FVI.TO · 2020-03-26 12:00:00

Fortuna Updates Mineral Reserves and Mineral Resources

Resource Estimates

Vancouver, March 26, 2020-- Fortuna Silver Mines, Inc. (NYSE: FSM ) ( TSX: FVI ) is pleased to report

updated Mineral Reserve and Mineral Resource estimates as of December 31, 2019 for the Caylloma Mine

located in Peru and the San Jose Mine located in Mexico and reiterates the Mineral Reserve and Mineral

Resource estimate as of March 31, 2019 for the Lindero Project located in Argentina.

Jorge A. Ganoza, President and CEO, commented: “Our infill drill program at Caylloma w as successful at

replenishing the majority of Mineral Reserves mined in 2019 with higher grade mineralized material.” Mr.

Ganoza continued, “ At San Jose, upgrading through infill drilling proved more challenging , as mining is

transitioning from the central Stockwork zone to th e Trinidad North area where mineralization tends to

be narrower and more variable in nature . As the mineralization style changes, t he operation is

implementing various initiatives, such as pillar recovery and narrow vein mining methods , to optimize

mineral extraction.”

Highlights of Mineral Reserve and Mineral Resource Update

• Combined Proven and Probable Mineral Reserves for the Caylloma and San Jose mines are

reported at 6. 4 Mt containing 37.2 Moz silver and 2 20 koz gold, representing year -over-year

decreases of 18 percent and 19 percent in contained silver and gold ounces, respectively

• Combined Inferred Mineral Resources for the Caylloma and San Jose mines are reported at 7.9 Mt

containing an estimated 30.9 Moz silver and 168 koz gold, reflecting a year-over-year decrease of

6 percent in contained silver ounces and no change in reported gold ounces

• Lindero Proven and Probable Mineral Reserves are reported at 84.2 Mt containing 1.7 Moz of

gold. Inferred Resources are reported at 8.6 Mt containing 106 koz of gold (refer to Fortuna news

release dated April 4, 2019)

Mineral Resources - Measured and Indicated Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines Caylloma,

Peru

Measured 681 110 0.37 1.96 3.28 2.4 8

Indicated 1,671 104 0.31 1.56 2.96 5.6 17

Measured +

Indicated 2,352 106 0.33 1.67 3.06 8.0 25

San Jose,

Mexico

Measured 17 104 0.80 N/A N/A 0.1 0

Indicated 538 105 0.70 N/A N/A 1.8 12

Measured +

Indicated 555 105 0.70 N/A N/A 1.9 13

Total Measured +

Indicated 2,907 106 0.40 N/A N/A 9.9 37

Gold

Mine Lindero,

Argentina

Measured 2,092 N/A 0.55 N/A N/A 0.0 37

Indicated 16,774 N/A 0.49 N/A N/A 0.0 265

Measured +

Indicated 18,866 N/A 0.50 N/A N/A 0.0 302

Total Measured + Indicated 9.9 339

Mineral Reserves - Proven and Probable Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines Caylloma,

Peru

Proven 99 101 0.34 2.19 3.09 0.3 1

Probable 2,361 80 0.20 2.41 3.86 6.1 15

Proven + Probable 2,460 81 0.21 2.41 3.83 6.4 16

San Jose,

Mexico

Proven 232 311 2.12 N/A N/A 2.3 16

Probable 3,704 239 1.58 N/A N/A 28.5 188

Proven + Probable 3,936 243 1.61 N/A N/A 30.8 204

Total Proven + Probable 6,396 181 1.07 N/A N/A 37.2 220

Gold

Mine Lindero,

Argentina

Proven 25,352 N/A 0.76 N/A N/A 0.0 618

Probable 58,875 N/A 0.58 N/A N/A 0.0 1,096

Proven + Probable 84,226 N/A 0.63 N/A N/A 0.0 1,714

Total Proven + Probable 37.2 1,934

Mineral Resources – Inferred Contained Metal

Property Classification Tonnes

(000)

(g/t)

