04:26:28 EDT Fri 14 Aug 2020
Enter Symbol
or Name
USA
CA



Login ID:
Password:
Save
Sierra Metals Inc
Symbol SMT
Shares Issued 162,810,553
Close 2020-06-18 C$ 1.01
Recent Sedar Documents

Sierra Metals drills 17.5 m of 428 g/t Ag at Cusi

2020-06-18 06:57 ET - News Release

Mr. Luis Marchese reports

SIERRA METALS CONFIRMS NEW HIGH-GRADE SILVER ZONE AT ITS CUSI MINE, MEXICO, INCLUDING 17 METERS TRUE-WIDTH OF 428 GRAMS PER TON SILVER, AND PROVIDES AN OPERATIONAL UPDATE

Sierra Metals Inc. has discovered a new high-grade silver zone with significant widths in an area called Northeast-Southwest system of epithermal veins and is providing a corporate update for its Cusi mine in Mexico.

The new high-grade silver vein system was discovered as a consequence of a combination of mine development work in recent months and confirmatory drilling, which is reported in this press release, which includes true widths of 17.45 metres of 428 grams per tonne silver (464 g/t silver equivalent), 9.35 metres of 304 g/t silver (327 g/t silver equivalent), 8.75 metres of 303 g/t silver (322 g/t silver equivalent) and 4.90 metres of 1,140 g/t silver (1,163 g/t silver equivalent).

Sierra Metals announced with a press release on June 29, 2018, the discovery of a 40-metre-wide high-grade stockwork area within the Santa Rosa de Lima vein at Cusi. As the area was developed for mining in the later part of 2019 and early 2020, the company's geologists reinterpreted the stockwork structure as a series of high-grade veins that had an orientation perpendicular to the Santa Rosa de Lima structure. The most important implication of this reinterpretation is that rather than a widening of the Santa Rosa de Lima zone, these veins extended farther to the northeast side of the Cusi fault, which was considered barren of silver mineralization before. Note that the Cusi fault coincides with the Santa Rosa de Lima structure. All the historic silver mineralization at the Cusi mine reported by Sierra Metals was in the southwestern side of this regional fault. The new discovery is an extension of the Cusi vein systems in the northeast of the fault and, rather than barren, the veins are reporting silver grades and widths above the average of the structures previously known at the mine in the southwest to the Cusi fault.

The company has plans to drill an additional 1,000 metres to better understand the extension of the zone at depth and to northeast. This mineralized zone is made up of multiple veins extending over 300 metres in length, which are in proximity to the existing operations. The Cusi mine is located within the municipality of Cusihuiriachi in the central portion of the state of Chihuahua in Mexico. The mine area encompasses 11,657 hectares at an elevation range of 1,950 to 2,460 metres above sea level in the Sierra Madre Occidental mountain range.

                             DRILL HOLE HIGHLIGHTS 

Hole            From      To      Ag       Pb      Zn       Au      AgEq  True width
                 (m)     (m)   (g/t)      (%)     (%)    (g/t)     (g/t)         (m)

DC20M656        30.0   38.75     303     0.22    0.31     0.07       322        8.75
DC20M658       96.25   105.6     304     0.34    0.25     0.10       327        9.35
DC20M658      113.25   119.7     435     0.57    0.39     0.13       471        6.45
DC20M677       52.10   57.00   1,140     0.37    0.36     0.03     1,163        4.90
DC20M686       47.40   50.40     518     0.06    0.10     0.15       530        3.00
DC20M686      185.40  202.55     428     0.46    0.76     0.04       464       17.45
DC20M687      237.65  238.50     890     1.74    3.20     0.45     1,151        0.85
DC20M690       34.25   36.90     368     0.47    0.40     0.20       405        2.65

* The metallurgical recoveries used were based on averages obtained from production 
data provided by Sierra Metals. The metallurgical recoveries used are: 87 per cent 
Ag, 57 per cent Au, 86 per cent Pb and 51 per cent Zn.
** Metal prices used were based on consensus are: $17.86 per ounce silver, $1,431
per ounce gold, 93 cents per pound lead and $1.06 per pound zinc.

