Defiance Silver Announces a Mineral Resource Estimate for the Tepal Project and Filing of Supporting NI 43-101 Technical Report
Defiance Silver Announces a Mineral
Resource Estimate for the Tepal Project and
Filing of Supporting NI 43-101 Technical
Report
Vancouver, British Columbia--(Newsfile Corp. - December 10, 2024) - Defiance Silver Corp. (TSXV:
DEF) (FSE: D4E) (WKN: A1JQW5) ("
Defiance
" or the "
Company
") is pleased to announce a Mineral
Resource Estimate ("
MRE
") prepared in accordance with the National Instrument 43-101 -
Standard for
Disclosure for Mineral Projects
("
NI 43-101
") for the 100% owned Tepal Gold-Copper Project, located
in the municipality of Tepalcatepec, Michoacán State, in south-western Mexico.
Highlights
Include:
111.67 million tonnes (Mt)
of Measured & Indicated Mineral Resources averaging
0.26 g/t gold
for
926,000 ounces of gold
111.67 Mt
Measured & Indicated Mineral Resources averaging
0.19% copper
for
473.86 million
pounds (Mlb) of copper
111.67 Mt
of Measured & Indicated Mineral Resources averaging
1.55 g/t silver
for
5.58 million
ounces (Moz) of silver
124.36 Mt
of Inferred Mineral Resources averaging
0.25 g/t gold
for
985,000 ounces of gold
124.36 Mt
of Inferred Mineral Resources averaging
0.16% copper
for
451.0 Mlb copper
124.36 Mt
of Inferred Mineral Resources averaging
1.46 g/t silver
for
5.83 Moz of silver
Mineral resources were estimated using a cut-off grade of 13 $/t NSR for the oxidized zone and 15
$/t NSR for the sulphide zone; both the oxide and sulfide estimates lie within the optimized pit shell
Metallurgical testing indicates recoveries of 86% Cu and 54% Au for the North/South Zones and
84% Cu and 50% Au for the Tizate Zone mineralization which would produce a 23% Cu copper
concentrate with gold credits.
The MRE was independently prepared by Micon International Limited ("Micon")
MRE for the Tepal Project
The MRE, independently prepared by Micon's QPs, have classified the mineral resources for the Tepal
Project in the Measured, Indicated and Inferred categories for the Tepal North Zone resources and the
Indicated and Inferred categories for Tepal South Zone and Tizate Zone resources (as defined in the
Canadian Institute of Mining, Metallurgy and Petroleum ("
CIM
") Definition Standards for Mineral
Resources & Mineral Reserves incorporated by reference into NI 43-101) and has an effective date of
October 30, 2024.
Table 1 summarizes the MRE, and Figures 1 to 4 show various plan views and cross sections of the new
block model and/or optimized pit outlines. Tepal North Zone, Tepal South Zone and Tizate deposits are
all part of the Tepal Project; the three deposits have been estimated separately to honour their geometry
and grade characteristics.
