Alvo Minerals Limited (ASX: ALV) ('Alvo' or 'the Company') is pleased to report a substantial increase in the JORC MRE for its 100%-owned Palma VMS Project ('Palma' or the 'Project') located in Central Brazil.
The updated JORC MRE significantly increases the high-grade resource base, demonstrating the potential for Palma to emerge as a globally significant VMS district. The Company continues to test high-priority targets across the >70km of prospective VMS strike which could add significantly to the growing inventory. The MRE updates the C1 and C3 deposits, which includes resources into the higher confidence Indicated category for the first time, a Maiden MRE for the newly discovered C4 deposit and a Maiden MRE for the near surface oxide component of the C3 deposit. All Deposits remain open along strike and at depth, are potentially mineable by open-pit methods and have potential to expand and upgrade with additional drilling, metallurgy and engineering studies.
Rob Smakman, Alvo's Managing Director commented: 'We are really pleased to deliver such an important upgrade in size and confidence on our Palma Cu-Zn Project in Brazil. Palma is Alvo's formation asset and the growth over the past drilling campaigns confirms our confidence in the project since partnering with the Brazilian Geological Survey in 2019. We expect that growth to continue as we progress exploring and pursuing the opportunities highlighted by this MRE update. 'We now have >150kt of CuEq in resources, a size sufficient to consider development options for the Project. The fundamentals of the deposits are sound: high grades near-surface, clean and standard metallurgy, receptive community and access to enviable infrastructure, we are confident that a development pathway can utilise these resources as a solid base. 'In addition to the increases in resources at C1 and C3 - which are enhanced by the significant volume of Indicated material, we are encouraged by the maiden estimate of oxide resources at C3 and excited by the maiden MRE for C4 - an early success from our multi- disciplinary exploration efforts. Both of the maiden results have excellent upside potential, and we intend to continue working on these new prospects in coming months. '2024 has seen stronger copper and zinc prices, with most analysts forecasting continued strength going forward. We firmly believe it's an ideal time to be actively exploring for these critical metals and the diamond drilling program currently underway is an exciting part of Alvo's future. We are confident that each day we are getting closer to another major discovery in the Palma district.'
Background
Alvo acquired the Palma Volcanogenic Hosted Massive Sulphide (VMS) Project from the Brazilian Geological survey (CPRM) in 2019. Based upon the historical drilling performed by the CPRM across the Palma District, Alvo was able to declare a maiden MRE for Palma's C1 and C3 deposits in 2021. Following Alvo's IPO in late 2021, Alvo commenced extensive drilling programs across the wider Palma Project, including the C1 and C3 deposits, in order to confirm and expand the MREs. Alvo also instigated exploration at C4, which included detailed geophysical surveys followed by drilling, resulting in the discovery of a new deposit at C4. This report details the Maiden MRE for C4. During exploration at C3, shallow, copper and zinc oxide mineralisation was noted and a campaign of Reverse Circulation (RC) holes were drilled to investigate the extent and importance of this previously unrecognised mineralisation. This report details the Maiden MRE for C3 oxide.
Updated JORC Mineral Resource Estimate Palma Project Utilising assay results from diamond and RC drilling completed by Alvo up until the end of 2023, along with the historical drilling by the CPRM, MB Geologia Ltda has prepared an updated MRE for the C1 and C3 sulphide deposits as well as a maiden MRE for the C4 sulphide and C3 Oxide deposits, a part of the Palma VMS Project in central Brazil. All of the resources have been estimated assuming an open-pit mining scenario with different cut-off grades applied for the different deposits. At a USD$50 Net Smelter Return (NSR) cut-off for C1 and C3 and a USD$80 NSR for C4, the sulphide resource estimate comprises:
Total metal contents in the updated MRE (at the cut-off outlined above- not including the Oxide at C3) includes 55kt of copper, 260kt of zinc, 40kt of lead, 4 Moz of silver and 6koz of gold all contained in mathematical open pits, based on operating and capital costs for similar projects in Brazil. Additional work to consider an ideal cut-off for future possible mining scenarios requires additional drilling, metallurgy and engineering as well as economic and other modifying factors. As mining studies are advanced and the costs and mining methods are clarified, the cut-offs should be modified accordingly. The higher confidence Indicated resources estimated for the C1 and C3 sulphide deposits at a USD$50 NSR cut-off comprises
Geology and Geological Interpretation
Volcanogenic Massive Sulfide (VMS) deposits are significant sources of copper, zinc, lead, gold, and silver. These deposits form in deep marine environments where there is circulation of hydrothermal fluids originating from magmatic sources. Upon contact with seawater, these fluids interact and precipitate massive sulfides with high concentrations of the referred metals. Massive sulphide bodies commonly occur as stratiform lenses overlying zones of vein stockwork, with stringer and disseminated sulphides and are surrounded by hydrothermal alteration halos. The polymetallic deposits of the Palma Project are situated in the central-northern portion of the N-S trending Neoproterozoic Brasilia thrust and fold belt of Central Brazil. The Brasilia belt is the result of a continental collision between the Amazonas and Sao Francisco cratons. The Palmeiropolis volcano-sedimentary sequence (also referred as the Palmeiropolis Complex), which hosts the Palma deposits is composed of a series of bimodal volcanic rocks and associated sedimentary units, metamorphosed under amphibolite facies. Massive sulphide bodies of zinc, copper, and lead are associated with a thick package of basic metavolcanic rocks (amphibolite) and meta sedimentary units, are closely linked to the hydrothermally altered portions of these units. These