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Goldsource Mines Inc
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Goldsource files NI 43-101 report on Eagle Mountain

2021-02-22 11:05 ET - News Release

Mr. Steve Parsons reports


Goldsource Mines Inc. has released the results of an updated mineral resource estimate (MRE) for its 100-per-cent-owned Eagle Mountain gold project in Guyana, South America. Details of the mineral resource estimate, which include the Eagle Mountain and Salbora deposits, will be provided in a technical report prepared in accordance with National Instrument 43-101 filed under the company's SEDAR profile within 45 days of the release with an effective date of Feb. 17, 2021. The updated MRE was prepared by CSA Global in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) definition.


  • The resource estimated 23 million tonnes (Mt) grading 1.14 grams per tonne (gpt) gold for 848,000 ounces (oz) of gold contained in indicated resources and 25 Mt grading 1.09 gpt gold for 868,000 oz of gold in inferred resources.
  • The MRE includes the Eagle Mountain and Salbora deposits, both of which feature gold mineralization starting at surface in saprolite (soft rock) and extending into the underlying fresh rock. The saprolite is estimated to contain 42 per cent of the gold in indicated resources and 16 per cent of the gold in inferred resources.
  • Mineral resources, employing cut-off grades of 0.30 gpt gold for the saprolite and 0.50 gpt gold for the fresh rock, are contained within a conceptual open pit. Gold in surficial saprolite and the shallow subhorizontal zones of the Eagle Mountain deposit result in a low average strip ratio. The strip ratio of the saprolite is estimated to be below 1:1.
  • The updated MRE is defined by a total of 674 core holes for 57,550 metres drilled, as well as 158 auger drill holes for 532 metres drilled, which includes infill and exploration drilling up to Nov. 6, 2020.
  • In comparison with the 2014 preliminary economic assessment (PEA), the updated MRE delivers a 349-per-cent increase in gold contained in indicated resources and a 9-per-cent increase in gold contained in inferred resources.
  • Additional infill and expansion drilling since the 2014 PEA contributed to the significant increase in indicated resources, while the discovery of the Salbora deposit and extensions to the Eagle Mountain deposit with the Friendly and No. 1 Hill areas being added to mineral resources.
  • The company is planning a second resource update in the second half of 2021. This will incorporate results from expansionary and infill drilling at the Eagle Mountain deposit, including the Baboon and Ounce Hill areas, and exploration drilling along the prospective Salbora-Powis trend targeting Salbora-style mineralization. Three drill rigs are currently active on the property.

Steve Parsons, professional engineer, chief executive officer of Goldsource, commented: "This updated resource estimate is a very strong result, both in terms of the increase in contained ounces of gold and the quality of the resource. Specifically, the ounces are hosted within a conceptual open pit that is shallow and features soft-rock saprolite at surface. These attributes point to a project that offers the potential for resource scale and tangible opportunities for production scalability.

"We look forward to our second resource update planned for later in 2021. This resource will reflect the results of drilling after the MRE cut-off date of Nov. 6, 2020, and include the impact of stepout drilling at the Eagle Mountain deposit and further exploration drilling along the Salbora-Powis trend. The second update will form the basis for a prefeasibility study (PFS) which is intended to be completed in 2022. The company's in-country team in Guyana continues to deliver, growing the scale and quality of Eagle Mountain."

Yannis Tsitos, president of Goldsource, added: "Since 2019, Goldsource has had a stated objective of building a mineral resource of 1.3 to 1.6 million ounces of gold in a shallow open-pit configuration with a grade greater than one gpt gold. The company has delivered with a resource exceeding the top end of that range through expansion of the Eagle Mountain deposit to the Friendly and No. 1 Hill areas and with the inclusion of the recently discovered Salbora deposit. Furthermore, newly announced discoveries provide opportunities to grow and enhance the quality of the resource. These opportunities will be the subject of further drilling in 2021."

