And Confirms Reduced Shale Host at Tabalosos East, PERU
1305 – 1090 West Georgia Street, Vancouver, BC, V6E 3V7
Phone: +1 604 685 9316 / Fax: +1 604 683 1585
NEWS RELEASE SEPTEMBER 20, 2021
HANNAN CHANNEL SAMPLES 1.6m @ 5.3% COPPER AND 83 g/t SILVER
AND CONFIRMS REDUCED SHALE HOST AT TABALOSOS EAST, PERU
Vancouver, Canada – Hannan Metals Limited (“Hannan” or the “Company”) (TSXV: HAN) (OTCPK:
HANNF) reports on exploration program results from the Tabalosos East prospect within the San Martin JOGMEC
JV sediment-hosted copper-silver project in Peru (Figures 1 and 2).
Highlights:
Surface channel sampling from ou tcrops at Tabalosos East, taken over a 500-metre strike, returned
s i g n i f i c a n t r e s u l t s f r o m t h r e e n e w o u t c r o p s . T h e z o n e i s l o c a t ed 1.9 kilometres north of previously
reported mineralization and is interpreted to be hosted in the same min eralized horizon. Better assays
included (Figures 1 and 2):
o 2.8 metres (“m”) @ 3.0% copper (“Cu”) and 48 g/t silver (“Ag”) (partially sampled)
Including 1.6m @ 5.3% Cu and 83 g/t Ag
o 2.0m @ 1.1 % Cu and 11 g/t Ag
o 0.2m @ 2.2 % Cu and 27 g/t Ag (partially sampled)
Separately, 1.2 kilometres east of the new outcrops, mapping ov er significant distances of mineralized
outcrops in trenches, exposed be neath soil anomalies, clearly d emonstrates that copper is hosted by a
fine grained, organic-rich reduced shale within a bleached package of shaly siltstones:
o A 10m wide altered and bleached zone with anomalous copper has been mapped and inferred
over 650m of strike with geochemical assays from 380m of strike including 1.2m @ 0.52% Cu
and 6 g/t Ag and 3.5m @ 0.73% Cu and 9 g/t Ag including 0.2 m @ 1.1% Cu and 13 g/t Ag;
o This is considered critical new geological information, as it is the first time that detailed mapping,
over the larger scale, has defined a mappable, consistent, and well-defined fine-grained, reduced
organic shale, previously only mapped between sporadic boulders and poorly exposed outcrops;
o This provides further evidence that the mineralization at San Martin and is of the reduced facies
sediment hosted copper-silver “Kupferschiefer” style;
All mineralization described above is located at Tabalosos East where the company is currently preparing
an Environmental Impact Statement (Declaración de Impacto Ambie ntal, or "DIA") study. The DIA,
previously reported here, will allow low impact mineral exp loration that includes diamon d drilling of up
to 40 platforms in a 9 x 3 kilometre area. Subject to permitti ng, drilling is anticipated to take place in
Q2 2022.
Michael Hudson, CEO, states, "Further high-grade surface channel samples with a highlight r esult of 1.6m @
5.3% Cu and 83 g/t Ag from outcrop mineralization attest to the thickness of high-grade copper and silver
mineralization that we continue to uncover at San Martin over s uch large scales (Figure 2). However, equally
important is the first detailed work to emerge from the project that demonstrates a consistent and mappable
organic and reduced shale that hosts mineralization, that furth er geologically supports the reduced facies
sediment-hosted style. This geol ogical style globally forms the largest and most consistent sediment-hosted
copper systems, and includes the vast Kupferschiefer deposit in Eastern Europe and deposits of the African
Copper Belt in sub-Saharan Africa, two of the largest copper di stricts on earth. We hav e multiple geological
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teams unravelling the opportunit y while permitting and social t eams continue to work together with all
stakeholders on the DIA, to permit diamond drilling.”
Detailed mapping of outcrops with correlating stratigraphic columns demonstrates that copper mineralization in
the new zone mentioned above is hosted by an organic rich shale facies within an approximately 10m thick
bleached/altered and copper anomalous package of shaly siltston es. This sequence represents a different
depositional environment of lower energy that has facilitated the deposition of a consistent organic-rich, reduced
shale facies. The impact on the exploration model is fundamental, as it supports the assumption of a widespread
reduced facies across the Huallaga basin.
Five geologists and associated f ield assistants, two social con sultants plus two local social support, two
archaeologists and other external environmental consultants related to the DIA program have been engaged at
Tabalosos East. In other work, a total of 2,329 soil samples have now been collected within the DIA area, and
22 pits and trenches have been dug below the soil samples. Additionally, a total of 90% of the 64,500 hectares
or 2,782-line kms of LiDAR have b een acquired at the San Martin JOGMEC JV sediment-hosted copper-silver
project with the survey to be completed in the coming weeks when weather conditions allow.
Technical Background
All samples were collected by Ha nnan geologists. Rock and sedim ent samples were transported to ALS in Lima via third
party services using traceable parcels. At the laboratory rock samples were prepared and analyzed by standard methods.
The sample preparation involved crushing 70% to less than 2mm, riffle split off 250g, pulverize split to better than 85%
passing 75 microns. The crushers and pulverizes were cleaned wi th barren material after every sample. Samples were
analyzed by method ME-MS61, a four acid digest preformed on 0.2 5g of the sample to quantitatively dissolve most
geological materials. Analysis is via ICP-MS.
Channel samples are considered representative of the in-situ mineralization samples and sample widths quoted approximate
the true width of mineralization, while grab samples are select ive by nature and are unlikely to represent average grades
on the property.
