Mr. Darin Wagner reports
BALMORAL RELEASES INITIAL RESOURCE ESTIMATE FOR MARTINIERE GOLD SYSTEM, DETOUR GOLD TREND PROJECT, QUEBEC
Balmoral Resources Ltd. has provided the initial resource estimate for the near-surface portion of the Martiniere gold system on the company's wholly owned Martiniere property in Quebec. The initial resource estimate confirms the continuity of the gold mineralization within the Bug and Martiniere West deposits and indicates potential for a significant portion of the currently outlined deposits (73 per cent) to be extracted via open pit.
Block model with open-pit and underground resource
Over 93 per cent of the estimated initial resource is contained within the upper 350 metres of the system. Expansion drilling below this level has begun and is currently anticipated to continue through the balance of 2018. Balmoral's drilling has confirmed that the Bug gold deposit continues to over 650-metre vertical depth, and is open below that, providing a clear path for near-term resource expansion. The present estimate does not include the recently discovered Bug NW extension or several other promising recent gold discoveries on the property, which all provide additional avenues for further expansion of one of the Abitibi's newest gold systems.
Initial resource estimate
The initial resource estimate for the Martiniere gold system has been prepared by Marc Jutras (PEng, MASc) of Ginto Consulting Inc. and is summarized below. Mr. Jutras is an independent qualified person pursuant to National Instrument 43-101.
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At a 0.5-gram-per-tonne cut-off grade the Martiniere gold system is currently estimated to host an open-pit-constrained indicated gold resource of 431,000 ounces at an average grade of 2.0 g/t and an inferred gold resource of 11,000 ounces at an average grade of 2.5 g/t.
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At a 2.5 g/t cut-off grade the system is currently estimated to host an additional underground indicated resource of 159,000 ounces at an average gold grade of 4.5 g/t and an inferred resource of 43,000 ounces at an average gold grade of 5.8 g/t.
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Ninety-two per cent of the estimated resource is contained within the indicated category.
"The initial resource estimate for the Martiniere gold system, which outlines those resources occurring principally over the upper 350 vertical metres of the system, provides a strong base from which to continue to expand," said Darin Wagner, president and chief executive officer of Balmoral. "The 2016 discovery of the Bug South deposit, and the multiple near-surface discoveries since then, have provided the opportunity to outline a significant open-pit resource at Martiniere, which could then potentially give way to underground development several years into any envisaged future operation. Our near-term focus at Martiniere will remain on the expansion of the gold system on multiple fronts."
BASE CASE INITIAL MINERAL RESOURCE ESTIMATE -- EFFECTIVE DATE OF
MARCH 27, 2018
Martiniere gold system
Base case -- indicated mineral resource
Gold cut-off grade Tonnage Average gold grade Contained gold
g/t tonnes g/t oz
Constrained open pit at $1,300 (U.S.) per ounce
0.5 6,827,000 1.96 431,000
Underground
2.5 1,092,000 4.54 159,000
Martiniere gold system
Base case -- inferred mineral resource
Gold cut-Off grade Tonnage Average gold grade Contained gold
g/t tonnes g/t oz
Constrained open pit at $1,300 (U.S.)/oz
0.5 132,000 2.50 11,000
Underground
2.5 231,000 5.75 43,000
Resource estimate assumptions and notes:
(1) The independent and qualified person for the mineral resource estimate, as
defined by NI 43-101, is Marc Jutras, PEng, MASc, principal of Ginto
Consulting Inc. The effective date of the estimate is March 27, 2018.
(2) These mineral resources are not mineral reserves as they do not have demonstrated
economic viability.
(3) While the results are presented undiluted, the reported mineral resources are
considered to have reasonable prospects for eventual economic extraction. The
near-surface mineral resource is constrained within an optimized open-pit shell,
while the below pit portion of the mineral resource is reported at an elevated
gold grade cut-off.
(4) The estimate includes several discrete zones/subzones of mineralization.
(5) Resources were compiled at gold cut-off grades of 0.5, 0.7 and 1.0 g/t gold for the
evaluation of open-pit estimates and at 2.0, 2.5 and 3.0 g/t gold for evaluation of
underground estimates (see attached table). The base case resource estimate is
reported at a cut-off grade of 0.5 g/t gold for resources constrained within the
optimized pit shell and 2.5 g/t gold for resources outside the pit shell.
(6) Cut-off calculations for calculating the base case resource used (all U.S.-dollar
figures) $1.80/tonne for overburden removal, $2/t for open-pit mining, $50/t for
underground mining, $17/t for processing (for both open-pit and underground scenarios),
$2.50/t for general and administrative costs, and mill recovery rates of 91 per cent.
(7) Gold recovery rates of up to 91 per cent have been achieved in limited testing for
the Bug deposit. The Bug deposit comprises the majority of the estimated resource.
Gold recoveries of up to 97 per cent to concentrate, and 72 per cent over all, have
been achieved in preliminary testing of the Martiniere West deposit.
(8) For the open-pit scenario pit slopes of 50 degrees were assumed in bedrock and 25
degrees in overburden.