(%)

(Moz)

(koz)

Silver

Mines

Caylloma,

Peru Inferred 4,056 112 0.37 2.58 4.00 14.6 48

San Jose,

Mexico Inferred 3,889 131 0.96 N/A N/A 16.3 120

Total Inferred 7,945 121 0.66 N/A N/A 30.9 168

Gold

Mine

Lindero,

Argentina Inferred 8,600 N/A 0.38 N/A N/A 0.0 106

Total Inferred 30.9 274

1. Mineral Reserves and Mineral Resources are as defined by the 2014 CIM Definition Standards for Mineral Resources and

Mineral Reserves

2. Mineral Resources are exclusive of Mineral Reserves

3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability

4. Factors that could materially affect the reported Mineral Resources or Mineral Reserves include; changes in metal price an d

exchange rate assumptions; changes in local interpretations of mineralization; changes to assumed metallurgical recoveries,

mining dilution and recovery; and assumptions as to the continued ability to access the site, retain mineral and surface righ ts

titles, maintain environmental and other regulatory permits, and maintain the social license to operate

5. Mineral Resources and Mineral Reserves are estimated as of September 25, 2019 for the San Jose Mine and as of June 30, 2019

for the Caylloma Mine and reported for both mines as of December 31, 2019 taking into account production -related depletion

for the period through December 31, 2019. Mineral Resources and Mineral Reserves for Lindero are estimated and reported as

of March 31, 2019

6. Mineral Reserves for the San Jose Mine are based on underground mining within optimized stope designs using an estimated

NSR break-even cut-off grade of US$64.54/t, equivalent to 138 g/t Ag Eq based on assumed metal prices of US$17/oz Ag and

US$1,380/oz Au; estimated metallurgical recovery rates of 91 % for Ag and 90 % for Au and mining costs of US$33.24/t; processing

costs of US$17.12/t; and other costs including distribution, management, community support and general service costs of

US$15.18/t based o n actual operating costs. Mining recovery is estimated to average 91% and mining dilution 11%. Mineral

Resources are reported at a 110 g/t Ag Eq cut -off grade based on the same parameters used for Mineral Reserves and a 15%

upside in metal prices. Proven and Probable Mineral Reserves include 2.36 Mt containing 20.4 Moz of silver and 124 koz of gold

reported at a 142 g/t Ag Eq cut-off grade, in addition to Inferred Resources totaling 2.71 Mt containing 10.9 Moz of silver and 78

koz of gold reported at a 110 g/t Ag Eq cut-off grade, located in the Taviche Oeste concession and subject to a 2.5 % royalty

7. Mineral Reserves for the Caylloma Mine are reported above NSR breakeven cut -off values based on the proposed mining

method for extraction including; mechaniz ed (breasting) at US$ 85.26/t; mechanized (enhanced) at US$ 78.90/t; and semi -

mechanized at US$ 86.03/t using assumed metal prices of US$17/oz Ag, US$1,380/oz Au, US$2,170/t Pb and US$2,590/t Zn;

metallurgical recovery rates of 84 % for Ag, 25 % for Au, 91 % for Pb and 90 % for Zn with the exception of the Ramal Piso Carolina

vein that uses a metallurgical recovery rate of 75 % for Au. Mining, processing and administrative costs used to determine NS R

cut-off values were estimated based on actual operating c osts incurred from July 2018 through June 2019. Mining recovery is

estimated to average 93 % with mining dilution ranging from 10 % to 22 % depending on the mining methodology. Mineral

Resources are reported at an NSR cut-off grade of US$65/t for veins classified as wide (Animas, Animas NE, Nancy, San Cristobal)

based on the same parameters used for reserves, and a 15% upside in metal prices and US$135/t for veins classified as narrow

(all other veins) based on narrow vein mining methods

8. Mineral Reserves for Lindero are reported based on open pit mining within a designed pit shell for variable gold cut-off grades

and gold recoveries by metallurgical type. Met type 1 cut-off 0.27 g/t Au, recovery 75.4 %; Met type 2 cut-off 0.26 g/t Au, recovery

