Torex Gold Announces Updated Media Luna Resource Estimate

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TORONTO, Jan. 13, 2020 (GLOBE NEWSWIRE) -- Torex Gold Resources Inc. (the “Company”) (TSX: TXG) announces an updated resource estimate for the Media Luna project, which includes an Indicated resource of 2.24 million gold equivalent ounces at a gold equivalent grade of 5.55 g/t and an Inferred resource of 4.56 million gold equivalent ounces at a gold equivalent grade of 4.23 g/t. Of the gold equivalent metal inventory (comprising the Indicated and Inferred resource categories), 58% of the contained metal value is attributable to gold, 34% to copper, and 8% to silver.

A breakdown of the December 2019 resource estimate by gold, silver, and copper can be found in Table 1 of this press release.

Fred Stanford, President and CEO of Torex Gold, stated:

“The purpose of the planned 175 hole infill drill program was to upgrade approximately 13 million tonnes (25%) of the Inferred resource to the Indicated resource category. The program was successful, 166 holes were drilled, 12.6 million tonnes were upgraded, and there was a modest increase in gold equivalent grade.   

“The learnings from the infill program, and other analyses, have led to an updated geological model, which has been applied to the area of the Inferred resource as well. This update has resulted in an increase of 5 million tonnes in the Inferred resource area, which has been offset by a loss of 8 million tonnes due to the use of a more conservative approach to smoothing the boundaries of the resource area. A drill program of 25 holes would be required to qualify these tonnes for consideration in a future resource estimate. We are in the planning stage of an additional infill drill program with a purpose of increasing the tonnes in the Indicated confidence class, so as to increase the mine life in the upcoming feasibility study. We will also consider whether it is worth drilling the 25 perimeter holes now or wait until later.

“Over the coming quarters we plan to continue to advance and de-risk Media Luna. With trade-off studies nearing completion and the upgraded resource in hand, we expect to complete a feasibility study in the next 12 to 14 months. On a parallel path, we have commenced the early field survey and technical study work in support of the permitting/approval process.

“With the confidence provided by the success of the infill drill program, part of the de-risking of the Media Luna project will be an early works program to start excavating the access tunnel to the deposit. This is a long tunnel. Getting started early, reduces the risk that this tunnel excavation could impact the schedule of commissioning Media Luna in early 2024. The current expectation is to start this excavation in H2 of this year. We expect to fund the development of Media Luna via cash flow from El Limón Guajes.”

The updated mineral resource estimate for Media Luna, prepared in accordance with National Instrument (NI) 43-101, is reported at a gold equivalent cut-off grade of 2.0 g/t. The resource estimate considers a total of 393 drill holes (approximately 194,000 metres) of which 166 holes (approximately 70,000 metres) were drilled as part of the recent infill program, which cost approximately $15 million to complete.

Applying the metal prices used in the December 2019 resource to the June 2015 resource model, implies a metal inventory of 6.90 million gold equivalent ounces (48.8 million tonnes at a gold equivalent grade of 4.40 g/t). These numbers compare to the 2019 Indicated resource of 2.24 million gold equivalent ounces (12.6 million tonnes at a gold equivalent grade of 5.55 g/t) and Inferred resource of 4.56 million gold equivalent ounces (33.5 million tonnes at a gold equivalent grade of 4.23 g/t).

The updated resource estimate is supported by a comprehensive 3D geological model, which has been enhanced through core logging, chemical analyses, and general geological studies completed over the last few years. The key changes relative to the prior resource estimate include a hard boundary between the mineralized exoskarn package and unmineralized footwall endoskarn, an increase in resource block size to 5 metres (sub-blocked to 2.5 metres) from 2.5 metres, as well as the definition of high-grade gold and copper-silver zones within the infill area.  

Decreasing the drill hole spacing in the infill area to 30 metres allowed for the classification of resources to the Indicated category. Inferred classification for the 2019 resource is predicated on 100 metre drill spacing relative to the 2015 resource estimate for which drill spacing was up to 110 metres. The impact of tighter spacing to inform the Inferred resource, in combination with more conservative smoothing along the edges of the resource envelope as well as updated geological model, resulted in a decrease of approximately 3 million tonnes of the resource model when comparing the updated resource to the previous resource using the same metal price assumptions (8 million tonne decline due to more conservative smoothing offset by a 5 million tonne increase related to previously discussed changes).

Based on internal estimates, the Company believes a fair portion of the impacted tonnes from more conservative smoothing could be brought back into the Inferred resource category by completing an additional 25 drill holes.

Block grades within the exoskarn domain were estimated using one-metre capped composites in a three-pass interpolation plan using inverse distance cubed (ID) weighting. A variable anisotropy was applied to ensure that searches were following the local geology. Grade restrictions were applied where necessary to avoid high-grade samples overpowering the grade estimation. Results were evaluated onto blocks of 5.0 metres x 5.0 metres x 5.0 metres (sub-blocked to 2.5 metres x 2.5 metres x 2.5 metres) and classified as Indicated or Inferred based on drill hole spacings of 30 metres or 100 metres. Results were validated using standard validation techniques and reported above a cut-off grade of 2.0 g/t gold equivalent mineral resources are generally continuous above this cut-off grade.

Table 2 and 3 below illustrate the sensitivity of the Indicated and Inferred resource estimates to changes in gold equivalent cut‑off grade.

Mineralization at Media Luna is hosted in exoskarn that developed at the contact of the intrusive granodiorite and overlying sedimentary rocks; the skarn is characterized by a mineral assemblage of pyroxene, garnet, and magnetite. Metal deposition and sulfidation occurred during retrograde alteration and is associated with a mineral assemblage comprising amphibole, phlogopite, chlorite, and calcite ± quartz ± epidote as well as variable amounts of magnetite and sulfides, primarily pyrrhotite.

The QA/QC program as designed has been approved by ASL (Analytical Solutions Ltd) of Ontario, Canada and is currently overseen by Nicolas Landon, Chief Exploration Geologist for the Media Luna Project.

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Globe Newswire: 01:15 GMT Tuesday 14th January 2020

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