"This exploration program confirms the existence of high-grade silver mineralization and demonstrates the important potential of this new zone. It will also allow the company to use a mining method which results in high productivity thus achieving the planned objectives for the Cusi mine," stated J. Alonso Lujan, vice-president, exploration, of Sierra Metals. He continued: "Intercepts such as those shown especially in holes DC20M658, DC20M677, DC20M686 and DC20M687 are common in high-grade epithermal deposits and demonstrate further potential. As such, they give us a reason to continue exploration in the Cusi fault area at depth and along strike, as well as at other high-value zones such as the San Rafael, San Nicolas and the Bordo fault. We look forward to an exciting future as we explore the Cusi district."

Luis Marchese, chief executive officer of Sierra Metals, commented: "Today's drilling results demonstrate the potential for further development of high-grade zones at Cusi. We are excited for further drill results as they along with today's results will potentially increases the value of the asset and play an important role in our growth strategy for the Cusi mine."

                                       2020 DRILLING -- NE SYSTEM  
                                        MINERALIZED INTERCEPTS 
                                                                     
Drill hole    Intercept    Mineralized length    Intercept                       Malpaso lab (Dia Bras)
                              From         To        width          Au      Ag     Pb         Zn     Mn
                               (m)        (m)          (m)       (g/t)   (g/t)    (%)        (%)    (%)

DC20M656              1      30.00      38.75         8.75        0.07     303   0.22       0.31   0.34
DC20M658              1      39.50      40.30         0.80        0.05     183   0.63       0.72   0.04
                      2      96.25     105.60         9.35        0.10     304   0.34       0.25   1.36
                      3     108.05     110.25         2.20        0.04     272   0.37       0.22   2.13
                      4     113.25     119.70         6.45        0.13     435   0.57       0.39   1.31
                      5     128.60     130.10         1.50        0.08     194   3.75       1.46   1.29
DC20M667              1      40.70      56.10        15.40        0.04     175   0.08       0.14   0.63
                      2      70.80      78.90         8.10        0.04     203   0.14       0.20   0.68
                      3      94.85     103.10         8.25        0.01     135   0.07       0.14   2.00
DC20M677              1      52.10      57.00         4.90        0.03   1,140   0.37       0.36   1.79
                      2      69.00      70.15         1.15         Ind     177   0.20       0.20   0.09
DC20M683              1       1.10       3.65         2.55        0.02     182   0.29       0.36   0.69
                      2      20.80      21.70         0.90        0.10     210   0.10       0.20   2.42
                      3      28.30      38.10         9.80        0.08     234   0.21       0.24   2.30
                      4      73.40      78.60         3.15        0.02     152   0.11       0.17   0.44
                      5     144.20     146.80         2.60        0.06     216   0.70       0.61   0.01
                      6     217.15     217.65         0.50        0.05     179   0.18       0.26   1.40
                      7     232.10     233.35         1.25        0.10     275   0.37       0.41   2.11

                                           2020 DRILLING -- NE SYSTEM 
                                             MINERALIZED INTERCEPTS
                                                                      
Drill hole      Intercept      Mineralized length    Intercept                            Malpaso lab (Dia Bras)
                                   From        To        width        Au      Ag       Pb      Zn             Mn
                                    (m)       (m)          (m)     (g/t)   (g/t)      (%)     (%)            (%)

DC20M686                1         47.40     50.40         3.00      0.15     518     0.06    0.10           0.43
                        2         96.70    104.55         7.85      0.06     205     0.10    0.12           0.71
                        3        130.15    131.30         1.15       Ind     312     0.18    0.24           0.03
                        4        171.85    172.95         1.10       Ind     216     0.34    0.39           2.19
                        5        185.40    202.85        17.45      0.04     428     0.46    0.73           1.39
DC20M687                1         35.00     35.75         0.75      0.45     341     0.11    0.23           1.10
                        2         44.70     50.80         6.10      0.13     156     0.23    0.21           1.13
                        3         70.00     70.40         0.40      0.30     179     0.24    0.61           0.02
                        4         94.95     96.30         1.35      0.40     118     0.25    0.27           0.27
                        5        100.55    100.95         0.40       ind     144     0.33    0.53           0.22
                        6        120.15    121.20         1.05       ind     106     0.61    1.04           0.10
                        7        157.25    158.55         1.30      0.05     312     0.26    0.19           0.24
                        8        159.40    159.75         0.35      0.10     483     0.75    1.61           0.77
                        9        170.95    172.30         1.35      0.03     424     0.34    0.73           0.46
                       10        227.90    228.40         0.50      0.35     353     0.10    0.55           0.08
                       11        237.65    238.50         0.85      0.45     890     1.74    3.20           0.05
DC20M690                1         26.25     28.30         2.05      0.05     130     0.06    0.11           1.82
                        2         34.25     36.90         2.65      0.20     368     0.47    0.40           1.87
                        3         62.30     63.10         0.80      0.35     180     0.37    0.14           0.01
                        4         64.70     66.00         1.30       ind     121     0.06    0.09           0.34
                        5         70.40     71.00         0.60      0.10     358     0.08    0.26           0.02
                        6         85.15     87.10         1.95       ind     116     0.09    0.20           0.17
                        7        148.00    149.85         1.85      0.22     290     1.63    1.04           0.48
                        8        169.45    170.15         0.70       ind     135     0.11    0.29           0.11
                        9        191.35    192.30         0.95       ind     115     0.08    0.11           0.59
                       10        198.50    201.25         2.75      0.05     211     0.12    0.15           0.27
                       11        210.60    211.00         0.40       ind     108     0.09    0.07           0.07
                       12        226.80    227.30         0.50      0.20     469     0.30    1.51           0.04
                       13        269.00    271.20         2.20      0.22     560     0.11    0.22           0.08

