Discovery Announces 2024 Work Program for Cordero
Discovery Announces 2024 Work Program for Cordero
January 24, 2024, Toronto, Ontario - Discovery Silver Corp. (TSX: DSV, OTCQX: DSVSF)
(“Discovery” or the “Company”) is pleased to outline its 2024 work program for its Cordero
project (“Cordero” or “the Project”) located in Chihuahua State, Mexico.
Tony Makuch, President and CEO, states: “2024 is expected to be a transformational year for
the Company. Our Feasibility Study is nearing completion and is on track to be delivered later
this quarter. The study will incorporate an additional 35,000 m of drilling that highlighted the
potential to extend the mine life beyond the 18 years outlined in the Pre -Feasibility Study, as
well as the results from recent metallurgical testwork that demonstrated higher silver
payabilities and reduced reagent consumption.
“The Feasibility Study is expected to position Cordero as the only silver development stage
asset in the industry that will produce more than 30 million ounces of silver -equivalent
production annually once built. This impressive scale is accompanied by a long mine life,
excellent capital efficiency due to staged expansions of the process plant and operating costs
in the bottom half of the cost curve, emphasizing the strategic importance of Cordero within
the silver space. In 2024, we also look forward to moving our way through the permitting and
project financing process with the objective of reaching a construction decision in late 2024 or
early 2025. We remain well funded to deliver on our key milestones this year with a cash
balance at the end of 2023 of approximately C$60 million.”
ENGINEERING & PROJECT DEVELOPMENT
The Feasibility Study (“FS” or the “Study”) is expected to be delivered later this quarter. The
FS will incorporate staged expansions of the processing facility to maximize the capital
efficiency of the Project and will in clude an additional 35,000 m of reserve definition and
expansion drilling, the results from the FS metallurgical testwork program as well as additional
geotechnical and hydrogeology data collected in 2023. The Company will also provide an
updated resource estimate concurrent with the results of the Study.
Following the delivery of the FS the Company plans to commence Front-End Engineering
Design (“FEED”) work for the Project. This engineering work consists of early project planning
and will enable the Company to place orders for long lead- time items and to award the
EPC/EPCM contract for the development of the Project.
The Company plans to progress all financing options for the Project through the course of
2024. These options include equity, debt, offtake, joint ventures, partnerships, lease financing
on major equipment, streams, royalties and other strategic alternatives.
NEWS RELEASE
PERMITTING
The two principal environmental permits required for the construction, operation and closure
of Cordero are:
1. Environmental Impact Assessment (“Manifestacion de Impacto Ambiental” or “MIA”)
2. Change of Land Use (“Cambio de Uso de Suelo” or “CUS”)
Both permits are subject to review and approval by the Secretaría de Medio Ambiente y
Recursos Naturales (“SEMARNAT”), Mexico’s federal agency for natural resources and the
environment.
The Company formally submitted for evaluation its MIA in August 2023. The MIA incorporates
extensive social and environmental work programs completed by the Company’s team in
Mexico since 2020 in conjunction with multiple reviews by third-party consultants. The review
process of the MIA submission by SEMARNAT is ongoing.
The CUS submission is supported by a Change of Land Use Study known as an Estudio
Tecnico Justificativo ( “ETJ”). Compilation of the ETJ by the Company and third -party
consultants will be finalized in the coming months with formal submission of the CUS expected
to be made by 3Q 2024.
KEY DE-RISKING ITEMS
Power: impact assessment and power installation studies were completed in 2023 confirming
that there is sufficient capacity in the existing power grid to supply the Project with power for
operations at peak throughput levels. The FS will include detailed capital cost estimates for the
standard upgrades required at the Camargo II substation and for the installation of a 74-
kilometre powerline from the substation to Cordero. The Company has identified three potential
routes for the powerline. Work in 2024 for the powerline will consist of finalizing the powerline
route, surface rights access negotiations, permitting and engineering for both the Camargo II
substation upgrade and the new powerline to site. The option to use renewable energy sources
at site to supplement grid power will also be evaluated.
Surface Rights: in 2023 the Company secured the surface rights that correspond with the
planned open pit and key infrastructure locations at Cordero. In 2024, the Company will focus
on acquiring ancillary surface rights where appropriate as well as securing long- term access
and lease agreements for nearby land as required.
Hydrology: the two potential sources of water for the Project are local groundwater and water
from local water treatment plants in the region. The Company has completed a hydrogeological
assessment through its Mexican specialist consultant Investigacion y Desarrollo de Acuiferos
y Ambiente (“IDEAS”) utilising data from hydrogeology drilling and pump test wells. Initial
results indicate the potential for sufficient local groundwater for Phase 1 of the project (mill
throughput of ~25,000 tonnes per day). In addition, M3 Engineering & Technology recently
completed a technical review on the scope and cost to source water from local water treatment
plants. The results from this review will be incorporated in the upcoming FS.
