TORONTO, April 28, 2022 (GLOBE NEWSWIRE) -- Discovery Silver Corp. (TSX-V: DSV, OTCQX: DSVSF) (“Discovery” or the “Company”) is pleased to announce its financial results for the fourth quarter (“Q4 2021”) and year ended December 31, 2021, and to provide a summary of key events for the quarter and subsequent to year-end. All figures are stated in Canadian dollars (“C$”) unless otherwise noted.
Discovery’s flagship project is our 100%-owned Cordero silver project (“Cordero” or the “Project”) located in Chihuahua State, Mexico. Following the completion of a Preliminary Economic Assessment (“PEA”) in 2021 that demonstrated Cordero is a large-scale, high-margin asset with a long mine life, our focus now is the delivery of a Pre-Feasibility Study (“PFS”) on the Project in the fourth quarter of this year.
HIGHLIGHTS FROM Q4 2021 & SUBSEQUENT EVENTS:
LOOKING AHEAD:
Work on our Pre-Feasibility Study is advancing well and we remain on schedule to deliver the study in the fourth quarter of this year. Our metallurgical testwork on the sulphides, which is focused on reagent optimization and the testing of high-grade samples ranging from 100 – 200 g/t AgEq to confirm grade versus recovery variability is now more than 50% complete. Our reserve definition drilling will wrap up later this quarter while our engineering drilling will commence in the coming weeks. We expect the PFS will continue to incorporate staged expansions of the processing facility and we will look to optimize the mining rates early in the mine life as well as the timing and size of the oxides/heap leach project to maximise capital efficiency.
In parallel with these work plans our ESG program continues to be an important area of focus, with our 2021 ESG report scheduled for issuance in the summer and key government and international accreditation certifications planned for completion in the second half of 2022. We also remain committed to the growth potential of Cordero with more than 30,000 m of drilling planned this year on resource expansion targets and our first ever drilling of five highly prospective property targets within 10 km of Cordero.
Our balance sheet remains exceptionally strong with a current cash balance of approximately $60 million and no debt. This puts us in a very strong position to fund all our activities at Cordero in 2022, as well as all necessary work to advance Cordero to a construction decision through the completion of a Definitive Feasibility Study currently scheduled for the second half of 2023.
SUMMARY OF Q4 2021 & SUBSEQUENT EVENTS:
Environment, Social, Governance:
Inaugural ESG Report / Sustainability website launch
In the fourth quarter we released our first Environmental, Social and Governance (“ESG”) report and launched a brand-new Sustainability section of our website. Report highlights include:
The full ESG Report is available in English and Spanish for download at:
www.discoverysilver.com/sustainability
Projects:
Preliminary Economic Assessment (PEA)
On November 30, 2021, we announced the results from the PEA on Cordero. Highlights from the study include (all figures are in USD unless otherwise noted):
The PEA was based on an updated Mineral Resource Estimate that was press released on October 20, 2021. Further details on the PEA results can be found in our news release dated November 30, 2021. Supporting technical disclosure and further details on the Mineral Resource Estimate can be found at the bottom of this release.
Phase 2 drilling
Subsequent to the year ended December 31, 2021, we announced two sets of drill results from our ongoing Phase 2 drill program. Phase 2 drilling will continue through the remainder of the year and will be focused on three key areas: (1) Pre-Feasibility Study drilling consisting of reserve definition and engineering drilling; (2) resource expansion in the northeast of the deposit and at depth; and (3) initial drill testing of five property-wide targets on the Company’s extensive land package. There are currently four drill rigs operating on site.
PFS Drilling – highlight intercepts from upgrading resources for inclusion in the PFS include:
Resource Expansion Drilling – highlight intercepts from outside the resource pit constraint include:
For further details on the drill results noted above refer to our news releases dated February 10 and March 31, 2022. Supporting Technical Disclosure for drill results can be found at the end of this release
SELECTED FINANCIAL DATA:
The following selected financial data is summarized from the Company’s consolidated financial statements and related notes thereto (the “Financial Statements”) for the year ended December 31, 2021, and the Management’s Discussion and Analysis (“MD&A”) for the year ended December 31, 2021.
