Andean Precious Metals Files Ni 43-101 Technical Report FOR Golden Queen Mining’S Soledad Mountain Operation
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ANDEAN PRECIOUS METALS FILES
NI 43-101 TECHNICAL REPORT FOR GOLDEN QUEEN MINING’S
SOLEDAD MOUNTAIN OPERATION
(All amounts are in U.S. dollars unless otherwise stated)
TORONTO, ON – January 31, 2024 – Andean Precious Metals Corp. (“Andean” or the
“Company”) (TSX-V: APM) (OTCQX: ANPMF) is pleased to announce updated mineral reserve
and mineral resource estimates (“MR&RE”) for its wholly owned subsidiary, Golden Queen Mining
LLC, which operates the Soledad Mountain mine and heap leach operation in Kern County,
Southern California.
The MR&RE and Feasibility Study Update Technical Report on the Soledad Mountain Heap Leach
Project, dated January 12, 2024 (the “Technical Report”), were prepared by Kappes, Cassiday
& Associates (“ KCA”), Independent Mining Consultants Inc. (“IMC”), RESPEC Company LLC
(“RESPEC”) and George Klemmick (AIPG Certified Professional Geologist, Consulting Geologist).
The Technical Report was prepared in compliance with National Instrument 43-101 – Standards
for Disclosure for Mineral Projects (“NI 43-101”) and has been filed on SEDAR+.
“We are pleased that the mineral reserve and resource estimates for Soledad Mountain fully met
our base case expectations ,” stated Alberto Morales, Executive Chairman and Chief Executive
Officer of Andean. “With an updated mineral reserve and resource in hand, our team is focused
on enhancing and growing the recently acquired Soledad Mountain mine. We are now identifying
near-term and sustainable opportunities to optimize mine operations and production to improve
margins, cash flow and costs per ounce. We are also defining and prioritizing exploration targets
to help realize the potential upside at Soledad Mountain and add to the operation’s life of mine.”
“We see many opportunities at Soledad Mountain and look forward to realizing the project’s
potential to be a growth catalyst in the US, one of the world’s leading mining jurisdictions.”
Soledad Mountain MR&RE Highlights
• Gold (“Au”)
̶ M&I resources of 41.8 M tonnes grading 0.62 grams per tonne (“ g/t”) Au for a total of
822,000 contained oz
̶ P&P reserves of 21.0 M tonnes grading 0.72 g/t Au for a total of 484,675 contained oz
̶ Inferred resources of 3.6 M tonnes grading 0.45 g/t for a total of 53,000 contained oz
Silver (“Ag”)
̶ M&I resources of 41.8 M tonnes grading 8.37 g/t Ag for a total of 11.24 M contained oz
̶ P&P reserves of 21.0 M tonnes grading 10.15 g/t Ag for a total of 6.85 M contained oz
̶ Inferred resources of 3.6 M tonnes grading 6.27 g/t Ag for a total of 0.73 M contained oz
* Mineral resources are inclusive of reserves. See Appendix for further tables and notes.
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• Life of mine (LOM): Five years from 2P mineral reserves.
• LOM average annual production: Up to 65 koz of gold and 466 Koz of silver.
• Total production: 373 Koz Au and 2.7 Moz Ag.
• Stripping ratio: 6.09:1 (waste tons: ore tons).
• Sustaining capital cost: $55.9 million.
• Project pre-tax and after-tax net present values of $116 million and $102 million, respectively,
at a discount rate of 5% with a gold price of $1,850/oz and a silver price of $24/oz.
• While stacking ore stops in 2029, work is expected to continue at site for approximately 35-40
years via the sale of waste rock for aggregate, construction and landscape material in the
regional area.
Soledad Mountain MR&RE Changes Since 2022
Since 2022, the reported reserves and resources have dropped slightly due to depletion by mining
and to a lesser extent due to a lower estimated recovery from the Silver Queen vein structure,
which is one of the many mineralized vein zones on the property. The recovery change reflects
production experience and new column leach tests. Production depletion was partially offset by
higher metal price assumptions used in the estimation of mineral resources and reserves.
In terms of economics, an increase in mine sustaining capital was incorporated into the Technical
Report to improve mining costs as compared to those in prior studies.
Mineral Resource Estimate Methodology
The estimates of mineral resources are effective as of September 30, 2023 and are presented in
Appendix - Table 1 of this press release.