Table 1:
Tepal Project Mineral Resource Estimates (rounded values)
Open Pit
Model
Resource
Category
Weathering
Zone
Average Grade
Content Metal
Tonnage
NSR
Cu
Au
Ag
NSR
Cu
Au
Ag
Mt
$/t
%
g/t
g/t
million $
thousand
lb
thousand
oz
thousand
oz
In-Pit Tepal
Measured
Oxide
2.71
31.16
0.31
0.45
1.03
84
18,818
39
90
Sulphide
21.21
38.04
0.24
0.39
0.92
807
111,170
269
627
Indicated
Oxide
3.85
17.51
0.19
0.25
0.80
67
16,508
31
99
Sulphide
28.51
25.35
0.18
0.23
1.22
723
110,322
213
1,114
In-Pit Tepal
North Zone
M+I
Oxide
6.56
23.15
0.24
0.33
0.90
152
35,327
70
189
Sulphide
49.72
30.77
0.20
0.30
1.09
1,530
221,492
481
1,741
Total
56.28
29.88
0.21
0.30
1.07
1,682
256,818
551
1,930
Inferred
Oxide
2.60
12.91
0.15
0.18
1.17
34
8,750
15
97
Sulphide
26.73
23.82
0.17
0.21
1.21
637
101,909
177
1,040
Total
29.33
22.86
0.17
0.20
1.21
670
110,659
192
1,137
In-Pit Tepal
South Zone
Indicated
Oxide
1.22
28.27
0.22
0.40
1.29
34
5,922
16
50
Sulphide
10.78
36.63
0.24
0.36
1.13
395
57,569
124
392
Total
11.99
35.78
0.24
0.36
1.15
429
63,492
140
443
Inferred
Oxide
1.48
10.25
0.11
0.14
0.87
15
3,635
7
41
Sulphide
35.84
35.02
0.18
0.41
1.29
1,255
145,779
477
1,481
Total
37.32
34.04
0.18
0.40
1.27
1,270
149,414
484
1,523
In-Pit Tizate
Zone
Indicated
Oxide
4.10
11.50
0.13
0.16
1.79
47
11,493
21
236
Sulphide
39.30
22.52
0.16
0.17
2.35
885
142,057
214
2,970
Total
43.40
21.47
0.16
0.17
2.30
932
153,549
235
3,206
Inferred
Oxide
4.55
9.58
0.14
0.12
2.19
44
14,450
18
321
Sulphide
53.16
21.15
0.15
0.17
1.67
1,124
176,488
292
2,853
Total
57.71
20.24
0.15
0.17
1.71
1,168
190,938
310
3,174
In-Pit Total
Tepal+Tizate
Measured
Oxide +
Sulphide
23.92
37.26
0.25
0.40
0.93
891
129,988
308
717
Indicated
87.75
24.52
0.18
0.22
1.72
2151
343,872
618
4,861
M+I
111.67
27.25
0.19
0.26
1.55
3,043
473,860
926
5,578
Inferred
124.36
25.00
0.16
0.25
1.46
3,109
451,011
985
5,834
Resource Estimate Notes:
1
.
The effective date of the MRE is October 30, 2024.
2
.
The Mineral Resource Estimate has been stated using a NSR $/t value cut-off grade. As per the economic assumption the cut-off grade is 13
$/t NSR for the oxide zone and 15 $/t for the sulphide zone.
3
.
William Lewis P.Geo., and Chitrali Sarkar M.Sc., P.Geo., of Micon are the QPs responsible for the MRE, as defined in NI 43-101.
4
.
The mineral resources disclosed in this report were estimated using the CIM standards for mineral resource and reserve definitions and the
CIM best practices guidelines for resource estimation.
5
.
The mineral resources reported are contained within the boundaries of a pit-shell derived from the open pit optimizer, assuming surface
mining methods with an overall slope angle of 45 degrees and with the original block model re-blocked to 20m x 20m x 20m. Mineralized
blocks outside of the pit-shell are not considered to be part of the MRE.
6
.
An open pit cut-off grade of 13 $/t NST for the oxide zone and 15 $/t for sulphide zone was calculated for the MRE, using a gold price of
US$ 2,300/oz, a silver price of US$30/oz and a copper price of US$4.8/lb, mining cost US$2.0/t, processing cost US$10/t for oxide and
US$12/t for sulphide, G&A costs of US$3/t. and relevant treatment and refining charges (TCRCs).
7
.
Molybdenum has not been considered to be part of NSR calculation at this time due to insufficient metallurgical testwork to determine the
applicable process recovery.
8
.
The MRE has been classified according to CIM definitions of Measured, Indicated and Inferred Resources for Tepal North Zone and Indicated
and Inferred for Tepal South and Tizate Zones. The Mineral Resource classification has also been visually reviewed to eliminate any"
Spotted Dog" effect, commonly seen in computer-generated models.
9
.
The mineral resource results are presented in-situ within the optimized pit.
10
.
