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Bolivar Mine

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Summary

Location: Chihuahua, Mexico   Stage: Production
Size: 6,616 ha   Mill: Piedas Verdes (6 km to mine)
Ownership: 100.00%   Capacity (tpm): 60,000
Metals: Copper-Zinc-Silver   Deposit Type: Copper-Zinc Skarn
By-product cash cost1: USD $1.57/lb of Copper
 
 
 

Overview

Bolívar comprises 12 mining concessions covering approximately 6,616 hectares within the municipality of Urique, in the Piedras Verdes mining district of Chihuahua, Mexico. During 2011, the Company completed the construction of the Piedras Verdes Mill, which is located only 6 kilometres from the Bolivar Mine and had an initial capacity of 1,000 tpd, resulting in a declaration of commercial production on November 29, 2011. The Mill was expanded to 2,000 tpd in November 2013 and at that production rate, the reserves provide a 10 year mine life with an additional year of processing from the stockpile for a total of 11 years.  

Production Summary

Bolivar Production 3 Months Ended
  June 30, 2014 Jun 30, 2013 % Var.
Copper (000 lb) 3,941 2.042 93%
Zinc (000 lb) 0 655 -100%
Silver (oz) 103,794 74,037 40%
Gold (oz) 646 0 N.A.

(For a detailed summary of production please click here)

NI 43-101 Reserves and Resources

On April 17, 2013 an NI 43-101 compliant Prefeasibility Study (PFS) was released on the Bolivar Mine. This updated reserves and resource calculation has substantially increased the life of mine at Bolivar and shows the upside of potential of the property at depth and along strike. A summary of the NI 43-101 reserves and resources estimate is provided below. 

  Cutoff
CuEq (%)
Tonnes Cu % Ag (g/t)  Zn % CuEq (%)1
Proven and Probable Reserves 
0.66%
7,456,806
0.76
19.52
0.33
1.04
Measured and Indicated
Resources
2
0.66%
15,404,274
0.79
19.45
1.01
1.26
Inferred Resources 
0.66%
6,164,000
0.73
18.10
0.93
1.17

1 Gold content was not considered in the Copper Equivalent ("CuEq") calculation
2 Measured and Indicated Resources include Proven and Probable Reserves 

(To see the full NI 43-101 resource tables please click here)

Geology

The Bolivar Property is situated within the Piedras Verdes Mining District, which is within the major north-northwest trending Sierra Madre Precious Metals Belt extending across the states of Chihuahua, Durango and Sonora in northwestern Mexico.  Late Cretaceous – Early Cenozoic sedimentary and volcanic rocks underlie the district (Lower Volcanic Series or LVS).  

In the Bolivar area the LVS is reported to be approximately 750 m thick. The rocks of the LVS are overlain by younger continental rhyolitic and dacitic ignimbrites (up to 1.5 km thick) of the Upper Volcanic Suite (UVS), which are interpreted to be Middle Tertiary in age. In general, rocks in the area trend northwest and dip gently to the northeast. These rocks are also cut by several northeast trending faults.

Skarn-type Cu-Zn-Ag-Au mineralization in the Bolivar area is structurally controlled and forms mineralized zones that are close to structures. Mineralized zones occupy pre-existing fault structures and extensional openings formed during mineralization. The mineralized zones are dominated by calc-silicate minerals and variable quantities of quartz, calcite, and chlorite.  Spalerite and chalcopyrite are the predominant sulphides, commonly ranging from 5% to 30% (combined), with occasional massive sulphide zones. Sulphides occur within the carbonate rocks, which they replace, a common feature in skarn-type mineralization.

Going Forward

Sierra Metals is focused on optimizing its mining and milling operations at the recent expanded milling rate of 2,000 tpd. Currently an exploration drilling programme is underway at the Bolivar mine to continue expanding known mineralization along the copper-magnetite horizon within the lower Skarn at Bolivar.

Footnotes

1 For thethree months ending March.31, 2014