Copalito Silver-gold Project

​PROJECT HIGHLIGHTS:

  • Classic low sulphidation epithermal vein system which has numerous small old workings located in Sinaloa State
  • No evidence or reports of historic exploration drilling
  • Six principal veins with individual veins currently traced over strike lengths of up to two (2) kilometers. Veins vary in width from 0.5 to 15 meters at surface
  • Kootenay surface sampling highlights completed in 2018 and 2019:
    • 7.2 gpt gold and 3,770 gpt silver in grab samples from 5 Senores and Agua Veins, respectively;
    • 8.2 gpt gold including 583 gpt silver over a 1.1-meter chip sample across the 5 Senores Vein;
    • 401 gpt silver including 0.24 gpt gold in a chip sample across 5.3 meters on 5 Senores Vein;
    • 532 gpt silver over 3.0 meters and 306 gpt silver over 4.9 meters chip sampled across Agua Vein;
    • 17.45% zinc, 9.89% lead, 76 gpt silver and 0.52 gpt gold in a grab sample taken at Pillar Vein; and
    • Copper values of 5.1%, 1.6 % and 1.5% taken from the northern area of the Property along the Cobriza Vein.
  • 2020 Drill highlights:
    • BDH-20-001: 369 gpt silver equivalent (“AgEq.”); 250 gpt silver and 0.247 gpt gold over 5.0 meters; 272 gpt AgEq.; 360 gpt silver and 0.1 gpt gold over 1.0 meter
    • BDH-20-004: 1,323 gpt AgEq.; 1,297 gpt silver and 0.285 gpt gold over 3.2 meters
    • BDH-20-009: 1,047 gpt AgEq.; 936 gpt silver, 0.29 gpt gold and 3.31% lead+zinc (“Pb+Zn”) over 1.0 meter
    • BDH-20-015: 394 gpt AgEq.; 51 gpt silver, 2.28 gpt gold, 6.18 % Pb+Zn over 1.2 meters
    • BDH-20-033: 1,210 gpt AgEq.; 59 gpt silver, 7.05 gpt gold, 13.55 % Pb+Zn over 0.2 meters
    • BDH-20-037: 1,261 gpt silver AgEq.; 846 gpt silver, 3.11 gpt gold and 6.15% lead plus zinc over 1.0 meter at the 5 senores vein
    • BDH-20-040: 933 gpt AgEq. over 2.25 meters consisting of 6.65 gpt gold, 335 gpt silver 1,813 gpt AgEq. over 0.51 meters consisting of 16.95 gpt gold, 369 gpt silver and 3.74% Pb+Zn including:
      • 1,813 gpt AgEq. over 0.51 meters consisting of 16.95 gpt gold, 369 gpt silver and 3.74% Pb+Zn at the 5 Senores vein (one of the deepest holes drilled to date)

Overview

The Copalito Project is a classic low sulphidation epithermal vein system which has numerous small old workings and no evidence or reports of historic exploration drilling. The Property consists of seven concessions totaling approximately 3,700 hectares and is located 35 kilometres east of McEwen Mining’s “El Gallo Mine” complex in Sinaloa State, along the western fringes of the Sierra Madre Occidental in northwestern Mexico. Copalito has good access, topography and infrastructure. Kootenay can acquire a 100% ownership in the concessions by making staged payments over a 4-year period totaling US$985,000. The Company at its option may accelerate the payments due under the Agreement. Upon earn-in the vendors will retain a 0.5% net smelter return.

EXPLORATION WORK COMPLETED AT COPALITO

Extensive mapping and sampling work has been carried out by the Company in 2018 and 2019. The vein system comprised of numerous veins with many of the individual veins traced over strike lengths of up to two (2) kilometers. Veins vary in width from 0.5 to 15 meters at surface. Sampling in preparation for the initial drill program returned up to 7.2 gpt gold and 3,770 gpt silver in grab samples and up to 8.2 gpt gold including 583 gpt silver over a 1.1-meter chip sample.