The gold and silver resources were modeled and estimated by:
(i) evaluating the drill data statistically and spatially to determine natural gold and silver
populations;
(ii) explicitly modeling low -, medium-, and high-grade mineral-domain polygons for both
gold and silver on sets of cross sections spaced at 50- and 100-ft intervals;
(iii) projecting the cross-sectional mineral domain polygons horizontally to the drill data
within each cross-sectional window;
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(iv) slicing the three -dimensionally projected mineral domain polygons along 20 foot-
spaced horizontal planes and using the m to guide refinement of the gold and silver
mineral domain polygons on a set of 20 foot-spaced level plans;
(v) coding a block model comprised of 20 x 20 x 20 ft blocks to the gold and silver mineral
domains for each of the two deposit areas using the level plan mineral domain
polygons;
(vi) analyzing the modeled mineralization geostatistically to aid in the establishment of
estimation and classification parameters; and
(vii) interpolating gold and silver grades into the block model by inverse-distance to the third
power, using the coded gold and silver mineral domain percentages to constrain the
grade estimations.
Mineral Reserves Estimate Methodology
The estimates of mineral reserves are effective as of September 30, 2023, and are presented in
Appendix - Table 2 of this press release.
The following process and modifying factors were followed to calculate the mineral reserves:
• Selection of metal selling prices based on historical and projected prices.
• Review of all modifying factors including metal prices, costs, dilution, mining recovery,
processing recovery, sustaining capital, royalties, and mining methods.
• Dilution is built into the model and no additional dilution is required.
• Pit optimization using all modifying factors.
• Pit design following geotechnical recommendations.
• Mine production schedules for the life of the project, based on a combination of
monthly, quarterly, semi-annual and annual periods.
• Cost model verification based on new mine schedule and inventory.
• Generation of post-tax cash flow.
Capital and Operating Cost Estimates
The Soledad Mountain project has been in operation since early 2016 providing almost eight years
of historical operating data for the site. Future mining and processing at the site have recently
increased due to recent improvements in operation. The historical data and experience of the site
personnel will provide the best estimate of future costs.
The heap leach pad has been expanded to its final size. The capital costs are summarized as:
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Total Sustaining Capital
($000) Q4 2023 2024 2025 2026 2027 2028 2029
Mining $ 3,079 $ 11,647 $ 5,449 $ 500 $ 500 $ 250
Processing 25 820 $410 210 160 90 $ 1,000
Overhaul 10,622 5,724 8,338 1,625
Other 131 2,401 2,304 250 250 125
Total $ 3,235 $ 25,490 $ 13,887 $9,298 $ 2,535 $ 465 $ 1,000
The capital costs are sustaining costs to rebuild and replace equipment and to replace the Merrill
Crowe plant with a carbon adsorption circuit at closure.
Operating Cost Summary
Category Cost per Ton Ore Cost Fraction
Mining $ 12.93 54.7%
Process 6.91 29.2%
Site services 1.17 5.0%
Administration 1.28 5.4%
Offsite operating 1.25 5.3%
Reclamation 0.10 0.4%
Total $ 23.66 100.0%
The columns may not sum exactly due to rounding.
The operating costs are estimated to average $23.66 per ton, including mining, processing, G&A
and reclamation.
After-tax Cash Flow Analysis
The Soledad Mountain project has pre-tax and after-tax net present values of $116 million and
$102 million, respectively, at a discount rate of 5.0%. The undiscounted, cumulative net cash
flows for pre-tax and after-tax are approximately $145 million and $129 million, respectively. By
comparison, at an 8.0% discount rate, the pre -tax and after-tax NPVs are $102 million and $89
million, respectively. Project cash flows are from October 1, 2023 through to the end of 2030.
The contribution of gold, silver and aggregate to gross revenues is approximately 91.2%, 8.6%
and 0.2% respectively. The operating equivalent gold cash cost per ounce is $1,340/oz. The total
cash costs per equivalent ounce including sustaining capital is $1,477/oz. Gold and silver prices
used to model the cash flows were $1,850/oz and $24/oz, respectively.
The Soledad Mountain p roject is expected to generate positive cash flow in each year of
production except 2026.
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Qualified Persons
The following people served as the Qualified Persons for Golden Queen ’s Soledad Mountain
operation as defined in NI 43-101 and have reviewed and approved this press release:
• Carl E. Defilippi, SME Registered Member, Engineering Manager, KCA, Reno NV.
• Michael M. Gustin, AIPG Certified Professional Geologist, RESPEC Principal Consultant.
• Joseph C. McNaughton, PE, Partner, IMC, Tucson AZ.
• George Klemmick, AIPG Certified Professional Geologist, Consulting Geologist, Chugiak, AK.
