Mr.
Graham Hill reports
SILVER BEAR ANNOUNCES THE MAIDEN MINERAL RESOURCE FOR THE STERZHNEVOY AND PORPHIROVY DEPOSITS WITHIN THE MANGAZEISKY SILVER PROJECT
Silver Bear Resources Inc. has released the maiden mineral resource for two additional deposits, Sterzhnevoy and Porphirovy, located within haulage distance of the Vertikalny mine development at the Mangazeisky silver project in the Republic of Sakha (Yakutia), Russia. The National Instrument 43-101 technical report prepared by Tetra Tech will be filed on SEDAR within 45 days of this release.
Highlights:
- Resource grade at Sterzhnevoy is 1,500 grams per tonne silver;
-
Sterzhnevoy and Porphirovy structures are open along strike and down dip;
- Maiden gold and copper resources for the property;
- Inferred mineral resources increased by 10 per cent;
-
Drilling has demonstrated that mineralization extends to depth.
Silver Bear's chief executive officer, Graham Hill commented: "On the heels of our Vertikalny resource upgrade, we have once again increased our mineral resource inventory, demonstrating the exploration potential of the Mangazeisky licence. In addition, the Sterzhnevoy discovery has an inferred resource grade of 1,500 grams per tonne silver, similar to that of the Vertikalny deposit. Like [the] Mangazeisky North and South deposits, both the Sterzhnevoy and Porphirovy discoveries are within a short distance of the Vertikalny mine development, supporting our goal to increase resources and mine life by establishing a multipit, single-plant mining operation. In keeping with this objective, the company has engaged Tetra Tech to complete a preliminary economic assessment (PEA) on the Mangazeisky North deposit, with the intention of incorporating it into the Vertikalny mine plan, further enhancing the attractive economic October feasibility study pretax NPV [net present value], at a 5-per-cent discount, of $132.6-million (U.S.) and a pretax IRR [internal rate of return] of 86.1 per cent."
SUMMARY OF MAIDEN RESOURCES FOR THE PORPHIROVY
AND STERZHNEVOY DEPOSITS
Zone Inferred resource
Grade Grade
Tonnes Au Ag Grade Contained Contained Contained
(t) (g/t) (g/t) Cu (%) metal Au metal Ag metal Cu
(troy oz) (troy oz) (lb)
Porphirovy 80,000 1.7 46 0.6 4,000 115,000 1,000,000
Sterzhnevoy 48,000 - 1,530 - - 2,360,000 -
Tetra Tech has adopted the definition of mineral resources as outlined within the CIM definition standards on mineral resources and mineral reserves (CIM, 2010) in order to classify the resources. The effective date of the mineral resource estimate is Aug. 27, 2016.
Resource estimation assumptions and methods
Key assumptions used to estimate the mineral resources are:
- The mineral resources have been estimated into two separate three-dimensional block models each comprising the following parameters:
- 20 metres by 20 metres by 10 metres (x, y, z), with minimum subblock dimensions of one metre by one metre by 0.5 metre (x, y, z).
- The estimation was constrained to the mineralized zone using wireframe
solid models. The wireframes were subdomained to isolate each
mineralized structure.
- Grade estimates were based on 0.5-metre composited assay data.
- The interpolation of the metal grades was undertaken using inverse-distance weighting.
- In order to demonstrate that the deposit has reasonable prospects for
economic extraction a cut-off grade of 150 grams per tonne has been applied for
Sterzhnevoy, based upon the following assumptions:
- Silver price of $17 per troy ounce;
- Mining cost of $75 (U.S.) per tonne;
- Processing cost of $50 (U.S.) per tonne;
- General and administration costs of $40 (U.S.) per tonne;
- Overall Silver recovery of 90 per cent.
- The company used a cut-off grade of $77 equivalent based on the same assumptions for
Porphirovy. Dollar equivalent calculated with the formula equals gold ounces multiplied by $1,250 plus silver ounces multiplied by $17 plus copper pounds multiplied by $2.20.
