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Overview

The Ermitaño Project is a gold/silver mineral exploration project located in the Sonora State, Mexico. Ermitaño is located four kilometres southeast of the Santa Elena Silver/Gold Mine, a silver and gold producing complex operated by First Majestic.

Location

Ermitaño is approximately 145 kilometres northeast of Hermosillo and contiguous with Santa Elena Mine near the intersection of 29° 59´ 29.25” north latitude and 110° 05´24.95” west longitude and 12km west of Banamichi.  

Ermitano West Map

Following the discovery in late 2016, the company released a maiden Inferred Mineral Resource in early 2018 of 40.8 million silver equivalent ounces.

In early 2019 the company updated its Inferred Mineral Resource to 49 million silver equivalent ounces and added 8.8 million silver equivalent ounces in the Indicated Category.

Mineral Resources

Ermitano Mineral Resources Table

  1. Mineral Resources have been classified in accordance with the CIM Definition Standards on Mineral Resources and Mineral Reserves, whose definitions are incorporated by reference into NI 43-101.
  2. Metal prices considered for Mineral Resource estimates were $17.50/oz Ag and $1,300.00/oz Au.
  3. The Mineral Resources information provided above is based on internal estimates prepared as of December 31, 2018. The information provided was reviewed and validated by Ramon Mendoza Reyes, PEng, QP Geology for First Majestic, who has the appropriate relevant qualifications, and experience in geology and resource estimation.

Local Geology & Mineralization

The Ermitaño West area contains a network of east–west trending low sulphidation epithermal veins and stockwork within an area of 1,200 metres long 600 metres wide.   Vein textures suggest a shallower level of exposure in the low sulphidation epithermal environment compared to Santa Elena. Surface sampling includes 946 chip and channel samples which average 0.12 gpt Au and ranging up to 6.67 gpt Au

Ermitaño Vein System

Low sulphidation epithermal silver and gold mineralization is hosted in the steep dipping Ermitaño and Ermitaño Splay structures. The structures host green and white massive, banded, and bladed and stockwork quartz, calcite, and adularia. The veins are commonly brecciated and are associated with argillic alteration. Sulphide and iron oxide after sulphide and pyrolusite occur locally. The bulk of Inferred mineralization disclosed in 2018 is hosted in the Ermitaño Splay. Drilling of the Ermitaño Splay has delineated an east-west striking structure approximately 500 metres long, 400 metres down dip, with mineralized true thicknesses ranging from 0.9 to 30.0 metres, averaging 11.0 metres. Mineralization in the Splay remains open up-dip and down-dip to the west. The Ermitaño Splay separates from the Ermitaño structure which is delineated by drilling over an approximate 1,000 metre southwest strike length and 400 metre dip length.  Mineralized true thickness range from 0.8 to 11.0 metres, averaging 4.0 metres.

Oblique view of Ermitaño and Ermitaño Splay

Plan view of Ermitaño and Ermitaño Splay

Ermitaño West Drill Results

In October 2016, First Majestic began a diamond drilling campaign at Ermitaño West. Ten drill holes were completed over a total of 3,156 metres which defined the current 40.8 million silver equivalent resource below. By the end of the 2018, a total of 50 drill holes had been completed on the property.  The 2018 exploration program added 17,447 metres in 40 drill holes consisting of nine infill holes designed to increase the confidence and size of the resource and 31 step out holes to target areas to the West and East of the known mineralization.  The 2019 exploration program totalled 33,767 metres in 103 drill holes primarily consisting of infill holes designed to increase the confidence and overall size of the resource.

Preparing For Detailed Mine Design And Initial Production

In 2020, the Company is planning to drill approximately 15,000 metres in 50 drill holes. This drilling will focus on infill of the main resource area, including resource expansion in the eastern Ermitaño vein area, the Aitana vein, and several nearby newly identified targets.

In addition, the Company is currently working on several engineering studies, including geotechnical and geohydrological investigations, a detailed metallurgical testing and a series of trade-offs analysis to define the materials handling infrastructure. These studies will support a pre-feasibility study expected to be released in the fourth quarter of 2020.

Furthermore, the Company is expected to complete 3,800 metres of underground development in 2020. This development program, which began in late 2019, is designed to complete the main access ramp to reach the mineralized area and prepare five production levels with all associated mining infrastructure. Production from Ermitaño is expected to displace the current feed from the old heap pads which is currently making up approximately 40% of the feed to the mill.