78.2 %; Met type 3 cut-off 0.26 g/t Au, recovery 78.5 %; and Met type 4 cut -off 0.30 g/t Au, recovery 68.5 %. Mining recovery is

estimated to average 100% and mining dilution 0%. The cut -off grades and pit design are considered appropriate based on long

term gold pri ces of US$1,320/oz, estimated mining costs of US$1.28 per tonne of material, total processing and process G&A

costs of US$8.29 per tonne of ore, and refinery costs net of pay factor of US$6.90 per ounce gold. Lindero Mineral Resources are

reported within the same conceptual pit shell above a 0.2 g/t Au cut -off grade based on the same parameters used for reserves

and a 15% upside in metal prices

9. Eric Chapman, P. Geo. (APEGBC #36328) is the Qualified Person for Mineral Resources and Amri Sinuhaji (APEGBC # 48305) is

the Qualified Person for Mineral Reserves, both being employees of Fortuna Silver Mines Inc.

10. Totals may not add due to rounding procedures

11. N/A = Not Applicable

San Jose Mine, Mexico

As of December 31, 201 9, the San Jose Mine has Proven and Probable Mineral Reserves of 3.9 Mt

containing 30.8 Moz of silver and 204 koz of gold, in addition to Inferred Resources of 3.9 Mt containing

a further 16.3 Moz of silver and 120 koz of gold.

Year-over-year, Mineral Reserves decreased 24 percent in terms of tonnes and 21 percent in contained

silver and gold ounces after net changes resulting from production -related depletion and the upgrading

and conversion of Inferred Resources to Mineral Reserves due to a limited infill drill program focused

primarily on the Stockwork zones. Silver grade increased 3 percent and gold grade increased 4 percent to

243 g/t and 1. 61 g/t, respectively due to an increase in the break -even cut -off grade from 134 g/t to

138 g/t Ag Eq.

Measured and Indicated Resources tonnes exclusive of Mineral Reserves increased slightly year-over-year

from 0.3 Mt to 0.5 Mt due primarily to the change in the breakeven cut-off grade for reserves.

Year-over-year, Inferred Resources increased 61 percent in terms of tonnes and 7 percent in contained

silver and gold ounces. Silver and gold grades decreased by 33 percent. The net variation is due to

reductions resulting from the upgrading of high-grade Inferred Resources related to infill drilling in the

Stockwork zones counteracted by exploration drilling discovering new resources in the Victoria

mineralized zone.

Caylloma Mine, Peru

As of December 31, 201 9, the Caylloma Mine has Proven and Probable Mineral Reserves of 2.5 Mt

containing 6.4 Moz of silver and 1 6 koz of gold, in addition to Inferred Resources of 4.1 Mt containing

14.6 Moz of silver and 48 koz of gold.

Year-over-year, Mineral Reserve tonnes decreased by 6 percent, while silver grade increased 5 percent to

81 g/t, lead grade increased 14 percent to 2.41%, and zinc grade increased 4 percent to 3.83%. Changes

are primarily due to mining related depletion and the upgrading and conversion of Inferred Resources to

Mineral Reserves due to a successful infill drill program focused primarily on the Animas NE vein.

Measured and Indicated Resource tonnes, exclusive of Mineral Reserves, increased by 9 percent year-

over-year to 2.4 Mt.

Inferred Resources tonnes decreased by 1.3 Mt or 24 percent year-over-year. Silver, lead, and zinc grades

increased 10 percent, 8 percent, and 4 percent, respectively. The decrease in Inferred Mineral Resources

is primarily due to a successful infill drill program of the Animas NE vein resulting in the upgrading of

Inferred Mineral Resources to Mineral Reserves coupled with an increase in cut -off value from US$50/t

to US$65/t for the reporting of resources in wide veins.

