El Valle-Boinás/Carlés Reserves and Resources

(See Orvana’s Annual Information Form dated December 29, 2021 for the fiscal year-ended September 31, 2021, pages 20-23)

Cautionary Notes to Investors - Mineral Reserves and Resources Estimates

 

In accordance with applicable Canadian securities regulatory requirements, all mineral reserve and mineral resource estimates of the Company disclosed have been prepared as at September 30, 2021 in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"), classified in accordance with Canadian Institute of Mining Metallurgy and Petroleum's "CIM Standards on Mineral Resources and Reserves Definitions and Guidelines" (the "CIM Guidelines").

Pursuant to the CIM Guidelines, mineral resources have a higher degree of uncertainty than mineral Reserves as to their existence as well as their economic and legal feasibility. Inferred mineral resources, when compared with measured or indicated mineral resources, have the least certainty as to their existence, and it cannot be assumed that all or any part of an inferred mineral resource will be upgraded to an indicated or measured mineral resource as a result of continued exploration. Pursuant to NI 43-101, inferred mineral resources may not form the basis of any economic analysis, including any feasibility study. Accordingly, readers are cautioned not to assume that all or any part of a mineral resource exists, will ever be converted into a mineral Reserve, or is or will ever be economically or legally mineable or recovered.

In fiscal 2020, Orovalle engaged an independent engineering firm, Roscoe Postle Associates Inc. (“RPA”), to complete mineral reserves and resources estimates and a life-of-mine-plan update, which were published in the “Technical Report on Orovalle Operation, Asturias, Spain” dated November 30, 2020 (the “Orovalle NI 43-101 Report”) by: (i) Rick C. Taylor, P.Eng., of RPA, in respect of the estimated mineral reserves and the life of mine plan, and (ii) John Makin, P.Geo., of RPA, in respect of the estimated mineral resources. Each of Messrs. Taylor and Makin is a Qualified Person within the meaning of NI 43-101.

Since the Orovalle NI 43-101 Report, the Company has updated the mineral reserves and resources. The updated mineral resource estimates for El Valle as at September 30, 2021 were prepared by Orovalle under the supervision of Ms. Guadalupe Collar, European geologist and the Chief of Geology of Orovalle, based on updating resource block models incorporating drilling results from July 1, 2020 to June 30, 2021 and accounting for production depletion up to September, 2021. Mineral resource estimates are summarized in the following tables:

Summary of Mineral Resources inclusive of Mineral Reserves
September 30, 2021 - Orovalle Operation

Measured Mineral Resources

Zone

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(%Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

 

BOINÁS OXIDES

1,690

4.02

10.90

0.44

218

592

16,440

 

BOINÁS SKARN

2,704

2.55

16.28

0.71

221

1,416

42,308

 

CARLES

374

3.23

7.21

0.43

39

87

3,502

 

TOTAL

4,767

3.12

13.66

0.59

478

2,094

62,249

 

 

 

 

 

 

 

 

 

 

 

Indicated Mineral Resources

Zone

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(%Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

 

BOINÁS OXIDES

3,553

4.63

5.24

0.32

529

599

25,167

 

BOINÁS SKARN

674

2.70

16.68

0.66

61

361

9,841

 

CARLES

1,346

3.21

7.37

0.35

139

319

10,329

 

TOTAL

5,572

4.05

7.14

0.37

728

16.6

45,337

 

 

 

 

 

 

 

 

 

 

 

Measured + Indicated Mineral Resources

Zone

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(%Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

 

BOINÁS OXIDES

5,242

4.43

7.06

0.36

747

1,190

41,606

 

BOINÁS SKARN

3,378

2.58

16.36

0.70

280

1,777

52,149

 

CARLES

1,719

3.22

7.33

0.37

178

405

13,831

 

TOTAL

10,340

3.62

10.15

0.47

1,205

3,373

107,586

 

 

 

 

 

 

 

 

 

 

 

Inferred Mineral Resources

Zone

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(%Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

 

BOINÁS OXIDES

1,752

4.44

5.95

0.31

250

335

11,863

 

BOINÁS SKARN

572

2.56

11.67

0.44

50

232

5,564

 

CARLES

1,167

3.25

5.07

0.31

122

190

8,031

 

La Brueva

193

3.87

15.25

0.09

24

94

382

 

