- Base Gold Price assumption used in the La Colorada technical report.
- Comparison gold price.
Company Overview on San Agustin:
- San Agustin Operations show US$12.7M NPV5, 156.1% IRR, US$4.2M CAPEX and 45k total ounces produced at a US$2,100/oz gold price
- Receiving the Phase 4 Permit will allow for strong cash flow generation from San Agustin including funding San Agustin rehabilitation costs
- Upon receipt of permit, expected in 2025, the Company will undertake drilling to potentially extend the mine life from oxide gold production and is reviewing the projects sulphide potential
Au Price
(US$/oz Au) | Net Cash Flow
(US$M) | After-Tax NPV
@ 5.0% Discount Rate
(US$M) | IRR
(%) | Payback Period
(years) | Payback Multiple |
| 2,100 1 | 14.83 | 12.67 | 156.1 | 0.8 | 1.1 |
| 2,600 2 | 28.84 | 25.22 | 365.0 | 0.3 | 2.2 |
- Base Gold Price assumption used in the San Agustin technical report..
- Comparison gold price.
Company Overview on San Antonio:
- San Antonio Project Preliminary Economic Assessment( PEA) shows US$398.7M NPV5, 40.7% IRR, US$131.3M CAPEX and 1.1 million total ounces produced at a US$1,900/oz gold price
- Mineral resource of 1.6 million ounces of gold at San Antonio project creates attractive optionality with high grade, low CAPEX, sub-US$1,100/oz ASIC and long mine life
Au Price
(US$/oz Au) | Net Cash Flow
(US$M) | After-Tax NPV
@ 5% Discount Rate
(US$M) | IRR
(%) | Payback Period
(years) | Payback Multiple |
| 1,900 1 | 651.21 | 398.66 | 40.7 | 2.0 | 5.2 |
| 2,600 2 | 1,135.42 | 715.05 | 58.8 | 1.5 | 8.3 |
- Base Gold Price assumption used in the San Antonio technical report..
- Comparison gold price.
Vancouver, British Columbia--(Newsfile Corp. - January 13, 2025) - Heliostar Metals Ltd. (TSXV: HSTR) (OTCQX: HSTXF) (FSE: RGG1) ("Heliostar" or the "Company") advises that it has filed technical reports on the La Colorada Operations, the San Agustin Operations and the San Antonio Project. The technical reports were prepared on material projects acquired in 2024.
The technical reports are available on SEDAR+ (www.sedarplus.ca) and on the Company's website (www.heliostarmetals.com).
Heliostar CEO, Charles Funk, commented "Heliostar has filed technical reports for three of its recently acquired Mexican projects. At La Colorada, we have restarted production this month with 2025 focused on the newly defined Junkyard Stockpile and then expanding to over 50,000 ounces of gold per year with the El Crestón expansion. At San Agustin, the Phase 4 Permit area can generate strong cash flow and reduce closure costs. More importantly receiving expansion permits will provide the trigger to restart drilling, targeting further mine life expansion at the mine which has upside oxide and sulphide potential. The PEA at San Antonio demonstrates a rare, 1.0 Au g/t heap leach deposit with low CAPEX, low ASIC and a long mine life. It provides attractive optionality for our long-term growth. The combined projects have positive economics at conservative gold prices and significantly stronger returns at today's gold prices. In 2025, the Company will focus on reducing front-end capital requirements for El Crestón to improve the project economics for the expansion decision and will continue to advance Ana Paula through its Feasibility Study."
LA COLORADA MINE
Mineral Resource and Mineral Reserve estimates and a life-of-mine (LOM) plan were completed for the 100% owned La Colorada Operations (La Colorada) located in the state of Sonora, Mexico. The LOM plan in the La Colorada technical report is based on continued production from three sequentially-staged deposits: the Junkyard Stockpile (La Chatarrera), the El Crestón pit expansion (El Crestón), and the Veta Madre pit expansion (Veta Madre). The La Colorada technical report that is the subject of this news release supersedes a technical report that was prepared on the La Colorada Mine by Argonaut Gold Inc., which had an effective date of October 1, 2021.
The La Colorada technical report includes first-time disclosure of a Mineral Resource and Mineral Reserve estimate for the Junkyard and updated Mineral Resource and Mineral Reserve estimates for El Crestón and Veta Madre. The LOM plan indicates a Probable Mineral Reserve of 377k ounces of gold exploited with two years of pre-strip and 4.1 years of mine life, from the effective date of the La Colorada technical report, at production rates up to the 13,000 t/d nameplate throughput capacity of the mine at an all-in sustaining capital cost of US$1,763/oz Au.
Key Highlights
| La Colorada - Mineral Reserve & Production Highlights |
| Mineral Reserves (kt) 1 | 18,159 |
| Gold Grade (g/t Au) | 0.65 |
| Contained Gold (koz Au) | 377 |
| Processing Rate (t/d average) 2 | 8,292 |
| Life of Mine (years) 3 | 4.1 |
| Annual Production (oz Au per year, 2026) | 14,564 |
| Annual Production (oz Au per year, average 2027-2030) | 64,309 |
- Probable Mineral Reserve.
- Processing throughput rates vary over the Life of Mine, up to the nameplate capacity of about 13,000 t/d.
- Excludes 2 years of metals production from the Junkyard (2025) and from near-surface ore extracted during pre-stripping (2026).
| La Colorada - Financial Highlights |
| Average Cash Costs (US$ per oz AuEq) 1 | 1,549 |
| Average AISC (US$ per oz AuEq) 1 | 1,763 |
| Total Initial Capital Cost (US$M) 2 | 53.9 |
| Total Sustainable Capital Cost (US$M) | 9.8 |
| Total LOM Capital Cost (US$M ) | 63.7 |
- Non-International Financial Reporting Standards (IFRS) measures. All-in sustaining costs (AISC) were first issued by the World Gold Council (WGC) in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance note in 2018.
- Reflects capital investment before first metals production from El Crestón. Further expenditure will be required after first metals production for pre-stripping. A maximum negative cash flow of US$139 million is projected at the base assumptions used in the La Colorada technical report.
| La Colorada Return Estimates based on Gold Price1 |
| | US$2,000/oz 2
| US$2,600/oz 3 |
IRR (%)
| 11.9 | 34.7 |
NPV @ 5.0% discount (US$M)
| 25.9 | 110.0 |
NPV @ 7.5% discount (US$M)
| 15.0 | 91.2 |
Payback (years)
| 2.2 | 1.4 |
- All other key parameters set at base assumptions, including the 5% discount rate used. More detailed analysis is presented in the La Colorada technical report.
- Base Gold Price assumption used in the La Colorada technical report.
- Comparison gold price with reference to US$2,687.45 London Bullion Market Association (LBMA) PM gold price on trading day January 10, 2025.
La Colorada Mineral Resource Estimates
Mineral Resources were estimated at La Colorada for three deposits: El Crestón, Veta Madre and the Junkyard, and are summarized in the following tables by deposit.
