Mako Mining Reports Results of an Updated Mineral Resource Estimate for San Albino; Highlighted by a Measured and Indicated Resource of 177,800 Ounces with a Diluted Grade of 10.21 g/t Gold
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595 Burrard Street, Suite 2833
Vancouver, BC V7X 1K8
Tel: (604) 646-1580
www.makominingcorp.com
TSX-V: MKO | OTCQX: MAKOF
1
October 19, 2020
TSX-V: MKO; OTCQX: MAKOF
Mako Mining Reports Results of an Updated Mineral Resource Estimate for San Albino; Highlighted
by a Measured and Indicated Resource of 177,800 Ounces with a Diluted Grade of 10.21 g/t Gold
Mako Mining Corp. (TSX-V: MKO ; OTCQX: MAKOF ) ( “Mako” or the “Company” ) is pleased to report the
results of an updated mineral resource estimate prepared by Mine Development Associates (“MDA”), a division of
RESPEC, out of Reno, Nevada, at Mako’s wholly-owned San Albino gold project (“San Albino”) located in Nueva
Segovia, Nicaragua. A technical report for the updated mineral resource estimate will be filed i n accordance with
National Instrument 43 -101, Standards of Disclosure for Mineral Projects (“NI 43 -101”) under the Company’s
SEDAR profile at www.sedar.com within 45 days of this news release , and on the Company’s websi te at
www.makominingcorp.com.
This updated technical report is part of the corporate objectives established for Mako following the management
changes that were announced in 2019 (see press releases dated March 13, 2019 and August 9, 2019 ). In 2019, an
infill drill program was initiated, which grew to over 24,000 meters (“m”), that focused primarily on the first 120 m
from surface at San Albino. The goal of the infill drill ing program was to better define the open pit mineral
resource estimate in the preliminary economic assessment dated April 29, 2015 , prepared by P&E Mining
Consultants Inc. (the “2015 PEA”), which is superseded by this updated technical report . As the infill drilling
program progressed, an internal geological model was created and in February 2020 that internal model was handed
off to MDA as the foundation for the updated mineral resource estimate . MDA found the Company’s internal
model useful and reasonable, and refined the model only slightly before using it to control the estimate.
MDA believes that the exploration procedures, sampling and data derived by Mako is high quality and that the
Company’s internal geological model w as sound and required few changes. MDA has also been retained to begin
evaluating the exploration work being performed at the Las Conchitas area, with the goal of preparing a maiden
mineral resource estimate.
Akiba Leisman, Chief Executive Officer of Mak o states that “this updated technical report confirms San Albino’s
rank among the highest-grade open pit gold projects in the world. Importantly, it is the first time a mineral resource
estimate has been calculated at San Albino where the domains used for estimation are an accurate representation of
the geological controls that define the high -grade mineralization. In addition, MDA, led by Principal Geologist
Steve Ristorcelli, has conservatively reflected the selective open pit mining methods presently being utilized at San
Albino, such that management has confidence that the fully diluted open pit grade of 9.54 g/t Au in the Measured
and Indicated categories can be met or exceeded when mined. It should also be noted that the mineralization at San
Albino remains open along strike and at depth , and that while a substantial portion of the underground resource in
the Inferred mineral resource category from the 2015 PEA was not included in this resource update, it is in part due
to the lack of drilling below 120 m at San Albino since 2013. T he Company plans to begin addressing the
underground potential at San Albino in 2021 and looks forward to continuing to work with MDA on future mineral
resource estimates at San Albino, Las Conchitas and other exploration targets on our approximately 188 square
kilometer land package.”
Mineral Resources
For reporting, technical and economic factors likely to influence the “reasonable prospects for eventual economic
extraction” were evaluated using the best judgement of MDA. In evaluating the open -pit potential, MDA ran a
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series of optimized pits using variable gold prices and p arameters. The chosen mining cost is US$2 per tonne
(“/t”), processing cost US$60/t, G&A cost US$5/t and metallurgical recoveries used are 95% and 70% for gold and
silver, respectively. To evaluate the potential for underground mining, MDA ran a series o f stope optimizations at
variable cutoffs and for the reporting cutoff grade MDA assumes an average mining cost of US$70/t, processing
cost of US$60/t and G&A of US$10/t. The factors used in defining cutoff grades are based on US$1,750/oz gold.
For greater clarity, all mineral resources categorized by MDA, including the Inferred mineral resources, are part of
a likely economic extraction plan.
