JV Video: Minaurum’s Alamos lands 55M-oz resource

Minorum Silver – Alamos Project: First Mineral Resource Estimate – Detailed Summary

Key Concepts:

• Mineral Resource Estimate: An official assessment of the quantity and quality of minerals in a deposit.
• Silver Equivalent (oz AgEq): A standardized measure used to represent the value of different metals (in this case, silver and other associated metals) as a single unit.
• Inferred Resource: A category of mineral resource with the lowest level of geological confidence; estimates are based on limited sampling and geological interpretation.
• Vein Zones: Naturally occurring concentrations of minerals filling fractures or cracks in rock.
• Stacked Veins: Multiple, closely spaced veins occurring in the same area, increasing resource potential.
• Cutoff Grade: The minimum grade of ore required to make mining economically viable.
• Underground Mining: A method of extracting ore from beneath the surface, suitable for high-grade deposits.
• Dilution: The inclusion of unwanted rock material during mining, impacting ore grade.

1. Initial Resource Estimate & Project Overview

Minorum Silver has released its first mineral resource estimate for the Alamos project located in Sonora, Mexico. This estimate quantifies the project’s potential, currently standing at over 55 million ounces of silver equivalent (oz AgEq). Crucially, this estimate is based on only three of the 26 identified vein zones within the Alamos district, indicating significant expansion potential. The estimate was derived from approximately 37,000 meters of drilling, with an additional 25-30,000 meters of historical drilling providing targets for future resource growth. The company is fully permitted for underground mining at the Alamos project.

2. Exploration Strategy & District-Scale Potential

Daryl Rder, President and CEO of Minorum Silver, emphasized a deliberate exploration strategy. Instead of immediately focusing on drilling individual veins, the company spent the first five to six years exploring the entire Alamos property, completing nearly 30,000 meters of drilling to confirm its status as a district-scale silver system. This approach involved making discoveries across multiple vein zones and then prioritizing the three most promising for the initial resource estimate. The presence of 26 vein zones, each often consisting of multiple “stacked veins,” distinguishes Alamos from typical isolated silver deposits found in Mexico. The stacked vein structure allows for maximizing discoveries, adding both ounces and tons with each drill hole.

3. Resource Classification & Advancement Strategy

Currently, all identified resources are classified as “inferred.” This means the geological confidence is lower due to wider drill spacing. However, Minorum Silver’s immediate strategy isn’t to upgrade the existing resource quality but to expand it beyond 100 million oz AgEq. A 50,000-meter drill program is underway to achieve this goal. Following this expansion, the company will allocate drilling efforts to reduce drill hole spacing and increase the resource classification to “indicated” or “measured.” Rder noted that drill hole spacing requirements for an indicated resource at Alamos may be tighter than in other regions due to the lack of comparable operating mines in the immediate vicinity.

4. Importance of Grade & Vein Characteristics

The Alamos project is characterized by its high-grade silver mineralization. Rder highlighted the industry adage, “grade pays, tons cost,” emphasizing the economic benefits of high-grade deposits, particularly for underground mining. Higher grades reduce the tonnage required for a viable resource, mitigating exposure to cost inflation associated with larger-scale extraction. Furthermore, the veins at Alamos are notably wide – averaging 5-6 meters in one zone and over 3 meters in another – reducing the need for dilution during mining. Typical underground mining widths in Mexico are around 1.5 meters, meaning the Alamos veins are significantly larger and easier to access.

5. Future Catalysts & Investor Focus (2024-2026)

Investors should focus on several key catalysts:

• Drill Results: Ongoing drill results from the 50,000-meter program, expected to be released regularly, will demonstrate resource expansion. The internal objective is to exceed 100 million oz AgEq in the second half of 2024.
• Updated Resource Estimate: A revised resource estimate, incorporating the new drilling data, is anticipated in the second half of 2024.
• Development-Related Catalysts: Minorum Silver is actively working on de-risking the project through surveying, infrastructure development (roads, processing facilities), and securing permits for water usage and explosives. While these are not immediate stock-moving events, they are crucial for attracting potential major mining company partners.

6. Technical Details & Terminology

• Infill Drilling: Drilling conducted to increase the density of drill holes in a specific area, improving resource classification.
• Dilution (Mining): The unavoidable inclusion of waste rock when extracting ore, which lowers the overall grade of the mined material.
• Underground Mining Amendable: The geological characteristics of the deposit are suitable for extraction using underground mining methods.
• Vein: A fracture or zone of fracture in rock filled with mineral deposits.

7. Logical Connections & Overall Strategy

The company’s strategy is logically structured: first, establish the Alamos project as a district-scale silver system; second, rapidly expand the resource base to over 100 million oz AgEq; and third, refine the resource classification and de-risk the project to attract potential partners or development funding. The emphasis on grade and vein width is directly tied to the planned underground mining approach, maximizing profitability and minimizing operational challenges.

8. Data & Statistics

• Initial Resource Estimate: >55 million oz AgEq
• Number of Vein Zones Identified: 26
• Drilling Completed for Initial Estimate: 37,000 meters
• Historical Drilling for Future Targets: 25-30,000 meters
• Current Drill Program: 50,000 meters
• Vein Widths: 3-6 meters average
• Typical Underground Mining Widths (Mexico): 1.5 meters

9. Synthesis & Conclusion

Minorum Silver’s initial resource estimate at the Alamos project represents a significant milestone, validating the company’s district-scale exploration strategy. The project’s high-grade nature, wide veins, and significant expansion potential position it favorably within the silver mining landscape. The company’s near-term focus on resource expansion, coupled with ongoing de-risking efforts, is designed to attract investment and ultimately unlock the full value of this promising silver district. Investors should closely monitor drill results and the updated resource estimate expected in the second half of 2024.