El Crestón Mineral Resource Statement
| Category | Tonnes
(kt) | Gold
Grade
(g/t) | Silver
Grade
(g/t) | Gold
Contained
Metal
(koz) | Silver
Contained
Metal
(koz) |
| Indicated | 12,393 | 0.91 | 11.94 | 364 | 4,758 |
| Inferred | 202 | 0.70 | 6.07 | 5 | 39 |
Notes to accompany El Crestón Mineral Resource table:
- Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 31 October 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., Associate Mineral Resource Estimator with Mine Technical Services.
- Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- Mineral Resource estimates use the end of month October 2024 topography.
- Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; rock mining cost of US$2.66/t mined; backfill mining cost of US$2.0/t mined; crushing and conveying cost of US$1.33/t processed; process and leaching cost of US$4.54/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 79%; silver metallurgical recovery of 13%; and pit slope angles from 22º (pad), 35-42º (pit).
- Mineral Resources are reported at a gold equivalent cut-off of 0.14 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:502.51.
- Totals may not sum due to rounding.
Veta Madre Mineral Resource Statement
| Category | Tonnes
(kt) | Gold
Grade
(g/t) | Silver
Grade
(g/t) | Gold
Contained
Metal
(koz) | Silver
Contained
Metal
(koz) |
| Indicated | 2,724 | 0.73 | 3.5 | 64 | 309 |
| Inferred | 77 | 0.53 | 2.5 | 1 | 6 |
Notes to accompany Veta Madre Mineral Resource table:
- Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 31 October, 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., Associate Mineral Resource Estimator with Mine Technical Services.
- Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- Mineral Resource estimates use the end of month October 2024 topography.
- Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; mining rock costs of US$2.55/t mined; crushing and conveying cost of US$1.33/t processed; process and leaching cost of US$4.54/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 72%; silver metallurgical recovery 9.0%; and pit slope angles averaging 45º.
- Mineral Resources are reported at a gold equivalent cut-off of 0.15 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:661.54.
- Totals may not sum due to rounding.
La Chatarrera Mineral Resource Statement
| Category | Tonnes
(kt) | Gold
Grade
(g/t) | Silver
Grade
(g/t) | Gold
Contained
Metal
(koz) | Silver
Contained
Metal
(koz) |
| Indicated | 3,504 | 0.20 | 6.8 | 23 | 763 |
| Inferred | 1,220 | 0.41 | 33.29 | 16 | 1,305 |
Notes to accompany the Junkyard Stockpile Mineral Resource table:
- Mineral Resources are reported in stockpiles, using the 2014 CIM Definition Standards, and have an effective date of 31 October, 2024. The Qualified Person for the estimate is Mr. David Thomas, P.Geo., of Mine Technical Services.
- Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- Mineral Resource estimates use the end of month October 2024 topography.
- Mineral Resources are reported using the following assumptions: a gold price of US$2,150/oz Au; a silver price of US$26/oz Ag; a stockpile rehandle cost of US$1.30/t mined; crushing and conveying cost of US$1.72/t processed; process and leaching cost of US$3.10/t processed; general and administrative cost of US$1.15/t processed; selling cost of US$0.66/t processed; gold metallurgical recovery of 66%; and a silver metallurgical recovery of 27%.
- Mineral Resources are reported at a gold equivalent cut-off of 0.17 g/t AuEq, using AuEq = (Au + Ag/equivalency factor), where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)). This results in a Au:Ag ratio of 1:202.14.
- Totals may not sum due to rounding.
La Colorada Mineral Reserve Estimates
Mineral Resources were converted to Mineral Reserves for El Crestón, Veta Madre and the Junkyard.
The Mineral Reserve estimate is based on operation of the existing crusher and conveyor system having a nameplate throughput capacity of about 13,000 t/d, and continued operation of the heap leach and carbon-in-circuit (CIC) process circuit and refinery to process ore from the three deposits. The Mineral Reserve estimate is presented in the following table.
Mineral Reserves Statement
| Classification | Zone | AuEq Cut-off
(g/t) | Tonnes
(kt) | Gold Grade
(g/t Au) | Silver Grade (g/t Ag) | Contained Gold
(koz) | Contained Silver
(koz) |
| Probable | El Crestón | 0.160 | 12,841 | 0.76 | 10.1 | 312 | 4,181 |
| Veta Madre | 0.175 | 1,905 | 0.70 | 3.1 | 43 | 189 |
| La Chatarrera | 0.164 | 3,413 | 0.20 | 6.4 | 22 | 704 |
| Total |
| 18,159 | 0.65 | 8.69 | 377 | 5,074 |
Notes to accompany Mineral Reserves table:
- Mineral Reserves are reported at the point of delivery to the process plant, using the 2014 CIM Definition Standards.
- Mineral Reserves have an effective date of 30 November 2024. The Qualified Person for the estimate is Mr. Jeffrey Choquette, P.E., of Hard Rock Consulting.
- A 0.16 g/t AuEq cut-off is used for reporting the Mineral Reserves at El Crestón, and a 0.175 g/t AuEq cut-off is used for reporting Mineral Reserves at Veta Madre. Cut-offs were calculated based on a gold price of US$1,900/oz Au, silver price of US$23/oz Ag, processing costs of US$5.87/t, general and administrative costs of US$1.15/t, refining and selling costs of US$0.66/t, gold recovery of 79% for El Crestón and 72% for Veta Madre and a silver recovery of 13% for El Crestón and 9% for Veta Madre. The AuEq cut-off for the Junkyard Stockpile is 0.164 g/t AuEq based on metal prices of US$1,900/oz Au, and US$23/oz Ag, processing costs of US$4.82/t, general and administrative costs of US$1.15/t, refining and selling costs of US$0.66/t, gold recovery of 66% and a silver recovery of 27%. The AuEq calculation uses the formula AuEq = (Au + Ag/equivalency factor) where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)).
- Mineral Reserves are reported within the ultimate reserve pit design. An external dilution factor of 10% and a metal loss of 5% were factored into the Mineral Reserves estimates.
- Tonnage and grade estimates are in metric units.
- Mineral Reserve tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding.
The LOM plan outlines sequential exploitation of the three deposits with two years of pre-production from the Junkyard (2025) and from near-surface ore extracted during pre-stripping (2026), before a production LOM of 4.1 years.
Figure 1 - Ore Mined by Pit Phase
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/7729/237102_heliostar1.jpg
Note: Figure prepared by Hard Rock Consulting, 2024
La Colorada Operating Cost Estimates
The existing mining and process circuit at the La Colorada Mine remains unchanged for the proposed LOM plan in the La Colorada technical report, with exploitation of the three deposits benefitting from the installed capacity. The expected operating performance and operating cost forecasts were compiled with the benefit of benchmarking historical performance at La Colorada and the input of seasoned professionals knowledgeable of the conventional technologies being used at La Colorada, the expected consumption quantities of key supplies, and commercial pricing for goods and services in Mexico.