Lindero Project, Argentina

The Lindero Project has Proven and Probable Mineral Reserves of 8 4.2 Mt containing 1.7 Moz of gold, in

addition to Inferred Resources of 8.6 Mt containing 106 koz of gold (refer to Fortuna news release dated

April 4, 2019) .

Qualified Person

Mr. Eric Chapman is a Professional Geoscientist of the Association of Professional Engineers and

Geoscientists of the Province of British Columbia (Registration Number 36328) and has reviewed and

approved the scientific and technical information contained in this news release.

About Fortuna Silver Mines Inc.

Fortuna is a growth oriented, precious metals producer focused on mining opportunities in Latin America.

Our primary assets are the Caylloma silver Mine in southern Peru, the San Jose silver-gold Mine in Mexico

and the Lindero gold mine, currently under construction, in Argentina. The Company is selectively

pursuing acquisition opportunities throughout the Americas and in select other areas. For more

information, please visit our website at www.fortunasilver.com.

ON BEHALF OF THE BOARD

Jorge A. Ganoza

President, CEO and Director

Fortuna Silver Mines Inc.

Trading symbols: NYSE: FSM | TSX: FVI

Investor Relations:

Carlos Baca- T (Peru): +51.1.616.6060, ext. 0

Forward-looking Statements

This news release contains forward looking statements which constitute “forward -looking information” within the meaning of

applicable Canadian securities legislation and “forward looking statements” within the meaning of the “safe harbor” provision s

of the Private Securities Litigation Reform Act of 1995 (collectively, “Forward looking Statements”). All statements included herein,

other than statements of historical fact, are Forward looking Statements and are subject to a variety of known and unknown risks

and uncertainties which could cause actual events or results to differ materially from those reflected in the Forward -looking

Statements. The Forward looking Statements in this news release may include, without limitation, statements about the

Company's plans for its mine sand mineral properties; the Company’s business strategy, plans and outlooks; the merit of the

Company’s mines and mineral properties; mineral resource and reserve estimates; the Company’s ability to convert inferred

mineral resources to indicated mineral resources and to convert mineral resources to mineral reserves; timelines; production at

the mines, the future financial or operating performance of the Company; the effects of laws, regulations and government policies

affecting our operations or potential future operations; future successful development of our projects; the estimates of expected

or anticipated economic returns from the Company’s mining operations including future sales of metals, concentrate or other

products produced by the Company; the Company’s ability to achieve its production and cost guidance; capital expenditures at

the Company’s operations; approvals and other matters. Often, but not always, these Forward -looking Statements can be

identified by the use of words such as “estimated”, “potential”, “open”, “future”, “assumed”, “projected”, “used”, “detailed”, “has

been”, “gain”, “planned”, “reflecting”, “will”, “containing”, “remaining”, “expected”, “to be”, or statements that events, “could”

or “should” occur or be achieved and similar expressions, including negative variations.

Forward-looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual results,

performance or achievements of the Company to be materially different from any results, performance or achievements expressed

or implied by the Forward -looking Statements. Such uncertainties and factors include, among others, risks inherent in mineral

exploration; the reliability of Mineral Resource and Mineral Reserve estimates; uncertainties inherent in the estimation of Mineral

Reserves, Mineral Resources, and metal recoveries; the Company’s ability to replace mineral reserves; changes to current

estimates of mineral reserves and resources; changes to production estim ates; changes in general economic conditions and

financial markets; uncertainty of production, development plans and cost estimates for the Caylloma Mine, the San Jose Mine and

the Lindero Project; changes in prices for silver and other metals; technologic al and operational hazards in Fortuna’s mining and

mine development activities; market risks related to the sale of the Company’s concentrates and metals; future development risks,

the Company’s ability to obtain adequate financing for further exploration and development programs and opportunities;

governmental and other approvals; the ability to obtain necessary licences and permits; claims and legal proceedings, including

adverse rulings in litigation against the Company; challenges to the title to the Company’s properties; political unrest or instability

in countries where Fortuna is active; labor relations issues; as well as those factors discussed under “Risk Factors” in the Company's

Annual Information Form. Although the Company has attempted to ident ify important factors that could cause actual actions,

events or results to differ materially from those described in Forward -looking Statements, there may be other factors that cause

actions, events or results to differ from those anticipated, estimated or intended.

