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Commodity: Polymetallic – Au, Ag, Pb, Zn, Cu
Deposit Type: Manto-Chimney, Polymetallic system
Location: Sonora, Mexico
Size: 2,604 hectares
Status: Optioned to Hochschild Mining

La Union Project is located in westerns Sonora approximately 30 km south of Caborca part of the orogenic gold trend and is within close proximity of major mines such as: Noche Buena, La Herradura and Cerro Colorado. La Union has only seen small-scale production dating back to the 1950s by Peñoles and local families. The Project has since been left unexplored until 2012, when Paget and Millrock started exploration work. High-grade rock chip samples taken by Paget and Millrock triggered Riverside’s attention to the project and in 2019, Riverside purchased the project as part of a five Mexico project portfolio acquisition.

Riverside has since worked on expanding its current footprint at the La Union Project evaluating the existing system of mineralization and its potential. October 2021 highlighted the high-grade gold mineralization (up to 59.8 g/t), Ag (833 g/t), Pb (5.8%), Zn (4.2%) in samples helping the Company better characterize the size of the system.

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Figure 1: Location of La Union project within the gold belt of Sonora

Riverside’s initial field work in September 2021 included selective rock sampling from abandoned mine workings and dumps with results returning up to 59.4 g/t Au and 833 g/t Ag (see Table 2). Further exploration work will begin shortly as the Company has completed its review.

La Union Polymetallic Project was previously defined as a manto-chimney style deposit that could potentially be linked to a porphyry-skarn system further at depth. The ongoing work has been demonstrating significantly high-grades in gold, silver, lead and zinc across mineralized areas. Near surface, the oxide gossan cap and carbonate replacement bodies are particularly extensive with strong similarities with the Leadville polymetallic system in Colorado, USA. At La Union the Paleozoic carbonate stratigraphic section is a composite of over 1,000 m thick regionally and the mineralization of chimneys and mantos is unexplored.

After completing a claim consolidation in September, Riverside conducted a follow up field mapping and sampling program of 103 samples with the best sample returning 83.2 g/t (2.6 oz/t) gold and 4,816 g/t (150 oz/t) silver. The work further enhanced Riverside’s understanding of the structural and lithological context by linking the small historical workings into a larger regional context. Although the Project is still in its initial stages, mineralization appears to be of manto-chimney and replacement type within Pre-Cambrian to Cambrian sedimentary rocks (see Figure 3 in Diagrams).

Following-up on this high-grade discovery Riverside’s team returned and was able to define the extent of the mineralization. The highlights of this latest work defined high grade polymetallic samples up to 30% Zn, 83.2 g/t Au, 4,816 g/t Ag, 10.3% Pb (see Table 1). Of the 103 samples assay value ranged from 83.3 g/t gold to non-detectable with about 30% of the samples returning significant values in gold, silver, lead and/or zinc the best being.

  • Au – high: 83.2 g/t; low cut-off: 0.5 g/t
  • Ag – high: 4,816 g/t; low cut-off: 300 g/t
  • Pb – high: 10.3%; low cut-off: 0.1%
  • Zn – high: 30%*; low cut-off: 0.1%

*30% Zn is the upper detection limit in analysis method performed

Table 1: Assays from La Union Polymetallic Project. Results from November 2021 program

Sample ID Au (g/t) Ag (g/t) Pb (%) Zn (%) Sample Type Width_m Description
RRI-10180 83.2 1.1 - - chips   oxide veining
RRI-10178 22.6 20.3 - - dump   oxide veining
RRI-7814 0.3 4816 10.3 3.5 chips   oxide veining
RRI-10155 0.0 14.7 1.1 30 dump   hanging wall copper oxides
RRI-10156 0.0 8.2 2 21.4 chips   gossan
RRI-10157 0.1 176 3.8 19.8 chips   carbonate replacement
RRI-10865 9.4 107.6 0.06 1.6 chip channel 0.8 oxides
RRI-10866 9.9 53.6 0.01 2.5 chip channel 1.6 brecciation with oxides
RRI-10888 3.6 373 7.3 7.3 chip channel 0.6 manto with copper oxides
RRI-10889 2.6 169.7 0.7 6.6 chip channel 1.5 brecciation with oxides
RRI-10869 4.2 42 2.3 3.5 dump   brecciation with oxides
RRI-10189 6.1 23.4 8.2 0.06 chips   oxide veining
RRI-7808 8.8 183.2 3.9 3.4 chips   oxide veining

Note: Best 13 assays from 103 samples collected.