Total Operating Cost Summary
| Operating Costs | Operating Cost
($/oz AuEq) | Operating Cost
($/t ore) | Operating Cost
($/t mined) |
| Total mining | 1,038.63 | 17.02 | 2.06 |
| Total processing | 368.21 | 6.04 |
|
| Total site general and administrative | 68.40 | 1.12 |
|
| Refinery and transport | 26.37 | 0.43 |
|
| Cash operating costs | 1,501.61 | 24.61 |
|
| Production taxes | 27.14 | 0.44 |
|
| Royalties | 20.00 | 0.33 |
|
| Total cash costs | 1,548.74 | 25.39 |
|
| Capital costs | 214.11 | 3.51 |
|
| Total AISC | 1,762.86 | 28.90 |
|
La Colorada Capital Cost Estimates
The Junkyard only requires working capital to bring the deposit into production.
The initial capital cost for El Crestón is estimated at US$54.0M, including US$9.0M capital for pad expansion and US$43.4M mining pre-stripping costs until first production. A significant pre-strip is required to fully exploit the El Crestón deposit, comprising both capitalized and expensed pre-stripping costs.
The LOM plan includes US$6.8M for reclamation work at the end of the mine life.
Capital Cost Summary
| Capital Costs | Initial
(US$ M) | Sustaining
(US$ M) | Total LOM
(US$ M) |
| Mine pre-production development | 43.40 | 0.00 | 43.40 |
| Contractor mobilization | 0.21 | 0.00 | 0.21 |
| Slope radar system | 0.00 | 0.50 | 0.50 |
| Leach pad expansion | 8.97 | 2.13 | 11.10 |
| Total direct costs | 52.58 | 2.63 | 55.21 |
| Owner costs and reclamation | 0.00 | 6.80 | 6.80 |
| Indirects and contingency | 1.35 | 0.37 | 1.72 |
| Total indirect costs | 1.35 | 7.17 | 8.52 |
| Total | 53.93 | 9.80 | 63.73 |
La Colorada Economic Analysis
The financial analysis shows an after-tax net present value at a discount rate of 5% of US$25.9 M, an after-tax internal rate of return of 11.9%, and a payback period of 2.2 years. The forecast total lifespan of the Project is 4.1 years with two years of pre-production, although some metals production is planned in these two years. Approximately 377,000 oz of gold is projected to be mined, with 287,000 oz of gold recovered and produced for sale.
Summary Economic Results
| Project Valuation Overview | Units | After Tax | Before Tax |
| Total cashflow | US$ M | 54.92 | 86.51 |
| NPV @ 5.0% (base case) | US$ M | 25.93 | 49.77 |
| NPV @ 7.5%; | US$ M | 14.99 | 35.82 |
| NPV @ 10.0%; | US$ M | 5.90 | 24.14 |
| Internal rate of return | % | 11.9 | 17.2 |
| Payback period | Years | 2.15 | 2.04 |
| Payback multiple |
| 1.35 | 1.55 |
| Total initial capital | US$ M | 53.93 | 53.93 |
Metal Prices
The La Colorada technical report includes a sensitivity analysis for key parameters impacting the forecast economic returns for La Colorada. The LOM plan and Mineral Reserves estimates are most sensitive to changes in the gold price, and gold grade. Since silver is projected to contribute only about 4% to the revenues. LOM variations in the silver price have limited impact on the cashflow forecast. The LOM plan and Mineral Reserves estimates are less sensitive to operating cost changes, and least sensitive to changes in capital costs.
Gold Price Sensitivity Analysis
Au Price
(US$/oz Au) | Net Cash Flow
(US$ M) | After-Tax NPV
@ 5.0% Discount Rate
(US$ M) | IRR
(%) | Payback Period
(years) | Payback Multiple |
| 1,000 | -235.88 | -203.08 | - | 0.0 | 0.0 |
| 1,200 | -167.30 | -149.64 | - | 0.0 | 0.2 |
| 1,400 | -99.10 | -96.46 | -31.1 | 0.0 | 0.5 |
| 1,600 | -30.90 | -43.29 | -7.0 | 0.0 | 0.8 |
| 1,800 | 19.43 | -3.17 | 4.2 | 2.7 | 1.1 |
| 2,000 | 54.92 | 25.93 | 11.9 | 2.2 | 1.4 |
| 2,200 | 89.39 | 53.96 | 19.4 | 1.8 | 1.6 |
| 2,400 | 123.85 | 82.00 | 27.0 | 1.6 | 1.9 |
| 2,600 | 158.32 | 110.03 | 34.7 | 1.4 | 2.3 |
| 2,800 | 192.79 | 137.88 | 42.3 | 1.2 | 2.7 |
| 3,000 | 227.26 | 165.60 | 49.7 | 1.1 | 3.2 |
Commentary by the Company on Relevant Matters
The results from ongoing drilling and other technical studies being performed at El Crestón are excluded from the La Colorada technical report but will be incorporated into a mineral resource model and will support a Mineral Reserve update that will be published with an updated technical report in mid-2025.
A total initial capital of $53.9M is a required, predominantly from waste stripping prior to the reaching the life-of-mine strip ratio. Further stripping is required after reaching the life-of-mine strip ratio and a maximum negative cash flow of US$139 million is projected at the base assumptions used in the La Colorada technical report (US$117M at US$2,600 gold).
The La Colorada technical report presents cash flows based on the base gold price used. With exploitation of the Junkyard starting this month, the project will generate revenues from sales based on current gold prices which are expected to be higher than the base gold price used in the La Colorada technical report.
The gold market has experienced significant upward price movement in the past few years and, considering that the gold price at the effective date of the La Colorada technical report is about 34% above the base gold price used in the La Colorada technical report. The sensitivity analysis presents gold price scenarios up to US$3,000/oz Au to understand the potential impact. From the base case price of $2,000/oz (years 2026-2031), a change in the average gold price of US$200/oz Au would change the NPV at a 5% discount rate by 108%, or approximately $28.0 M
Commentary by the Company on Next Steps and Permitting
Restart of mining activities at La Colorada has commenced at the Junkyard this month. The Company will provide production and cost guidance for 2025 later in January.
The Company will be continuing the current drill program and conducting other technical programs at El Crestón and plans to complete updated technical study in mid-2025.
The drill program includes shallow infill drilling designed to support short-term mine planning, and a program of infill and expansion drilling deeper in the pit to include in the future update to Mineral Resource and Mineral Reserve estimate.
Some ancillary permitting work is planned at El Crestón and is expected to be completed by mid-2025. A change of land use permit is required to enable exploitation of Veta Madre.
Since the development plan for La Colorada represents a continuation of the historical operations, minimal capital investment is required for new equipment and facilities; however, pre-stripping at El Crestón and Veta Madre will need to be financed. Subject to satisfactory conclusion of the planned work programs and arranging financing, the Company is anticipating making an investment decision at El Crestón in 2H 2025.