Cusi mine operation update

The Cusi mine remained in care and maintenance during the government-mandated shutdowns due to its proximity to urban centres with large populations. During this period of care and maintenance, the management team has had the time to complete an optimized view of the entire mine operation. Changes in the interpretation of the geological system have been made based on updated information from a stockwork tonnage system to a vein model system, which is expected to help better control and improve head grades, dilution and make better use of Cusi's silver mineral resources. The company plans to use a sublevel stoping method for extraction, which is better suited to the rock/mineral environment. Additionally, the main access ramp has been extended to an opening of four metres by four metres, which will allow for the use of larger 30-ton-capacity trucks into the mine and improve the efficiency of ore haulage coming from the mine.

Mine development is currently starting at Cusi in a zone that will bypass the previously announced area of subsidence (see press release dated May 13, 2020) and provide access to higher-grade economic ore to provide feed for the mill. Cusi production is expected to recommence after the mine development work is completed and once a process can be implemented at the mine to mitigate risk to employees at the site through a testing and quarantine methodology similar to the company's other operations. Production will include ore from Santa Rosa de Lima zone, the Promontorio zone, as well as from a series of east-west vein systems including the new zone announced today that cross the Cusi fault near Santa Rosa de Lima zone. Management is targeting a ramp-up to 1,200 tonnes per day by the end of the year, at which point the Cusi mine is expected to become self-sustainable and cash flow positive.

Additionally, during the second half of the year, studies will commence on the potential expansion of Cusi. Work will begin on a new tailing dam near the Mal Paso mill, providing for tails deposition capacity for the foreseeable future. Furthermore, infill drilling will take place at the Santa Rosa de Lima, Promontorio and San Nicolas zones to improve and build on mineral resources at the mine. Management also believes there is further brownfield potential in areas not previously explored but which are very close to the Santa Rosa de Lima zone such as those announced earlier in this press release.

Quality control

The quality assurance/quality control (QA/QC) program employed by Sierra Metals has been described in detail in the National Instrument 43-101 report for Cusi dated June, 2018, prepared by SRK Consulting in Denver, which is available for review on SEDAR. The lithologies logged are used in combination with the assay data to identify mineralization for the geologic model. Both geochemistry and assays feature the analyses for the primary elements to be reported at Cusi (Au, Ag, Pb and Zn).

Qualified persons

All technical data contained in this news release have been reviewed and approved by Americo Zuzunaga, FAusIMM (CP mining engineer), vice-president of corporate planning, who is a qualified person and chartered professional qualifying as a competent person under the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.

Augusto Chung, FAusIMM (CP metallurgist), vice-president, special projects and metallurgy, is a chartered professional qualifying as a competent person on metallurgical processes.

About Sierra Metals Inc.

Sierra Metals is a Canada-based growing polymetallic mining company with production from its Yauricocha mine in Peru, and its Bolivar and Cusi mines in Mexico. The company is focused on increasing production volume and growing mineral resources. Sierra Metals has recently had several new discoveries and still has additional brownfield exploration opportunities at all three mines in Peru and Mexico that are within or in close proximity to the existing mines.

We seek Safe Harbor.

© 2020 Canjex Publishing Ltd. All rights reserved.