Mineral resources that are not mineral reserves do not have demonstrated economic viability.
11
.
Geological modelling and the MRE have been completed using Leapfrog Geo and Edge software.
12
.
The tonnes and metal contents are rounded to reflect that the numbers are an estimate and any discrepancies in the totals are due to the
rounding effects.
13
.
Micon has not identified any legal, political, environmental, or other factors that could materially affect the potential development of the
mineral resource estimate.
Silver has been included in the current NSR calculation for the first time as it was not reported in any of
the previously released mineral resource estimates. Molybdenum has not been included as part of the
current NSR calculation for the MRE due to insufficient metallurgical testwork to determine the applicable
process recovery. However, molybdenum grades are significant, and the Company will aim to included
this in any future MRE or Preliminary Economic Assessment.
The current mineral resource estimate focuses exclusively on an open pit resource. However, while
performing the interpretation for the Tepal South Zone mineralization, Micon noticed that the mineralized
zone is dipping sharply towards the south at the south-east end of the deposit (Figure 4). The high-grade
material within the low-grade envelopes also follows a similar trend, and it is believed that there could be
underground resource potential for this area. Micon's QPs suggest performing a study using a
combination of open pit and underground mining methods in future resource estimates.
Figure 1
: Plan view of the Tepal Project showing new MRE optimized pit outlines diamond drilling
collars
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/2950/233141_07441258949c181d_001full.jpg
Figure 2:
Long section, looking east, along Tepal North Zone block model with optimized pit
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/2950/233141_07441258949c181d_002full.jpg
Figure 3:
Cross section (35m) thick along Tepal South Zone block model with optimized pit, showing
future exploration target with deep high-grade intercept of TEP-11-026
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/2950/233141_07441258949c181d_003full.jpg
Figure 4:
Long section along Tizate block model and optimized pit
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/2950/233141_07441258949c181d_004full.jpg
Mineral Resources Methodology and Assumptions
The 2024 Tepal Project MRE covers the Tepal North Zone, Tepal South Zone and Tizate deposits. The
main steps in the methodology were as follows:
Compiling and validating the diamond drill hole database used for mineral resource estimation.
Interpretation of the mineralized domain, based on lithological and assay information.
Capping outlier values and compositing the database, for the purpose of geostatistical analysis
and performing variography.
Generating the block model and grade interpolation.
Calculation and validation of NSR value.
Validating the criteria for mineral resource classification and eliminating any "Spotted Dog" effect
when classifying the resources".
Assessing the mineral resources with "reasonable prospects for eventual economic extraction" by
selecting appropriate cut-off grades and a producing a reasonable "resource-level" optimized pit-
shell.
Generating a Mineral Resource Estimate statement.
Assessing and identifying the factors that could affect the mineral resource estimate.
The CIM standards require that an estimated mineral resource must have reasonable prospects for
eventual economic extraction. The mineral resource discussed herein has been constrained by
reasonable mining shapes, using economic assumptions appropriate for an open-pit mining scenario.
The potential mining shapes are preliminary and conceptual in nature.
For the Tepal Project, three different pit-shells were optimized, based on NSR values calculated using a
set of economic parameters, depending on the material and mining method. The Tepal North Zone,
South Zone and the Tizate Zone have been treated separately for the Pit Optimization exercise which
has been carried out using Datamine Studio OP software.
The calculated economic cut-off grade of 13 $/t NSR met the definition of potential eventual economic
extraction for oxide zone, and a cut-off grade of 15 $/t NSR met the criterion for the sulphide zone. No
underground resource has been estimated at this time.
Quality Control - Sampling and Laboratory
Geologix Explorations Mexico, a wholly owned Mexican subsidiary of Defiance Silver Corp., acquired
from ValOro Resources in November 2018 (Defiance News Release dated Nov 6
th
2018), established a
QA/QC program for the drilling at the Tepal Project.