Qualified Persons
The technical report for the La Colorado Mine was prepared for Heliostar Metals Inc. by Mr. Todd Wakefield, RM SME, Mr. David Thomas, P.Geo., Mr. Jeffrey Choquette, P.E., Mr. Carl Defilippi, RM SME, and Ms. Dawn Garcia, CPG. Each of these Qualified Persons has reviewed and approved the technical information contained in this news release that was abstracted from the La Colorada technical report in their area of expertise and are independent of the Company.
SAN AGUSTIN MINE
Mineral Resource and Mineral Reserve estimates and a LOM plan were completed for the 100% owned San Agustin Operations (San Agustin) located in the state of Durango, Mexico. The LOM plan in the San Agustin technical report is based on an expansion of the existing open pit. The San Agustin technical report that is the subject of this news release supersedes a technical report that was prepared on the San Agustin Mine by Florida Canyon Gold Inc., which had an effective date of June 20, 2024.
The San Agustin technical report includes an updated Mineral Resource and Mineral Reserve estimate. The LOM plan indicates that a Probable Mineral Reserve of 68k ounces of gold can be exploited based on 1.2 years of mine life at an all-in sustaining capital cost of US$1,990/oz Au.
Key Highlights
| San Agustin - Mineral Reserve & Production Highlights |
| Mineral Reserves (kt) 1 | 7,358 |
| Grade (g/t Au) | 0.29 |
| Contained Gold (koz Au) | 68 |
| Processing Rate (t/d) 2 | 17,100 |
| Life of Mine (years) 3 | 1.2 |
| Annual Production (oz Au per year, average 2026-2027) 4 | 19,091 |
- Probable Mineral Reserve.
- Processing throughput rates will vary over the Life of Mine, up to the nameplate capacity of about 30,000 t/d.
- Excludes one year of metals production from ongoing re-leaching of heap leach piles.
- Gold production in 2026 is 32,625 ounces.
| San Agustin - Financial Highlights |
| Average Unit Costs (US$ per oz AuEq) 1 | 1,605 |
| Average AISC (US$ per oz AuEq) 1, 2 | 1,990 |
| Total Initial Capital Cost (US$M) | 4.2 |
| Total Sustainable Capital Cost (US$M) 2 | 14.3 |
| Total LOM Capital Cost (US$M) | 18.5 |
- Non-IFRS measures. AISC were first issued by the WGC in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance note in 2018.
- Includes reclamation costs for San Agustin mine.
| San Agustin Return Estimates based on Gold Price 1 |
| US$2,100/oz 2 | US$2,600/oz 3 |
| IRR (%) | 156.1 | 365.0 |
| NPV @ 5.0% discount (US$M) | 12.7 | 25.2 |
| NPV @ 7.5% discount (US$M) | 11.7 | 23.6 |
| Payback (years) | 0.8 | 0.3 |
- All other key parameters set at base assumptions, including the 5% discount rate used. More detailed analysis is presented in the LSan Agustin technical report.
- Base Gold Price assumption used in the San Agustin technical report.
- Comparison gold price with reference to US$2,687.45 LBMA PM gold price on trading day January 10, 2025.
San Agustin Mineral Resource Estimates
Mineral Resources were estimated for San Agustin as summarized in the following table.
Mineral Resource Statement
Material
Type | AuEq
Cutoff
(g/t AuEq) | Confidence
Classification | Tonnes
(kt) | Gold Grade
(g/t Au) | Silver Grade
(g/t Ag) | Contained Gold
(koz) | Contained Silver
(koz) |
| Oxide | 0.14 | Indicated | 17,154 | 0.30 | 11.5 | 165 | 6,333 |
| Transitional | 0.27 | 700 | 0.44 | 17.4 | 10 | 391 |
| Sulphide argillic | 0.41 | 5,348 | 0.80 | 14.0 | 138 | 2,403 |
| Sulphide silicified | 0.60 | 427 | 0.90 | 7.4 | 12 | 102 |
| Total | 23,629 | 0.43 | 12.2 | 325 | 9,229 |
| Oxide | 0.14 | Inferred | 1,273 | 0.29 | 9.2 | 12 | 378 |
| Transitional | 0.27 | 5 | 0.32 | 25.6 | 0 | 4 |
| Sulphide argillic | 0.41 | 121 | 0.64 | 9.6 | 2 | 38 |
| Sulphide silicified | 0.60 | 2 | 0.68 | 6.0 | 0 | 0 |
| Total | 1,401 | 0.32 | 9.4 | 14 | 421 |
Notes to accompany San Agustin Mineral Resource table:
- Mineral Resources are reported insitu, using the 2014 CIM Definition Standards, and have an effective date of 30 November, 2024. The Qualified Person for the estimate is Mr. David Thomas, PGeo., Associate Mineral Resource Estimator with Mine Technical Services.
- Mineral Resources are reported inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- Mineral Resource estimates are defined by end of month July 2024 topography.
- Mineral Resources are constrained by a conceptual pit shell using the following assumptions: a gold price of $2,150/oz Au; a silver price of $26.0/oz Ag; mining cost of $2.0/t mined; oxide process and leaching cost of $4.23/t processed; transition process and leaching cost of $5.14/t processed; sulphide argillic process and leaching cost of $5.36/t processed; sulphide silicic process and leaching cost of $4.94/t processed; general and administrative cost of $1.4/t processed; selling cost of $0.66/t processed; gold metallurgical recoveries from 17-66%; silver metallurgical recoveries from 9-10%; and pit slope angles of 45º.
- Totals may not sum due to rounding.
San Agustin Mineral Reserve Estimates
The Mineral Reserve estimate at San Agustin is based on operation of the existing crusher and conveyor system having a nameplate throughput capacity of about 30,000 t/d and continued operation of the heap leach and CIC process circuit to processing ore from the expanded open pit. The Mineral Reserve estimate is presented in the following table.
Mineral Reserve Statement
| Classification | Material
Type | AuEq Cut-off
(g/t AuEq) | Tonnes
(kt) | Gold Grade
(Au g/t) | Silver Grade
(Ag g/t) | Contained Gold
(koz) | Contained Silver
(koz) |
| Probable | Oxide | 0.156 | 7,281 | 0.29 | 16.24 | 67 | 3,803 |
| Transition | 0.310 | 77 | 0.39 | 31.39 | 1 | 77 |
| Total |
| 7,358 | 0.29 | 16.40 | 68 | 3,880 |
Notes to accompany Mineral Reserves table:
- Mineral Reserves are reported at the point of delivery to the process plant, using the 2014 CIM Definition Standards.
- Mineral Reserves have an effective date of 30 November 2024. The Qualified Person for the estimate is Mr. Jeffrey Choquette, PE, of Hard Rock Consulting, LLC.
