Vancouver, British Columbia–(Newsfile Corp. – April 17, 2018) – Bluestone Resources Inc. (TSXV: BSR) (OTCQB: BBSRF) (“Bluestone” or the “Company”) is pleased to announce initial drill results from its Cerro Blanco Gold project in Guatemala, where the Company is carrying out resource definition drilling concurrent with its feasibility study planned for completion by the end of 2018.
The Company currently has a total of five drill rigs operational on the project. Three drill rigs are stationed within the underground development primarily carrying out in-fill drilling. Two portable drill rigs are drilling from surface targeting deeper and peripheral extensions to mineralized veins. Gold and silver mineralization at Cerro Blanco is associated with epithermal quartz-adularia veins and vein swarms that sit immediately below a silicified cap that forms a low-lying hill.
The Cerro Blanco project consists of 3.2 kilometers of underground development, including two underground declines from surface (North and South Ramps). Prior to the acquisition of Cerro Blanco by Bluestone in 2017, a total of 155,500 meters were drilled in 522 holes by previous operators. All Figures referred to in this press release including location of drill holes, drill sections and photos can be accessed by clicking HERE.
Fan drilling is underway at specific locations throughout the north, south and central areas of the underground development (see FIGURE 1). Drilling is designed primarily to provide additional information within key areas of the resource model and validate previous historical drilling. A total of 2,030 meters in 14 holes have been completed to date. Average hole depth is 150 meters and a minimum of 4,000 meters of underground drilling is planned. Assay results from six holes have been received and are presented in Table 1 below.
Epithermal mineralization at Cerro Blanco is associated with chalcedony-adularia-calcite veins with very minor pyrite. Highest precious metal grades are associated with dark colloform-banded chalcedony (quartz) and adularia often with black ginguro banding comprising of mainly acanthite (a silver sulphide mineral) and fine-grained pyrite. Visible gold is rarely observed with a hand lens but is commonly viewed with a microscope. Selected core photos are shown in FIGURE 6.
Significant broad intervals of gold and silver mineralization were intercepted in drill holes UGCB18-71, 73 and 76 within the North Ramp area, where individual higher-grade vein intervals occur, e.g. 5.8 g/t Au and 18.6 Ag over 34.5 meters (29.2 meters true width, UGCB18-76) and 5.5 g/t Au and 17.2 g/t Ag over 27.7 meters (23.1 meters true width, UGCB18-71). Wall rocks adjacent and in between individual veins are invariably silicified with lower-grade zones of stockworks and brecciation.
A total of 5,875 meters in 22 holes have been drilled to date, with an average hole depth of 270 meters targeting the deeper extensions to veins requiring better definition within the resource block model. Assay results from 14 holes have been received and are presented in Table 2. Best intercepts included 5.3 meters of 16.0 g/t Au and 29.1 g/t Ag from 164.27 meters depth in CB18-390. CB17-376 targeted the down-dip extension of the vein system drilled in UGCB18-71, and intercepted various structures including 2.5 meters of 17.1 g/t Au and 33 g/t Ag from 221.9 meters depth (see FIGURE 3).
Darren Klinck, President & CEO commented, ” These initial results from the surface and underground drilling programs correspond very well with the previously announced underground sampling results, and the combined programs are achieving their objective of solidifying our confidence in the resource model.” He added, “Having access to the deposit via the previously completed underground development for drilling and sampling has proven to be a real game-changer for our team, allowing us to better understand the subtleties of the deposit which will be key as we advance through mine planning and other aspects of the Feasibility Study.”
The silicified cap in the upper part of the Cerro Blanco deposit is approximately 100 meters thick from surface and comprises a sequence of plant-rich sandstones, conglomerates, phreatic breccias and thin sinter horizons (Salinas Group) showing widespread chalcedony and clay alteration. The cap represents the preserved palaeosurface of the mineralized system, typical of deposition in a hot springs environment and hosts significant, low-grade disseminated gold mineralization, e.g. 92.1 meters of 0.41 g/t Au from 9.9 meters depth (CB17-375) and 61.0 meters of 0.49 g/t Au from 17.5 meters depth (CB17-376). Some of the gold-bearing veins that make up the bulk of the high-grade gold deposit at Cerro Blanco do penetrate through the Salinas rocks to surface, but the majority are hosted in an underlying sequence of volcaniclastics and sedimentary rocks (Mita Group). Assay results for the upper low-grade silica cap are pending for the majority of the holes drilled.
Table 1: Underground Drilling Results
|HOLE ID||FROM (m)||TO (m)||CORE INTERVAL (m)||EST. TRUE WIDTH (m)||Au g/t||Ag g/t|
Notes: Intervals in bold are cited in the text of the news release. A top-cut of 140 g/t Au as per PEA was applied
Table 2: Surface Drilling Results
|HOLE ID||FROM (m)||TO (m)||CORE INTERVAL (m)||EST. TRUE WIDTH (m)||Au g/t||Ag g/t|
|CB17-375||No significant results|
|CB17-378||No significant results|
|CB18-382||No significant results|
|CB18-391||No significant results|
Notes: Intervals in bold are cited in the text of the news release. A top-cut of 140 g/t Au as per PEA was applied.
Underground drilling is ongoing and additional results will be reported when received. Assay results from the drill program will be incorporated into the new resource estimation planned for mid-2018.
About Cerro Blanco
Cerro Blanco is a classic hot springs-related, low sulphidation epithermal gold-silver deposit. Mineralization occurs within composite veins of chalcedony, quartz, adularia and calcite which are hosted in altered sequence of volcaniclastic and sedimentary rocks. The current resource has a footprint of 800 meters x 400 meters between elevations of 300 meters and 500 meters above sea level. It occurs at the south end of a north-south corridor of hydrothermal alteration, about five kilometers long and one kilometer wide, which has potential for discovery of additional mineralization. This corridor has several other gold targets currently under investigation. The current resource comprises both high- and low-angle veins of colloform-banded chalcedony with minor adularia, dark grey bands of silver sulphides and bladed calcite replacement textures. These textures are all classic indicators of boiling fluids that deposited gold and silver.
