Silver In Inferred Resource Estimate For The Boleras Deposit

VANCOUVER – Orex Minerals Inc. – reported that a first resource estimate for the Boleras Silver Deposit on the Sandra Escobar Project in Durango, Mexico, has been prepared by the consulting firm Mining Plus. The Sandra Escobar Project is being advanced by Orex under an option agreement with Canasil Resources Inc. At a “Base Case” of 45 g/t Ag cut-off, the Inferred Resource Estimate yields 9.8 million tonnes grading 106 g/t Ag for a total of 33.3 million ounces of silver.

The Mineral Resource is sub-horizontal, outcropping or close to surface, and is therefore expected to be mineable by open pit methods with a low strip ratio. It has reasonable prospects of economic extraction at a cut-off grade of 45 g/t silver. 

Orex’s President, Gary Cope says, “A first Resource Estimate is a major step in an exploration project. We have achieved this benchmark in less than a year from the start of diamond drilling and we believe that this initial resource is the first of many to come.” 

The resource estimate is based on the results from diamond drilling up to and including drill hole SA-16-059 for a total of 7432 meters. The data cut off date was October 7, 2016 and the “Effective Date” for the Inferred Resource Estimate is October 25, 2016. The 45 g/t Ag cut-off was chosen as a robust base case with consideration to the current spot price of $17.50/oz Ag and production cost at Mexican mines with deposits of a similar scale with low strip ratios.   The resource is not pit constrained as this is an initial resource and the deposit limits are not fully constrained.

Two discrete domain types were modelled; D1 – disseminated silver mineralization in a horizontal rhyolite crystal tuff, and D2 – disseminated and stockwork veinlet hosted silver mineralization crosscutting the horizontal tuff horizon. D1 is of average grade material and includes a top capping of values at 225 g/t Ag. D2 is of higher grade material and includes a top capping of values at 1,500 g/t Ag.

The block model was run at different block sizes of 5x5x3 meters and at 20x20x3 meters. Sub-blocking was used to model the D2 high grade domain. The Blended D1 and D2 model was regularized to a Block size of 10x10X6.  Grades were assigned to the blocks by the Ordinary Kriging (OK) method, which correlated well with the Inverse Distance Squared (ID2) method. The bulk density was estimated with ID2 due to insufficient sample pairs for meaningful variography and OK estimation.

Silver mineralization is hosted in a rhyolite volcanic dome. An altered and highly permeable crystal lithic tuff unit contains disseminations of silver bearing minerals and domains with broadly spaced stockwork veinlets. The current working model has a porphyritic rhyolite unit, with andesite sills, as an impermeable cap, which may have focused mineralizing fluids into the host permeable volcaniclastic unit. Orex maintains a QA/QC sampling protocol for the diamond drilling program, including the insertion of commercial analytical standards and blank samples. Analytical testing has been performed by SGS Minerals Services and Bureau Veritas. Silver values are determined by fire assay with a gravimetric finish. Multi-element analyses are also determined using a 4-acid digestion and ICP-MS (Inductively Coupled Plasma Mass Spectrometry).

Sandra Escobar is situated north of the town of Tepehuanes, Durango, in the heart of the “Mexican Silver Trend”, midway between the mining districts of Tovar and Guanacevi and is 75 km west of Silver Standard’s La Pitarrilla. This prolific trend hosts some of the world’s largest silver camps and deposits, including Fresnillo, Guanajuato, La Pitarrilla, La Preciosa, Real de Angeles and  Zacatecas. The project consists of 6,333 hectares of mineral concessions and covers multiple mineralized epithermal quartz veins and breccia structures. These veins form a high level silver-gold-base metals system, hosted in andesitic and rhyolitic rocks, centered on a large rhyolite dome complex in the north and silver systems in smaller rhyolite dome complexes to the southeast. All within a large caldera complex. Intense alteration zones and fluid flooding in permeable formations indicates the presence of bulk tonnage targets. Excellent infrastructure exists in the Sandra Escobar area, including paved road access, electrical power, water and manpower from nearby communities.