2020 DRILL PROGRAM

The objective of the first phase drill program totaling 4,153 meters over 40 drill holes was to test each of the known vein structures to determine grade, continuity potential and build a prioritized inventory of veins. The Program successfully verified the existence and continuity of mineralized gold and silver veins at the project, where there is no evidence of modern exploration. Results demonstrate several areas having potential to host high grade deposits that will be the focus of follow up drilling.

Results of forty short holes, averaging approximately 100 meters a hole, targeting a range from 50 to 184 meters in depth, confirm that gold and silver mineralization continue at depth. This mineralization is associated with a significant percent of other elements including lead, zinc and copper, which provide an important addition to the precious metals. The best intersections are related to dilation zones, “mineralized shoots”, within the veins of the low sulphidation system.

The first four (4) holes tested the 5 Senores Vein located in the southern portion of the Property. These holes show good continuity for at least 500 meters of strike length along the 5 Senores Vein. In addition, drilling results from the veins tested to date on the project have returned high-grade mineralization matching up with the promising results garnered form surface sampling.

Detailed Drill Results - Hole BDH-20-001 to BDH-004

Hole ID From
(meters)
To
(meters)
Interval
(meters)
Silver
(gpt)
Gold
(gpt)
Silver Eq.
(gpt)
BDH-20-001 8 64 56.0 58.0 - 58
including 29 51 22.0 106.0 - 106
including 29 32 3.0 244.0 1.09 342
including 46 51 5.0 250.0 0.247 272
BDH-20-002 42 52.25 10.3 80.0 0.905 161.5
Including 42 48 6.0 118.0 0.346 149.1
including 48 52.25 4.3 26.7 1.69 178.8
including 50.6 52.25 1.7 3.0 3.02 274.8
BDH-20-003 31 38.1 7.1 29.7 0.307 57.33
including 33 37 4.0 33.8 0.516 80.24
including 34 35 1.0 40.0 1.18 146.2
BDH-20-004 20.82 21.25 0.4 146.0 - -
BDH-20-004 41 42 1.0 100.0 -
BDH-20-004 54 67.1 13.1 347.0 0.216 366.44
including 57.78 61 3.2 1,297.0 0.285 1,322.65
including 60 61 1.0 2,830.0 0.145 2,843.1
Note: Silver Equivalent based on 90:1 (silver to gold ratio)

Note: Estimated true widths range from 60 to 90% of drilled widths depending on dip of the vein and inclination of the hole. All silver composites rounded to the nearest whole number.

Holes BDH-20-001, 039, 41 - Cross Section (Looking Northwest) Hole BDH-20-004 - Cross Section (Looking Northwest)

WORKED PLANNED

In March 2021, the Company commence a 3,500-meter core drill program to will follow up the results of 40 shallow drill-holes totaling 4,153 meters completed in 2020, confirming gold and silver mineralization in several areas of the Property. Drilling will be guided by detailed structural mapping to test veins such as 5 Senores located in the southern area where good continuity and grade potential has been shown for at least 600 meters of strike length. Drill results from 5 Senores are highlighted by several high-grade intercepts that ranged to 2,830 gpt silver (BDH-20-04) and 16.95 gpt gold (BDH-20-40). Further highlights from drilling completed on other veins at Copalito include the Pilar Vein with gold values of up to 7.05 gpt and 13.55% lead plus zinc (BDH-20-33); the Chiva Vein with silver values of up to 936 gpt (BDH-20-09); and the Cobriza Vein with silver values of up to 307 gpt.

GEOLOGY

Mineralization is hosted within classic low sulfidation epithermal quartz and rare calcite veins. Multiple mineral events are evidenced by banded mineralized textures, multiple cross cutting veins/veinlets, laminated banding of chalcedonic and crystalline quartz, sulfide replacement and infillings of breccia matrix. Sulfide content is generally low but does range to 20% or more in hand samples. Sulfides and their oxide equivalents include fine grained pyrite, black and yellow sphalerite, galena, chalcopyrite and silver sulphosalts. Some zonation is becoming apparent with veins in the northeast being higher in gold and base metals and those in the south being high in silver and low in base metals.

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