- A 0.156 g/t AuEq cut-off is used for reporting the Mineral Reserves in oxide, and a 0.310 g/t AuEq cut-off is used for reporting Mineral Reserves in transitional material. Cut-offs were calculated based on a gold price of US$1,900/oz Au, silver price of US$23/oz Ag, processing costs of US$4.23/t for oxide, processing costs of US$5.14/t for transitional, general and administrative costs of US$1.40/t, refining and selling costs of US$0.66/t, gold recovery of 66% for oxide and 38% for transitional and a silver recovery of 10% for oxide and transitional. The AuEq calculation uses the formula AuEq = (Au + Ag/equivalency factor) where equivalency factor = ((Au price in US$/g * Au recovery) / (Ag price in US$/g * Ag recovery)).
- Mineral Reserves are reported within the ultimate reserve pit design. An external dilution factor of 5% and a metal loss of 3% have been factored into the Mineral Reserve estimate.
- Tonnage and grade estimates are in metric units.
- Mineral Reserve tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding
Figure 2 - Ore Mined by Pit Phase
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Note: Figure prepared by Hard Rock Consulting, 2024
San Agustin Operating Cost Estimates
The existing mining and process circuit at San Agustin remains unchanged for the proposed LOM plan in the San Agustin technical report, with exploitation of the ore from the expanded open pit benefitting from the installed capacity. The expected operating performance and operating cost forecasts were compiled with the benefit of benchmarking historical performance at San Agustin and the input of seasoned professionals knowledgeable of the conventional technologies being used at San Agustin, the expected consumption quantities of key supplies, and commercial pricing for goods and services in Mexico.
Total Operating Cost Summary
| Operating Costs | Operating Cost
(US$/oz AuEq) | Operating Cost
(US$/t ore) | Operating Cost
(US$/t mined) |
| Total mining | 681.41 | 4.44 | 2.36 |
| Total processing | 699.96 | 4.56 |
|
| Total site general and administrative | 123.57 | 0.80 |
|
| Refinery and transport | 38.47 | 0.25 |
|
| Cash operating costs | 1,543.41 | 10.05 |
|
| Production taxes | 40.10 | 0.26 |
|
| Royalties | 21.00 | 0.14 |
|
| Total cash costs | 1,604.51 | 10.45 |
|
| Capital costs | 385.59 | 2.51 |
|
| Total AISC | 1,990.09 | 12.96 |
|
San Agustin Capital Cost Estimates
The initial capital cost is estimated at US$4.2M, including US$2.7M capital for Owner's costs and US$0.6M for an in-fill drill program.
The LOM plan includes US$13.6M for reclamation work at the end of the mine life.
Capital Cost Summary
| Capital Costs | Initial
(US$ M) | Sustaining
(US$ M) | Total LOM
(US$ M) |
| Definition drilling Phase 4 Pit | 0.60 | 0.00 | 0.60 |
| Mine contractor mobilization and demobilization | 0.15 | 0.05 | 0.20 |
| Leach pad expansion | 0.00 | 0.61 | 0.61 |
| Total direct costs | 0.75 | 0.66 | 1.41 |
| Owner Costs and reclamation | 3.40 | 13.57 | 16.97 |
| Indirects and contingency | 0.00 | 0.09 | 0.09 |
| Total indirect costs | 3.40 | 13.67 | 17.07 |
| Total | 4.15 | 14.33 | 18.48 |
San Agustin Economic Analysis
The financial analysis in the San Agustin technical report shows an after-tax net present value at a discount rate of 5% of US$12.7 million, an after-tax internal rate of return of 156%, and a payback period of 0.8 years. The forecast total lifespan of the Project is 1.2 years with 0.8 years of residual leaching. Approximately 67,800 oz of gold is projected to be mined, with 44,500 oz of gold recovered and produced for sale.
Summary Economic Results
| Project Valuation Overview | Units | After Tax | Before Tax |
| Total cashflow | US$ M | 14.83 | 19.69 |
| NPV @ 5.0% (base case) | US$ M | 12.67 | 19.46 |
| NPV @ 7.5% | US$ M | 11.74 | 18.10 |
| NPV @ 10.0% | US$ M | 10.88 | 16.86 |
| Internal rate of return | % | 156.1 | 218.9 |
| Payback period | Years | 0.79 | 0.59 |
| Payback multiple |
| 1.09 | 1.66 |
| Total initial capital | US$ M | 4.15 | 4.15 |
Metal Prices
The San Agustin technical report includes a sensitivity analysis for key parameters impacting the forecast economic returns for San Agustin. The LOM plan and Mineral Reserves estimates are most sensitive to gold price and gold grade. Since silver is projected to contribute only about 9% to the San Agustin revenues, variations in the silver price have a small impact on the cashflow forecast. The LOM plan and Mineral Reserves estimates are less sensitive to operating cost changes, and least sensitive to changes in capital costs.
Gold Price Sensitivity Analysis
Au Price
(US$/oz Au) | Net Cash Flow
(US$ M) | After-Tax
NPV @ 5%
(US$ M) | IRR
(%) | Payback Period
(years) | Payback
Multiple |
| 1,000 | -34.64 | -31.50 | - | - | - |
| 1,200 | -24.16 | -22.18 | - | - | - |
| 1,400 | -13.69 | -12.86 | - | - | - |
| 1,600 | -3.22 | -3.53 | -19.6 | - | - |
| 1,800 | 4.75 | 3.62 | 38.2 | 1.6 | 0.4 |
| 2,000 | 12.03 | 10.16 | 119.8 | 1.1 | 0.9 |
| 2,100 | 14.83 | 12.67 | 156.1 | 0.8 | 1.1 |
| 2,200 | 17.63 | 15.18 | 194.8 | 0.6 | 1.3 |
| 2,400 | 23.23 | 20.20 | 277.4 | 0.4 | 1.8 |
| 2,600 | 28.84 | 25.22 | 365.0 | 0.3 | 2.2 |
| 2,800 | 34.44 | 30.23 | 455.6 | 0.2 | 2.7 |
| 3,000 | 40.05 | 35.25 | 548.3 | 0.2 | 3.2 |
Commentary by the Company on Relevant Matters
The San Agustin technical report presents cash flows based on the base gold price used. With exploitation of the Mineral Reserve as presented in the San Agustin technical report, the project will generate revenues from sales which may be higher than the base gold price used in the San Agustin technical report.
The gold market has experienced significant upward price movement in the past few years and, considering the gold price at the effective date of the San Agustin technical report is about 34% above the base gold price used in the San Agustin technical report. The sensitivity analysis presents gold price scenarios up to US$3,000 per ounce to understand the potential impact. From the base case price of $2,100/oz, a 10% change in the average gold price (or US$210/oz Au) would change the NPV at a 5% discount rate by 42%, or approximately $5.3 M.
Commentary by the Company on Next Steps and Permitting
Although mining activities at San Agustin ceased in August 2024, the Company is continuing re-leaching activities. The Company will provide production and cost guidance for 2025 later in January.
