Cerro La Cumbre Silver-Gold Project

Cerro La Cumbre hosts the potential for a high-grade silver-gold resource in northern Peru called Cerro La Cumbre. Historic underground development on this new property exposed a high-grade silver-gold vein returning values up to 1,535 grams per tonne silver and 5.13 grams per tonne gold. The property is located about three hours by truck or approximately 90 kilometres by a combination of highway and dirt road from Peruvian Metals’ 80-per-cent-owned Aguila Norte processing plant.

The property is located within the Tertiary-aged Calipuy volcanic complex. This volcanic unit hosts several prolific gold producers in northern Peru, including Newmont’s Yanacocha and Barrick’s Laguna Norte and Pierina mines. The precious metal mineralization occurs in a series of quartz veins that are considered to be of low-sulphidation type. The nearby historic Machacala gold-silver mine and the Salpo mine are also considered to below sulphidation epithermal deposits. Three other notable low sulphidation gold-silver systems hosted within northern Peru’s Calipuy volcanic complex are the 2.6-million-gold-ounce Tres Cruces deposit owned by Barrick and New Oroperu Resources, the privately owned Urumalqui silver-gold deposit, and SSR Mining’s high-grade gold-silver San Luis deposit.

The property comprises three concessions covering an area of 1,027 hectares. The underground development on the property consists of both shafts and drifts exposing a well-defined north-south-trending structure showing typical low-sulphidation-type silver-gold mineralization. Geological observation and interpretation suggest that the adits and shafts were driven into the higher level of a low-sulphidation system. The bladed textures observed in the adits are now filled with quartz, suggesting the high-grade precious metal intervals are below the workings.

The main silver-gold-mineralized structure outcrops on a large silicified mound and is observed to have a strike length of at least 700 metres. Eight samples were taken by the company from the quartz vein exposed in the underground workings with an average width of 0.70 metre. Gold assays range from 0.99 gram per tonne gold to 5.13 grams per tonne gold, averaging 2.24 grams per tonne gold, and silver assays range from 90 grams per tonne silver to 1,535 grams per tonne silver, with an average of 326 grams per tonne silver, or a silver equivalent grade of 16 ounces per ton using a 77:1 gold-to-silver ratio. Historic sampling reports 10 non-systematic samples were taken in 2003 at various mined underground sites with vein widths ranging between 0.30 metre and 0.80 metre. Gold results reported in the report range between 4.16 grams per tonne gold and 16.78 grams per tonne gold, averaging 8.8 grams per tonne gold over a weighted average width of 0.66 metre. Silver results over the same average width range between 111 grams per tonne silver and 1,038 grams per tonne silver, averaging 412 grams per tonne silver, or a silver equivalent grade of 35 ounces per ton. Please take caution as these results are historical in nature and should not be relied upon.

Mineralized Material

Stockpile of Mineralized Material

Shaft Entrance – 41 metres deep