This news release constitutes a “designated news release” for the purposes of the Company’s prospectus supplement dated May 17, 2021 to its short form base shelf prospectus dated January 29, 2021.
Americas Gold and Silver Corporation (TSX:USA) (NYSE:USAS) (“Americas” or the “Company”), a growing North American precious metals producer, is pleased to provide an exploration update for the Galena Complex and corporate update.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210712005267/en/
Figure 1: Phase 2 Exploration Targets (Section looking North) (Graphic: Americas Gold and Silver Corporation)
Highlights
- Phase 1 drilling of the Recapitalization Plan is complete and the results will be incorporated into the updated mineral reserve and resource estimates expected before the end of August 2021.
- Targeted mineral resource additions through June 2021 of least 50 million ounces of silver, on a 100% basis for the property.
- Initial 21-hole drill program targeting the downdip extension of the prolific Silver Vein all hit high grade mineralization and is now complete. Highlighted recent drill results include:
- Hole 55-183: 3,345 g/t silver and 2.8% copper (3,633 g/t silver equivalent [1]) over 3.8 m [2]
including: 13,800 g/t silver and 11.1% copper (14,900 g/t silver equivalent) over 0.5 m
- Hole 55-143: 2,460 g/t silver and 2.1% copper (2,680 g/t silver equivalent) over 4.1 m
including: 7,060 g/t silver and 5.4% copper (7,620 g/t silver equivalent) over 0.6 m
- Hole 55-184: 3,966 g/t silver and 4.0% copper (4,372 g/t silver equivalent) over 2.2 m
including: 7,610 g/t silver and 7.6% copper (8,390 g/t silver equivalent) over 0.5 m
- Hole 55-183: 3,345 g/t silver and 2.8% copper (3,633 g/t silver equivalent [1]) over 3.8 m [2]
- Phase 2 drill program expected to start in Q3-2021 and will initially target extensions of the three south-east plunging veins at depth (72 Vein, Silver Vein and 360 Complex) from the first of several planned drill stations further east to determine the extent and potential source of these similar vein structures. In addition, the Company will also target the Vulcan Gap, which is located between surface and the 2400-Level.
- Targeted resource growth from the Phase 2 drilling program is an additional 50 million ounces of silver resources, on a 100% basis for the property.
“The Phase 1 drilling at the Galena Complex has been a tremendous success,” stated Americas Gold and Silver President & CEO Darren Blasutti. “I am excited for the results to be incorporated into the updated mineral reserve and resource estimates for the Galena Complex which I believe will continue to showcase the resource potential when capital is allocated to drilling. The recent drilling of the Silver Vein has been remarkable and I believe the Phase 2 drilling will continue to demonstrate the potential of the property at depth.”
Galena Update
The Company has completed the Phase 1 drilling program as part of the Galena Complex Recapitalization Plan. The Company’s most recent mineral resource update, which was released in September 2020, already demonstrated the significant exploration potential at the property with Measured and Indicated Resource increasing by 36% and Inferred Resource increasing by 100%.
The Company expects to provide an updated Mineral Resource estimate by the end of August 2021. The Company is confident that based on the continued exploration success, from drilling completed during July 2020 through June 2021, that the resource estimates will increase by the Company’s target for over 50 million ounces of silver, when considering Galena on an 100% basis.
The Company expects 2021 to be a transitional year at the Galena Complex from a production standpoint with continued exploration drilling supporting production growth toward a 2 million silver ounce per year plan by the end of 2022. Longer term, and assuming continued exploration success, the Company is confident that the operation will again reach peak historical annual production levels of approximately 5 million ounces per year.
Continued Exploration Success of Deep Extension of Silver Vein
The initial 21-hole drill program targeting the newly discovered Silver Vein at depth is complete with all holes intersecting mineralization. Most recent high-grade results include:
- Hole 55-183: 3,345 g/t silver and 2.8% copper (3,633 g/t silver equivalent) over 3.8 m
including: 13,800 g/t silver and 11.1% copper (14,900 g/t silver equivalent) over 0.5 m
- Hole 55-143: 2,460 g/t silver and 2.1% copper (2,680 g/t silver equivalent) over 4.1 m
including: 7,060 g/t silver and 5.4% copper (7,620 g/t silver equivalent) over 0.6 m
- Hole 55-184: 3,966 g/t silver and 4.0% copper (4,372 g/t silver equivalent) over 2.2 m
including: 7,610 g/t silver and 7.6% copper (8,390 g/t silver equivalent) over 0.5 m
- Hole 55-173: 1,747 g/t silver and 2.0% copper (1,968 g/t silver equivalent) over 1.5 m
including: 12,400 g/t silver and 16.2% copper (14,100 g/t silver equivalent) over 0.1 m
- Hole 55-181: 1,185 g/t silver and 1.4% copper (1,330 g/t silver equivalent) over 1.9 m
and: 738 g/t silver and 0.5% lead (790 g/t silver equivalent) over 2.1 m
- Hole 55-186: 2,264 g/t silver and 3.1% copper (2,588 g/t silver equivalent) over 0.5 m
A full table of drill results can be found at:
https://americas-gold.com/site/assets/files/4297/dr20210712.pdf.
Phase 2 Exploration Program
The Phase 2 drill program is expected to start in Q3-2021 with several targets identified. Drilling at depth will continue to focus on the three south-east plunging veins which include the 72 Vein, the Silver Vein and what is believed to be the top of the 360 Complex. Drilling will commence from a newly developed drill station further east on the 5500-Level to continue to test the extension of the Silver Vein at depth following the success of the initial 21-hole drill program. Subsequent drill stations are planned further east on the 5500-Level to continue to target the Silver Vein and 360 Complex. The initial drilling success of the 360 Complex during Phase 1 is believed to be the top of the system with the potential to extend at depth. Phase 2 will include continued exploration in gap areas within this south-east plunging trend to determine continuity and potential sources of these high-grade mineralized vein systems.
In addition to this deeper drilling, the Company will also target the Vulcan Gap, which has been historically underexplored and is located between surface and the 2400-Level.
The goal of Phase 2 drilling is to add significant mine life in known vein systems and to discover new orebodies both at depth and near surface. The Company is targeting an additional 50 million ounces of silver from the Phase 2 drilling program, on a 100% basis for the property.
Service of Statement of Claim
The Company has been served with a statement of claim that was filed in the Ontario Superior Court of Justice (the “Court”) to commence a proposed class action lawsuit against the Company and its Chief Executive Officer (the “Action”). Pursuant to the Action, the representative plaintiff seeks damages of C$130 million in relation to the Company’s public disclosure concerning its Relief Canyon mine. Although no assurance can be given with respect to the ultimate outcome, the Company believes that the complaint against it is unfounded and without merit, and it intends to vigorously defend the proceeding. The Company does not believe nor admit that the service of a statement of claim in the Action itself constitutes a material change in the business, operations, or capital of the Company but is disclosing the Action for the purpose of incorporating this information into the Company’s prospectus supplement dated May 17, 2021.
