El Domo Deposit

The El Domo deposit covers an area of 250 hectares and is located in the center of the Las Naves concession of 1,460 hectares and is part of one whole body which includes the anomalies Roble 1, Roble, Cade 1 and Cade Sur.

The deposit El Domo is a newly discovered massive - sulphide body; geologically rich in Au, Cu and Zn with 50-100% sulphides. The mineralized body now has a North - South strike length of 850m and an East - West width of between 300-500m, with an average thickness of 10m. The body is sub-horizontal beginning at 50m below surface.

Dr. Warren Pratt was the first to document and describe the Kuroko-type VMS environment and has established a lithostratigraphy for the Las Naves/El Domo area. Dr. Jim Franklin identified a marker unit in the immediate hanging wall of the massive sulphide mineralization and defined the zoned nature of the mineralized system.


HIGHLIGHTS

DISCOVERED
2008

LOCATION
Located in Las Naves concession

EXPLORATION
El Domo remains open towards the north, east and at depth. The average drill hole spacing is approximately 50m within the El Domo.

For the resource estimate made in December 2013, a total of 31,770m were drilled in 168 holes. A total of 7736 samples were assayed.

High priority outcrop anomalies still to be drill tested 800m north from El Domo Deposit (Sesmo Anomaly)

The footwall at El Domo is a classic felsic flow dome complex, very similar to Kuroko, Tasmania and Noranda.

LOCATION


RESOURCE ESTIMATE

Buenaventura Ingenitros S.A. of Lima, Peru, independent resource estimation consultant for Salazar, has prepared and authorized the release of the Mineral Resource Estimate. The El Domo Mineral Resource Estimate is based on an NSR cutoff value of US$50 per tonne.

The Indicated Mineral Resource of 6.080 million tonnes at an average grade of 2.33% Cu, 3.06% Zn, 0.28% Pb, 2.99 g/t Au, and 55.81 g/t Ag, containing 312.95 million pounds Cu, 409.56 million pounds Zn, 37.76 million pounds Pb, 584,457 ounces Au, and 10 .91 million ounces Ag.

The Inferred Mineral Resource of an additional 3.882 million tonnes at an average grade of 1.56 % Cu, 2.19% Zn, 0.16 % Pb, 2.03 g/t Au, and 42.92 g/t Ag, containing 133.46 million pounds Cu, 187.39 million pounds Zn, 13.96 million pounds Pb, 253,607 ounces Au and 5.36 million ounces Ag.

Table 1: El Domo Mineral Resource Estimate (December 15, 2013)

Table 1: El Domo Mineral Resource Estimate

The following contains information derived from the technical report dated January 16, 2015 and titled “Curipamba Project - El Domo Deposit - Amended and Restated Preliminary Economic Assessment – Central Ecuador.”

NOTE:

  • CIM definitions were followed for mineral resources
  • The Mineral Resource Estimate is based on 3D geological modelling of the volcanogenic massive sulphide deposit (VMS). Four mineralized units with an NSR cutoff of US$30 per tonne were considered as mineral resource
  • Metal prices used are US$2.95/lb Cu, US$0.91/lb Zn, US$0.91/lb Pb, US$1,200/oz Au, and US$20.00/oz Ag
  • Metallurgical recovery factors assumed were based on three mineral types defined by the metal ratio Cu/(Zn+Pb):
    • Zinc Mineral (Cu/(Pb+Zn)<0.3): 15% Cu, 90% Zn, 40% Pb, 50% Au, and 65% Ag
    • Mixed Cu/Zn Mineral (0.3≤Cu/(Pb+Zn)≤3.0): 75% Cu, 50% Zn, 0% Pb, 55% Au, and 65% Ag
    • Copper Mineral (Cu/(Pb+Zn)>3.0): 90% Cu, 0% Zn, 0% Pb, 30% Au, and 40% Ag
  • Common industry values for smelter terms were assumed
  • Bulk density was estimated based on specific gravity determinations for each lithological unit

Resources Classification Methodology

The method for resource classification is based on the geological knowledge of the deposit and the assumption of the spatial continuity of Cu and Zn. The geological controls and geostatistics used in the interpolation of the metal grades in the sub-cell type block model, produced various confidence levels as a function of the spatial configuration of the composites used for estimating a block. For each individual block, a number of parameters were recorded:

  1. The interpolation pass in which the block was estimated
  2. The number of drill holes with composites that contributed to the block interpolation
  3. The total number of composites used in the block interpolation
  4. The average weighted distance (by interpolation weights) for the composites used

Table 2: El Domo Significant Drill Holes to Date

El Domo Significant Drill Holes to Date

Notes:
1. Intercepts reported are intersection lengths
2. All drill results above have been previously released

Preliminary Metallurgy Tests:
Salazar provides update on metallurgical testing. Please click here for full Summary Report.

Preliminary Economic Assessment:
Salazar provides results of preliminary economic assessment: Please click here to view Summary of PEA.

Legal and Environmental Milestones:

  • November 16, 2007: Authorization of the Environmental Impact Study (EIA) for the exploration phase, by the Ministry of Mines and Petroleum
  • February 10, 2009: Authorization of EIA for the exploration and publication of the Official Registry for exploration phase, by the Ministry of Environment
  • January 14, 2010: Permits granted for the use of water for the exploration phase, authorized by the National Secretary of Water
  • Between March and May 2010: Replacement of the mining titles according to the new mining law, and we were granted 25 years of concessions
  • June 3, 2010: Authorization to reinitiate mining advanced exploration activities, authorized by the Ministry of nonrenewable natural resources (former Ministry of Mines and Petroleum)
  • May 2011: Granted the Environmental licenses for the Project