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NGEx Reports Initial Filo del Sol Inferred Resource Containing 2.9 Million Ounces Gold, 87.8 Million Ounces Silver, 2.3 Billion Pounds Copper

Dec 2, 2014 - 05:55 ET
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VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 2, 2014) - NGEx Resources Inc. (TSX:NGQ)(NASDAQ OMX:NGQ) ("NGEx" or the "Company") is pleased to announce the initial mineral resource estimate for the Filo del Sol silver-copper-gold deposit. The deposit is located on the border between Chile and Argentina and is 100% controlled by NGEx. These results confirm a large resource with a significant oxide component and distinct high grade silver and copper zones. All mineral zones remain open to expansion.

Filo del Sol is a high-sulphidation epithermal copper-gold-silver deposit. Overlapping mineralizing events combined with weathering effects, including supergene enrichment, have created several different styles of mineralization at Filo, including structurally-controlled gold, manto-style high-grade silver (+/- copper) and high-grade supergene enriched copper within a broader envelope of disseminated sulphide copper and gold mineralization. Filo del Sol is part of an emerging cluster of significant copper-gold deposits which includes the Company's nearby Los Helados and Josemaria deposits.

The resource estimate presented in Table 1 below represents the total Inferred Resource, divided between oxide and sulphide mineralization and based on a copper equivalent cutoff grade. Two higher-grade subsets of this resource are also broken out, one representing a discrete high-grade silver zone (the "Silver Zone") shown in Table 2, and one representing a higher-grade copper zone (the "Copper Zone") shown in Table 3. The Silver Zone and the Copper Zone are separate zones that are included within the total Inferred Resource envelope.

The total Inferred Resource for the Filo del Sol deposit, at a 0.30% CuEq1 cutoff grade is:

  • 280.5 million tonnes at a grade of 0.38% copper, 0.32 g/t gold, 9.7 g/t silver and 54 ppm molybdenum for a copper equivalent grade of 0.66% (2.3 billion pounds of copper, 2.9 million ounces of gold, and 87.8 million ounces of silver).

The Mineral Resource estimate as of the effective date of November 25, 2014 is shown in the tables below:

TABLE 1:

FILO DEL SOL TOTAL INFERRED MINERAL RESOURCE (0.3% CuEq Cutoff)
Resource Grade Contained Metal
Million Tonnes Cu (%) Au (g/t) Ag (g/t) Mo (ppm) CuEq1 (%) Cu (bill-
ion lbs)
Au
(mill-
ion oz)
Ag
(mill-
ion oz)
OXIDE 34.5 0.39 0.37 7.5 52 0.68 0.3 0.4 8.3
SULPHIDE 246.0 0.37 0.31 10.1 54 0.66 2.0 2.5 79.5
TOTAL 280.5 0.38 0.32 9.7 54 0.66 2.3 2.9 87.8
1 - Copper equivalent assumes metallurgical recoveries of 84% for copper, 70% for gold, 77% for silver and 60% for molybdenum based on similar deposits, as no metallurgical testwork has been done on Filo del Sol mineralization, and metal prices of US$3/lb copper, US$1300/oz gold, US$23/oz silver and US$12/lb molybdenum. The CuEq formula is: CuEq=Cu+Agx0.0102+Aux0.5266+Mox0.0003;
2 - The Qualified Person for the resource estimate is James N. Gray, P.Geo., of Advantage Geoservices Ltd.;
3 - All figures are rounded to reflect the relative accuracy of the estimate;
4 - Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability;
5 - The resource was constrained by a Whittle® pit shell using the following parameters: Cu $3/lb, Ag $23/oz, Au $1300/oz, Mo $12/lb, slope of 42°, mining cost of $2.2/t and process cost of $7.4/t.

The total resource shown above in Table 1 includes a subset of high-grade silver mineralization. The Silver Zone is tabulated below at three different silver cutoff grades.