A change of land use permit is required to enable exploitation of the Mineral Reserve at San Agustin. Subject to obtaining the permit, the Company plans to conduct a small, in-fill drill program to provide geotechnical information and support short-term mine planning, and to complete other preparation work needed to restart the mining activities. These activities are expected to require 4-6 months to complete from permit approval.
Qualified Persons
The technical report for the San Agustin Mine was prepared for Heliostar Metals Inc. by Mr. Todd Wakefield, RM SME, Mr. David Thomas, P.Geo., Mr. Jeffrey Choquette, P.E., Mr. Carl Defilippi, RM SME, and Ms. Dawn Garcia, CPG. Each of these Qualified Persons has reviewed and approved the technical information contained in this news release that was abstracted from the San Agustin technical report in their area of expertise and are independent of the Company.
SAN ANTONIO PRELIMINARY ECONOMIC ASSESSMENT
A Preliminary Economic Assessment (PEA) based on Mineral Resource estimates was completed for the 100% owned San Antonio Project (San Antonio Project technical report) located in the state of Baja California Sur, Mexico. The study considers construction and operation of a greenfield open pit and heap leach-CIC mine operation. The San Antonio Project technical report that is the subject of this news release supersedes a technical report that was prepared on the San Antonio Project by Argonaut Gold Inc., which had an effective date of 1 September, 2012.
The PEA is preliminary in nature and includes Inferred Mineral Resources that are too speculative geologically to have economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the preliminary economic assessment will be realized.
Key Highlights
| San Antonio PEA - Resource & Production Highlights |
| Mineral Resource within PEA mine plan |
|
| Indicated Mineral Resources (kt) | 49,410 |
| Grade (g/t Au) | 1.00 |
| Contained Gold (koz Au) | 1,590 |
| Inferred Mineral Resources (kt) | 5,397 |
| Grade (g/t Au) | 0.47 |
| Contained Gold (koz Au) | 82 |
| Processing Rate (t/d) | 10,960 |
| Life of Mine (years) | 13.7 |
| Average recovery rate (% Au) | 65.8 |
| Annual Production (oz Au per year, average) | 80,268 |
| Life of Mine Production (Moz Au) | 1.10 |
| San Antonio PEA - Financial Highlights |
Average Unit Cash Costs (US$ per oz Au)1
| 898 |
Average AISC (US$ per oz Au)1
| 1,063 |
Total Initial Capital Cost (US$M)
| 131.3 |
Total Sustainable Capital Cost (US$M)
| 48.6 |
Total LOM Capital Cost (US$M)
| 179.9 |
- Non-IFRS measures. AISC were first issued by the WGC in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance note in 2018. Gold Price used in La Colorada technical report
| San Antonio Return Estimates based on Gold Price 1 |
| US$1,900/oz 2 | US$2,600/oz 3 |
| IRR (%) | 40.7 | 58.8 |
| NPV @ 5.0% discount (US$M) | 398.7 | 715.1 |
| NPV @ 7.5% discount (US$M) | 315.1 | 575.9 |
| Payback (years) | 2.0 | 1.5 |
- All other key parameters set at base assumptions, including the 5% discount rate used. More detailed analysis is presented in the San Antonio technical report.
- Base Gold Price assumption used in Technical Report.
- Comparison gold price with reference to US$2,687.45 LBMA PM gold price on trading day January 10, 2025.
San Antonio Mineral Resource Estimates
Mineral Resources were estimated for San Antonio Project as summarized in the following table.
Mineral Resource Statement
| Confidence Classification | Area | Oxidation State | Cut-off Grade
(g/t Au) | Tonnage
(kt) | Gold Grade
(g/t Au) | Contained Metal
(koz Au) |
| Indicated | Los Planes | Oxide and transition | 0.095 | 15,839 | 0.91 | 461.2 |
| Sulphide | 0.156 | 26,607 | 1.10 | 943.7 |
| Intermediate | Oxide, transition, and sulphide | 0.150 | 5,239 | 0.87 | 146.3 |
| Las Colinas | Oxide and transition | 0.184 | 1,430 | 0.69 | 31.9 |
| Sulphide | 0.199 | 6,407 | 0.77 | 158.1 |
| Total | Oxide, transition, and sulphide | 0.095-1.99 | 55,522 | 0.98 | 1,741.3 |
| Inferred | Los Planes | Oxide and transition | 0.095 | 5,479 | 0.34 | 59.1 |
| Sulphide | 0.156 | 1,319 | 0.71 | 30.2 |
| Intermediate | Alluvium, oxide, transition, and sulphide | 0.150 | 660 | 0.43 | 9.2 |
| Las Colinas | Alluvium, oxide, and transition | 0.184 | 689 | 0.49 | 10.9 |
| Sulphide | 0.199 | 579 | 0.59 | 11.0 |
| La Colpa | Alluvium, oxide, and transition | 0.120 | 4,635 | 0.29 | 43.9 |
| Sulphide | 0.194 | 1,597 | 0.39 | 19.9 |
| Total | Alluvium, oxide, transition, and sulphide | 0.095-1.99 | 14,957 | 0.38 | 184.4 |
Notes to Accompany Mineral Resource Table:
- Mineral Resources are reported insitu, using the 2014 CIM Definition Standards.
- Mineral Resources have an effective date of 30 November, 2024. The Qualified Person for the estimate is Mr. Richard Schwering, RM SME, a Hard Rock Consulting employee.
- Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
- Mineral Resources are constrained within a conceptual open pit shell that used the following input parameters: gold price of US$2,150/oz; a mining cost of US$2/t mined, incremental mining cost of US$0.017/t mined for each 6 m depth; variable processing costs by oxidation state, ranging from US$3.84-5.26/t processed; general and administrative costs of US$1.00/t processed; finishing and selling costs of US$0.75/t processed; variable metallurgical recoveries by oxidation state, ranging from 44-86%; and variable pit slope angles ranging from 35-45º. Mineral Resources are reported above variable cut-off grades, ranging from 0.095-1.99 g/t Au.
- Numbers have been rounded.
San Antonio Mineral Resources Scheduled Within PEA Mine Plan
A mine plan was prepared based on an open pit and heap leach-CIC mine operation, with mineralized material processed sequentially and concurrently from three distinct mineral zones within the San Antonio deposit.
