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Reserves & Resources

Mineral Resource and Reserves

The Project comprises a series of copper porphyry deposits, three main zones Botija, Colina and Valle Grande plus three other zones Balboa, Brazo and Botija Abajo. There has been significant exploration drilling in this region giving the project a potential life of operations in excess of 40 years. Mineral Resources and Reserves were updated by the Company in June 2015, by the filing of an NI 43-101 Technical Report, which replaced the previous NI 43-101 report dated May 2010.

Mineral Resources

The Mineral Resource estimate for Cobre Panama, inclusive of the Mineral Reserve inventory, is presented below and reflects the position as at December 31, 2017. This estimate is consistent with that reported in the June 2015 NI 43 101 Technical Report.

Mineral Resource - as at December 31, 2017, and reported using a 0.15% Cu cut-off grade

Deposit Category Tonnes (Mt) TCu (%) Mo (%) Au (g/t) Ag (g/t)
Botija Measured 331 0.46 0.008 0.10 1.35
Botija Indicated 667 0.35 0.007 0.06 1.08
Colina Indicated 1,032 0.39 0.007 0.06 1.58
Medio Indicated 63 0.28 0.004 0.03 0.96
Valle Grande Indicated 602 0.36 0.006 0.04 1.37
Balboa Indicated 647 0.35 0.002 0.08 1.37
Botija Abajo Indicated 114 0.31 0.004 0.06 0.93
Brazo Indicated 228 0.36 0.004 0.05 0.81
Total Measured and Indicated 3,684 0.37 0.006 0.07 1.32
Botija Inferred 152 0.23 0.004 0.03 0.78
Colina Inferred 125 0.26 0.006 0.05 1.20
Medio Inferred 189 0.25 0.005 0.03 1.25
Valle Grande Inferred 363 0.29 0.005 0.03 1.14
Balboa Inferred 79 0.23 0.003 0.04 0.96
Botija Abajo Inferred 67 0.27 0.005 0.06 1.25
Brazo Inferred 76 0.21 0.003 0.01 0.73
Total Inferred 1,051 0.26 0.005 0.04 1.08

The current Mineral Resource inventory for Cobre Panama was estimated and verified by David Gray of the Company who is a qualified person and holds the following valid qualifications: BSc Hons(Geo), MAusIMM, Pr.Sci.Nat.

Mineral Reserves

The Mineral Reserve estimate for Cobre Panama is entirely within the Measured and Indicated Mineral Resource estimate in the table above. It is consistent with the Mineral Reserve estimate reported in the May 2015 NI 43 101 Technical Report. The actual cut-off grade for the estimate varies due to variable processing recovery, but otherwise reflects a longer-term consensus copper price of $3.00/lb, a molybdenum price of $13.50/lb, a gold price of $1,200/oz and a silver price of $16.00/oz.

The reported Mineral Reserve includes ore that has been mined during the course of the pre-strip and stockpiled for future processing.

A cut-off grade optimization strategy was adopted for the Mineral Reserve estimation process, whereby an elevated 0.2% Cu cut-off grade was adopted for the period up to 2040, then followed by a period of marginal cut-off grade plant feed for the remainder of the Project life. The impact of this strategy is that the initial production years are protected from copper price volatility which could otherwise impact on the economics of marginal grade plant feed at this time.

Commencing from the pre-strip phase, the project life extends for forty years.

Mineral Reserve - as at December 31, 2017 and reported based on a $3.00/lb Cu price

Classification/Pit

 Saprock OrePrimary Sulphide Ore Total Ore 

Tonnes

(Mt)

TCu

(%)

Mo

(ppm)

Au

(ppm)

Ag

(ppm)

Tonnes

(Mt)

TCu

(%)

Mo

(ppm)

Au

(ppm)

Ag

(ppm)

Tonnes

(Mt)

TCu

(%)

Mo

(ppm)

Au

(ppm)

Ag

(ppm)

 Botija
Total Proven 14.2 0.21 55.31 0.05 0.98331.4  0.4675.720.10 1.35 345.60.4574.880.101.33
Total Probable 12.7 0.16 39.03 0.04 0.88 590.3 0.3671.520.071.11603.00.3570.830.071.10
Total Mineral Reserve 26.9 0.19 47.62 0.04 0.93 921.7 0.3973.030.081.19948.60.3972.310.081.19
 Colina and Medio
Total Proven - - - - -----------
Total Probable 55.0 0.22 48.08 0.08 1.24954.9 0.4067.320.061.611,009.90.3966.270.061.59
Total Mineral Reserve 55.0
0.39 66.27 0.06 1.24 954.9 0.4067.320.061.611,009.90.3966.270.061.59
 Valle Grande
Total Proven - - - - -----------
Total Probable 39.0 0.16 64.58 0.05 1.04527.0 0.37 67.200.051.41566.00.3667.020.051.39
Total Mineral Reserve 39.0 0.36 67.02 0.05 1.04527.00.3767.200.051.41566.0
0.3667.020.051.39
 Balboa
Total Proven - - - - -----------
Total Probable - - - - -437.1 0.35 16.100.081.36437.10.3516.100.081.36
Total Mineral Reserve - - - - -437.10.3516.100.081.36437.10.3516.100.081.36
 BABR
Total Proven - - - - ----------
Total Probable 2.0 0.19 33.31 0.07 0.77218.6 0.4041.320.070.87220.50.4041.250.070.87
Total Mineral Reserve 2.0
0.40
41.25
0.07 0.77
218.60.4041.320.070.87220.50.4041.250.070.87
 Combined Pits
Total Proven 14.2 0.21 55.31 0.05 0.98 331.40.4675.720.10 1.35345.60.4574.880.101.33 
Total Probable 108.6 0.19 52.67 0.06 1.12 2,727.80.3857.910.061.362,836.40.3757.710.061.36
Total Mineral Reserve 122.8 0.19 52.98 0.06 1.10 3,059.20.3859.840.071.363,182.00.38 59.580.071.35

The current Mineral Reserve inventory for Cobre Panama has been estimated and verified by the Company personnel under the supervision of, and verified by, Michael Lawlor of the Company, who is a qualified person and holds the following valid qualifications: BEng (Mining)(Hons), MEngSc, FAusIMM