Mr. Michael McPhie reports
PRIZE MINING REPORTS RESULTS FROM DIAMOND DRILLING AT THE MANTO NEGRO COPPER PROJECT, MEXICO AND PROVIDES CORPORATE UPDATE
Prize Mining Corp.'s stepout diamond drill holes at the Pilar Grande area of the Manto Negro copper project in Coahuila state, Mexico, continue to intersect copper-silver mineralization. Drilling at the El Granizo site has encountered complex faulting that is yet to be fully interpreted as to the impact on mineralization.
"Our first drill program at the Pilar Grande and El Granizo areas continues to provide important geological information on the continuity of copper-silver mineralization," stated Michael McPhie, president and chief executive officer of Prize Mining. "In detail, the areas are more structurally complex than we had anticipated, but our geologists are working on an interpretation that will help guide our ongoing drill program."
As reported on Nov. 14, 2018, the first two holes from each of the El Granizo and Pilar Grande mine areas intersected consistent thicknesses and relatively consistent grades of copper and silver. Holes DDHDI-18-03 and 05 at Pilar Grande intersected similar mineralization, while hole DDHDI-18-04 returned no significant values.
At El Granizo, holes DDHMN-18-03 to 07 appear to have been drilled within a fault block that is not mineralized at the same horizon as the first two holes. The main northeasterly trending faults defining this block are, therefore, interpreted to be premineral and likely played a role in localizing metalliferous brines. As such, it is possible that a separate, lower mineralized horizon exists. If the structures are postmineral, then a simple offset of the mineralization would be expected.
HIGHLIGHTS OF DRILL INTERSECTIONS
Hole number Area From To Width Cu Ag
(m) (m) (m) (%) (g/t)
DDHDI-18-03 Pilar Grande 85.75 87.80 2.05 0.59 20
DDHDI-18-05 Pilar Grande 75.05 77.55 2.50 0.72 46
Including 75.05 75.60 0.55 1.43 126
And 77.10 77.55 0.45 1.74 87
DDHDI-18-05 Pilar Grande 80.90 83.05 2.15 0.79 37
DDHDI-18-05 Pilar Grande 87.70 90.60 2.90 0.72 24
Note: Intersections are drilled core lengths. True thicknesses
are thought to be approximately 80 to 90 per cent of drilled lengths.
Due to performance issues, the drilling contractor has been changed and the program is continuing with a single rig at the moment with a new contractor. Performance has improved significantly as a result of this and production expectations are being met or exceeded on a daily basis. A second rig may be added in the new year.
Copper-silver mineralization on the Manto Negro project belongs to the category of sediment-hosted stratabound copper deposits, similar in style to the world-class deposits of the Kupferschiefer in Poland.
Sampling quality assurance/quality control and analysis
The company followed a rigorous quality assurance/quality control program over the chain of custody of samples with the insertion of blanks and duplicates into the sample stream submitted to the laboratory for analysis. Sample preparation and analysis took place at the SGS facility in Durango, Mexico.
The analysis completed on all samples was the 32-element package by four-acid digestion and inductively coupled plasma optical emission spectrometry (ICP-OES) (package GE-ICP40B). Samples with copper or lead over the upper detection limit of 10,000 ppm (parts per million) were reanalyzed by sodium peroxide fusion and ICP-OES (package GO-ICP90Q). Samples with silver over the upper detection limit of 100 ppm were reanalyzed by lead fusion fire assay with gravimetric finish (package GO-FAG313).
Robert Archer, professional geoscientist, a director of the company and a qualified person under National Instrument 43-101, is the company's nominated qualified person responsible for monitoring the supervision and quality control of the programs completed on the company's properties. Mr. Archer has approved and verified the scientific and technical information in this news release.
On June 21, 2018, Prize Mining announced that the amount sought to be raised under a previously announced private placement had been increased to $8-million and that the proceeds would be used for marketing, advertising and investor relations activities, corporate development, and M&A (merger and acquisition) financial advisory services, in addition to financing exploration programs on Prize's Manto Negro copper project and Kena gold project, property payments, and general and administrative expenses. On July 9, 2018, Prize announced that the initial tranche of this private placement was completed for proceeds of $6.5-million and that the net proceeds were intended to be used by the company for:
Marketing, advertising and investor relations activities;
- Corporate development and M&A financial advisory services;
- Drilling, geological, engineering and metallurgical investigations, and associated consulting services on the Manto Negro copper project located in Coahuila state, Mexico;
- Property payments, leases, option payments;
- Corporate general and administrative expenses.
As of the date of this release, the company has completed two drilling programs at the Kena gold project, located in southeastern British Columbia since July, 2018. The programs consist of drilling a total of 20 holes and 3,886 metres (see Prize press release on Dec. 12, 2018). The company has also been undertaking the first phase of drilling at the Manto Negro copper project in northeastern Mexico as discussed above. This initial 3,000-metre diamond drill program is continuing now and assay results are pending.
In conjunction with the closing in July, 2018, the company also entered into several contractual agreements for the provision of marketing, advertising and investor relation activities, corporate development and M&A advisory, and financial accounting and advisory services. These agreements totalled $5.5-million, are prepaid and the services were to be carried out over a 12-month period. On Nov. 1, 2018, the company reallocated its corporate spending, cancelled and allocated $1.22-million from five agreements toward project-related initiatives. Prize undertook this initiative to address revised corporate priorities and a focus on drilling and exploration opportunities at its properties in Mexico and British Columbia.
As part of the company's continuing evaluation of priorities and direction and its internal processes where it follows up with all of its contracts and consultants on a regular basis to evaluate their work and deliverables, the company has decided to shift its focus on the remaining work programs associated with certain additional agreements. These agreements had an initial value of $3.71-million at inception. The company has determined to cancel the remaining work associated with these agreements and is in discussions with the service providers involved to facilitate that decision.
About Prize Mining Corp.
Prize Mining is a junior mining issuer listed on the TSX Venture Exchange. The company is focused on the exploration and development of the Manto Negro copper property in Mexico and the Kena gold property in B.C.
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