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Mineral Resource Estimate

LAS MINAS INITIAL MINERAL RESOURCE ESTIMATE

On August 1, 2017, Mexican Gold Corp. tabled its initial Mineral Resource Estimate for the El Dorado/Juan Bran and Santa Cruz zones, two of the eight known mineralized zones at the Las Minas property.

The total Inferred Resource is 719,000 gold equivalent ounces contained within 10,304,000 tonnes grading 2.17 g/t Au Eq. The total Measured and Indicated Resource is 304,000 Au Eq ozs contained within 4,970,000 tonnes grading 1.90 g/t Au Eq. The resource is largely pit constrained, with 13,868,000 tonnes contained within a pit shell. The weighted average grade of the open pit resource is 2.00 g/t Au Eq.  The underground total measured and indicated resource is 1,183,000 tonnes grading 3.00 g/t Au Eq. 

El Dorado/ Juan Bran & Santa Cruz Zones

The El Dorado / Juan Bran zone outcrops on surface and occurs as a flat lying to sub-horizontal body measuring approximately 650 metres N-S by 250 metres E-W. The zone varies in thickness from 6.0 to 28.0 metres.

The Santa Cruz zone is comprised of a series of high-grade stacked lenses of skarn mineralization that strike NW and dip approximately 50 degrees to the west. Overall dimensions of Santa Cruz mineralization are approximately 220m x 100m. 

The estimate was prepared by John T Boyd and based on data generated from 140 diamond drill holes totaling 19,636 metres of drilling and including 4,247 assays. The two zones remain open for expansion on strike and down dip.

See Table 1 for details concerning the estimate.

TABLE 1: El Dorado /Juan Bran & Santa Cruz Mineral Resource Estimate

Material Category Au  Eq
g/t
Au
g/t
Cu
%
Ag
g/t
Tonnes Au Eq
oz
Pit Constrained Measured 2.32 1.24 0.65 4.66 62,000 5,000
Pit Constrained Indicated 1.86 0.90 0.58 4.33 4,685,000 281,000
Pit Constrained Total M&I 1.87 0.91 0.58 4.34 4,747,000 286,000
Pit Constrained Inferred 2.06 1.02 0.64 3.69 9,121,000 605,000
Underground Measured 0.00 0.00 0.00 0.00 0 0
Underground Indicated 2.46 1.24 0.74 5.05 223,000 18,000
Underground Total M&I 2.46 1.24 0.74 5.05 223,000 18,000
Underground Inferred 2.99 1.57 0.86 6.25 1,183,000 114,000
PC + UG Measured 2.32 1.24 0.65 4.66 62,000 5,000
PC  + UG Indicated 1.89 0.92 0.58 4.36 4,908,000 299,000
PC + UG Total M&I 1.90 0.92 0.59 4.37 4,970,000 304,000
PC + UG Inferred 2.17 1.08 0.66 3.99 10,304,000 719,000

Notes to Table:

  1. Mineral Resources have an effective date of July 31, 2017 and are reported on a 100% ownership basis.
  2. Mineral Resources are calculated at a gold price of US$1,250 per troy ounce, a copper price of US$2.85 per pound and a silver price of US$16.75 per troy ounce.  Gold equivalent grade is calculated as Au Eq (g/t) = Au (g/t) + Ag (g/t) * 0.013 + Cu (%) * 1.564.  The factors for silver (0.013) and copper (1.564) will change depending on the metal price.  The metal price numbers listed above were used to determine the conversion factors presented herein.
  3. The Mineral Resources presented above are global and do not include a detailed pit or underground design, only an economic pit shell was used to determine the in-pit mineral resources. The underground Mineral Resources are that material outside of the in-pit Mineral Resources above the stated underground cut-off grade.
  4. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
  5. The Mineral Resources presented here were estimated using a block model with a block size of 10 m by 10 m by 10 m sub-blocked to a minimum block size of 5 m by 5 m by 5m using ID3 methods for grade estimation. All Mineral Resources are reported using an open pit gold cut-off of 0.46 g/t Au and an underground gold cut-off of 1.60 g/t Au.
  6. The Mineral Resources presented here were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.

Figures are rounded and totals may not add correctly

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