Ermitaño Splay Grade x Thickness Long Section

Ermitaño Splay Grade x Thickness Long Section

Summary of Drill Composites

Hole ID From To Length (m) Estimated True Length (m) Ag g/t Au g/t Ag Eq g/t
EW-19-53 216.7 225.6 8.9 8.2 73 4.19 419
EW-19-55 99.7 114.1 14.4 9.6 57 8.20 734
including 101.7 104.7 3.1 2.0 190 30.82 2,733
EW-19-57 456.8 457.7 0.9 0.6 287 8.91 1,022
EW-19-62 394.5 396.3 1.8 1.3 65 7.23 662
EW-19-66 83.9 89.2 5.2 4.2 18 6.03 515
including 87.6 89.2 1.6 1.3 53 20.23 1,722
EW-19-67 96.0 122.3 26.3 10.8 46 12.84 1,106
including 102.5 103.5 1.0 0.4 86 41.47 3,508
including 108.7 109.4 0.7 0.3 73 27.40 2,333
including 112.9 113.9 1.0 0.4 85 29.12 2,487
including 113.9 114.9 1.0 0.4 88 29.55 2,526
EW-19-72 173.2 179.8 6.6 4.1 38 5.99 532
including 174.9 175.7 0.8 0.5 68 18.41 1,587
EW-19-74 360.1 369.3 9.2 6.4 383 9.46 1,164
including 360.9 361.6 0.7 0.5 865 16.75 2,247
including 361.6 362.4 0.8 0.6 982 21.03 2,717
including 368.6 369.3 0.7 0.5 301 16.48 1,661
EW-19-75 304.3 305.3 1.1 0.9 100 10.17 939
EW-19-77 212.8 214.2 1.4 1.2 102 5.46 552
EW-19-78 236.2 244.1 7.9 5.1 200 2.76 428
EW-19-80 225.6 234.5 9.0 5.3 156 5.11 578
EW-19-85 232.2 236.1 3.9 2.4 459 31.63 3,068
including 232.2 233.2 1.0 0.6 1,224 88.40 8,517
including 233.2 233.7 0.5 0.3 584 33.51 3,349
EW-19-87 198.5 202.6 4.2 2.9 95 6.99 672
EW-19-91 113.8 138.0 24.3 13.0 45 11.61 1,003
including 117.4 126.4 8.9 4.8 79 27.54 2,350
EW-19-92 124.6 132.8 8.3 4.6 69 7.72 706
including 125.6 129.4 3.8 2.1 98 13.32 1,196
EW-19-93 168.2 173.1 4.9 3.7 84 4.50 456
EW-19-96 104.9 107.0 2.1 1.9 75 29.15 2,480
including 104.9 106.2 1.3 1.2 83 41.92 3,542
EW-19-98 148.0 156.8 8.8 5.9 111 9.43 889
including 150.3 150.9 0.5 0.4 245 35.81 3,199
EW-19-99 84.0 87.5 3.5 2.1 64 9.11 816
including 85.0 86.6 1.6 1.0 103 18.67 1,643
including 180.6 182.5 1.9 1.2 145 14.06 1,305
EW-19-102 226.1 235.1 9.0 5.0 115 4.50 487
EW-19-103 112.4 125.9 13.5 7.7 111 16.37 1,462
including 114.5 114.9 0.4 0.2 90 33.49 2,853
EW-19-109 133.0 145.4 12.4 9.5 45 5.18 472
including 134.6 135.5 0.9 0.7 53 11.57 1,008
including 136.3 137.5 1.2 0.9 57 12.77 1,111
including 142.4 143.0 0.5 0.4 81 11.17 1,003
EW-19-111 82.2 88.3 6.2 4.5 79 17.98 1,562
including 82.7 83.5 0.8 0.6 182 32.32 2,848
including 83.5 84.5 1.0 0.7 107 40.48 3,447
EW-19-113 104.4 121.5 17.1 9.1 130 14.22 1,302
including 109.9 110.4 0.5 0.3 1,030 150.72 13,465
including 113.0 118.9 5.9 3.1 187 23.17 2,099
EW-19-114 109.5 128.5 19.0 8.0 71 5.85 554
including 111.4 112.1 0.7 0.3 81 10.67 961
EW-19-115 254.6 265.7 11.2 7.4 103 7.45 717
including 254.6 255.6 1.0 0.7 294 25.75 2,418
including 260.5 262.3 1.8 1.2 104 17.28 1,529
EW-19-116 233.4 239.4 6.0 3.9 232 4.32 589
including 236.7 237.4 0.8 0.5 152 11.42 1,094
EW-19-117 257.8 262.7 5.0 3.2 337 4.99 749
EW-19-119A 226.8 233.8 7.0 5.4 70 10.81 962
including 227.2 228.0 0.8 0.7 180 47.66 4,111
including 229.1 230.1 1.0 0.8 65 14.09 1,227
EW-19-120 135.8 148.7 13.0 8.0 109 7.64 739
including 136.5 141.9 5.3 3.3 176 16.88 1,569
EW-19-123 212.0 221.3 9.4 4.6 144 6.60 689
including 213.4 216.0 2.5 1.2 198 13.24 1,290
including 220.5 221.3 0.9 0.4 205 16.20 1,541
EW-19-124 270.5 279.0 8.5 3.0 266 7.10 852
including 272.3 274.2 1.8 0.7 967 25.81 3,097
EW-19-127 273.3 284.3 11.0 7.2 209 7.93 863
including 282.9 283.7 0.8 0.5 597 25.36 2,689
EW-19-129 345.0 349.5 4.5 2.6 177 5.12 600
including 456.8 457.2 0.4 0.2 139 28.97 2,529
including 362.1 362.9 0.8 0.5 753 25.50 2,856
ESTW-19-04 392.8 409.3 16.5 9.7 53 5.32 492
including 397.5 398.5 1.0 0.6 63 12.65 1,106
ESTW-19-05 483.0 506.0 23.0 11.0 86 6.21 599
including 501.9 504.2 2.3 1.1 213 35.69 3,157

Note: Holes EW16-01 to EW16-04 were announced on January 17, 2017 (see press release at https://www.firstmajestic.com/news/2017/index.php?content_id=312). Holes EW16-06 and EW 17-09 were announced on January 9, 2018 (see press release at https://www.firstmajestic.com/news/index.php?content_id=340). Gold equivalent (“Gold-Equiv”) is calculated using a gold to silver ratio of 1:80.


After detailed geological logging, all drill core samples were split on site by diamond saw. One half of the core was submitted to Bureau Veritas Mineral Laboratories at the laboratory in Vancouver, British Columbia, Canada and to SGS Laboratories at the laboratories in Durango and Hermosillo, Mexico. The remaining half core is retained on-site for verification and reference purposes.

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