Morro Bay and Riverside Resources Inc. Announce Filing Of NI 43-101 Technical Report For The Jesus Maria Silver And El Capitan Gold Zones, Penoles Project, Durango State, Mexico
April 16, 2015 - Vancouver, BC: Morro Bay Resources Ltd. (“Morro Bay”) (TSX-V:MRB) and Riverside Resources Inc. (“Riverside”) (TSX-V:RRI) are pleased to report that they have filed a project-first, independent resource estimate for the Jesus Maria Silver Zone (“Jesus Maria”) and the El Capitan Gold Zone (“El Capitan”) prepared in accordance with Canadian Securities Administrators’ National Instrument 43-101 (the “Report”). The Report may be found at Morro Bay’s or Riverside’s websites or under their respective profiles at www.sedar.com. The independent Report, dated April 16, 2015 and effective March 2, 2015, entitled “Peñoles Gold-Silver Project El Capitan & Jesus Maria, Durango State, Mexico, 2015 Mineral Resource Estimate NI 43-101 Technical Report” was issued by Robert C. Sim (P.Geo.) of SIM Geological Inc., Ben Whiting (P.Geo.) of Whiting Geological Consulting Inc., and Mike Redfearn (P.Eng) of Inspectorate Exploration and Mining Services. The Report provides detail to the disclosure contained in the two Companies’ news release issued March 2, 2015, announcing the key findings included in the Report.
The Report includes a mineral resource estimate for the Jesus Maria Silver Zone based on results from 30 diamond drill-core holes and 3,114 metres of drilling completed as at December 30, 2014, and consists of (30 g/t silver cut-off):
- An inferred resource of 7.6 million tonnes containing 15,158,000 ounces of silver at an average grade of 62.3 g/t and 26,000 ounces of gold at an average grade of 0.105 g/t gold. (See table below).
The mineral resource estimate for the El Capitan Gold Zone is based on results from 50 diamond drill-core holes and 7,004 metres of drilling completed as at December 30, 2014, and consists of (0.25 g/t gold cut-off):
- An inferred resource of 20.7 million tonnes containing 305,000 ounces gold at an average grade of 0.458 g/t gold and 1,832,000 ounces of silver at an average grade of 2.8 g/t silver. (See table below).
PENOLES PROJECT RESOURCE PROVIDED IN THE REPORT
Table 1: Inferred Mineral Resource Estimate
The “base case” cut-off grades of 0.25g/t gold at El Capitan and 30g/t silver at Jesus Maria, are based on projected metal prices of $1300/oz gold and $20/oz silver. Variations in these projected prices results in changes to the cut-off grades. The sensitivity of mineral resources to cut-off grade is presented in Tables 2 and 3.
Table 2: Sensitivity of El Captain Mineral Resource To Cut-off grade
Table 3: Sensitivity of Jesus Maria Mineral Resource to Cut-off grade
Further details of the estimation methods and procedures are available in the Report.
ABOUT THE PENOLES PROJECT
The Peñoles Project includes two historic silver mines (Jesus Maria and San Rafael), an oxide gold prospect (referred to as El Capitan) and numerous exploration targets located in the historic Peñoles Mining District of Durango, Mexico. Bedrock exposure combined with surface trenching and drilling have identified several epithermal type vein systems, poly-metallic skarns, and silicified breccia zones localized at or near the unconformity between Tertiary age volcaniclastic rocks and Cretaceous aged sediments. Approximately 86 diamond drill holes totaling more than 11,550 metres have now been completed at the Project. The Jesus Maria and El Capitan mineralized zones have not been completely delineated and are open for expansion in several directions.
Morro Bay Resources holds an option to purchase up to a 65% interest in the Peñoles project from Riverside. Morro Bay can earn an initial 51% interest by making a payment of $750,000 to Riverside by May1, 2015 (payable in cash or Morro Bay shares (valued at $0.05 per share), at Morro Bay’s election).