Open Pit, Underground and Historical Dumps
Measured
Cutoff Tonnes g/t Au Oz Au g/t Ag Oz Ag
Various* 115,200 11.74 43,500 17.6 65,100
Indicated
Cutoff Tonnes g/t Au Oz Au g/t Ag Oz Ag
Various* 426,300 9.86 135,100 17.4 238,600
Measured and Indicated
Cutoff Tonnes g/t Au Oz Au g/t Ag Oz Ag
Various* 541,500 10.21 177,800 17.4 303,700
Inferred
Cutoff Tonnes g/t Au Oz Au g/t Ag Oz Ag
Various* 421,600 7.44 100,900 12.6 170,600
* Various includes the fully diluted method for the open pit, for underground resources a
cutoff grade of 2.5 g/t Au is used and for historical dumps a cutoff grade of 1.0 g/t Au is
used.
Open Pit
Measured
Tonnes g/t Au Oz Au g/t Ag Oz Ag
Fully Diluted* 114,700 11.78 43,400 17.5 64,700
Indicated
Tonnes g/t Au Oz Au g/t Ag Oz Ag
Fully Diluted* 196,200 8.25 52,000 15.6 98,500
Measured and Indicated
Tonnes g/t Au Oz Au g/t Ag Oz Ag
Fully Diluted* 310,900 9.54 95,400 16.3 163,200
Inferred
Tonnes g/t Au Oz Au g/t Ag Oz Ag
Fully Diluted* 226,700 8.50 62,000 14.1 102,400
* Effectively, all estimated vein material is above cutoff. The fully diluted open pit grade
was determined by applying 1.0 m of dilution comprised of a 0.5 m rind both above and
below all veins.
Underground
Measured
Cutoff g/t Au Tonnes g/t Au Oz Au g/t Ag Oz Ag
2.5 500 10.20 100 28.9 400
Indicated
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Cutoff g/t Au Tonnes g/t Au Oz Au g/t Ag Oz Ag
2.5 230,100 11.24 83,100 18.9 140,100
Measured and Indicated
Cutoff g/t Au Tonnes g/t Au Oz Au g/t Ag Oz Ag
2.5 230,600 11.22 83,200 19.0 140,500
Inferred
Cutoff g/t Au Tonnes g/t Au Oz Au g/t Ag Oz Ag
2.5 116,100 8.42 31,400 13.7 51,200
Historical Dumps, Inferred
Cutoff g/t Au Tonnes g/t Au Oz Au g/t Ag Oz Ag
1.0 78,800 2.95 7,500 6.7 17,000
Composites
Composite lengths of 1.0 m were used to support a resource block size of 1.0 m high. Although the majority of
sample lengths are 1.0 m or less in the veins and halos , some de-compositing was necessary. MDA evaluated the
models using 1.0 m and 1.5 m composites, and the model performed better using 1.0 m composite intervals.
Capping of samples was done prior to compositing. Details of capping levels and number of samples are given in
the table below . Capping levels were determined considering coefficients of variation (“CV”), cumulative
probability plots, and outlier sample locations.
Domain Au Capping
level (g/t)
Number
capped
Ag Capping
level (g/t)
Number
capped
Arras vein 100 7 150 7
Naranjo vein 65 5 80 5
San Albino vein 100 7 150 5
Historical Dumps 25 42 70 21
Descriptive statistics of the composite samples are given in the table below.
Arras Vein
Valid Median Mean Std Dev CV Minimum Maximum Units
Au 698 7.65 14.30 19.26 1.3 0.04 212.69 g/t
Au Capped 698 7.65 13.91 16.71 1.2 0.04 100.00 g/t
Ag 693 19.0 27.2 28.7 1.0 0.4 204.2 g/t
Ag Capped 693 19.0 26.9 27.2 1.0 0.4 150.0 g/t
Naranjo Vein
Valid Median Mean Std Dev CV Minimum Maximum Units
Au 121 13.80 20.99 20.82 0.9 0.06 89.87 g/t
Au Capped 121 13.80 20.20 18.69 0.9 0.06 65.00 g/t
Ag 121 19.5 29.3 32.2 1.1 2.1 193.0 g/t
Ag Capped 121 19.5 26.2 21.4 0.8 2.1 80.0 g/t
San Albino Vein
Valid Median Mean Std Dev CV Minimum Maximum Units
Au 750 9.42 16.25 18.16 1.1 0.05 136.00 g/t
Au Capped 750 9.42 16.03 17.08 1.0 0.05 100.00 g/t
Ag 750 17.9 26.4 25.5 0.9 0.3 177.0 g/t
Ag Capped 750 17.9 26.3 25.1 0.9 0.3 150.0 g/t
Mineral Domains
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Three major veins (San Albino, Naranjo and Arras) were modeled based on drill and trench data. For the San
Albino vein, which comprises the majority of the open pit mineral resource estimate, the hanging wall halo
mineralization was modeled separately from the footwall halo, while the mineral ized halos around Arras and
Naranjo were modeled as envelopes without a distinction of hanging wall and footwall. MDA did not separate vein
versus halo for the El Jobo vein or other “miscellaneous” veins. El Jobo and miscellaneous veins are a very small
part of the total mineral resource and are entirely categorized as Inferred mineral resources.