Mineral resources

Together, the Eagle Mountain and Salbora deposits contain an estimated 23 Mt of indicated mineral resources grading 1.14 gpt gold and 25 Mt of inferred mineral resources grading 1.09 gpt gold. An attached table shows project total updated mineral resources and resources per deposit and by weathering type (saprolite and fresh rock).

The mineral resource estimate is based on the company's exploration programs and validated historical results. Mineral resources are classified as indicated and inferred based on CIM definition standards. The effective date for the mineral resource estimate is Feb. 17, 2021. The most significant component of the data, collected by Goldsource and others and validated by CSA and previous qualified persons, represents 674 drill holes (57,550 metres), as well as 158 auger drill holes (532 metres), used in a portion of the Eagle Mountain deposit where core drilling was widely spaced. These auger data have been subject to similar quality assurance and quality control (QA/QC) to the core drilling. Details of the company drill results can be found in various press releases from Aug. 28, 2017, to the cut-off date of Nov. 6, 2020, and the 2014 PEA.

Resource estimation parameters and methodology

Gold cut-off has been calculated based on a gold price of $1,500 (U.S.) per oz, mining costs of $1.5 (U.S.) per tonne (t) for saprolite and $2 (U.S.) per t for fresh rock, processing costs of $6 (U.S.) per t for saprolite and $12 (U.S.) per t for fresh rock, and mine site administration costs of $3 (U.S.) per t. Metallurgical recoveries of 95 per cent are based on testwork.

Gold grades were interpolated based on 10-metre by 10-metre by three-metre blocks for the Eagle Mountain deposit and five-metre by 10-metre by five-metre blocks for Salbora. The interpolation used ordinary kriging for the Eagle Mountain deposit and the inverse of the squared distance (ID2) for Salbora. Both models used the geological domains and subdomains for mineralized-grade shells.

Specific gravity for saprolite is 1.7 t per cubic m and 1.6 t per cubic metre at the Eagle Mountain deposit and Salbora, respectively. Fresh rock specific gravity of granitoid and basaltic units is 2.7 t per cubic m. Both saprolite and fresh rock figures are based on laboratory testwork.

Variography, interpolations and estimate validations were carried out separately for each estimation domain. Estimates were validated visually using sections and three-dimensional visualization, along with using swath plots, comparison of averages in drill hole and blocks, and global change of support. For the Eagle Mountain deposit, several estimation methodologies were used for validation, including ID2, uniform conditioning and nearest neighbour estimation.

Resource classification for the Eagle Mountain deposit used blocks with at least three drill holes within 90 metres to classify as indicated resources. Blocks between 90 metres and 160 metres from three drill holes were classified as inferred resources. For the Salbora deposit, blocks with at least three drill holes used for estimation, and within 30 metres of a drill hole, were classified as indicated resources, with remaining blocks classified as inferred resources.

Mineral resources are constrained by a pit shell optimized with the software, SimSched, with block net values estimated using the same price, metal recovery and cost assumptions used to define the reporting cut-offs, and assuming a maximum pit slope angle of 45 degrees. Resources for both the Eagle Mountain and Salbora deposits are shallow (zero to 160 metres).

2014 mineral resource estimate

The prior mineral resource estimate, as used as the basis for the 2014 PEA saprolite study, comprised 3.9 Mt grading 1.49 gpt gold for 188,000 ounces contained in indicated resources and 20.6 Mt grading 1.20 gpt gold for 792,000 ounces contained in inferred resources. The grade was higher in both categories due in large part to the use of a 0.5-gram-per-tonne-gold cut-off grade for both saprolite and fresh rock. The effect of a 0.5-gram-per-tonne cut-off grade on the 2021 MRE is shown in an attached table. All other key parameters and a description of the resource methodology are detailed in the 2014 PEA report (effective date of June 15, 2014), which is located on the company's website or SEDAR.