TOTAL

3,684

3.74

0.46

5.67

446

852

25,838

 

 

 

 

 

 

 

 

 

 

 

Notes:

1. CIM definitions were followed for mineral resources.
2. Mineral Resources are estimated at gold equivalent ("AuEq”) cut-off grades of 2.48 g/t for Boinás oxides, 2.11 g/t for Boinás skarns and 1.96 g/t for Carlés. AuEq cut-offs are based on recent operating results for recoveries, off-site concentrate costs and on-site operating costs. AuEq cut-off grades of 2.48 g/t was used for La Brueva.
3. Mineral Resources are estimated using a long-term gold price of US$1,700 per ounce; copper price of US$3.25 per pound; and a silver price of US$ 20 per ounce. A US$/Euro exchange rate of 1/1.20 was used.
4. Mineral resources are inclusive of mineral reserves.
5. A crown pillar of 60 m is excluded from the Mineral Resource below El Valle TSF.
6. A crown pillar of 40m is excluded from the Mineral Resource below Boinás East open pit.
7. Unrecoverable material in exploited mining areas has been excluded from the Mineral Resources.
8. A no-mining sterilization zone of 10 meters below already mined stopes in Boinás has been excluded from the Mineral Resources.
9. A no-mining sterilization zone of 5 meters around waste filled stopes in Boinás has been excluded from the mineral resources.
10. Areas of mineral blocks in Carlés and Boinas have been removed from the Mineral Resource report to ensure RPEEE.
11. Numbers may not add due to rounding.
12. El Valle mineral resources estimates were prepared under the supervision G. Collar, European Geologist, a qualified person for the purposes of NI 43-101, who is an employee of OroValle and thus not independent of the Company.



Summary of Mineral Reserves

SEPTEMBER 30, 2021 - Orovalle Minerals S.L. – Orovalle Operation

Proven and Probable

Category

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(% Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

Proven

1,327

2.71

9.02

.043

116

385

12,574

Probable

1,997

3.25

4.20

0.28

209

270

12,324

Proven and Probable

3,324

3.04

6.13

0.34

324

655

24,898

 

 

 

 

 

 

 

 

Proven

Category

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(% Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

Boinas Skarns

516

1.91

11.89

0.57

34

214

7,041

Boinas Oxides

736

3.32

6.91

0.32

79

164

5.237

Carlés

30

2.84

7.21

0.44

3

7

296

TOTAL

1,327

2.71

9.02

0.43

88

385

12,574

 

 

 

 

 

 

 

 

Probable

Category

Tonnage
(000 t)

Grade
(g/t Au)

Grade
(g/t Ag)

Grade
(% Cu)

Contained Metal
(000 oz Au)

Contained Metal
(000 oz Ag)

Contained Metal
(000 Lb Cu)

Boinas Skarns

276

1.91

11.06

0.46

17

98

2,771

Boinas Oxides

1,522

3.58

3.02

0.26

175

148

8,822

Carlés

200

2.55

3.80

0.17

16

24

731

TOTAL

1,997

3.25

4.20

0.28

209

270

12,324

Notes:

1. IM (November 29, 2019) definitions and guidelines were followed for Mineral Reserve estimation.
2. Mineral Reserves are estimated using AuEq break-even cut-off grades by zone, consisting of 3.35 g/t AuEq for Boinás oxides (D&F), 2.90 g/t AuEq for Boinás skarns (SLS), and 2.09 g/t AuEq for Carlés skarn (SLS). AuEq cut-offs are based on recent operating results for recoveries, off-site concentrate costs, and on-site operating costs. AuEq factors are based on metal prices, metallurgical recoveries, metal payables, and selling costs.
3. Mineral Reserves are estimated using average long term prices of US$1,600/oz Au, US$18/oz Ag, and US$3.00/ lb Cu. A US$/€ exchange rate of 1.20/1.00 was used.
4. A minimum mining width of 4 m was used.
5. Crown pillars of 75 m and 42 m are excluded from the Mineral Reserves below the El Valle TSF and Boinás East open pits, respectively.
6. A no-mining sterilisation zone of 10 m below mined out stopes and 5 m around waste filled stopes has been applied.
7. El Valle mineral reserves estimates were prepared under supervision of Brian Buss, a qualified person for the purposes of NI 43-101, who is an independent consultant of the Company.
8. Numbers may not add due to rounding.