A copy of the Financial Statements and MD&A is available at www.discoverysilver.com or on SEDAR at www.sedar.com.
Net loss | Q4 2021 | Q4 2020 | ||||
(a) Total | $ | (7,098,928 | ) | $ | (6,125,457 | ) |
(b) basic and diluted per share | $ | (0.02 | ) | $ | (0.02 | ) |
Net loss & total comprehensive loss | $ | (7,030,220 | ) | $ | (5,455,362 | ) |
Total weighted average shares outstanding | 329,898,229 | 302,368,222 |
December 31, 2021 | December 31, 2020 | |||||
Cash, cash equivalents & short-term investments | $ | 69,748,652 | $ | 82,547,897 | ||
Total assets | $ | 107,790,755 | $ | 111,564,881 | ||
Total current liabilities | $ | 1,704,530 | $ | 982,260 | ||
Total liabilities | $ | 1,704,530 | $ | 1,023,349 | ||
Working capital | $ | 69,611,661 | $ | 82,435,046 | ||
Total Shareholders’ equity | $ | 106,086,225 | $ | 110,541,532 |
About Discovery
Discovery’s flagship project is its 100%-owned Cordero project, one of the world’s largest silver deposits. The PEA completed in November 2021 demonstrates that Cordero has the potential to be developed into a highly capital efficient mine that offers the combination of margin, size and scaleability. Cordero is located close to infrastructure in a prolific mining belt in Chihuahua State, Mexico. Continued exploration and project development at Cordero is supported by a strong balance sheet with a current cash balance of approximately C$60 million.
On Behalf of the Board of Directors,
Taj Singh, M.Eng, P.Eng, CPA,
President, Chief Executive Officer and Director
For further information contact:
Forbes Gemmell, CFA
VP Corporate Development & Investor Relations
Phone: 416-613-9410
Email: [email protected]
Website: www.discoverysilver.com
TECHNICAL NOTES & REFERENCES:
Drill results: all drill results in this news release are rounded. Assays are uncut and undiluted. Widths are drilled widths, not true widths, as a full interpretation of the actual orientation of mineralization is not complete. As a guideline, intervals with disseminated mineralization were chosen based on a 25 g/t AgEq cutoff with no more than 10 m of dilution. AgEq calculations are used as the basis for total metal content calculations given Ag is the dominant metal constituent as a percentage of AgEq value in approximately 70% of the Company’s mineralized intercepts. AgEq calculations for reported drill results are based on USD $22.00/oz Ag, $1,600/oz Au, $1.00/lb Pb, $1.20/lb Zn. The calculations assume 100% metallurgical recovery and are indicative of gross in-situ metal value at the indicated metal prices. Refer to notes below for metallurgical recoveries assumed in the 2021 PEA completed on Cordero.
Sample analysis and QA/QC Program: True widths of reported drill intercepts have not been determined. Assays are uncut except where indicated. All core assays are from HQ drill core unless stated otherwise. Drill core is logged and sampled in a secure core storage facility located at the project site 40km north of the city of Parral. Core samples from the program are cut in half, using a diamond cutting saw, and are sent to ALS Geochemistry-Mexico for preparation in Chihuahua City, Mexico, and subsequently pulps are sent to ALS Vancouver, Canada, which is an accredited mineral analysis laboratory, for analysis. All samples are prepared using a method whereby the entire sample is crushed to 70% passing -2mm, a split of 250g is taken and pulverized to better than 85% passing 75 microns. Samples are analyzed for gold using standard Fire Assay-AAS techniques (Au-AA24) from a 50g pulp. Over limits are analyzed by fire assay and gravimetric finish. Samples are also analyzed using thirty three-element inductively coupled plasma method (“ME-ICP61”). Over limit sample values are re-assayed for: (1) values of zinc > 1%; (2) values of lead > 1%; and (3) values of silver > 100 g/t. Samples are re-assayed using the ME-OG62 (high-grade material ICP-AES) analytical package. For values of silver greater than 1,500 g/t, samples are re-assayed using the Ag-CON01 analytical method, a standard 30 g fire assay with gravimetric finish. Certified standards and blanks are routinely inserted into all sample shipments to ensure integrity of the assay process. Selected samples are chosen for duplicate assay from the coarse reject and pulps of the original sample. No QAQC issues were noted with the results reported herein.