 

Table 2: Sample Results from La Union Polymetallic Project (October 2021).

Sample ID Au (g/t) Ag (g/t) Pb (%) Zn (%) Cu (%) Type Description
RRI-7891 59.4 833 5.76 4.16 0.3 rock chip massive sulfide - dolomitic breccia
RRI-7895 40 3.3     0.13 mine dump massive sulfide and jasperoid
RRI-7894 8.3 239     0.17 mine dump jesperoid
RRI-7890 1.367 50 1.63 1.43   mine dump sulfide-oxide bearing breccia
RRI-7893 0.473 12.4       rock chip brecciated contact - dolmite/quartzite
RRI-7889 0.072 76.4       rock chip brecciated contact - dolmite/limestone

Note: Six of the higher-grade due diligence samples out of eight total are shown in Table 2.

Mineralization is primarily located within the Paleozoic sedimentary sequence, known in this area for reaching up to 1,000 m in thickness and host to multiple historical mines. Regionally the mountain range is characterized by alternating limestone, dolomite and quartzite; regionally contact mineralization has been observed to grow into a manto-chimney style deposits. These types of deposits tend to have higher metal grades, making this style of deposition attractive for exploration.

The La Union Project is part of the El Viejo Mountain range of NW Sonora, Mexico. The Sierra El Viejo comprises a thick sequence of Pre-Cambrian to Cambrian sedimentary units which the Company has been carefully mapping in detail. Many historical workings are spread across the range with the most extensive being the Union Mine, La Famosa Mine and El Plomito Mine; all located along the southern tip of the El Viejo range within Riverside’s mineral concessions.

Three sedimentary units have been identified from top to bottom: black limestone, quartzite, and grey limestone. Thicknesses of these units vary from 150 to 250 m with folding occurring mostly within the grey limestone, which is believed to be the primary reactive layer responsible for mineral deposition (see Figure 4 in Diagrams). As a weaker unit the grey limestone is prone to low angle thrusting while the quartzite units are more brittle and tend to fracture.

Post-mineral faulting also plays an important role. The west side of the property at the Plomito mine target area is separated from the Union-Famosa corridor target by a 3 km-wide colluvium-filled N-S trending graben. The geology at the Plomito Mine shows many similarities to the eastern side of the range at Union-Famosa where grey limestone with a small window of quartzite is mapped. Low angle faulting is also present in the area and tends to be mineralized showing carbonate replacement and patchy marble zones. Historical workings are scattered across the property and tend to follow the low angle oxidized structures varying from centimeters to metres in width.

Geochemistry shows an overall similar pattern across the property, with the dominant geochemical signature being polymetallic Pb-Ag-Zn-As-Cu-Sb-Au. Secondary Au-As association is recognized which suggests another hydrothermal event spatially associated with the dominant polymetallic event. 

Mineralization is found on surface associated with low angle faults, folds, with the thicker mineralized intervals being where high angle fault intersect with other structures creating ‘traps’. GIS compilation of Riverside’s work and older data is showing a tendency for thicker mineralized zones to occur within the stratigraphy defined ‘grey limestone’ (see Figures 3 & 4 in Diagrams) where replacement and crack infilling is noted.

Riverside is currently planning future exploration work, which will include a geophysical survey to better identify the depth and behavior of mineralization within the grey limestone unit and the structural nature of the lower part of the sedimentary sequence. The next stage in exploration will be to compile the proposed geophysics with the existing information to identify drill targets for a 2022 program.

Local historical productions in the 1950’s mined high-grade material averaging 7-20 g/t Au, 300 g/t Ag, 10-20% Pb and 5% Zn, for which mineralized bodies were traced for at least 80 m depth within oxides (Yantis, 1957). Since then, only small exploration programs have occurred including more recent work by Paget Mineral Exploration Company and Millrock Resources with sampling programs yielding up to 22.5 g/t Au and multiple high-grade polymetallic samples over the project area. The presence of many high-grade areas in addition to the thickness of the host rock and extent of the system across multiple known historic mines suggests an extensive system exits in this district.

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Figure 2: Map of Riverside’s La Union Polymetallic Project, Sonora, Mexico. Highlights of the results in October 2021 from rock sampling from Riverside

 

figure3 interpretative schematic cross section

Figure 3: Interpretative schematic cross section of the Plomito target in the Union-Famosa corridor showing stratigraphic column with interpretative mineralization relationship.

