Goldplay Exploration

Gold Exploration Company in Past Producing Mining District in Mexico

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Overview

Goldplay Exploration Ltd. (TSXV:GPLY) is an advanced stage exploration company, with a diverse portfolio of gold, silver and base metal assets,  ranging from recent discovery to advanced resource-stage.

The majority of Goldplay’s projects operate out of the Rosario mining district in Sinaloa, Mexico. The Rosario mining district has a 250-year mining history and hosts the past producing multi-million gold + silver ounce Rosario gold mine. The Rosario gold mine was in operation from the 1700s to 1944 and with a production rate of approximately 500 tonnes per day. In 1883, the average grade produced at the mine was 1,133.98 g/t gold and 77.96 g/t silver.

The company holds 6 properties, strategically located in a highly prospective geological setting in the Rosario mining district. Due to the rich mining history of the district, mining infrastructure and a skilled workforce already in place, allied with cost effective approach to carry out exploration, this translates to approximately 80 percent of shareholder capital currently being directly invested into the ground. Additionally, many of Goldplay’s properties are adjacent to each other and/or are located immediately adjacent to operations or exploration projects controlled by other major mining companies, such as Marlin Gold Mining Ltd. (TSX:MLN), Minera Penoles S.A. de CV (BMV:PE&OLES) and First Majestic Silver Corp. (TSX:FR), which can lead to future M&A opportunities.

Goldplay’s San Marcial property was acquired from SSR Mining Inc. (TSX:SSRM) in April 2018 and is a main focus for the Company, as it views San Marcial to host compelling expansion potential on its 30 Moz Ag eq, high grade indicated resource (historical NI 43-101 compliant) “resource”, estimated by Silvermex in 2008. The resource demonstrates viability for developing a high grade, open pit project proximal to other projects under development by First Majestic Silver Corp. Historic preliminary leach testing at San Marcial has indicated a metallurgical  recovery rate of 80 % Ag  and a of up to 90 % for Pb and Zn. The resource  is situated on a 500 m strike mineralized structure and is open for expansion for 3.5 km with evidence of surface mineralization.  The company will be releasing new drill results in the coming months to support  resource expansion upside and  to update the NI 43-101.  The Company plans to engage external consultants to carry out  a preliminary economic assessment (PEA) within the next 12 months.

Goldplay’s second property is El Habal. The property is proximily located to the past-producing Rosario mine and displays geological structures that are similar to those found at the Rosario mine. Goldplay has completed surface trenching, underground mapping, channel sampling, a ground geophysical survey and it is currently carrying out phase 1 of its 2000 m core drilling program. Initial trenching results have confirmed wide oxidized mineralization on surface.  Results from the core drill program will be released in the upcoming months.

Goldplay owns three additional properties in the Rosario mining district. The Yauco and Villa Union properties are adjacent to and share similar geological structures with the El Habal property. Finally, the El Placer II property is located on the borders of the Rosario and Concordia mining districts which have hosted numerous artisanal and well-established mining companies from the 1700s to the early 1900s. The El Placer II property has also displayed evidence of artisanal mining.

Goldplay has attracted a  strong financial and shareholder base , such as Sandstorm Gold Royalties (TSX:SSL) and SSR Mining.  Sandstorm invested  C$1 million in Goldplay after the company went public on the TSXV, and Sandstorm owns 7.8 percent.  SSR Mining holds 3.3 percent of the Goldplay’s shares, acquired through the divestment of the San Marcial Project. Management also notably owns 21.7 percent of the shares.,

Goldplay’s CEO Marcio Fonseca has +20 years’ worth of experience in the mining and finance industries. He has held senior level roles for Macquarie Bank, and large mining corporations, including Phelps Dodge and Vale (NYSE:VALE) in Latin America. Additionally, Fonseca has been working in Mexico for over 12 years. His most recent successful direct investment and management experience  was the sale of SilverCrest Mines to First Majestic Silver Corp for C$155 million in 2015.