The review of sampling and assaying procedures indicates that an adequate system was in place to
maximize the quality of drill hole samples and to assess the reliability, accuracy and precision of
subsequent assay data for use in resource estimation.
The QA/QC program consisted of:
The inclusion of CRM's in sample batches sent to ALS to assess analytical accuracy (1 per 30
samples)
The inclusion of field blanks and pulp blanks to assess laboratory sample preparation and
analytical accuracy (1 per 30 samples)
The inclusion of field duplicates and externally assayed pulp duplicates to assess sample
preparation and precision (1 per 30 samples)
Approximately 20% of all samples submitted to the laboratory were quality control samples.
Micon's QP has reviewed the QA/QC program established by Geologix and believes that the QA/QC
program implemented was of sufficient quality to allow the results to be used as the basis for a mineral
resource estimate.
Geology Summary
Mineralization on the Tepal Project is characteristic of porphyry copper-gold-molybdenum systems. This
is interpreted based on its porphyritic host rocks, its alteration, its copper-gold with minor molybdenum
(and silver) signature, and its quartz-dominated stockwork veinlets and disseminations associated with
sulphide mineralization.
The Tepal Project is located within the Coastal Ranges of southwestern Mexico, south of the Neogene
Trans-Mexican Volcanic Belt. Rocks consist of Cretaceous to early Tertiary intermediate composition
intrusions and weakly metamorphosed sedimentary and volcanic rocks of Cretaceous to Early Tertiary
age. The Jurassic to Cretaceous sedimentary and volcanic rocks are part of an accreted Mesozoic
Island arc volcano-sedimentary assemblage. At least some of the intrusive rocks are coeval with the
volcanic units. Neogene basalts locally overlie basement rocks and represent outliers of the Trans-
Mexican Volcanic Belt.
The Tepal Project is underlain by intrusive, volcanic and sedimentary rocks. Tizate is located within an
intrusive complex mapped at surface. The North Zone and South Zone are hosted within dominantly
volcanic rocks mapped at surface, though various porphyritic intrusions exist at depth, as noted in drill
core.
The structures that dominate at the project and, to an extent regionally, are east-northeast striking, north-
northwest striking, and northeast striking. These faults show clear separation of geological units at
surface and appear to have juxtaposed different erosional levels.
Mineralization on the property consists of zones of stockwork quartz veinlets, sulphide veinlets and
disseminated sulphide mineralization that are hosted within intrusive rocks, volcanic rocks and breccias.
These sulphide-bearing zones contain significant concentrations of copper and gold and, to a lesser
extent, molybdenum and silver. The mineralization is hosted in three distinct deposits: the North Zone
and South Zone with relatively high-grade copper and gold, and Tizate with relatively lower-grade copper
and gold, but higher-grade molybdenum.
There is an oxide horizon and a narrow transition layer present in all deposits on the Tepal Project above
the sulphide mineralization. The depth of oxidation ranges from 20 to 40 m on the hilltops and 0 to 20 m
in the drainages. The transition zone may be up to 15 m thick; however, it is usually significantly less than
this and, in some cases, is absent altogether. The transition is identified by the overlapping presence of
iron oxides and sulphide mineralization.
Primary sulphide mineralization consists dominantly of chalcopyrite and pyrite, with locally significant
bornite and molybdenite. The highest consistent grades of copper and gold mineralization are
associated with low pyrite:chalcopyrite ratios and increasing bornite. Local areas of very high-grade gold
are associated with thicker veins that cross-cut Tizate, and contain pyrrhotite, sphalerite, galena, silver
sulphides, as well as chalcopyrite and pyrite.
Tepal Exploration Potential
Defiance Silver believes that the Tepal Project has excellent exploration upside to increase the size of
the mineralization, by both expanding the known mineralization of North Zone, South Zone and Tizate,
and by exploring for new deposits within the Project. A series of targets have been defined based on
geological, geochemical, geophysical, alteration and structural information. These targets include, but
are not limited to, the following:
Clear areas of open, untested plunges of high-grade porphyry-style mineralization at depth in
known deposits. An example is in the deep South Zone (Figure 3) where drill hole TEP-11-26
returned values of 0.41% Cu and 1.21 g/t Au over 150.8m (from 315.20m to 466.05m). There has
been no previous additional drilling in this area below the resource optimized pit.