The mineral resource estimates disclosed in this press release were estimated by Robert Sim who is a Qualified Person within the meaning of NI 43-101 for the purposes of mineral resource estimates in the Report. Estimates are made from 3-dimensional block models based on geostatistical applications using commercial mine planning software (MineSight® v9.50-01). The project limits are based in the UTM coordinate system using a nominal block size of 10 x 5 x 10 metres, with the shorter blocks roughly perpendicular to the east-southeast oriented strike direction of the deposits. Diamond drilling is conducted from surface drill stations in the hangingwall of the deposits. Holes are generally spaced at 40m intervals and drilled to depths of between 100 metres and 200 metres below surface.
The resource estimate has been generated from drill hole sample assay results, and limited surface trench and underground drift channel samples, and the interpretation of a geologic model which relates to the spatial distribution of gold and silver in the El Capitan and Jesus Maria deposits. Interpolation characteristics have been defined based on the geology, drill hole spacing and geostatistical analysis of the data. The resources have been classified by their proximity to the sample locations and are reported, as required by NI43-101, according to the CIM standards on Mineral Resources and Reserves. Both deposits are at a relatively early stage of evaluation by drilling and, as a result, some assumptions have to be made using the available data. Classification at El Capitan is primarily influenced by the nature of gold in the deposit. Similarly, classification at Jesus Maria is primarily driven by the distribution of silver in the deposit. Visual observations and studies of indicator variogram ranges suggest that zones of continuous mineralization, above the base case cut-off limits, can be inferred when drill holes are spaced at a maximum distance of 150 metres. Therefore, blocks in the model within a maximum distance of 75 metres from a drill hole have been included in the Inferred category.
Gold and Silver mineralization occurs over relatively continuous zones for over 500 metres of strike length at Jesus Maria and for over 1 kilometre of strike at El Capitan. Floating cone pit shells, based on projected technical and economic parameters, suggest that mineralization to depths of 150 metres below surface exhibits reasonable prospects for eventual economic extraction using open pit extraction methods. The Mineral Resource statements for the El Capitan and Jesus Maria deposits, listed in Table 1, are not constrained within pit shells but include mineralization, above cut-off, that is within a maximum depth of 150 metres below surface. There are no adjustments for recovery or dilution in the statement of mineral resources. It is important to realize that these are estimates of mineral resources, not mineral reserves, as the economic viability has not been demonstrated.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied. The mineral resource estimates referenced in this press release and the Report use the term "Inferred Mineral Resources." While this term is defined by Canadian regulations (under NI 43-101), it is not recognized by the U.S. Securities and Exchange Commission ("SEC"). "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. The SEC normally only permits issuers to report mineralization that does not constitute SEC Industry Guide 7 compliant "reserves" as in-place tonnage and grade without reference to unit measures. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves. Morro Bay and Riverside Resources are not SEC registered companies.
ABOUT MORRO BAY
Morro Bay is a junior mineral exploration company based in Calgary, Alberta, Canada, focused on the exploration for precious metals in Mexico. Morro Bay's business strategy is to build shareholder value by rapidly advancing the Peñoles Project in Mexico through the resource delineation stage.
ABOUT RIVERSIDE RESOURCES INC.
Riverside is a well-funded prospect generation team of focused, proactive precious and base metal discoverers. The Company currently has more than $3,000,000 in the treasury and approximately 37,000,000 shares outstanding. The Company’s model of growth through partnerships and exploration uses the prospect generation business approach to own resources, while partners share in de-risking projects en route to discovery. Riverside has additional properties available for option with more information available on the Company’s website at www.rivres.com.
For additional information contact:
John C. Zang
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Information in this news release may contain forward looking information. Statements containing forward looking information express, as at the date of this news release, the Company's plans, estimates, forecasts, projections, expectations, or beliefs as to future events or results and are believed to be reasonable based on information currently available to the company. There can be no assurance that forward-looking statements will prove to be accurate. Readers should not place undue reliance on forward-looking information.
The forward-looking information contained in this news release is as of the date hereof and Morro Bay does not undertake any obligation to update publicly or to revise any of the included forward looking statements contained herein, except as required by applicable law. The forward-looking statements contained herein are expressly qualified by this cautionary statement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state in the United States in which such offer, solicitation or sale would be unlawful. The securities referred to herein have not been and will not be registered under the United States Securities Act of1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.