Initial Inferred Mineral Resource Estimate Of 670M Tons Containing 1.15B In-situ Ounces Silver Equivalent For Iska Iska Project

TORONTO — Eloro Resources Ltd. reported on the inaugural mineral resource estimate (MRE) for the Iska Iska silver-tin polymetallic project in the Potosi Department of southwestern Bolivia. The MRE has been prepared by independent qualified persons (QPs) with Micon International Limited as defined under National Instrument 43-101 (NI-43-101). A Technical Report outlining the mineral resource estimation will be filed.

Tom Larsen, CEO, said, “We are delighted with this initial MRE which shows what a massive discovery Iska Iska is. The recent metallurgical work, particularly the positive “ore sorting” results, has significantly enhanced the potential economics by substantially lowering the NSR cutoff, especially for the potential open pit where the bulk of the resource is located. The fact that this potential pit is 1.4km in diameter and extends to a depth of 750m below the Santa Barbara hill attests to the remarkable size of the Iska Iska mineralized system. The overall stripping ratio of 1:1 is very attractive. In the first years of the potential production from the near surface higher grade resource, the stripping ratio will be less than 1. Although the resource is classified as inferred, we are confident that further drilling will upgrade much of this to the indicated category. In addition, the metallurgical testing program was very extensive for this stage of the project but was felt to be necessary to confirm the economic potential. Additional planned metallurgical testing has the potential to further improve recoveries.

The overall MRE contains almost 300 million ounces of in situ silver, 4.1 million tonnes of zinc, 1.7 million tonnes of lead and 130,000 tonnes of tin for a remarkable total of 1.15 billion ounces silver equivalent in situ. Our geological team led by Dr. Bill Pearson, P.Geo., Vice President, Exploration, and Dr. Osvaldo Arce, P.Geo., General Manager of Minera Tupiza, are confident that the Iska Iska resource can be further expanded and that grades in areas with only wide-spaced drilling will likely increase with definition drilling. The tin domain in particular is very under drilled, and our geophysical data indicates potential for a large tin porphyry at depth.

The overall in situ value based on the net NSR values stated above is approximately US$6.8B of which US$3.3B is in the shallower high-grade zone in the potential open pit. This augers well for the potential for early payback on the project. We will shortly be commencing the next phase of work which will include definition drilling, further metallurgical testing, preparation of a preliminary economic assessment (“PEA”) and further exploration drilling of the tin domain.”

Osvaldo Arce, P.Geo., the author of Yacimientos Metaliferos de Bolivia, said, “Iska Iska, which is a very large “Bolivian-type” polymetallic porphyry-epithermal deposit, is one of the major discoveries historically in the prolific Bolivian Tin Belt joining the “giant” (>500 million tonnes) systems such as Cerro Rico de Potosi (Ag, Sn) and Llallagua (Sn). Iska Iska is an example of responsible mineral exploration practices, environmental protection and respect for the rights of local communities that will be fundamental to ensure sustainable and equitable growth in this sector. This, in turn, generates employment and growth opportunities for local communities and in the country as a whole.”

The Iska Iska deposit is polymetallic in nature and as such/hence, the value of its mineralized material will result from the extraction and sale of a combination of metals which include Ag, Pb, Sn and Zn for the Initial Mineral Resource. Pending further success in metallurgical testwork, Cu, Au, and In may be added to the economic equation.

Based on the CIM Best Practice Guidelines of November 2019: Two methods are widely applied in the mining industry to address the polymetallic nature of such deposits. These include the use of a metal-equivalent or the calculation of the Net Smelter Return (NSR). For the NSR method, the dollar value that each metal contributes towards the total value is calculated and is expressed as one value referred to as the NSR value. The calculation of an NSR value considers revenues, metallurgical recoveries, smelter deductions, treatment charges, penalties, and transportation costs for all metals of potential economic interest. This NSR value can then be used to derive a cut-off value, where the NSR cut-off value is then the dollar value of a given sample or block that equals the total operating costs, as appropriate.

In some cases where there are multiple elements in the deposit that contribute to the deposit value, a one-commodity equivalent calculation is sometimes used as the cut-off grade or value. In this approach, all the grades for the various commodities are converted to an equivalent metal grade by consideration of the metal prices and recoveries. The calculation of equivalent cut-off grade or value is based on a formula developed by the Practitioners. This formula, and the parameters used for its development, must be clearly stated. The metal-equivalent grades are then used as the cut-off grades to estimate the Mineral Reserves.

2. NSR versus Metal equivalent grade cut-off grades: Based on the Micon’s QP Experience: In multi-metal deposits where there is a primary product supported by secondary products, it is more appropriate to use a Metal Equivalent cut-off grade based/denominated on the primary commodity. Conversely, in multi-metal deposits where the deposit constituents/metals are considered largely as co-products with no obvious dominant commodity, it is best to employ a NSR value in applying a cut-off grade. The second scenario suits the Iska Iska deposit better at this stage of exploration in the definition of the deposit.

3. ISKA ISKA Initial MRE Statement - Due to the multi-metal nature of the deposit, the resources are reported using Net Smelter Return (NSR) cut-off values which are as follows: Polymetallic (Zn-Pb-Ag) domain = US$9.20/t for open pit (OP) and US$34.00/t for underground (UG) mining; Tin (Sn-Ag-Pb) domain = US$6.00/t for OP mining. Costs have been significantly reduced due to the major impact of the positive “ore-sorting” tests.