Two mineral domains – almost coincident with and driven by the geologic model – were used to control the gold
and silver resource estimate: a low -grade halo d omain containing mineralized wall rock with grades generally
between approximately 0.1 g/t Au and 2-4 g/t Au, and a vein domain beginning at approximately 2-4 g/t Au.
The gold mineralization in the low -grade domain is in sheared and/or brecciated wallrock in the margins of gold -
bearing quartz veins and contains sparse, often broken or brecciated, discontinuous quartz veins. The vein domain
comprises quartz vein with mi nor sulfides, and minor , intensely sheared and mineralized wall rock. Cumulative
probability plots indicate the presence of a third and higher -grade sub-domain above approximately 20 -30 g/t Au.
This high-grade mineralization is contained in quartz veins with “styolitic” textures, galena, and common visible
gold. Although distinct, the higher -grade quartz vein domain was not modeled separately from the main vein
domain because of volume and continuity considerations.
Estimation
A conservative approach has been applied to all estimation, particularly where there is any uncertainty. The San
Albino vein, where the vast majority of the open pit ounces are located, was particularly well drilled. In the San
Albino vein, about half of the block grade estimates were based on the closest samples ≤10 m away, and 85% of all
blocks were located within 30 m of a composite sample. Classification of the mineral resources considered
adequacy and reliability of sampling, geologic understanding, results of quality cont rol analyses, geologic
complication, and apparent grade continuity. A Measured mineral resource classification was permitted only in the
San Albino vein, because there is a very good understanding of its geology and because there is extensive drilling
and trench sampling. Indicated mineral resources were permitted only in San Albino and Arras veins. All Naranjo
vein has been classified as an Inferred mineral resource because its geology is poorly understood, but like all
Inferred mineral resources, resource classification there will most likely be upgraded with additional drilling.
Historical workings at Arras are likely substantially underreported so an area around suspected workings ha s been
classified as Inferred mineral resources. Furthermore, any block that touches modeled workings is classified as
Inferred mineral resources, in addition to reducing tonnes for mining.
Dilution
Mining dilution is an important factor at San Albino i n part because the vein is , in some places , so thin that the
dilution can render it uneconomic, but also because the operation requires very detailed grade control. A helpful
feature of the vein is that in many places it has distinct hanging wall and foot wall contacts, which aid with grade
control. This mineral resource includes an approximately 0.5 m rind of dilution both above and below the vein.
The dilution grade varies from zero to averaging up to 0.5 g/t Au. In all cases, the dilution grade is tak en from the
mineral resource estimate and is not a singularly applied grade. It is expected that underground dilution will be
greater because of ground conditions, shallow dip, minimum mining height, and less control on locating hanging
wall and footwall. MDA is reporting full -block-diluted grades for the underground for all material within the
optimized stopes at a mining cutoff of 2.5 g/t Au (blocks are 1.0 m high by 1.0 m across strike and 2.0 m long).
Potential for Increased Grade
Clustering of high-grade data necessitated use of a quadrant search to minimize spreading out the high grade. This
clustering is clearly demonstrated by the difference between Measured versus Indicated mineral resource grades.
While higher grade in higher -classification material is not unusual, at San Albino the effect was exaggerated by
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normal exploration and follow-up drilling to better define the higher grades. Given that history, both the Indicated
and Inferred mineral resource grades may increase as well.
Post Model Performance
After the effective date of th e current mineral resource estimate, t here were seven new holes with assays in the
mineralized zone or projection of the mineralized zone. Four of those holes drilled areas where the model predicted
no mineralization, which was confirmed by this later drilling . The other three holes were drilled into areas where
mineralization was expected . O ne intersected good grade precisely where mineralization was expected, although
the model had interpolated that area as low-grade halo mineralization. The second hole intersected mineralization
with goo d grade where adjacent holes on either side of a fault were lower grade, however the location of the
mineralization was substantially different than expected as the mineralized zone had been offset by faulting. The
area around this fault is classified as Inferred mineral resources. Indeed, all mineralization around these faults is
classified as Inferred mineral resources because of th is known lack of certainty of location. The third hole
intersected the vein where predicted and encountered better than expected grade.