Qualified assurance program and quality control measures

Goldsource has implemented QA/QC protocols, including insertion of duplicate, blank and standard samples in all drill holes. The samples were submitted directly to Actlabs Guyana Inc. in Georgetown, Guyana, for preparation and analysis. Additional duplicate testwork has been conducted on mineralized samples to assess variability of coarse reject and pulp samples. A CSA independent qualified person visited the Eagle Mountain project between Nov. 21 to Nov. 25, 2020. Independent sampling was completed. CSA has reviewed the QA/QC work completed by Goldsource and believes the database is reliable for estimating mineral resources.

Eagle Mountain gold project geology

The Eagle Mountain project comprises two gold deposits, Eagle Mountain and Salbora, in addition to several other exploration targets. The deposits are structurally controlled and considered to be part of the same mineralizing system. They are affected by a zone of saprolitic weathering up to 50 metres thick and overprints earlier-formed mineralization in both the granodiorite and basalt but has not resulted in enrichment of gold in the saprolite horizon.

Eagle Mountain deposit

Gold mineralization at the Eagle Mountain deposit is associated with a series of tabular to gently undulating, shallow, dip-slope shear zones developed within a granodioritic host rock. The deposit has a lateral extent that covers an area of approximately 2.5 kilometres by one kilometre. Three discrete zones of alteration and mineralization have been delineated. Zone 1 is shallowest and outcrops at surface across much of the deposit. Zones 2 and 3 lie at depth below Zone 1, separated by low-grade material. Zone 1 contains 92 per cent of the gold in the indicated resource category and 77 per cent of the gold in the inferred resource category. Zones 2 and 3 make up the balance.

Salbora deposit

Gold mineralization at Salbora is formed by a series of north to northwest-trending, steeply dipping structures within a basaltic host rocks, on the margin of a monzonite intrusion. These steep structures (shear zones and breccia bodies) coalesce into a broader zone of brecciation that forms a near-surface subhorizontal lens up to 100 metres thick and approximated 200 metres by 200 metres in area, where higher-grade gold mineralization occurs and which represents almost 100 per cent of the mineral resources of this deposit.

2021 drill program

For 2021, the company's exploration program has three primary growth objectives:

  1. Follow-up exploration of several new target areas, along the prospective Salbora-Powis trend, such as the Toucan, Powis, Ann and Montgomery prospects where the potential exists for Salbora-style mineralization;
  2. Testing for new lateral extensions of the dip-slope subhorizontal zones of the Eagle Mountain deposit, notably to the north, west and southwest currently outside of the 2021 MRE;
  3. In-fill drilling of the 2021 MRE to upgrade a significant portion of mineralization currently classified as inferred resource to the measured and indicated categories to be used as the basis for a prefeasibility study.

Three drill rigs are currently operating at the Eagle Mountain gold project. In all, the base case budget calls for 16,500 metres to be drilled over 2021, with approximately 40 per cent to 50 per cent of the budgeted metres earmarked for in-fill drilling of the 2021 MRE. With increased geological knowledge, several areas previously unexplored have become targets and will be tested with surface auger sampling and trenching to concentrate further drilling programs in new areas as discussed above.

Qualified persons

Adrian Martinez (professional geoscientist) of CSA is the independent qualified person for the mineral resource estimates presented in this press release, has approved its publication and will be the principal qualified person for the National Instrument 43-101 technical report that will be filed on SEDAR within 45 days.

The company qualified person under National Instrument 43-101 for this news release is N. Eric Fier, CPG, professional engineer, executive chairman and vice-president of finance for Goldsource, who has reviewed and approved its contents.

About Goldsource Mines Inc.

Goldsource Mines is a Canadian resource company working aggressively to develop its advanced-stage, 100-per-cent-owned Eagle Mountain saprolite and hard-rock gold project in Guyana, South America. From 2016 to 2017, through a gravity pilot plant initiative, the company completed testing on gravity-only gold production and both dry and wet mining open-pit techniques. Goldsource is now focused on expanding gold resources and delivering subsequent studies for decision-making on a large-scale gold production at Eagle Mountain. Goldsource is led by an experienced management team, proven in making exploration discoveries and in project construction.

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