Osiko Metals - ZINC

Gilmour South

The Gilmour Brook South zinc-lead prospect is located about 20km south-southeast of the former Brunswick No 12 mine and 27 kilometres by main forestry road from the Key Anacon Project. It is hosted within the Brunswick Horizon, at the top of the Nepisiguit Falls Formation, and exhibits mineralization in the style and type as that found both at the Brunswick No. 6 and No. 12 mines. This “Brunswick Horizon” sulphide mineralization is commonly present as semi-massive to massive occurrences of stratiform zinc-lead sulphide mineralization that has been intersected intermittently over a strike of 1400 metres and locally to vertical depths of 700 metres. Historical drilling by Noranda Exploration during the period 1998 to 2000 intersected significant grade and widths of zinc-rich mineralization in two lenses approximately 400 metres apart.

The Gilmour South Property is within the East Bathurst Mining Camp (“EBMC”) that comprises the Brunswick Horizon extending from the prolific Brunswick No.12 and No. 6 Mines to Gilmour South and extending for an additional 30 kilometres along the surface trace of the Portage River Anticline before reaching the Key Anacon Project. The Gilmour South Property covers 1.4 kilometres of the Brunswick Horizon. Mineralization is characterized by zinc-lead-copper-silver-bearing sulphide mineralization, host-rock types and alteration similar to the Brunswick Mines stratiform zinc-lead sulphide mineralization.

Current mineral resources are reported by Osisko Metals for Gilmour South as follows:

Table 1: Mineral Resource Estimate as Reported by AGP Mining Consultants Inc. (1)

Mineralized Zones

Resource Category

 

Grades (@ 5.5 ZnEq cut-off)

In-situ Metal

Tonnes

Zn

Pb

Cu

Ag

ZnEq

Zn

Pb

Cu

Ag

mil

%

%

%

g/t

%

mil

mil

mil

mil

lbs.

lbs.

lbs.

 oz

Key Anacon Main

Indicated

1.67

6.02

2.52

0.14

74.20

9.31

221.0

92.5

5.1

4.0

Key Anacon Titan

0.29

4.36

1.57

0.65

38.80

7.25

28.2

10.1

4.2

0.4

Total Indicated @ 5.5 ZnEq cut-off

1.96

5.77

2.38

0.22

68.90

9.00

249.1

102.6

9.3

4.3

Key Anacon Main

Inferred

0.61

5.83

1.98

0.05

68.20

8.49

77.7

26.5

0.6

1.3

Key Anacon Titan

0.98

4.12

1.62

0.78

42.90

7.35

89.5

35.2

17

1.4

Gilmour South

2.26

5.74

1.30

0.19

44.30

8.08

286.8

64.8

9.4

3.2

Total Inferred @ 5.5 ZnEq cut-off

3.85

5.34

1.49

0.32

47.70

7.96

453.0

126.4

27.0

5.9

Mineral resources are estimated in conformance with the CIM Mineral Resource definitions referred to in NI 43-101 Standards of Disclosure for Mineral Projects. This mineral resource estimate covers the Gilmour South Deposit, and the Key Anacon deposit’s Main Zone and Titan Zone. The independent qualified person for the 2019 MRE, as defined by NI 43-101 guidelines, is Pierre Desautels, P. Geo, of AGP Mining Consultants Inc. Effective date is January 14, 2019.

The current resource estimate is reported using a Zn Equivalent (ZnEq) cut-off grade of 5.5%. The determination of the cut-off grade was based on:
• Mining cost of USD$45/Tonne.
• Total operating cost of USD$70/Tonne.
• This MRE is based on a zinc price of US$1.10/lb, a lead price of US$0.90/lb, a copper price of US$2.72/lb and a silver price of US$15.90/oz and a revenue factor of 1.1.
• Recoveries of 84% Zinc, 60% Lead, 52% Copper and 65% Silver.

The MRE is based on drilling by Osisko Metals comprising 38,475 metres in 92 drill holes which includes 32 holes at Gilmour, 35 holes at Key Anacon Main Zone and 25 holes at the Titan Zone. The remaining holes are historical and were drilled by a number of operators namely, Key Anacon Mines Limited (1953-1966), Rio Algom Limited (1992-1993), Noranda Inc (2000), Hunter Brook Holdings Limited (2015). The use of which was validated by a drill hole collar survey where available, original assay certificates, drill logs and twin drilling.

Table 4. Eastern BMC MRE – Total Drill Hole Statistics

Deposit Name

In Database

Within Mineralized Wireframes

# of Holes

Length (m)

# of Assays

# of Holes

Length (m)

# of Assays

Key Anacon Main

376

73,523

5,846

263

4,564

2,394

Key Anacon Titan

92

32,602

2,404

38

1,217

1,238

Gilmour South

110

50,328

2,215

39

958

871

Total

578

156,453

10,465

340

6,739

4,503


Table 5. Eastern BMC – Osisko Metals Drill Hole Statistics

Deposit Name

In Database

Within Mineralized Wireframes

# of Holes

Length (m)

# of Assays

# of Holes

Length (m)

# of Assays

Key Anacon Main

35

13,522

2,115

26

580

608

Key Anacon Titan

25

9,498

1,137

21

630

666

Gilmour South

32

15,455

913

17

500

531

Total

92

38,475

4,165

64

1,710

1,805


The full technical report will be available soon.

Exploration potential is considered excellent based on the extent of the Brunswick Horizon on the property and potential for the thickening of the sulphide mineralization along previously unrecognized structural corridors that are typically associated to the major deposits in the EBMC.

Note 1. These mineral resources are not mineral reserves as they do not have demonstrated economic viability. The quantity and grade of the reported Inferred Mineral Resources in this estimation are conceptual in nature and are estimated based on limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity. For these reasons, an Inferred Mineral Resources has a lower level of confidence than an Indicated Mineral Resources and it is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.

Note 2. Map Reference: Brunswick 6 and 12 Mines past production statistics. Source: The Government of New Brunswick, Department of Energy and Resource Development, Energy and Mines Division Mineral Occurrence Database.


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