Mineral Resource Scheduled Within PEA Mine Plan
| Material Type | Indicated | Inferred |
Tonnes
(kt) | Gold Grade
(g/t Au) | Contained Gold
(koz Au) | Tonnes
(kt) | Gold Grade
(g/t Au) | Contained Gold
(koz Au) |
| Los Planes; oxide, mixed | 15,566 | 0.92 | 458.0 | 3,569 | 0.40 | 46.3 |
| Los Planes; sulphide | 25,276 | 1.13 | 918.9 | 968 | 0.76 | 23.7 |
| Intermediate; oxide, mixed | 478 | 0.58 | 8.9 | 204 | 0.40 | 2.6 |
| Intermediate; sulphide | 3,242 | 0.88 | 91.3 | 120 | 0.44 | 1.7 |
| Las Colinas; oxide, mixed | 1,275 | 0.69 | 28.3 | 313 | 0.42 | 4.2 |
| Las Colinas; sulphide | 3,574 | 0.74 | 84.8 | 223 | 0.42 | 3.0 |
| Total | 49,410 | 1.00 | 1,590.2 | 5,397 | 0.47 | 81.6 |
Figure 3 - Mineralization Mined by Pit Phase
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San Antonio Operating Cost Estimates
The operating costs in the San Antonio Project technical report were estimated for mining, processing, and general administration activities for an open pit and heap leach-CIC mine operation.
Total Operating Cost Estimate
| Operating Costs | Operating Cost
(US$/oz Au) | Operating Cost
(US$/t mineralized material) | Operating Cost
(US$/t mined) |
| Total mining | 522.78 | 10.40 | 2.06 |
| Total processing | 204.24 | 4.06 |
|
| Total site general and administrative | 59.26 | 1.18 |
|
| Refinery and transport | 16.85 | 0.34 |
|
| Cash operating costs | 803.13 | 15.97 |
|
| Production taxes | 76.22 | 1.52 |
|
| Royalties | 19.00 | 0.38 |
|
| Total cash costs | 898.34 | 17.87 |
|
| Capital costs | 165.04 | 3.28 |
|
| Total AISC | 1,063.39 | 21.15 |
|
San Antonio Capital Cost Estimates
The initial capital cost including contingency was estimated at US$131.8M, with a 2-year pre-production phase for construction of the greenfield mine.
Total LOM Capital Costs
| LOM Capital Costs | Initial
(US$M) | Sustaining
(US$M) | Total LOM
(US$M) |
| Mine area | 4.36 | 5.00 | 9.36 |
| General and administrative infrastructure | 72.26 | 20.50 | 92.76 |
| Processing | 12.81 | 0.00 | 12.81 |
| Total direct costs | 89.43 | 25.50 | 114.93 |
| Owner costs and reclamation | 5.00 | 17.31 | 22.31 |
| Project indirect costs | 16.51 | 0.00 | 16.51 |
| Contingency | 20.35 | 5.80 | 26.16 |
| Total indirect costs | 41.86 | 23.11 | 64.97 |
| Total | 131.28 | 48.62 | 179.90 |
San Antonio Economic Analysis
The financial analysis in the San Antonio Project technical report shows an after-tax net present value at a discount rate of 5% of US$399M, an after-tax internal rate of return of 40.7%, and a payback period of 2.1 years. The forecast total lifespan is 14 years. Approximately 1.67 M ounces of gold is projected to be mined, with 1.10 M ounces of gold forecast to be recovered and produced for sale.
Summary Economic Results
| Project Valuation Overview | Units | After Tax | Before Tax |
| Total cashflow | US$ M | 651.21 | 1,013.36 |
| NPV @ 5.0% (base case) | US$ M | 398.66 | 635.33 |
| NPV @ 7.5% | US$ M | 315.09 | 509.96 |
| NPV @ 10.0% | US$ M | 250.14 | 412.36 |
| Internal rate of return | % | 40.7 | 53.7 |
| Payback period | Years | 2.05 | 1.71 |
| Payback multiple |
| 5.24 | 7.65 |
| Total initial capital | US$ M | 138.59 | 138.59 |
Metal Prices
The San Antonio Project technical report includes a sensitivity analysis for key parameters impacting the cashflow forecast. The PEA LOM plan that is based on Mineral Resources is most sensitive to gold price and gold grade. It is less sensitive to operating cost changes, and least sensitive to changes in capital costs.
Gold Price Sensitivity Analysis
Au Price
(US$/oz Au) | Net Cash Flow
(US$ M) | After-Tax
NPV @ 5%
(US$ M) | IRR
(%) | Payback Period
(years) | Payback
Multiple |
| 1,000 | 11.34 | -20.14 | 1.5 | 5.3 | 1.1 |
| 1,200 | 162.93 | 78.70 | 15.0 | 3.5 | 2.0 |
| 1,400 | 303.75 | 171.10 | 23.8 | 2.8 | 3.0 |
| 1,600 | 443.11 | 262.51 | 31.2 | 2.4 | 3.9 |
| 1,800 | 582.04 | 353.46 | 37.7 | 2.2 | 4.8 |
| 1,900 | 651.21 | 398.66 | 40.7 | 2.0 | 5.2 |
| 2,000 | 720.38 | 443.86 | 43.5 | 2.0 | 5.7 |
| 2,200 | 858.73 | 534.26 | 49.0 | 1.8 | 6.6 |
| 2,400 | 997.07 | 624.66 | 54.0 | 1.7 | 7.5 |
| 2,600 | 1,135.42 | 715.05 | 58.8 | 1.5 | 8.3 |
| 2,800 | 1,273.76 | 805.45 | 63.4 | 1.5 | 9.2 |
| 3,000 | 1,412.10 | 895.85 | 67.8 | 1.4 | 10.1 |
Commentary by the Company on Relevant Matters
The gold market has experienced significant upward price movement in the past few years and considering gold price at the effective date of the San Antonio technical report is about 41% above the base gold price used in the San Agustin Project technical report. The sensitivity analysis presents gold price scenarios up to US$3,000 per ounce to understand the potential impact. From the base case price of US$1,900/oz Au, a change in the average gold price of US$200/oz Au would change the NPV at a 5% discount rate by 22.7%, or approximately $90.4 M.
Commentary by the Company on Next Steps and Permitting
The Project requires further development planning and engineering. All major environmental and other permits will need to be obtained before an investment decision can be considered by Heliostar.
Based on the results from the San Antonio Project technical report, the Company will conduct a strategic Project review with the objective of identifying and evaluating the next development steps and challenges. The Company will also consider additional work programs and alternative business possibilities to potentially add Project value to the San Antonio Project as presented in the PEA. This strategic review is expected to require 3-4 months to complete.
Qualified Persons
The technical report for the San Antonio Project was prepared for Heliostar Metals Inc. by Mr. Todd Wakefield, RM SME, Mr. Richard Schwering RM SME, Mr. Jeffrey Choquette, P.E., Mr. Carl Defilippi, RM SME, and Ms. Dawn Garcia, CPG. Each of these Qualified Persons has reviewed and approved the technical information contained in this news release that was abstracted from the San Antonio Project technical report in their area of expertise and are independent of the Company.
With respect to this News Release:
Qualified Persons for News Release
Sam Anderson, CPG, Gregg Bush, P.Eng. and Mike Gingles, MBA, the Company's Qualified Persons, as such term is defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects, have reviewed the scientific and technical information not derived from the technical reports and included in this news release in the Company Overview, Commentary by the Company on Relevant Matters and Commentary by the Company on Next Steps and Permitting sections for each property and have approved the disclosure herein.