Company Highlights

  • Located in Mexico’s historic Rosario mining district, which has been reportedly in operation for 250 years. The past-producing multi-million ounces Rosario gold mine is proximally located to Goldplay’s El Habal, Villa Union and Yauco properties
  • NI 43-101 indicated resource of 18 million ounces of silver, 29.9 million pounds of zinc and 55.3 million pounds of lead;  inferred resources of  4.4 million ounces of silver, 19.5 million pounds of zinc and 34.7 million pounds of lead.  This represents 30 million ounces of Ag equivalent with immediate upside opportunity for resource expansion.
  • Fast-tracking toward expansion of  San Marcial ’s NI 43-101 Ag, Au, Pb , Zn resource report and completion of a Preliminary Economic Analysis (PEA) at the San Marcial Project .
  • Preliminary metallurgical test work results supporting attractive recovery rates for Ag, Zn, Pb at San Marcial.
  • Significant historical drilling intercepts at San Marcial, near-surface, supporting a high grade, open pit target:
    •  SM-4:  53.95 m @ 235 g/t Ag, 0.3% Pb, 0.47% Zn
    •  SM-9:  12.68m  @ 540 g/t Ag, 0.18%Pb, 0.36% Zn
    • SM-13: 17.50m  @ 621 g/t Ag, 0.49% Pb, 0.85%Zn
  • Core drill testing is underway at El Habal property after its successful surface trenching program where Goldplay discovered wide oxidized gold mineralization on surface with intercepts including:
    • Santos Trench , 130 m @ 0.86 g/t Au
    • La Reina Trench, 90 m @ 0.84 g/t Au
    • Arenal Trench, 100 m @ 1.02 g/t Au
  • Aggressive exploration program in place  aiming to define new precious metal discoveries.
  • Management and key shareholders hold strong track records in discovery, development, financing and successful sale of assets in Latin America
  • Properties are adjacent or in proximity to numerous operating major mining companies, (Trinidad Mine – Marlin Gold Mining Ltd.)  or projects under exploration and development (Plomosas Mine – First Majestic Silver Corp.).
  • Two of Goldplay’s major shareholders are US$1 Billion market capitalization companies, SSR Mining and Sandstorm Gold
  • Management and insiders notably hold 21.7 percent of company shares

San Marcial

In April 2018, Goldplay entered into an option agreement with SSR Mining Inc. to acquire 100 percent interest in the San Marcial project. The project is 1,250 hectares in size and is located 5 kilometres south of the historic La Rastra and Plomosas mines, currently under development by First Majestic Corp Inc, in area with well-established infrastructure for project development.

Historic NI 43-101 resource estimate

The San Marcial Project hosts a historic NI 43-101 resource which was completed by Silvermex Resources Inc in 2008 . The resource showed the attractiveness of developing a bulk tonnage open pit mine and has significant exploration potential as well along strike and down dip. The resource was based on  30 core drill holes that only explored 500 meters of a 3.5 kilometer mineralized trend.  22 additional core drill holes were completed in 2010.  Goldplay is currently analyzing these holes with the objective of reporting updated mineralized intervals.

Exploration done by previous operators identified 14 additional Au and Ag exploration targets, which present immediate upside potential for new exploration discoveries in the San Marcial Project.

The San Marcial Project positions Goldplay in a competitive position to advance an updated resource and define an attractive open pit amenable project in a well-established mining jurisdiction in Mexico.

Ongoing exploration

Goldplay is currently in the process of updating the historical NI 43-101 resource, which will include current exploration efforts and 22 holes that were drilled in 2010 by SilverMex (acquired in 2012 by First Majestic Corp Inc.). Goldplay will also be mapping, surface sampling and drilling  along the 3.5 kilometer strike, aiming to expand the resource, towards defining a multi-million ounce world class deposit. The company will be working towards developing a PEA within the next year.

El Habal

The wholly-owned El Habal project comprises of 3,700 hectares and is located 75 kilometers east Mazatlán and is 10 kilometers away from the historical mining community of Rosario.  The project is easily accessible by paved roads, and has all key infrastructure, social and environmental components to mitigate common mine development risk.