(9) Calculations used a U.S./Canadian-dollar exchange rate of 1.22 and a gold price of
$1,300 (U.S.) in keeping with current long-term consensus estimates.
(10) Cut-off grade calculations would have to be re-evaluated in light of future prevailing
market conditions (metal prices, exchange rate and mining costs).
(11) Density values were estimated for all lithological units from measured samples. Density
values for the mineralized zones were calculated from a measured density database.
(12) The resource was estimated using Vulcan software. The estimate is based on results
from 490 diamond drill holes (91,988 m). The cut-off date for the drill hole database
is Jan. 30, 2018.
(13) High-grade capping was done on composited assay data and established on a per zone basis.
(14) Compositing was done on drill hole intercepts falling within the mineralized zones
(composite length of 1.0 m).
(15) Resources were evaluated from composited and capped drill hole assays using three-pass
ordinary kriging and inverse distance squared interpolation methods in a block model
(block size of 2.5 by 2.5 by 2.5 m).
(16) The mineral resources presented herein are categorized as indicated and inferred based
on drill spacing and geological and grade continuity. Based on the nature of the
mineralization, a maximum average distance of composites of 40 m was used for indicated
resources in the Bug deposit and 35 m in the Martiniere West deposit.
(17) Ounce (troy) is equal to metric tonnes multiplied by grade divided by 31.10348. Calculations
used metric units (metres, tonnes and g/t). Metal contents are presented in ounces.
(18) The number of metric tonnes and contained ounces was rounded to the nearest thousand. Any
discrepancies in the totals are due to rounding effects.
(19) The quantity and grade of reported inferred resources in this mineral resource estimate are
uncertain in nature and there has been insufficient exploration to define these inferred
resources as indicated or measured, and it is uncertain if further exploration will result
in upgrading them to these categories.
(20) CIM definitions and guidelines for mineral resources have been followed.
(21) The qualified persons are not aware of any known environmental, permitting, legal, title-related,
taxation, socio-political or marketing issues, or any other relevant issue, that could materially
affect the mineral resource estimate.
The initial resource estimate for the Martiniere gold system is based on results from 93,294 assays collected from 490 diamond drill holes representing in total 91,988 metres of drilling.
As indicated in the table, the base case initial resource includes both an open-pit and an underground component reported at cut-off grades of 0.5 g/t and 2.5 g/t respectively after incorporation of estimates for operating costs based on those associated with mines currently operating in the local region, mill recoveries and overburden removal at an estimated long-term gold price of $1,300 (U.S.).
The attached table provides an analysis of the volumetric resources at a range of cut-off grades for the modelled portion of the Martiniere gold system as calculated by the qualified person.
SENSITIVITY ANALYSIS AT A RANGE OF CUT-OFF GRADES
Martiniere gold system
Indicated mineral resource
Gold cut-off grade Tonnage Average gold grade Contained gold
g/t tonnes g/t oz
Constrained open pit at $1,300 (U.S.)/oz
0.5 6,827,000 1.96 431,000
0.7 5,703,000 2.23 409,000
1.0 4,355,000 2.66 372,000
Underground (based on open pit at 0.5 g/t cut-off)
2.0 1,657,000 3.75 200,000
2.5 1,092,000 4.54 159,000
3.0 751,000 5.36 129,000
Martiniere gold system
Inferred mineral resource
Gold cut-off grade Tonnage Average gold grade Contained gold
g/t tonnes g/t oz
Constrained open pit at $1,300 (U.S.)/oz
0.5 132,000 2.50 11,000
0.7 122,000 2.67 10,000
1.0 108,000 2.89 10,000
Underground (based on open pit at 0.5 g/t cut-off)
2.0 332,000 4.68 50,000
2.5 231,000 5.75 43,000
3.0 185,000 6.50 39,000 Qualified persons
The independent and qualified person for the mineral resource estimate, as defined by NI 43-101, is Marc Jutras, PEng (British Columbia and Quebec), MASc, principal of Ginto Consulting Inc. Mr. Jutras confirms that he has reviewed this press release and that the scientific and technical information is consistent. The qualified person will prepare and deliver to Balmoral, in conjunction with Equity Exploration Consultants Ltd., a technical report in support of this initial resource estimate for the Martiniere gold system. Balmoral will, in accordance with National Instrument 43-101, file the report on SEDAR within 45 days of this release. The company will provide notification once the report has been filed.
About Balmoral Resources Ltd.
Balmoral is a well-financed, Canadian-based company actively expanding the over-590,000-ounce Martiniere gold system on its Detour gold trend project in the Abitibi region of Quebec. Martiniere is one of the most recent gold systems discovered in the Abitibi and is host to a number of open-ended gold zones and deposits.
Balmoral also controls the largest undeveloped nickel sulphide deposit in the Abitibi region, the Grasset nickel-copper-cobalt-platinum-group-element deposit, which also remains open for expansion, and a dominant land position along trend from one of Canada's largest gold mines. Employing a drill-focused exploration style in one of the world's pre-eminent mining jurisdictions, Balmoral is following an established formula with a goal of maximizing shareholder value through discovery and definition of high-grade, Canadian gold and base metal assets.
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