Velocity Reports Initial Mineral Resource Estimate at Obichnik Gold Project, Southeast Bulgaria
Inferred Resource at 0.3g/t gold cut-off grade 4.4Mt @ 1.1 g/t gold for 156,000 ounces
Mineralization at Obichnik Remains Open for Expansion
Vancouver, British Columbia--(Newsfile Corp. - March 16, 2021) - Velocity Minerals Ltd. (TSXV: VLC) ("Velocity" or the "Company") announces that as part of its Obichnik joint venture earn-in agreement it has received an initial Inferred Mineral Resource estimate for the Durusu Zone on its Obichnik gold Project ("Obichnik" or the "Project"), southeast Bulgaria (Table 1). Highlights include:
Initial Resource; 4.4 Mt @ 1.1 g/t gold for 156,000 ounces, at 0.3 g/t gold cut-off grade
Near-surface; 80% of estimated resources are located within 120m of surface
Open; The mineralized system at Obichnik remains open for expansion
Drilling; Ongoing drilling of multiple additional targets
Under the terms of an option agreement signed with Gorubso Kardzhali A.D. ("Gorubso"), Velocity can earn a 70% interest in the Obichnik property through delivery of a Mineral Resource estimate prepared in accordance with National Instrument 43-101 ("NI 43-101") and an EIA prepared in accordance with Chapter Six of the Bulgarian Environmental Protection Act. The Company plans to publish an NI 43-101 Technical Report within 45 days.
Table 1: Obichnik Inferred Mineral Resource Estimate, effective date February 11th, 2021(1)
|Cut-Off Grade |
(gold x 1,000)
(1) Mineral resources were estimated by Jonathon Abbott, a member of the Australian Institute of Geoscientists and employee of MPR Geological Consultants Pty Ltd of Perth, Australia. Mr. Abbott is a Qualified Person, as defined by National Instrument 43-101.
Figure 1. Plan view of Inferred Mineral Resource extents relative to drill hole dataset
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Figure 2. Representative section of Mineral Resource Estimate scaled and coloured by proportion above 0.3 g/t gold cut off grade
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An exploration program is currently underway, aiming to expand the Durusu mineralization to the south, where anomalous soil geochemistry and spectrometry remains untested.
Resource Estimate Methodology and Assumptions
Recoverable resources were estimated for the Durusu Zone at Obichnik using Multiple Indicator Kriging ("MIK") with block support adjustment, a method that has been demonstrated to provide reliable estimates of recoverable open pit resources in gold deposits of diverse geological styles. The resource estimates include a variance adjustment to give estimates of recoverable resources above gold cut off grades for selective mining unit ("SMU") dimensions of 5m east by 2m north by 2m in elevation. The variance adjustments were applied using the direct log-normal method.
The estimates are based on data from diamond drilling undertaken by Velocity since 2019 and includes drilling information available on the 10th of February 2021 comprising 37 holes for 6,820m. Velocity's diamond holes are inclined to the southwest at generally 50o at generally around 25m spacing along generally 50 m spaced traverses with rare closer spaced holes.
Resource modelling incorporated two steeply northwest dipping mineralized domains interpreted from 2m down-hole composited gold grades and capturing intervals of greater than 0.1 g/t. The main, northern domain extends over approximately 380m of strike with an average width of around 80m. The subsidiary southern domain averages around 40m wide over 320m of strike. Mineralization is characterized as structurally controlled steep epithermal replacement of the volcanic host with a large envelope of alteration that forms part of a 2.5km by 1km wide intrusive related hydrothermal mineralizing system.
Mineral Resources are truncated at a maximum vertical depth 180m around 30m above the base of mineralized drilling, with around 80% of estimates from depths of less than 120m and less than 5% from below 160m.
Model blocks are categorized by oxidation zone from triangulated surfaces representing the base of complete oxidation and top of fresh rock interpreted from geological logging of Velocity's diamond holes. Within the resource area the depth to the base of complete oxidation averages around 55m, with fresh rock occurring at an average depth of around 68m.
Bulk densities of 2.30, 2.50 and 2.55 tonnes per cubic metre were assigned to completely oxidized, transitional and fresh material respectively on the basis of 30 immersion density measurements performed by Velocity on diamond drill core samples.
All class grades were for MIK modelling determined from bin mean grades with the exception of the upper bins, which were reviewed on a case by case basis for each mineralized domain/oxidation zone subset and bin grades selected on the basis of bin mean, or median with or without exclusion of high grade composites. This approach was adopted to reduce the impact of a small number of outlier composites.
Quality Assurance / Quality Control
The work program at Obichnik was designed and is supervised by Stuart A. Mills, CGeol, the Company's Vice-President Exploration, who is responsible for all aspects of the work, including the quality control/quality assurance program. On-site personnel at the project rigorously collect and track samples which are then security sealed and shipped to ALS Global laboratory in Romania. Samples were prepared and analyzed by fire assay using a 30-gram charge in compliance with industry standards. Field duplicate samples, blanks and independent controlled reference material (standards) are included in every batch. An additional sample taken from each pulverized sample is shipped to ALS Global laboratory in Ireland for aqua regia digest and silver plus multi-element analysis by Inductively Coupled Mass Spectrometry (ICPMS).