The revised maiden Sterzhnevoy and Porphirovy resources are presented in the attached table, along with all other current mineral resources within the property.
TOTAL SILVER RESOURCES FOR THE MANGAZEISKY PROPERTY
Zone Indicated resource Inferred resource
Tonnes Grade Ag Contained Tonnes Grade Ag Contained
(t) (g/t) metal Ag (t) (g/t) metal Ag
(troy oz) (troy oz)
Vertikalny
Central 670,000 1,266 27,400,000 300,000 779 7,500,000
Vertikalny
Northwest 150,000 605 3,000,000
Nizhny Endybal 710,000 316 7,200,000
Mangazeisky
North 304,000 626 6,100,000 98,000 671 2,100,000
Mangazeisky
South 60,000 246 500,000
Sterzhnevoy 48,000 1,530 2,360,000
Silver total 974,000 1,066 33,500,000 1,366,000 514 22,660,000
Zone Inferred resource
Grade Grade
Tonnes Au Ag Grade Cu Contained Contained Contained
(t) (g/t) (g/t) (%) metal Au metal Ag metal Cu
(troy oz) (troy oz) (lb)
Porphirovy 80,000 1.7 46 0.6 4,000 115,000 1,000,000The effective date of the original Nizhny Endybal resource estimate was Sept. 11, 2012. This resource was restated with a higher cut-off grade on June 10, 2015. The effective date of the Mangazeisky South resource is June 10, 2015. The effective date of the Mangazeisky North resource is March 31, 2016. The effective date of the Vertikalny Central and Northwest resource estimates was July 8, 2016.
The Sterzhnevoy, Mangazeisky North, Mangazeisky South and Nizhny Endybal resources are reported above a cut-off grade of 150 grams per tonne silver, assuming open-pit mining methods. Porphirovy resource is reported at $77 dollar equivalent, assuming open-pit methods. The Vertikalny Central and Northwest deposits are reported above a cut-off grade of 200 grams per tonne silver for open-pit resource and above 350 grams per tonne silver for underground resource.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues.
Mineral reserve
The mineral reserve statement is as of Sept. 23, 2016, and is shown in the attached table. Please refer to the press release of Oct. 4, 2016, for full details on the mineral reserve. The mineral reserves are contained within the indicated resources.
TOTAL RESERVES FOR VERTIKALNY CENTRAL DEPOSIT
Category Cut-off grade Quantity Ag grade Ag metal
(g/t Ag) (kt) (g/t) content
(koz)
Proven -- open pit - - - -
Proven -- underground - - - -
Probable -- open pit 250 364 1,209 14,144
Probable -- underground 450 458 569 8,375
Total mineral reserves - 822 852 22,519Geological and sampling procedures
A quality assurance/quality control is part of the drilling program on all of the deposits on the Mangazeisky property. This program includes chain-of-custody protocols, as well as systematic submittals of standards, duplicates and blank samples into the flow of samples produced by the drilling. Prior to 2011, analysis was carried out at Russian certified laboratories in Yakutsk and Aldan, Russia. Analysis for 2012, 2013, 2014 and 2015 campaigns were completed by ALS Chemex in Chita, Russia.
Qualified person
The new inferred mineral resource estimate was prepared by Joe Hirst, BSc, MSc, EurGeol, CGeol. Mr. Hirst is a resource geologist at Tetra Tech and is a qualified person as such term is defined in NI 43-101. Mr. Hirst has reviewed the technical and scientific information in this press release relating to the mineral resource estimates and has approved the use of the information contained herein. The updated mineral resource estimates were generated using the parameters set out in this press release.
About Silver Bear
Silver Bear is focused on the development of its wholly owned Mangazeisky silver project, covering a licence area of approximately 570 square kilometres that includes the high-grade Vertikalny deposit (amongst the highest-grade silver deposits in the world), located 400 kilometres north of Yakutsk in the Republic of Sakha within the Russian Federation. The company was granted a 20-year mining licence for the Vertikalny deposit in September, 2013, and recently updated its feasibility study in the fourth quarter of 2016.
We seek Safe Harbor.
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