TABLE 2:

FILO DEL SOL SILVER ZONE INFERRED MINERAL RESOURCE (Silver Zone only, by Silver Cutoff)
Resource Grade Contained Metal
Cutoff
Ag (g/t)
Million Tonnes Cu (%) Au (g/t) Ag (g/t) Mo (ppm) CuEq1 (%) Cu (bill-
ion lbs)
Au
(mill-
ion oz)
Ag
(mill-
ion oz)
80 6.3 0.50 0.42 142.4 84 2.20 0.1 0.1 28.7
50 11.8 0.45 0.40 105.5 79 1.77 0.1 0.2 40.1
20 17.7 0.41 0.40 82.7 73 1.49 0.2 0.2 47.1

The total resource shown above in Table 1, also includes a subset of higher-grade copper mineralization which is in addition to the high-grade silver zone. The Copper Zone is tabulated below at two different copper cutoff grades.

TABLE 3:

FILO DEL SOL COPPER ZONE INFERRED MINERAL RESOURCE (Copper zone only, by Copper Cutoff)
Resource Grade Contained Metal
Cutoff
Cu (%)
Million Tonnes Cu (%) Au (g/t) Ag (g/t) Mo (ppm) CuEq1 (%) Cu
(bill-
ion lbs)
Au
(mill-
ion oz)
Ag
(mill-
ion oz)
0.70 17.3 1.19 0.37 16.1 72 1.57 0.5 0.2 9.0
0.50 38.3 0.85 0.36 12.8 71 1.20 0.7 0.4 15.8

Commenting on today's news release, Wojtek Wodzicki, President and CEO of NGEx stated, "We are very pleased with these results. The initial Resource estimate is an important milestone and demonstrates the potential of Filo del Sol to host high-grade silver mineralization along with significant copper, gold, and molybdenum. Filo del Sol is the largest alteration zone in this part of the Andes and drilling to date has tested only a small portion of it. We are optimistic that further drilling can add significantly to the current resource."

ESTIMATION METHODS

The resource estimate was completed by James N. Gray, P.Geo., of Advantage Geoservices Ltd., an Independent Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Mineral Reserves, adopted by CIM Council, as amended. Estimation methods are summarized below. Further details of the estimation methods and procedures will be available in a NI 43-101 Technical Report which will be filed on SEDAR (www.sedar.com), within 45 days from the date of this release.

The resource estimate is controlled by a geologic model based on the interpretation of drilling on 100 metre spaced cross-sections. Ninety holes (16 core and 74 RC) have been utilized in the resource estimation. Copper, silver, gold, and molybdenum assays were composited to a constant length of two metres. Outliers to the composite distributions were controlled by high-grade capping. Grades for the four elements were estimated by ordinary kriging using Gemcom® software, into 15 x 15 x 10m blocks. Average rock densities were applied based on the geologic model. A total of 878 density measurements have been made on core samples. Bulk density for the deposit averages 2.31 tonnes/m3.

Reasonable prospects of economic extraction were established by the optimization of a Whittle® pit shell using the following parameters: Cu $3/lb, Ag $23/oz, Au $1300/oz, Mo $12/lb, slope of 42°, mining cost of $2.2/t and process cost of $7.4/t. Blocks were assigned as Inferred Mineral Resource where they are: within 50m of a drillhole and/or have sample data in at least three octants of a 150m spherical search and fall within the optimized pit shell. At a copper equivalent cutoff grade of 0.3%, the optimized pit shell results in a strip ratio of 1.8:1.

2014-15 WORK PROGRAM

The planned 2014-2015 work program for the Filo del Sol project includes up to 8,000 metres of drilling which will be focused on expanding this initial resource laterally in all directions. A portion of the step out drilling program will target a potential feeder zone for the mineralization which has been highlighted by geophysical surveys. The program will also include a limited number of infill holes in key locations which will help to define the distribution of metal grades within the deposit, including arsenic which is present at elevated levels consistent with other high sulphidation epithermal deposits. Drilling is expected to start during December.