General Notes with Respect to Technical Information
The mineral resource disclosed herein has been estimated in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum "CIM Definition Standards for Mineral Resources and Mineral Reserves" (CIM, 2014).
Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Any known legal, political, environmental, or other risks that could materially affect the potential development of the Mineral Reserves are detailed below in the section entitled "Cautionary Statement Regarding Forward-Looking Information".
The technical content of this news release that relates to Mineral Resource Estimates has been approved for disclosure by Jonathon Abbott, a member of the Australian Institute of Geoscientists and employee of MPR Geological Consultants Pty Ltd. Mr. Abbott is a Qualified Person, as defined by National Instrument 43-101. Mr. Abbott is independent of the Company.
The technical content of this release has been approved for disclosure by Stuart A. Mills, BSc, MSc, CGeol, a Qualified Person as defined by NI 43-101 and the Company's Vice President Exploration. Mr. Mills is not independent of the Company.
About Velocity Minerals Ltd.
Velocity is a gold exploration and development company focused on southeastern Bulgaria. Velocity's strategy is to develop a low cost centralized "Hub and Spoke" operation whereby multiple projects within this emerging gold district produce gold concentrates for trucking to a central processing plant for production of doré. The Company envisions staged open pit mining of satellite deposits and processing in a currently operating carbon-in-leach (CIL) plant. Velocity has a 70% interest in the Tintyava prospecting licence, which includes the Rozino gold project, and has entered into option agreements to earn a 70% interest in the Obichnik and Makedontsi gold projects and holds a 100% interest in the Iglika project. Velocity's management and board includes mining industry professionals with combined experience spanning Europe, Asia, and the Americas as employees of major mining companies as well as founders and senior executives of junior to mid-tier public companies. The team's experience includes all aspects of mineral exploration, resource definition, feasibility, finance, mine construction and mine operation as well as a track record in managing publicly listed companies.
On Behalf of the Board of Directors
President & CEO
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Neither the 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 does not constitute an offer of sale of any of the above-mentioned securities in the United States. None of the foregoing securities have been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act") or any applicable state securities laws and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the 1933 Act) or persons in the United States absent registration or an applicable exemption from such registration requirements. This news release does not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of the foregoing securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: statements related to proposed exploration and development programs at Rozino, grade and tonnage of material and resource estimates and the Alliance. Often, but not always, forward looking statements can be identified by words such as "pro forma", "plans", "expects", "may", "should", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes", "potential" or variations of such words including negative variations thereof, and phrases that refer to certain actions, events or results that may, could, would, might or will occur or be taken or achieved. In making the forward-looking statements in this news release, the Company has applied several material assumptions, including without limitation, that market fundamentals will result in sustained gold demand and prices, the receipt of any necessary permits, licenses and regulatory approvals in connection with the future development of Rozino in a timely manner, the availability of financing on suitable terms for the development, construction and continued operation of Rozino, and the Company's ability to comply with environmental, health and safety laws.
Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking information. Such risks and other factors include, among others, operating and technical difficulties in connection with mineral exploration and development and mine development activities for Rozino, including the geological mapping, prospecting and sampling programs for the project, the fact that the Company's interests in Rozino (Tintyava property) is only an option and there is no guarantee that the interest, if earned, will be certain, actual results of exploration activities, variations to the geological and metallurgical assumptions (including with respect to the size, grade and recoverability of mineral reserves and mineral resources), the timing and amount of estimated future production, costs of production, capital expenditures, the costs and timing of the development of new deposits, the availability of a sufficient supply of water and other materials, requirements for additional capital to fund the Company's business plan, future prices of precious metals, changes in general economic conditions, changes in the financial markets and in the demand and market price for commodities, possible variations in ore grade or recovery rates, possible failures of plants, equipment or processes to operate as anticipated, accidents, labour disputes and other risks of the mining industry, delays in obtaining governmental and regulatory approvals (including of the TSX Venture Exchange), permits or financing or in the completion of development or construction activities, changes in laws, regulations and policies affecting mining operations, hedging practices, currency fluctuations, title disputes or claims limitations on insurance coverage and the timing and possible outcome of pending litigation, environmental issues and liabilities, risks related to joint venture operations, and risks related to the integration of acquisitions, as well as those factors discussed under the heading "Risk Factors" in the Company's annual management's discussion and analysis and other filings of the Company with the Canadian Securities Authorities, copies of which can be found under the Company's profile on the SEDAR website at www.sedar.com. Information concerning mineral reserve and mineral resource estimates also may be considered forward-looking statements, as such information constitutes a prediction of what mineralization might be found to be present if and when a project is actually developed and / or is in production. The actual results or performance by the Company could differ materially from those expressed in, or implied by, any forward-looking statements relating to those matters.
Readers are cautioned not to place undue reliance on forward-looking statements. The Company undertakes no obligation to update any of the forward-looking statements in this news release or incorporated by reference herein, except as otherwise required by law.
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