Mineral Resource Estimate:
Sulphide Resource (assumed to be processed via mill/flotation)
NSR $/t cut-off | Class | Tonnes | Grade | Contained Metal | ||||||||
Ag | Au | Pb | Zn | AgEq | Ag | Au | Pb | Zn | AgEq | |||
(Mt) | (g/t) | (g/t) | (%) | (%) | (g/t) | (Moz) | (koz) | (Mlb) | (Mlb) | (Moz) | ||
$7.25/t | Measured | 128 | 22 | 0.08 | 0.31 | 0.52 | 52 | 89 | 328 | 881 | 1,470 | 212 |
Indicated | 413 | 19 | 0.05 | 0.28 | 0.51 | 47 | 255 | 707 | 2,543 | 4,663 | 625 | |
M&I | 541 | 20 | 0.06 | 0.29 | 0.51 | 48 | 344 | 1,035 | 3,424 | 6,132 | 837 | |
Inferred | 108 | 14 | 0.03 | 0.19 | 0.38 | 34 | 49 | 99 | 451 | 909 | 119 |
Oxide/Transition Resource (assumed to be processed by heap leaching)
NSR $/t cut-off | Class | Tonnes | Grade | Contained Metal | % Oxide / % Trans | ||||
Ag | Au | AgEq | Ag | Au | AgEq | ||||
(Mt) | (g/t) | (g/t) | (g/t) | (Moz) | (koz) | (Moz) | |||
$4.78/t | Measured | 23 | 20 | 0.06 | 25 | 15 | 43 | 19 | 92% / 8% |
Indicated | 75 | 19 | 0.05 | 23 | 45 | 125 | 56 | 87% / 13% | |
M&I | 98 | 19 | 0.05 | 23 | 60 | 168 | 74 | 88% / 12% | |
Inferred | 35 | 16 | 0.04 | 20 | 18 | 44 | 22 | 63% / 37% |
Supporting Technical Disclosure for Resource:
Preliminary Economic Assessment:
The most recent technical report for the Cordero Project is the 2021 Preliminary Economic Assessment (PEA). The PEA was completed by Ausenco Engineering Canada Inc. with support from AGP Mining Consultants Inc. and Knight Piésold and Co. (USA). The full technical report supporting the PEA is available on Discovery’s website and on SEDAR under Discovery Silver Corp.
Supporting Technical Disclosure for the PEA:
Qualified Person: Gernot Wober, P.Geo, VP Exploration, Discovery Silver Corp., is the Company's designated Qualified Person for this news release within the meaning of National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) and has reviewed and validated that the information contained in this news release is accurate.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release is not for distribution to United States newswire services or for dissemination in the United States.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United States of America. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “1933 Act”) or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
Cautionary Note Regarding Forward-Looking Statements
This news release may include forward-looking statements that are subject to inherent risks and uncertainties. All statements within this news release, other than statements of historical fact, are to be considered forward looking. Although Discovery believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those described in forward-looking statements. Such statements include but are not limited to: the timeline for the execution and completion of the Phase 2 drill program including the impacts and benefits; the timeline and anticipated results to be included in the Resource update including the impact and benefits; the timeline and anticipated results to be included in the Preliminary Economic Assessment including the impact and benefits; Factors that could cause actual results to differ materially from those described in forward-looking statements include fluctuations in market prices, including metal prices, continued availability of capital and financing, and general economic, market or business conditions. There can be no assurances that such statements will prove accurate and, therefore, readers are advised to rely on their own evaluation of such uncertainties. Discovery does not assume any obligation to update any forward-looking statements except as required under applicable laws. For a detailed discussion on the risks faced by the Company, refer to the documents incorporated by reference herein, the Company’s MD&A for the year ended December 31, 2021 and the Company’s 2021 Annual Information Form available on the Company’s website at www.discoverysilver.com or under Discovery’s profile on SEDAR at www.sedar.com.