hydrothermal altered zones consist of anthophyllite, biotite, and cordierite, as well biotite, sericite, chlorite and plagioclase. The mineralised bodies exhibit similar mineralogical compositions, comprising pyrrhotite and pyrite, with varying proportions of sphalerite, chalcopyrite, and galena. The presence of intensely hydrothermally altered zones, especially in the interpreted footwall of the mineralisation, constitutes the primary control of mineralization. The C3 deposit is primarily massive sulphides of pyrrhotite, sphalerite (zinc sulphide), chalcopyrite (copper sulphide), pyrite and galena (lead sulphide). Gossans mapped at surface define the oxidised extension of the VMS mineralisation, which is mapped as being fresh from approximately 40m depth. The C3 Oxide MRE is interpreted as secondary mineralisation, re-mobilised in the weathered zone by movement of groundwater. Primary VMS mineralisation extends for over 600m in strike length, varies from 1- 36m thick and extends to 350m depth. All reported mineralised material is contained in mathematical open-pits to a maximum depth of 275m. The mineralised zone is open at depth, with downhole electromagnetic surveys indicating extensions down-plunge to the SE. Alvo's diamond drilling program confirmed and updated the previous mineral resource estimation from 2021, especially the massive sulphide intercepts and confirms the deposit as the largest and highest-grade of the Palma Project. The C3 oxide deposit is a shallow, sub-horizontal mineralised zone, formed by weathering of the primary VMS sulphide mineralisation, where groundwater circulation has re-mobilised copper and zinc into the weathered zone. The oxide mineralisation is spread along the same strike as C3 (NW-SE) over 500m and extends up to 80m wide. Mineralisation is sub-horizontal and averages 40m thick. (note: C3 sulphide mineralisation is steeply dipping to the SE). Copper oxide mineralisation is logged as chalcocite, cuprite and bornite with mineralisation recognised as a black, brown and reddish minerals on fractured areas within the weathered zone. A 0.15% Cu cutoff was applied, based on the same copper price as the other deposits in the MRE and similar open-pit costs. As no metallurgical testing has been done on the C3 oxide material, a 'recovery factor' of 70% has been applied to the NSR, based on similar heap-leach style projects in South America. A density of 1.95g/cm3 was applied as an average across the deposit, based on oxide density measurements of samples from drilling across C3.
Classification Criteria
Mineral Resource classification was considered based on drill hole spacing and continuity of mineralisation. The portion of the resources which have drill hole spacing of 50m x 50m or closer, with good continuity of grade and structure has been classified as Indicated. Indicated resources were estimated almost exclusively with the first pass interpolation and extrapolated beyond the drill hole intersections up to 25m, if continuity of mineralisation could be reasonably assumed. The portions of the MRE where drill-hole spacing is greater than 50m were classified as Inferred. Inferred mineral resources were extrapolated up to 50m from drill holes. Inferred Resources carry a lower level of confidence compared to Indicated Resources and continued exploration, particularly additional drilling, is required to upgrade Inferred Resources to Indicated Resources. There is no assurance that additional work will upgrade Inferred Resources to Indicated or Measured categories. No Measured Resources have been estimated in the current updated MRE.
Contact:
Rob Smakman
Managing Director
Alvo Minerals Limited
Tel: +61 402 736 773
Email: rob@alvo.com.au
Competent Person's Statement
The information contained in this announcement that relates to information attributed to or compiled from the 'Mineral Resource Estimate' is based upon information compiled by Mr Marcelo Batelochi, a Competent Person and Member of the Australasian Institute of Mining and Metallurgy. Mr Batelochi is a full-time employee of MB Consultaria and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 'Australasian Code for Reporting of Mineral Resources and Ore Reserves' (or JORC 2012). Mr Batelochi consents to the inclusion in this announcement of the matters based upon the information in the form and context in which it appears. The information contained in this announcement that relates to recent exploration results is based upon information compiled by Mr Rob Smakman of Alvo Minerals Limited, a Competent Person and Fellow of the Australasian Institute of Mining and Metallurgy. Mr Smakman is a full-time employee of Alvo and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 'Australasian Code for Reporting of Mineral Resources and Ore Reserves' (or JORC 2012). Mr Smakman consents to the inclusion in this announcement of the matters based upon the information in the form and context in which it appears.
Forward Looking Statements
Statements regarding plans with respect to Alvo's exploration programs are forward-looking statements. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions which are outside Alvo's control and actual values, results or events may be materially different to those expressed or implied herein. Alvo does not undertake any obligation, except where expressly required to do so by law, to update or revise any information or any forward-looking statement to reflect any changes in events, conditions, or circumstances on which any such forward-looking statement is based. Often, but not always, forward looking statements can generally be identified by the use of forwardlooking words such as 'may', 'will', 'expect', 'intend', 'plan', 'estimate', 'anticipate', continue', 'projected', 'scheduled', 'believes', 'potential', 'predict', 'foresee', 'proposed', 'aim', 'target', 'opportunity', 'could', 'nominal', and 'guidance', or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs. Forward-looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance, and achievements to differ materially from any future results, performance or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licenses and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the Company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.
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