 

figure4 geological map

Figure 4: Geological map of the Union Project highlighting the two zones of El Plomito and the Union-Famosa Corridor.

 

Riverside has a 4-year term option on the properties with staged cash payments and no retained NSR. The terms for each respective properties (La Famosa and Plomito) are presented below:

YEAR PAYMENTS LA FAMOSA PLOMITO
0 On Signing $ - $ -
1 12 months $ 10,000.00  $ 10,000.00
2 24 months $ 15,000.00  $ 15,000.00
3 36 months $ 25,000.00 $ 25,000.00
4 48 months $ 50,000.00 $ 40,000.00
5 60 months $ 75,000.00 $ 75,000.00
TOTAL   $ 175,000.00 $ 165,000.00

PHASE I EARN-IN OPTION:

  • Hochschild will pay Riverside the sum of US$100,000 on signing the Agreement;
  • Hochschild will pay Riverside the sum of US$150,000 on the six-month anniversary of the Effective Date (November 5, 2022) for reimbursement of maintenance fees paid by Riverside through August 2022 in respect of the Concessions making for a total of $250,000;
  • Hochschild will reimburse Riverside for all periodic payments made pursuant to the underlying option agreements with respect to concessions comprising the Project;
  • Hochschild to incur expenditures as listed in the table below totaling at least US$8,000,000 of qualifying exploration expenditures before the fifth anniversary of the effective date of the executed Agreement.

Table 1: Phase I Earn-In Option (Qualifying Expenditures)

By May 5, 2023

1st anniversary of the Effective Date

Expenditure of US$700,000

By May 5, 2024

Expenditure of US$1,000,000

By May 5, 2025

Expenditure of US$1,000,000

By May 5, 2026

Expenditure of US$2,300,000

By May 5, 2027

Expenditure of US$3,000,000

 

PHASE II EARN-IN OPTION:

In order to exercise the Phase II Earn-in Option, Hochschild shall pay for all Qualifying Expenditures incurred during the Phase 1 Earn-In periods and incur an additional US$3,000,000 plus costs necessary to prepare a Feasibility Study (FS) in accordance with CIM standards before the eighth anniversary of the Effective Date.

Table 2: Phase II Earn-In Option (Qualifying Expenditures)

May 2027 – May 2028

Expenditure of at least US$1,000,000

May 2028 – May 2029

Expenditure of at least US$1,000,000

May 2029 – May 2030

Expenditure of at least US$1,000,000

Feasibility Study (FS)

Undefined Expenditure Amount

 

Additional Time Period for FS Preparation

The time within which the FS must be prepared can be extended for up to an additional 3 years subject to payment by Hochschild to Riverside of the following amounts:

Additional Period

Payment

1 year

US$50,000

2 years

US$250,000

3 years

US$500,000

Upon Hochschild’s completion of the Phase II Earn-In and Riverside’s acceptance, the parties can form a Joint Venture with Riverside having a 25% interest, and Hochschild having a 75% interest. Riverside will have the option to sell its interest in the Project to Hochschild for US$20,000,000, while retaining a 1% Net Smelter Royalty (NSR).

The scientific and technical data contained in this news release pertaining to the La Union Project was reviewed and approved by Freeman Smith, P.Geo, a non-independent qualified person to Riverside Resources, who is responsible for ensuring that the geologic information provided in this news release is accurate and who acts as a “qualified person” under National Instrument 43-101 Standards of Disclosure for Mineral Projects.

Rock samples from the exploration program discussed above at La Union were taken to the Bureau Veritas Laboratories in Hermosillo, Mexico for fire assaying for gold. The rejects remained with Bureau Veritas in Mexico while the pulps were transported to Bureau Veritas laboratory in Vancouver, BC, Canada for 45 element ICP/ES-MS analysis. A QA/QC program was implemented as part of the sampling procedures for the exploration program. Standard samples were randomly inserted into the sample stream prior to being sent to the laboratory.

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Photo 1: Photo of sample RRI7891 from La Famosa Mine and RRI7895 from Plomito Mine

 

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Photo 2: Photos of the mineralization as seen in the field. La Union as shown comprises a quartzite bed bounded by oxide horizons. La Famosa (right) photo shows the working from the 1980s.