Las Chispas

The Las Chispas property is located approximately 180 kilometres northeast of Hermosillo, Sonora, Mexico. The community of Arizpe (estimated population 2,000) is located approximately 12 kilometres to the north of the property. The property consists of 28 concessions totalling 1400.96 hectares. Currently SilverCrest has 16 drill rigs spinning and are testing discovery/ expansion/ infill targets. A Feasabilty Study is currently underway and is planned for summer of 2020. Currently only 10 of 36 known viens have been put towards our lastest resource estimate leaving 26 viens to still be drill tested.

Potential Economics

SilverCrest Metals Inc. announced the results of an independent Preliminary Economic Assessment (“PEA”) completed by Tetra Tech Canada, Inc. (“Tetra Tech”) for the Las Chispas project in Sonora, Mexico. The PEA is based on the mineral resource estimate, titled “Technical Report and Mineral Resource Estimate” for the Las Chispas Property, Sonora, Mexico, effective February 8, 2019 and announced on March 14, 2019. 

The following assumes a silver price of $16.68/ounce (“oz”), a gold price of $1,269/oz and a Mexican Peso/US$ exchange rate of 20:1.

  2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 LOM
 Tonnes Processed (000s) - 100 443 456 457 456 456 456 457 456 125 3,861
 Au Grade (g/t) - 1.38 7.57 5.28 6.08 4.90 4.39 2.95 1.37 1.37 0.94 4.05
 Ag Grade (g/t) - 119.0 656.5 555.8 612.1 496.6 387.6 302.0 218.8 196.1 167.8 411.0
 Au Recovery (%) - 89.9 94.9 94.9 94.9 94.9 94.9 94.9 94.9 94.9 94.9 94.9
 Ag Recovery (%) - 84.9 89.9 89.9 89.9 89.9 89.9 89.9 89.9 89.9 89.9 89.9
 Payable Au Production (000s oz) - 4 102 73 84 68 61 41 19 19 4 473
 Payable Ag Production (M oz) - 0.3 8.4 7.3 8.1 6.5 5.1 4.0 2.9 2.6 0.6 45.8
 AgEq Production (M oz) - 0.6 16.0 12.8 14.4 11.6 9.6 7.0 4.3 4.0 0.9 81.2
 AISC(1) (US$/oz AgEq) - $86.63 $4.10 $5.01 $4.75 $5.81 $7.00 $9.31 $11.46 $9.78 $13.28 $7.47
Total Revenue ($ million)   $10 $265 $211 $238 $192 $160 $116 $71 $66 $14 $1,345
 Total Operating Costs (US$ M) - ($7.8) ($45.6) ($45.3) ($49.8) ($50.0) ($48.5) ($46.2) ($40.1) ($36.1) ($11.4) ($380.9)
 Royalties(3) (US$ M) - ($0.2) ($17.8) ($13.5) ($15.3) ($11.6) ($9.2) ($5.8) ($2.7) ($2.6) ($0.3) ($79.1)
 Depreciation (US$ M) - ($4.5) ($35.3) ($20.9) ($19.0) ($21.5) ($25.4) ($28.8) ($21.9) ($15.7) ($11.8) ($202.4)
 Taxes (US$ M) - - ($50.8) ($39.7) ($46.4) ($32.9) ($23.1) ($10.7) ($2.0) ($3.5) - ($211.9)
 Initial Capex (US$ M) ($54.6) ($45.8) - - - - - - - - - ($100.5)
 Sustaining Capex (US$ M)     ($2.9) ($5.8) ($3.9) ($6.3) ($10.3) ($13.7) ($6.8) ($0.6) - ($50.3)
 Working Capital (US$ M)     ($10.0)                  
 Reclamation Bond (US$ M) ($4.0)                      
 Net Free Cash Flow(1)(2)  (US$ M) ($58.6) ($43.6) $138.8 $107.3 $122.9 $91.5 $68.8 $39.9 $19.6 $23.3 $2.8 $522.5
 Cumulative Net Free Cash Flow (US$ M) ($58.6) ($102.2) $36.6 $143.8 $266.7 $358.2 $427.0 $466.9 $486.5 $509.8 $512.5  

 (2) Includes expensed lateral development, but excludes capitalized ramp and vertical development.(1)   AgEq based on 75 (Ag):1 (Au), calculated using long-term silver and gold prices of $17 per ounce silver and $1,225 per ounce gold with average metallurgical recoveries of 90% silver and 95% gold.  

(3)   Contained ounces for gold and silver are estimated to include 29% indicated resources and 71% inferred resources.

The resource estimate is focused on an estimated 5.5 kilometres of approximately 20 known kilometres of cumulative vein strike length in the district.

History

In 1640, rich silver veins where discovered near Arizpe by soldiers under the command of Pedro de Perra. The property did not receive any notable exploration or production until the late 1800s. From 1880 to 1930, several mines on the property had intermittent production. From public information, approximately 100 million ounces of silver and 200,000 ounces of gold were cumulatively produced from the property. Since 1930, no significant work has been completed on the property.

Las Chispas

During the early 1980s, a local Mexican company reprocessed old waste and tailings dumps from Las Chispas. Processing was by vat leaching with no production records available.

Geology

Geologically, the Las Chispas property consists of a Late Cretaceous – Early Tertiary low sulfidation epithermal system. Host rocks are volcanic tuffs, rhyolites, agglomerates and rhyolite breccias. Andesite dykes are noted in underground workings sub-parallel to mineralized structures.

The Las Chispas Mine is known for its world-class silver mineral specimens including polybasite, stephanite, native silver and pyrargyrite. Specimens are on display in private collections and museums worldwide.

Historical Production

Mineralization occurs in 0.5 to 5 metre wide veins with adjacent stockwork and breccias trending northwest- southeast for 1 to 1.5 kilometres. Depth from surface of known mineralization is estimated at 300 metres. Main veins dip 55 to 85 degrees to the southwest. Fourteen epithermal veins have been previously defined on the property of which 3 have had notable production. The historical producing veins included Las Chispas, William Tell, and Babicanora. From public information, the Las Chispas mill production between 1908 through 1911 was approximately 25,000 tonnes grading 35 gpt gold and 4,500 gpt silver totalling an estimated 25,000 ounces of gold and 3.2 million ounces of silver. Several kilometres of underground workings exist on the property and are partially accessible.


Las Chispas area
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Babicanora area
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Exploration Programs

For the remainder of 2018, the Company will continue the Phase III drilling up to Q1, 2019, which will focus on expansion and infill drill holes. Drilling priorities over the next six months are:

The Company intends to provide another updated resource estimate, with resource re-categorization, and deliver a PEA in Q1, 2019. There is no certainty that these Inferred Mineral Resources will be converted to the Measured and Indicated categories through further drilling.


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N. Eric Fier, CPG, P.Eng., Chief Executive Officer & Director of the Company, is the Qualified Person under National Instrument 43-101, Standards of Disclosure for Mineral Projects, responsible for the preparation of the technical information included in this website and for supervision of field activities related to the Company projects.

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