An induced polarization (IP) geophysical survey is currently underway, and will be used to guide the drilling outside of the resource area. IP has proven to be a very effective method to map out the mineralization and the current data set suggests there is good potential to expand the high-grade Copper and Silver zone mineralization, particularly to the west.

About NGEX

NGEx is a Canadian mineral exploration company with exploration projects in Chile, Argentina, and Canada. The Company's shares are listed on the Toronto Stock Exchange and NASDAQ OMX under the symbol "NGQ". The Company's focus is on advancing its South American projects which include several large copper-gold systems including the Josemaria, Los Helados, and Filo del Sol projects, located on a land package that the Company holds in Chile's Region III and adjacent San Juan Province, Argentina. Los Helados is part of a joint venture in which the Company holds 60% and Pan Pacific Copper Co., Ltd. holds 40%. Josemaria is part of a joint venture in which the Company holds 60% and Japan Oil, Gas, and Metals National Corporation (JOGMEC) owns 40%. In addition, NGEx holds a 100% interest in Filo del Sol and an extensive portfolio of other 100% owned early stage exploration projects located in Chile and Argentina. It also owns a 100% interest in the GJ copper and gold project located in British Columbia, Canada. The GJ project is optioned to Teck Resources who are earning up to a 75% interest.

On behalf of the board

Wojtek Wodzicki, President and CEO

Qualified Persons

Mr. James N. Gray, P.Geo., of Advantage Geoservices Ltd., is an Independent Qualified Person as defined by National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) and is an independent consultant to the Company. Mr. Gray prepared the Mineral Resource Estimate and has reviewed and approved the technical information contained in this news release.

Mr. Bob Carmichael, B.A.Sc., P.Eng., is the Qualified Person as defined by National Instrument 43-101. Mr. Carmichael is Vice President, Exploration for the Company and has reviewed and verified that the technical disclosure contained in this news release is accurate.

Cautionary Note Regarding Forward-Looking Statements and Information

This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of NGEx Resources Inc. All statements in this news release other than statements of historical facts are "forward-looking information". Forward-looking information includes, but is not limited to, statements with respect to the resource potential, quantity and/or grade of minerals, potential size of a mineralized zone, potential expansion of mineralization, timing of and results of future exploration and/or mineral resource estimates, success of future exploration or development plans. Generally, this forward-looking information can be identified by the use of forward-looking terminology such as "is optimistic that", "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative connotations thereof. All such forward-looking information is based on the opinions and estimates of the relevant management as of the date such statements are made and are subject to important risk factors and uncertainties, many of which are beyond the Company's ability to control or predict.

Forward-looking information is necessarily based on estimates and assumptions that are inherently subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: risks and uncertainties relating to, among other things, changes in commodity prices, currency fluctuation, financing, unanticipated resource grades, infrastructure, results of exploration activities, cost overruns, availability of materials and equipment, timeliness of government approvals, taxation, political risk and related economic risk and unanticipated environmental impact on operations as well as other risks and uncertainties described under "Risks Factors" in the Company's Annual Information Form available under the Company's profile at www.sedar.com and the Company's website.

Although the Company has attempted to identify important factors that would cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated, or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. All of the forward-looking information contained in this document is qualified by these cautionary statements. Readers should not place undue reliance on forward-looking information.

Forward-looking information is provided for the purpose of providing information about management's current expectations and plans and allowing investors and other to get a better understanding of the Company's operating environment. These factors are not, and should not be construed as being, exhaustive. Statements relating to "mineral resources" are deemed to be forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions that the mineral resources described can be profitably produced in the future. The forward-looking information contained in this press release is expressly qualified by this cautionary statement. The Company expressly disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.


FOR FURTHER INFORMATION PLEASE CONTACT:

Sophia Shane
Corporate Development
+1 604 689 7842

Robert Eriksson
Investor Relations, Sweden
+46 70 111 2615



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