El Habal is also in close proximity to the past-producing Rosario mine, which was reportedly in operation for approximately 250 years, being located on the southern edge of the Panuco Graben structure, which is similar to the structures found at the Rosario mine.

Exploration

In 2017 and 2018, Goldplay completed a surface channel and trenching program which revealed wide oxidized gold mineralized zones over a six kilometer strike length and included four initial targets: La Reina, El Arenal, Santos and Octavio.

Recent mapping conducted by the company in conjunction with a recently completed ground geophysical program has identified 15 additional exploration targets. Goldplay is currently carrying out a 2000 meter core drill program on high priority targets, advancing towards the goal of a new discovery at the El Habal Project.

Ongoing exploration

The existing mineralized zone that has been identified on the property indicates an upside exploration  potential in the six kilometer trend. Goldplay is currently focusing its efforts on a 1.5 kilometer portion of the trend and in defining new discoveries down dip and along strike. The planned core drilling program coupled with surface trenching results revealed an attractive gold mineralized system, supporting upside potential for discoveries on the property.

Yauco

The Yauco project comprises of 7,000 hectares and is adjacent to the southern boundary of the El Habal project. The project is also in proximity to the Vanilla mining district, which reportedly has over 200 years’  of mining historic with inumerous records of artisanal mining activity. The district is home to three small scale underground mines that are being put back into production. There are also three abandoned underground mines in the district as well.

Ongoing exploration

Following a successful work program conducted in 2017, Goldplay will be conducting follow-up exploration on five high-priority targets in 2018. The exploration work will include trenching and potentially drilling.

Villa Union

The Villa Union project comprises 5,600 hectares and is located 12 kilometers north of the historical multi-million ounce Rosario Mine, controlled by Minera Penoles S.A. de CV, a major Mexican mining company. The project covers five kilometers of the western edge of the Panuco Graben and seven kilometers of the western edge of the Rosario Graben, which makes it an ideal area for precious metals exploration. The Panuco Graben hosts prevalent tertiary altered volcanic lithologies and regional structures which typically host gold and silver mineralization in the region.

Ongoing exploration

Recently, Goldplay has completed a regional reinterpretation study from data published by the Geological Survey of Mexico (SGM), which included aeromagnetic data and data from geological maps that are still being developed. Follow-up targets have been identified based off of the data from the reinterpretation and from the analysis of stream sediment and surface sampling programs that were completed by previous operators.

El Placer II

The El Placer II project is comprised of 111,000 hectares and hosts many sites that display evidence of historical artisanal mining. The Rosario and Concordia mining districts have hosted numerous artisanal and well-established mining companies from the 1700s to the early 1900s. As a result, four large processing plants were built to process the gold, silver, zinc and lead rich ores found in the area.

Ongoing exploration

Goldplay has recently completed the processing of data from historical and recent exploration efforts which will be used in the development of an anticipated 2018 work program. Goldplay is hoping to develop priority follow-up targets for future exploration.

Management

Marcio Fonseca — President, CEO & Director

Marcio Fonseca is a P. Geo with a M.Sc. (Integrated with MBA Program) in Mineral Project Appraisal from Imperial College-UK. Marcio Fonseca has also completed a specialization in Economic Engineering from FDC Brazil. He  has extensive experience in many jurisdictions through all phases of mineral asset development and operation, asset valuation, due diligence for top tier mining companies and financial institution. He also has solid technical experience to evaluate exploration and operational assets with knowledge from exploration stage to resource-reserve  estimation, mineral project appraisal, feasibility studies and mining operations.

He has held senior roles with Echo Bay Mines, Phelps Dodge and Vale in Latin America. He also has over 20 years of mining and financial industry experience and was a former Division Director for Macquarie Bank – Metals and Energy Division in New York and Vancouver.  In his 20+ years of mining and financial industry experience, Mr. Fonseca has developed a successful track record in assessing, leading, and investing in business opportunities in Mexico and Latin America. His most recent success was the acquisition of SilverCrest Mines by First Majestic Silver Corp. (October  2015) for a purchase price of C$155 million.