Forward-looking Statements contained herein are based on the assumptions, beliefs, expectations and opinions of management,

including but not limited to expectations regarding the accuracy of the Company’s current mineral resource and reserve estimates;

mine production costs; expected trends in mineral prices and currency exchange rates; that the Company’s activities will be i n

accordance with the Company’s public statements and stated goals; that there will be no material adverse change affecti ng the

Company or its properties; that all required approvals will be obtained; that there will be no significant disruptions affect ing

operations and such other assumptions as set out herein. Forward -looking Statements are made as of the date hereof and t he

Company disclaims any obligation to update any Forward -looking Statements, whether as a result of new information, future

events or results or otherwise, except as required by law. There can be no assurance that Forward -looking Statements will prove

to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly,

investors should not place undue reliance on Forward-looking Statements.

Cautionary Note to United States Investors Concerning Estimates of Reserves and Resources

Reserve and resource estimates included in this news release have been prepared in accordance with National Instrument 43-101

Standards of Disclosure for Mineral Projects ("NI 43 -101") and the Canadian Institute of Mining, Metallurgy, and Petroleum

Definition Standards on Mineral Resources and Mineral Reserves. NI 43 -101 is a rule developed by the Canadian Securities

Administrators that establishes standards for public disclosure by a Canadian company of scientific and technical information

concerning mineral projects. Equivalent U.S. reporting requirements are currently governed by the United States Securities and

Exchange Commission ("SEC") Industry Guide 7 (“Industry Guide 7”) under the U.S. Securities Act of 1933, as amended. Canadian

standards, including NI 43-101, differ significantly from the requirements of the SEC currently in effect under Industry Guide 7, and

reserve and resource information contained in this news release may not be comparable to similar information disclosed by U.S .

companies. In particular, the term "resource" does not equate to the term "reserves". Under the SEC's disclosure standards

currently in effect under Industry Guide 7, mineralization may not be classified as a "reserve" unless the determination has been

made that the min eralization could be economically and legally produced or extracted at the time the reserve determination is

made. While the SEC recognizes the reporting of mineral deposits which do not meet the Industry Standard Guide 7 definition of

“reserve” as of Febr uary 25, 2019, the effective adoption of the Modernization of Property Disclosures for Mining Registrants,

such rules are not required to be compiled with until the first fiscal year beginning on or after January 1, 2021. As a result, the

SEC's disclosure standards currently in effect normally do not permit the inclusion of information concerning "measured mineral

resources", "indicated mineral resources" or "inferred mineral resources" or other descriptions of the amount of mineralization in

mineral deposits that do not constitute "reserves" by U.S. standards in documents filed with the SEC. You are cautioned not to

assume that resources will ever be converted into reserves. You should also understand that "inferred mineral resources" have a

great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. You should also

not assume that all or any part of an "inferred mineral resource" will ever be upgraded to a higher category. Under Canadian

rules, estimated "inferred mineral resources" may not form the basis of feasibility or pre -feasibility studies except in rare cases.

You are cautioned not to assume that all or any part of an "inferred mineral resource" exists or is economically or legally mineable.

Disclosure of "contained ounces" in a resource is permitted disclosure under Canadian regulations; however, the SEC's disclosure

standards currently in effect under Industry Guide 7 normally only permit issuers to report mineralization that does not constitute

"reserves" by such standards as in -place tonnage and grade without reference to unit measures. The requirements of NI 43 -101

for identification of "reserves" are also not the same as those of the SEC's disclosure standards currently in effect under I ndustry

Guide 7, and reserves reported in compliance with NI 43-101 may not qualify as "reserves" under such SEC standards. Accordingly,

information concerning mineral deposits set forth in this news release may not be comparable with information made public b y

companies that report in accordance with U.S. standards.

← Back to feed