Donald J. Birak, Registered Member, Society for Mining, Metallurgy and Exploration (SME) and
Fellow, Australasian Institute of Mining and Metallurgy (AusIMM) , is the Independent Consulting
Geologist to the Company, and a Qualified Person as defined by NI 43-101.
About Andean Precious Metals
Andean is a growing precious metals producer focused on expanding into top-tier jurisdictions in
the Americas. The Company owns and operates the San Bartolomé processing facility in Potosí,
Bolivia and the Soledad Mountain mine in Kern County, California, and is well-funded to act on
future growth opportunities. Andean’s leadership team is committed to creating value; fostering
safe, sustainable and responsible operations; and achieving our ambition to be a multi-asset, mid-
tier precious metals producer.
For more information, please contact:
Trish Moran
VP Investor Relations
T: +1 416 564 4290
Neither the TSX Venture Exchange, Inc. nor its Regulation Services Provider (as that term is defined in policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward-Looking Statements
Certain statements and information in this release constitute “forward-looking statements ” within the
meaning of applicable U.S. securities laws and “forward-looking information ” within the meaning of
applicable Canadian securities laws, which we refer to collectively as “forward-looking statements ”.
Forward-looking statements are statements and information regarding possible events, conditions or results
of operations that are based upon assumptions about future economic conditions and courses of action. All
statements and information other than sta tements of historical fact may be forward -looking statements. In
some cases, forward -looking statements can be identified by the use of words such as “seek”, “expect”,
“anticipate”, “budget”, “plan”, “estimate”, “continue”, “forecast”, “intend”, “believe”, “predict”, “potential”,
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“target”, “may”, “could”, “would”, “might”, “will” and similar words or phrases (including negative variations)
suggesting future outcomes or statements regarding an outlook.
Forward-looking statements in this release include, but are not limited to, statements and information
regarding the project’s cash flows from October 1, 2023 through to the end of 2030, the expected timing of
stacking ore termination and the length of time that work is expected to continue at site via the sale of waste
rock for aggregate, construction and landscape mater ial in the regional area . Such forward -looking
statements are based on a number of material factors and assumptions, including, but not li mited to: the
Company’s ability to carry on exploration and development activities; the Company ’s ability to secure and
to meet obligations under property and option agreements and other material agreements; the timely receipt
of required approvals and permits; that there is no material adverse change affecting the Company or its
properties; that contracted parties provide goods or services in a timely manner; that no unusual geological
or technical problems occur; that plant and equipment function as antic ipated and that there is no material
adverse change in the price of silver, costs associated with production or recovery. Forward -looking
statements involve known and unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements, or industry results, to differ materially from those anticipated in such
forward-looking statements. The Company believes the expectations reflected in such forward -looking
statements are reasonable, but no assurance can be given that these expectations will prove to be correct,
and you are cautioned not to place undue reliance on forward-looking statements contained herein.
Some of the risks and other factors which could cause actual results to differ materially from those expressed
in the forward -looking statements contained in this release include, but are not limited to: risks and
uncertainties relating to the interpretation of drill results, the geology, grade and continuity of mineral
deposits and conclusions of economic evaluations; results of initial feasibility, pre -feasibility and feasibility
studies, and the possibility that future exploration, development or mining results will not be consistent with
the Company’s expectations; risks relating to possible variations in reserves, resources, grade, planned
mining dilution and ore loss, or recovery rates and changes in project parameters as plans continue to be
refined; mining and development risks, including risks re lated to accidents, equipment breakdowns, labour
disputes (including work stoppages and strikes) or other unanticipated difficulties with or interruptions in
exploration and development; the potential for del ays in exploration or development activities or the
completion of feasibility studies; risks related to the inherent uncertainty of production and cost estimates
and the potential for unexpected costs and expenses; risks related to commodity price and foreign exchange
rate fluctuations; the uncertainty of profitability based upon the cyclical nature of the industry in which the
Company operates; risks related to failure to obtain adequate financing on a timely basis and on acceptable
terms or delays in obtaining governmental or local community approvals or in the completion of development
or construction activities; risks related to environmental regulation and liability; political and regulatory risks
associated with mining and exploration; risks related to the uncertain global economic environment; and
other factors contained in the section entitled “Risk Factors” in the Company’s Management Discussion and
Analysis dated November 29, 2023.
Although the Company has attempted to identify important factors that could cause actual results or events
to differ materially from those described in the forward-looking statements, you are cautioned that this list is
not exhaustive and there may be othe r factors that the Company has not identified. Furthermore, the
Company undertakes no obligation to update or revise any forward -looking statements included in this
release if these beliefs, estimates and opinions or other circumstances should change, except as otherwise
required by applicable law.