Francisco Vargas — Exploration & Country Manager

Francisco Vargas is a geologist who graduated from the University of Costa Rica. He has over 30 years of direct experience in the exploration and discovery of mineral deposits. He currently oversees the office in Rosario with logistics in place.

Vargas has extensive experience with exploration of epithermal deposits throughout Central America, Panama, and Mexico. He actively participated in the following discovery and exploration projects: Crucitas 2.3 MOz Au, Conchudita 0.5 M Oz Au, which was led by Placer Dome. As exploration manager in Mexico, he took part in the discovery of new reserves in La Mina Trinidad and at San Cristobal’s new mining district with Marlin Gold in the Rosario Gold District.

He has recently worked as exploration manager at SilverCrest Mines and was responsible for the advancement of an exploration program that would delineate a new mineral resource around the Santa Elena mine in Sonora, Mexico, including the most recent discovery announced by First Majestic Silver Corp. (Ermitano).

Blaine Bailey — CFO

Blaine Bailey is CPA and CGA with over 13 years of experience as CFO for mineral exploration companies listed on the TSX, TSXV and NYSE.

Gino DeMichele — Director

Gino DeMichele has been engaged in global and domestic financial markets and brings 25 years of corporate finance and M&A expertise. During his incumbencies as vice president and investment advisor, he managed assets in excess of $250 million and was consistently recognized as a top investment advisor nationally and with Macquarie Private Wealth Inc. DeMichele has lead, structured and financed dozens of public and private deals spanning the last 22 years, a number of which exceeded a market cap of $500 million.

Laura Diaz — Director

Laura Diaz is Mexican national and a partner of DBR Lawyers. She has over 22 years of experience as a legal counsellor for multiple public exploration and mining companies in Mexico with track record in successful natural resource transactions. Mexican Corporate Lawyer for Mid-Size Canadian Mining companies operating in Mexico.

Michael Thomson — Director

Michael Thomson has over 30 years of experience in the securities industry as a lawyer, regulator, investment banker, Vice President with two securities dealers and as an entrepreneur. Thomson has been the President and principal of Independent Capital Partners Inc., a corporate finance consulting and advisory company since May 1998. He is also a past independent director of the Lil’Wat Business Corporations, the business arm of the Mt. Currie (Pemberton) First Nations Band. Thomson obtained a Bachelor of Law degree from the University of Ottawa in 1983.

Heye Duan — Director

Heye Duan is currently the CEO, Co-founder & Director of Osino Resources, a private gold company with assets in Africa. He is a mining engineer with over  20 years of experience with top-tier mining companies and financial groups. Duan was the former President & CEO of Ecuador & Copper Corp. and oversaw the $200 million merger with Odin Mining. He is also the co-founder of Auryx Gold Corp. and co-lead Auryx through IPO, capital raising, project development to the $180 million sale of the company to B2Gold Corp. Prior to that, he worked with Nedbank Capital and Old Mutual Investment Group. For the first 10 years of his career he worked with Rio Tinto, Anglo Gold and GoldFields where he helped build and operate mines in Africa.

Alan Friedman — Director

Alan Friedman is currently the President, co-founder & Director of Osino Resources, a private gold company with assets in Africa. Friedman is an African-trained lawyer and public markets entrepreneur and has been involved with North American public markets for more than 15 years.

Friedman has played an integral role in the acquisitions, financings and go-public transactions for many resource companies on TSX and AIM. He is also the co-founder & Director of TSXV listed Eco (Atlantic) Oil and Gas Ltd. and Auryx Gold Corp. Friedman is also the Director of the Canada-Southern Africa Chamber of Business.

Darren Bahrey — Director

Darren Bahrey is an exploration geologist and company builder. He has a track record in prospect generation and multi-million-ounce discoveries during his 15 years with Placer Dome in the Americas. His solid technical, business and team facilitation skills have been the key to successful exploration and discovery programs. Bahrey has significant business and technical experience in Mexico, including over 10 years of experience in the Rosario Gold District including that discovery at the Trinidad Mine (Marlin Gold) where a discovery hole of 61.1 meters graded 8.5 g/t gold.

 

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