Quality Analysis and Quality Control
Assay results listed within this release were performed by Inspectorate Laboratories (“Inspectorate”), a division of Bureau Veritas, which are ISO 17025 accredited laboratories. Logging and sampling is undertaken at site at Cerro Blanco by Company personnel under a QA/QC protocol developed by Bluestone. Samples are transported in security sealed bags to Inspectorate, Guatemala City, Guatemala, for sample preparation. Sample pulps are shipped to Inspectorate Laboratories in Vancouver, BC, Canada or Reno, NV, USA, and assayed using industry-standard assay techniques for gold and silver. Gold and silver were analyzed by a 30-gram charge with atomic adsorption and/or gravimetric finish for values exceeding 3 g/t Au and 100 g/t Ag. Analytical accuracy and precision are monitored by the analysis of reagent blanks, reference material, and replicate samples. Quality control is further assured by Bluestone’s QA/QC program, which involves the insertion of blind certified reference materials (standards) and field duplicates into the sample stream to independently assess analytical precision, and accuracy of each batch of samples as they are received from the laboratory. A selection of samples is sent to ALS Chemex Laboratories in Vancouver for check analysis and additional quality control.
David Cass, P.Geo., Vice President Exploration, is the designated Qualified Person for this news release within the meaning of National Instrument 43-101 and has reviewed and verified that the technical information set out above in this news release is accurate and therefore approves this written disclosure of the technical information.
About Bluestone Resources
Bluestone Resources is a mineral exploration and development company that is focused on advancing its 100%-owned Cerro Blanco Gold and Mita Geothermal projects located in Guatemala. The Cerro Blanco Gold project economics, as disclosed in the Company’s Cerro Blanco Preliminary Economic Assessment which is available at www.sedar.com, and updated mineral resource estimate for Cerro Blanco, indicate a robust project with an expected nine-year mine life producing 952,000 ounces of gold and 3,141,000 ounces of silver. Initial capital expenditures estimated in the PEA to fund construction and commissioning is estimated at US$170.8 million with all-in sustaining cash costs (as defined per World Gold Council guidelines, less corporate general and administration costs) estimated to be US$490 per ounce of gold produced. The Company trades under the symbol “BSR” on the TSX Venture Exchange and “BBSRF” on the OTCQB.
On Behalf of Bluestone Resources Inc.
Darren Klinck | President, Chief Executive Officer & Director
The PEA is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
The Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
This press release contains “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements“). All statements, other than statements of historical fact, that address activities, events or developments that Bluestone Resources Inc. (“Bluestone” or the “Company“) believes, expects or anticipates will or may occur in the future including, without limitation: the proposed timeline and benefits of the Feasibility Study; statements about the Company’s plans for its mineral properties; Bluestone’s business strategy, plans and outlook; the future financial or operating performance of Bluestone; capital expenditures, corporate general and administration expenses and exploration and development expenses; expected working capital requirements; the future financial estimates of the Cerro Blanco Project economics, including estimates of capital costs of constructing mine facilities and bringing a mine into production and of sustaining capital costs, estimates of operating costs and total costs, net present value and economic returns; proposed production timelines and rates; funding availability; resource estimates; and future exploration and operating plans are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to Bluestone and often use words such as “expects”, “plans”, “anticipates”, “estimates”, “intends”, “may” or variations thereof or the negative of any of these terms.
All forward-looking statements are made based on the Company’s current beliefs as well as various assumptions made by them and information currently available to them. Generally, these assumptions include, among others: the ability of Bluestone to carry on exploration and development activities; the price of gold, silver and other metals; there being no material variations in the current tax and regulatory environment; the exchange rates among the Canadian dollar, Guatemalan quetzal and the United States dollar remaining consistent with current levels; the presence of and continuity of metals at the Cerro Blanco Project at estimated grades; the availability of personnel, machinery and equipment at estimated prices and within estimated delivery times; metals sales prices and exchange rates assumed; appropriate discount rates applied to the cash flows in economic analyses; tax rates and royalty rates applicable to the proposed mining operation; the availability of acceptable financing; anticipated mining losses and dilution; success in realizing proposed operations; anticipated timelines for community consultations and the impact of those consultations on the regulatory approval process.
Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements and, even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, Bluestone. Factors that could cause actual results or events to differ materially from current expectations include, among other things: risks and uncertainties related to expected production rates, timing and amount of production and total costs of production; risks and uncertainties related to ability to obtain or maintain necessary licenses, permits, or surface rights; risks associated with technical difficulties in connection with mining development activities; risks and uncertainties related to the accuracy of mineral resource estimates and estimates of future production, future cash flow, total costs of production and diminishing quantities or grades of mineral resources; risks associated with geopolitical uncertainty and political and economic instability in Guatemala; risks and uncertainties related to interruptions in production; the possibility that future exploration, development or mining results will not be consistent with the Company’s expectations; uncertain political and economic environments and relationships with local communities; risks relating to variations in the mineral content within the mineral identified as mineral resources from that predicted; variations in rates of recovery and extraction; developments in world metals markets; risks related to fluctuations in currency exchange rates; as well as those factors discussed under “Risk Factors” in the Company’s Amended and Restated Annual Information Form.
Any forward-looking statement speaks only as of the date on which it was made, and except as may be required by applicable securities laws, Bluestone disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although Bluestone believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to their inherent uncertainty. There can be no assurance that forward-looking statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.