Southern Silver Exploration Corp. reported that metallurgical scoping tests confirm the technical feasibility of recovering both free cyanide-leachable gold and refractory gold from pyritic material through a process of fine grinding and hot atmospheric pressure oxidation followed by cyanide leaching. The results are significant as it now allows the consideration of new gold revenues in future economic modelling of the Cerro Las Minitas (CLM) Project.

This work is one of several engineering initiatives the company is pursuing to de-risk and increase the value of the CLM project. Earlier work on the CLM project did not consider the potential contribution of gold in the financial modelling mainly due to low gold grades in the Skarn Front mineralization which made up the majority of the mineral resources on the project. However, post-2020 drilling in the La Bocona, South Skarn and North Felsite regions encountered significantly higher gold grades which represented untapped value to be assessed.

Similarly, oxide mineralization which was identified in the 2021 Mineral Resource Update on the project was never incorporated into the most recent economic modelling on the project. To assess these factors, Southern Silver initiated a metallurgical test program to understand gold deportment in both the sulphide and oxide resources. Both sulphide and oxide composites were tested as part of the metallurgical program.

Mass balance reconciliations on the sulphide composite testwork indicate that 50% of the total gold is recoverable by hot atmospheric pressure oxidation prior to cyanide leaching at an overall 83.9% recovery. An additional 21.5% of gold is recovered into a copper concentrate at payable grades for a total of 71.5% recovery of gold. The oxide composite was treated with standard cyanide-leach over a 48-hour period at increasingly finer grinds.

Leach extraction successfully returned 70.2% recovery at a p80 of 75 microns grain size;. 74.0% recovery at p80 of 53 microns; and 75.1% recovery at a p80 of 38 microns. Work continues on the CLM Project with a focus on adding value early in the production time-line for maximum economic benefit.

This includes: the scheduling of recently added mineral resources into the economic modelling, further engineering upgrades to the project design; a detailed review of the capital expenditures; and pre-concentration to improve the project economics. Mineralization remains open at depth, particularly on the eastern side of the Cerro which with further exploration can continue to add high margin mineralization early in the production scenario.