Data Verification
In addition, the Qualified Persons for each of the technical reports verified the data in the reports in their areas of expertise, and concluded that the information supported Mineral Resource and Mineral Reserve estimation, and could be used in mine planning and economic analysis. The verification completed by each Qualified Person is discussed in each technical report and included site visits, and could include data audits, suitability of data for use in estimation and mine planning, quality assurance and quality control checks, review of available technical and economic study data, review of data collection and evaluation methods, review of production data including reconciliation where available, review of actual cost data for operations, and review of third-party inputs to forecasts.
The Company's Qualified persons verified the information that was not derived from the technical reports. The data verification included site visits, data audits, review of available study data, review of data collection and evaluation methods, review of production data including reconciliation where available, review of actual cost data for operations, and review of third-party inputs to forecasts, and consideration of the Company's plans for the projects.
About Heliostar Metals Ltd.
Heliostar aims to grow to become a mid-tier gold producer. The Company is focused on increasing production and developing new resources at the recently acquired La Colorada and San Agustin mines in Mexico, and on developing the 100% owned Ana Paula Project in Guerrero, Mexico.
Neither TSX Venture 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.
Cautionary Statement Regarding Forward-Looking Information
This news release includes certain "Forward-Looking Statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" under applicable Canadian securities laws. When used in this news release, the words "anticipate", "believe", "estimate", "expect", "target", "plan", "forecast", "may", "would", "could", "schedule" and similar words or expressions, identify forward-looking statements or information. These forward-looking statements or information relate to, among other things, El Crestón expansion at La Colorada is expected to produce over 50,000 ounces of gold per year, Current drill program (five drill rigs) is targeting lower CAPEX and increased production for an updated technical report planned for mid-2025, Receiving the Corner Permit allow for strong cash flow generation from San Agustin including funding San Agustin rehabilitation costs, Upon receipt of permit, expected in 2025, the Company will undertake drilling to potentially extend mine life from oxide gold production and is reviewing the projects sulphide potential, Mineral resource of 1.6 million ounces of gold at San Antonio project creates attractive optionality with high grade, low CAPEX, sub-US$1,100/oz ASIC and long mine life, the combined projects have positive economics at conservative gold prices and significantly stronger returns at today's gold prices and In 2025, the Company will focus on reducing front-end capital requirements for El Crestón to improve the project economics for the expansion decision and will continue to advance Ana Paula through its Feasibility Study.
Forward-looking statements and forward-looking information relating to the terms and completion of the Facility, any future mineral production, liquidity, and future exploration plans are based on management's reasonable assumptions, estimates, expectations, analyses and opinions, which are based on management's experience and perception of trends, current conditions and expected developments, and other factors that management believes are relevant and reasonable in the circumstances, but which may prove to be incorrect. Assumptions have been made regarding, among other things, the receipt of necessary approvals, price of metals; no escalation in the severity of public health crises or ongoing military conflicts; costs of exploration and development; the estimated costs of development of exploration projects; and the Company's ability to operate in a safe and effective manner and its ability to obtain financing on reasonable terms.
These statements reflect the Company's respective current views with respect to future events and are necessarily based upon a number of other assumptions and estimates that, while considered reasonable by management, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors, both known and unknown, could cause actual results, performance, or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements or forward-looking information and the Company has made assumptions and estimates based on or related to many of these factors. Such factors include, without limitation: precious metals price volatility; risks associated with the conduct of the Company's mining activities in foreign jurisdictions; regulatory, consent or permitting delays; risks relating to reliance on the Company's management team and outside contractors; risks regarding exploration and mining activities; the Company's inability to obtain insurance to cover all risks, on a commercially reasonable basis or at all; currency fluctuations; risks regarding the failure to generate sufficient cash flow from operations; risks relating to project financing and equity issuances; risks and unknowns inherent in all mining projects, including the inaccuracy of reserves and resources, metallurgical recoveries and capital and operating costs of such projects; contests over title to properties, particularly title to undeveloped properties; laws and regulations governing the environment, health and safety; the ability of the communities in which the Company operates to manage and cope with the implications of public health crises; the economic and financial implications of public health crises, ongoing military conflicts and general economic factors to the Company; operating or technical difficulties in connection with mining or development activities; employee relations, labour unrest or unavailability; the Company's interactions with surrounding communities; the Company's ability to successfully integrate acquired assets; the speculative nature of exploration and development, including the risks of diminishing quantities or grades of reserves; stock market volatility; conflicts of interest among certain directors and officers; lack of liquidity for shareholders of the Company; litigation risk; and the factors identified under the caption "Risk Factors" in the Company's public disclosure documents. Readers are cautioned against attributing undue certainty to forward-looking statements or forward-looking information. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update these forward-looking statements or forward-looking information to reflect changes in assumptions or changes in circumstances or any other events affecting such statements or information, other than as required by applicable law.
This news release includes certain non-International Financial Reporting Standards (IFRS) measures. The Company has included these measures, in addition to conventional measures conforming with IFRS, to provide investors with an improved ability to evaluate the project and provide comparability between projects. The non-IFRS measures, which are generally considered standard measures within the mining industry albeit with non-standard definitions, are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Cash costs (Cash Costs) are a common financial performance measure in the gold mining industry but with no standard meaning under IFRS. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate each project's economic results in the technical reports and each project's potential to generate operating earnings and cash flow. All-in Sustaining Costs (AISC) more fully defines the total costs associated with producing precious metals. The AISC is calculated based on guidelines published by the World Gold Council (WGC), which were first issued in 2013. In light of new accounting standards and to support further consistency of application, the WGC published an updated Guidance Note in 2018. Other companies may calculate this measure differently because of differences in underlying principles and policies applied. Differences may also arise due to a different definition of sustaining versus growth capital. Note that in respect of AISC metrics within the technical reports because such economics are disclosed at the project level, corporate general and administrative expenses were not included in the AISC calculations.
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Key Projects
Figure 1: Hurricane Project location map showing all three tenements, prospects and sample locations. The samples have been thematically mapped by gold, demonstrating the widespread occurrence of high-grade gold across the project. The project is sandwiched by 2 major northwest-southeast trending faults being the Hurricane and the Retina Faults. Locally, the project area is dominated by the Hodgkinson Formation and 2 late-stage felsic intrusions located within EPM 19437. Shown in the inset is the location of the Hurricane Project in North Queensland relative to the major towns of Cairns, Townsville and Brisbane.
Fig 1: Kpali Gold Prospect: Plan showing latest drill results and outline of interpreted multiple mineralised sub-parallel lodes on simplified sub-surface geology.
Fig 2: North-south long-section through mineralised hangingwall and footwall lodes at Kpali highlighting zones of shallow plunging, high-grade gold mineralisation.
