notes
- All mineral resources are classified following the CIM definition standards for mineral resources
and mineral reserves (May, 2014), in accordance with the CIM estimation of mineral resources and
mineral reserves best practice guidelines and the guidelines of NI 43-101.
- Mineral resources are not mineral reserves and do not have demonstrated economic viability. All
numbers have been rounded to reflect the relative accuracy of the estimates.
- The Keno Hill silver district comprises five deposits: Bellekeno, Lucky Queen, Flame and Moth,
Onek, and Bermingham, of which Bellekeno, Lucky Queen, and Flame and Moth are incorporated into the
current mine plan outlined in the technical report filed on SEDAR dated Dec. 10, 2014, entitled
"Updated Preliminary Economic Assessment for the Keno Hill Silver District Project - Phase 2, Yukon,
Canada." The mineral resource estimates for the project are supported by: (a) disclosure in the news
release dated Dec. 23, 2014; and (b) a technical report filed on SEDAR dated Dec. 10, 2014, entitled
"Updated Preliminary Economic Assessment for the Keno Hill Silver District Project - Phase 2, Yukon,
Canada." The mineral resource estimates for the Flame and Moth deposit are further supported by
disclosure in the news release dated April 30, 2015.
- The resource estimates for the Bellekeno deposit are based on a geologic resource estimate having
an effective date of Sept. 30, 2012. The Bellekeno indicated resources are as at Sept. 30, 2013, and
reflect the geologic resource less estimated subsequent depletion from mine production.
- The mineral resource estimates for the Lucky Queen deposit have an effective date of July 27,
2011.
- The mineral resource estimates for the Flame and Moth deposit have an effective date of April 28,
2015.
- The mineral resource estimates for Onek have an effective date of Oct. 15, 2014.
- The mineral resource estimates for Bermingham have an effective date of Jan. 3, 2017.
- The mineral resource estimate for the Elsa tailings has an effective date of April 22, 2010, and
is supported by the technical report dated June 16, 2010, entitled "Mineral Resource Estimation, Elsa
Tailings Project, Yukon, Canada."
- Historical mineral resources for Silver King are supported by disclosure in the news release
dated Dec. 23, 2014.
11. The disclosure regarding the summary of estimated mineral resources for Alexco's mineral
properties within the Keno Hill district has been reviewed and approved by Scott Smith, PEng, former
Bellekeno mine manager and a qualified person as defined by NI 43-101.
BERMINGHAM RESOURCE ESTIMATE BY VEIN AND VEIN MARGIN
Deposit Zone Class Tonnes Ag Pb Zn Au Ag
(g/t) (%) (%) (g/t) (oz)
Bermingham Bermingham vein Indicated 220,000 432 1.9 1.7 0.13 3,062,000
Inferred 23,000 583 2.7 2.8 0.16 424,000
Bermingham vein margin Indicated 152,000 332 1.5 1.5 0.07 1,621,000
Inferred 26,000 356 1.3 1.7 0.09 303,000
Bear vein Indicated 49,000 2,543 7.5 2.7 0.37 4,017,000
Inferred 25,000 550 2.9 1.9 0.18 447,000
Bear vein margin Indicated 99,000 794 3.0 1.3 0.14 2,515,000
Inferred 43,000 505 2.5 0.7 0.11 699,000
Bermingham footwall vein Indicated 167,000 657 3.0 1.7 0.16 3,536,000
Inferred 62,000 1,407 1.3 3.5 0.19 2,815,000
Bermingham footwall vein margin Indicated 150,000 430 1.3 1.5 0.06 2,067,000
Inferred 36,000 442 1.1 1.4 0.09 518,000
West Dipper vein Indicated 13,000 932 3.4 2.8 0.15 388,000
Inferred 4,000 1,818 17.4 8.3 0.55 244,000
West Dipper vein margin Indicated 8,000 421 1.0 1.7 0.06 115,000
Inferred - - - - - -
Total All veins and vein margins Indicated 858,000 628 2.4 1.7 0.13 17,321,000
Inferred 220,000 770 2.1 2.2 0.15 5,450,000
1. The effective date of this mineral resource estimate is Jan. 3, 2017.
2. Mineral resources are not mineral reserves and do not have demonstrated economic viability. All
numbers have been rounded to reflect the relative accuracy of the estimate.
3. Reported at a contained metal value cut-off grade of $185.00/tonne (80 U.S. cents equals $1)
using consensus long-term metal prices and recoveries developed for the nearby Bellekeno deposit
(silver: $20.00 (U.S.)/ounce, recovery 96 per cent; lead: 95 U.S. cents/pound, recovery 97 per cent;
zinc: $1.00 (U.S.)/pound, recovery 88 per cent; gold: $1,300 (U.S.)/ounce, recovery 72 per cent).
4. Ag grades capped at 1,500 grams per tonne, Zn capped at 9.5 per cent and Pb capped at 9 per cent
for the Bermingham vein.
5. Ag grades capped at 11,000 g/t, Zn capped at 7 per cent and Pb capped at 20 per cent for the Bear
vein.
6. Ag grades capped at 3,000 g/t, Zn capped at 9 per cent and Pb capped at 30 per cent for the
Bermingham footwall vein.
7. Ag grades capped at 2,000 g/t, Zn capped at 12 per cent and Pb capped at 20 per cent for the West
Dipper vein.
8. Table numbers may not add up due to rounding.
We seek Safe Harbor.
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