In 2024, the Company plans to initiate the permitting process for the zoning of the groundwater
rights it already owns. The Company also plans to advance engineering work for the required
upgrades to the water treatment plant and accompanying water pipeline.
EXPLORATION
In 2024, the Company plans to complete mapping and sampling of new target areas along with
2,500 m of drilling. Key target areas include La Perla (10 km south of Cordero), Dos Mil Diez
(immediately southwest of Cordero) and Porfido Norte (10 km north of Cordero).
• La Perla – targeting is focused on a zone of anomalous silver from rock sampling within
a very large alteration footprint and high chargeability / low resistivity anomalies defined
by the geophysics program completed in 2022. Historical mine workings are also present
within a northeast trending structural corridor (parallel to the orientation of the main
mineralized trends at Cordero).
• Dos Mil Diez – further mapping and sampling is planned to support the evaluation of
chargeability anomalies identified during an IP survey completed in 2022. Dos Mill Diez is
located in an area of mapped intrusives, veining and alteration, directly to the southwest
of Cordero.
• Porfido Norte – additional mapping and sampling is planned to define targets within a
northeast trending structural corridor in this area.
The planned drill program for 2024 may be expanded depending on the results of the mapping
and sample program and initial drilling. A map showing the location of these target areas can
be found at the following link: Property Wide Targets
About Discovery
Discovery’s flagship project is its 100%-owned Cordero project, one of the world’s largest silver
deposits. The PFS completed in January 2023 demonstrates that Cordero has the potential to
be developed into a highly capital efficient mine that offers the combination of margin, size and
scaleability. Cordero is located close to infrastructure in a prolific mining belt in Chihuahua
State, Mexico.
On Behalf of the Board of Directors,
Tony Makuch, P.Eng
President, CEO & Director
For further information contact:
Forbes Gemmell, CFA
VP Corporate Development
Phone: 416-613-9410
Email: [email protected]
Website: www.discoverysilver.com
Qualified Person
Gernot Wober, P.Geo, VP Exploration, Discovery Silver Corp., is the Company's designated
Qualified Person for this news release within the meaning of National Instrument 43- 101
Standards of Disclosure for Mineral Projects (“NI 43-101”) and has reviewed and validated that
the information contained in this news release is accurate.
The most recent technical report for the Cordero Project is the 2023 Preliminary Feasibility
Study for the Company’s Cordero project. The report was completed by Ausenco with support
from AGP, Knight Piésold and Hard Rock and is available on Discovery’s website and on
SEDAR under Discovery Silver Corp.
FORWARD-LOOKING STATEMENTS:
Neither TSX Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This news release is not for distribution to United States newswire services or for dissemination in the United States.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the
securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United
States of America. The securities have not been and will not be registered under the United States Securities Act of 1933, as
amended (the “1933 Act”) or any state securities laws and may not be offered or sold within the United States or to, or for account
or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable
state securities laws, or an exemption from such registration requirements is available.
Cautionary Note Regarding Forward-Looking Statements
This news release may include forward- looking statements that are subject to inherent risks and uncertainties. All statements
within this news release, other than statements of historical fact, are to be considered forward looking. Although Discovery believes
the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not
guarantees of future performance and actual results or developments may differ materially from those described in forward-looking
statements. Statements include but are not limited to the timing and results of the feasibility study and the anticipated capital and
operating costs, sustaining costs, net present value, internal rate of return, payback period, process capacity, average annual
metal production, average process recoveries, concession renewal, permitting of the Project, anticipated mining and processing
methods, proposed pre- feasibility study production schedule and metal production profile, anticipated construction period,
anticipated mine life, expected recoveries and grades, anticipated production rates, infrastructure, social and environmental
impact studies, the completion of key de-risking items, including the timing of receipt permits, availability of water and power,
availability of labour, tax rates and commodity prices that would support development of the Project. Information concerning
mineral resource/reserve estimates and the economic analysis thereof contained in the results of the pre-feasibility study are also
forward-looking statements in that they reflect a prediction of the mineralization that would be encountered, and the results of
mining, if a mineral deposit were developed and mined. Forward- looking statements are statements that are not historical fact s
which address events, results, outcomes or developments that the Company expects to occur. Forward- looking statements are
based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made and they
involve a number of risks and uncertainties. Factors that could cause actual results to differ materially from those described in
forward-looking statements include fluctuations in market prices, including metal prices, continued availability of capital and
financing, and general economic, market or business conditions. There can be no assurances that such statements will prove
accurate and, therefore, readers are advised to rely on their own evaluation of such uncertainties. Discovery does not assume
any obligation to update any forward- looking statements except as required under applicable laws. The risks and uncertainties
that may affect forward- looking statements, or the material factors or assumptions used to develop such forward- looking
information, are described under the heading "Risks Factors" in the Company’s Annual Information Form dated March 30, 2023,
which is available under the Company’s issuer profile on SEDAR at www.sedarplus.ca.