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APPENDIX
Table 1: Updated Mineral Resources – Soledad Mountain as of September 30, 2023
In-Situ Grade Contained Metal
Gold Silver Gold Silver
Classification Tonnes Tons g/t oz/ton g/t oz/ton oz oz
Measured 2,667,000 2,940,000 0.99 0.029 12.93 0.377 86,000 1,108,000
Indicated 39,147,000 43,152,000 0.58 0.017 8.06 0.235 736,000 10,133,000
Measured + Indicated 41,814,000 46,092,000 0.62 0.018 8.37 0.244 822,000 11,241,000
Inferred 3,625,000 3,996,000 0.45 0.013 6.27 0.183 53,000 732,000
Notes to Table 1
1. Mineral resources are inclusive of mineral reserves.
2. Mineral resources that are not mineral reserves do not have demonstrated economic
viability.
3. Mineral resources are reported by applying cutoffs of 0.008 oz AuEq/ton (0.274 g/t) at the
Silver Queen zone and 0.005 oz AuEq/ton (0.171 g/t) at all other areas to all model blocks
lying within optimized resource pits, in consideration of potential open-pit mining and heap-
leach processing.
4. Gold equivalent grades were calculated as follows: oz AuEq/ton = oz Au/ton + (oz Ag/ton
/ AuEq Factor). The AuEq Factor is derived from metal prices ($ 2,000/oz Au and $23/oz
Ag) and recoveries of 55% for Au and 40% for Ag for model blocks lying within the Silver
Queen zone (AuEq Factor = 120), and 85% for Au and 40% for Ag in all other areas (AuEq
Factor = 185).
5. The effective date of the mineral resources is September 30, 2023.
6. Tonnage and grade estimations are presented in both U.S. and metric units. Grades are
reported in troy ounces per short ton (U.S.) and in grams per metric tonne.
7. The Qualified Person for estimation of mineral resources is Michael Gustin of RESPEC.
8. Rounding may result in apparent discrepancies between tons, grade, and contained metal
content.
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Table 2: Updated Mineral Reserves – Soledad Mountain as of September 30, 2023
Mineralization
Contained
(In-Situ)
Grade
Contained
Metal
Metric Imperial NSR Gold Silver Gold Silver
Classification (ktonnes) (ktons) ($/ton) (g/t) (opt) (g/t) (opt) (oz) (oz)
Proven 1,671 1,842 42.6 1.11 0.032 14.29 0.417 59,744 767,876
Probable 19,338 21,316 29.3 0.68 0.020 9.79 0.285 424,931 6,085,430
Total Proven + Probable 21,009 23,158 30.3 0.72 0.021 10.15 0.296 484,675 6,853,306
Notes to Table 2
1. Mineral reserves were tabulated based on a $1,850/oz gold price and $23/oz silver price within
a pit designed.
2. Mineral reserves are based on the economic input parameters provided in Tables 15.1 -2,
15.1-3 & 15.1 -4 of the Technical Report, which is available under the Company’s profile on
SEDAR+.
3. The mineral reserves cutoff grade is based on a net smelter return of $8.44/ore ton ($9.30/ore
tonne).
4. Includes 389 ktons (353 ktonnes) from a low-grade stockpile, grading 0.48 g/t (0.014 opt) gold
grade applied to probable reserves, not verified by QP, but is not material to the mineral reserves.
5. Based on end of September 2023 topography.
6. Imperial: ktons means 1000 short tons; where, 1 short ton = 2000 lbs.
7. Metric: ktonnes means 1000 metric tonnes; where, 1 metric tonne = 2204.6 lbs.
8. Gold and silver are all reported as contained grades and contained metal where:
"opt" is troy ounce per short ton and "g/t" is grams per metric tonne
"g/t" is grams per metric tonne
"oz" is 1 troy ounce.
9. The columns may not sum exactly due to rounding.
The Q ualified Person for the mineral reserve estimate is Joseph McNaughton, Senior Mining
Engineer, P.Eng. and a partner of I ndependent Mining Consultants, Inc. The mineral reserve
estimate was prepared in compliance with the disclosure and reporting requirements set forth in the
NI 43-101. In accordance with the CIM classification system, only Measured and Indicated resource
categories were converted to reserves (through inclusion within the open -pit mining limits). In this
Mineral Reserve Statement, Inferred Mineral Resources are reported as waste.