Various adjacent and distal untested to poorly tested targets with similar porphyry-style signatures,
defined by multiple exploration criteria within the project
Cross-cutting and/or superimposed different deposit styles (e.g., high-grade polymetallic
intermediate-sulphidation epithermal-style veins, high-sulphidation epithermal-style potential under
advanced argillic alteration, etc.)
Several of these target areas at Tepal are presented below (Figure 5) in plan map view.
Figure 5:
Map of Tepal deposits with various exploration target areas outlined in red
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/2950/233141_07441258949c181d_005full.jpg
Recommendations
Further exploration and development of the Tepal Project is recommended. The recommended next
phase of work is: a Lidar topographic survey, detailed mapping and surface sampling, systematic
channel sampling, relogging of a number of holes, relocating the collars for some of the old INCO drill
holes, as well as reprocessing the old geophysical programs. In addition, further resource infill and
expansion drilling is recommended especially into the deep South Zone target area (Figure 3). It is also
recommended the company conduct further metallurgical testwork at the Tepal Project. Data gained
from this recommended work will help the Company with its plan to produce a Preliminary Economic
Assessment during the course of 2025.
Qualified Persons, NI 43-101 Technical Report and MRE
As reported by the Company in its November 29
th
news release, Defiance had commissioned Micon to
prepare a new technical report, including a MRE, associated with the potential development of the Tepal
mineral resource. The technical report, prepared in accordance with the NI 43-101, will be filed today on
SEDAR+ (www.sedarplus.ca) under the Company's issuer profile. The effective date of the current MRE
is October 30, 2024.
The MRE is preliminary in nature and includes inferred mineral resources considered too speculative
geologically to have the economic considerations applied that would enable them to be categorized as
mineral reserves. Mineral resources that are not mineral reserves do not have demonstrated economic
viability.
The Micon MRE report is titled "
NI 43-101 Technical Report and 2024 Mineral Resource Estimate for
the Tepal Project, Michoacán, Mexico
" dated November 29, 2024, with an effective date of October 30,
2024.
William J. Lewis P.Geo., and Chitrali Sarkar M.Sc., P.Geo., of Micon are the QPs for the MRE
and have reviewed and approved the technical disclosure relating to the MRE contained in this news
release. Richard Gowans P.Eng., of Micon is the QP responsible for reviewing the Tepal metallurgical
work which the MRE is based upon. Mr. Lewis, Ms. Sarkar and Mr. Gowans are all independent of
Defiance and are the Micon QPs for the Technical Report.
About Defiance Silver Corp.
Defiance Silver Corp. (TSXV: DEF) (FSE: D4E) (OTCQX: DNCVF) is an exploration company
advancing the district-scale Zacatecas Project, located in the historic Zacatecas Silver District and the
Tepal Gold/Copper Project in Michoacán state, Mexico. Defiance is managed by a team of proven mine
developers with a track record of exploring, advancing, and developing several operating mines and
advanced resource projects. Defiance's corporate mandate is to advance our projects through capital-
efficient exploration focused on resource growth and new mineral discoveries.
On behalf of Defiance Silver Corp.
"Chris Wright"
CEO & Chairman of the Board
For more information, please contact: Investor Relations at +1 (604) 343-4677 or via email at
www.defiancesilver.com
Suite 2900-550 Burrard Street
Vancouver, BC V6C 0A3
Canada
Tel: +1 (604) 343-4677
Email:
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Information contained in this news release which are not statements of historical facts may be
"forward-looking information" for the purposes of Canadian securities laws. Such forward-looking
information involves risks, uncertainties and other factors that could cause actual results,
performance, prospects and opportunities to differ materially from those expressed or implied by such