Importantly, San Albino is open along strike and a t depth, and with additional drilling, MDA believes that mineral
resources are likely to be upgraded and expanded.
2015 Resource Estimate
The 2015 PEA estimated mineral resources totaling 152,000 Indicated ounces of gold and 787,000 Inferred ounces
of gold. This updated mineral resource estimate totals 177,800 Measured and In dicated ounces and 100,900
Inferred ounces of gold. Comparing the 2015 and 2020 models, it was evident that the general location of the 2015
mineralized zone w as modeled appropriately with respect to locations of the principal domains albeit generous in
thickness and extrapolation. Several 2015-modeled solids depicting vein mineralization have since been drilled
showing that mineralization does not exist where mo deled in 2015. Another reason for the difference is that MDA
took a more conservative approach to modeling extrapolations and projections from drill data , where no drilling
was done since 2013. The 2020 volume of modeled veins and veins -plus-halo were 89 % and 46% lower,
respectively, compared to the 2015 single-domain volumes.
An important difference between the 2015 and 2020 models is the interpretations of the mineralization. The vein
and vein zones ( both averaging >15 g/t Au) have distinct, sharp-bounded contacts usually within low -grade halos.
By modeling these veins and halos as one in 2015 , the extreme high -grades in the vein were spread out into the
larger volume of the halo in the estimate, thereby over-estimating metal, albeit at lower grades than exist in the vein
and vein zones.
Qualified Person
Steven Ristorcelli, CPG, a geologist and qualified person (as defined under NI 43 -101) has read and approved the
technical information contained in this press release. Mr. Ristorcelli is t he Principal Geologist at Mine
Development Associates in Reno, Nevada working on the updated mineral resource estimate for San Albino.
On behalf of the Board,
Akiba Leisman
Chief Executive Officer
About Mako
Mako Mining Corp. is a publicly listed gold mining, development and exploration firm. The Company is
developing its high -grade San Albino gold project in Nueva Segovia, Nicaragua. Mako’s primary objective is to
bring San Albino into production quickly and efficiently, while continuing exploration of prospective targets in
Nicaragua.
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For further information: Akiba Leisman, Chief Executive Officer, Telephone: 203 -862-7059, E -mail:
[email protected] or visit our website at www.makominingcorp.com and SEDAR www.sedar.com.
Forward-Looking Information: Some of the statements contained herein may be considered “forward -looking information”
within the meaning of applicable securities laws. The forward -looking information contained herein is based on the
Company’s current plans, expectations and assumptions, including the expectation that narrow, high -grade structures at San
Albino can be mined open pit with limited levels of dilution; that the average diluted grade will likely drift lower as more
benches are mined at San Albino; that the updated technical report will be filed within 45 days from this news release; that a
maiden mineral resource estimate will be completed at Las Conchitas; that the Company will begin to address in 2021 the lack
of drilling below 120 m at San Albino; that the Company will continue to work with MDA on future mineral resource updates
at San Albino, Las Conchitas and other exploration targets on its land package; that the estimated costs and cut -off grades
used in the mineral resources estimates will prove to be ac curate; the expectation that the current grade s may increase and
mineral resources may be expanded. . Such forward-looking information is subject to a variety of risks and uncertainties which
could cause actual events or results to differ materially from th ose reflected in the forward -looking information, including,
without limitation, the risk of economic and/or technical failure at the San Albino project associated with making a production
decision without demonstrated economic and technical viability; that grades may not increase; that mineral resources may not
be expanded; the Company determines not to work with MDA on additional work in the future; that the cut -off grades and
other assumptions used in th e mineral resource estimates do not p rove accurate; that the Company does not continue to find
positive results from its reconnaissance exploration program and proposed drilling on its concessions; that exploration and
assay results do not confirm continuity of mineralization as expected; po litical risks and uncertainties involving the Company’s
exploration properties; the inherent uncertainty of cost estimates and the potential for unexpected costs and expense;
commodity price fluctuations and other risks and uncertainties as disclosed in th e Company’s public disclosure filings on
SEDAR at www.sedar.com. Such information contained herein represents management’s best judgment as of the date hereof,
based on information currently available and is included for the purposes of providing investors with the Company’s plans and
expectations regarding the San Albino project, and may not be appropriate for other purposes. Mako does not undertake to
update any forward-looking information, except in accordance with applicable securities laws.
Neither t he TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.