About the San Martin JOGMEC JV Project (Copper-Silver, Peru, 88 mining concessions for 660 sq km)
On November 30, 2020 Hannan announced that it had signed a binding letter agreement for a significant Option and Joint
Venture Agreement (the “Agreement”) with JOGMEC. Under the Agreement, JOGMEC has the option to earn up to a 75%
beneficial interest in the San Martin Project by spending up to US$35,000,000 to deliver to the joint venture (“JV”) a
feasibility study.
The Agreement grants JOGMEC the option to earn an initial 51% o wnership interest by funding US$8,000,000 in project
expenditures at San Martin over a four-year period, subject to acceleration at JOGMEC’s discretion.
JOGMEC, at its election, can then earn:
an additional 16% interest for a total 67% ownership interest by achieving either a prefeasibility study or funding
a further US$12,000,000 in project expenditures in amounts of a t least US$1,000,000 per annum (for a
US$20,000,000 total expenditure); and,
subject to owning a 67% interest, a further 8% interest for a t otal 75% ownership interest by achieving either a
feasibility study or funding a further US$15,000,000 in project expenditures in amounts of at least US$1,000,000
per annum (for a US$35,000,000 total expenditure).
Should JOGMEC not proceed to a prefeasibility study or spend US $20,000,000 in total, Hannan shall have the right to
purchase from JOGMEC for the sum of US$1, a two percent (2%) Pa rticipating Interest, whereby Hannan’s Participating
Interest will be increased to fifty-one percent (51%) and JOGME C’s Participating Interest will be reduced to forty-nine
percent (49%).
At the completion of a feasibility study, JOGMEC has the right to either:
p u r c h a s e u p t o a n a d d i t i o n a l t e n p e r c e n t ( 1 0 % ) P a r t i c i p a t i n g I nterest from Hannan Metals (for a total 85%
maximum capped Participating Interest) at fair value as determined in accordance with internationally recognized
professional standards by an agreed upon independent third-party valuator; or
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receive up to an additional ten percent (10%) Participating Interest from Hannan (for a total 85% maximum capped
Participating Interest) in consideration of JOGMEC’s agreement to fund development of the project, by loan carrying
Hannan until the San Martin Project generates positive cash flow.
After US$35,000,000 has been spent by JOGMEC and before a feasibility study has been achieved, both parties will fund
expenditures pro rata or dilute via a standard industry dilutio n formula. If the Participating Interest in the Joint Venture
of any party is diluted to less than 5% then that party’s Parti cipating Interest will be automatically converted to a 2.0%
net smelter royalty (“NSR”), and the other party may at any time purchase 1.0% of the 2.0% NSR for a cash payment of
US$1,000,000. Hannan will manage exploration at least until JOG MEC earns a 51% interest, after which the majority
participant interest holder will be entitled to act as the operator of the joint venture. Initial exploration activities will focus
on the collection of the geological, geophysical, and geochemical datasets in the JV project areas.
Sediment-hosted stratiform copper-silver deposits are among the two most important copper sources in the world, the
other being copper porphyries. They are also a major producer of silver. According to the World Silver Survey 2020
KGHM Polska Miedz’s (“KGHM”) three copper-silver sediment-hosted mines in Poland are the leading silver producer in the
world with 40.2Moz produced in 2019. This is almost twice the p roduction of the second largest producing mine. The
Polish mines are also the sixth l argest global copper miner and in 2018, KGHM produced 30.3 Mt of ore at a grade of
1.49% copper and 48.6 g/t silver from a mineralized zone that averages 0.4m to 5.5m thickness.
About Hannan Metals Limited (TSXV:HAN) (OTCPK: HANNF)
Hannan Metals Limited is a natural resources and exploration co mpany developing sustainable resources of metal needed
to meet the transition to a low carbon economy. Over the last d ecade, the team behind Hannan has forged a long and
successful record of discovering, financing, and advancing mine ral projects in Europe and Peru. Hannan is a top ten in-
country explorer by area in Peru.
Mr. Michael Hudson FAusIMM, Hannan’s Chairman and CEO, a Qualified Person as defined in National Instrument 43-101,
has reviewed and approved the technical disclosure contained in this news release.
On behalf of the Board,
"Michael Hudson"
Michael Hudson, Chairman & CEO
Further Information
www.hannanmetals.com
1305 – 1090 West Georgia St., Vancouver, BC, V6E 3V7
Mariana Bermudez, Corporate Secretary,
+1 (604) 685 9316, [email protected]
Forward Looking Statements. Certain disclosure contained in this news release may constitut e forward-looking information or forward-looking
statements, within the meaning o f Canadian securities laws. The se statements may relate to this news release and other matters identified in the
Company's public filings. In making the forward-looking stateme nts the Company has applied certain factors and assumptions tha t are based on the
Company's current beliefs as well as assumptions made by and in formation currently available to the Company. These statements address future events
and conditions and, as such, involve known and unknown risks, u ncertainties and other factors which may cause the actual resul ts, performance or
achievements to be materially different from any future results , performance or achievements expressed or implied by the state ments. These risks and
uncertainties include but are not limited to: the political environment in which the Company operates continuing to support the development and operation
of mining projects; the threat associated with outbreaks of vir uses and infectious diseases, including the novel COVID-19 viru s; risks related to negative
publicity with respect to the Company or the mining industry in general; planned work programs; permitting; and community rela tions. Readers are
cautioned not to place undue reliance on forward-looking statem ents. The Company does not intend, and expressly disclaims any intention or obligation
to, update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.
Neither the TSX Venture Exchange nor its Regulation Services Pr ovider (as that term is defined in the policies of the TSX Vent ure Exchange) accepts
responsibility for the adequacy or accuracy of this news.
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