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Ownership: 100% Candelaria Mining Corp.

Land Package: The Pinos Project consists of 29 mining concessions for exploration, mining, and production, totalling approximately 3,816 hectares. These concessions are held by Minera Apolo S.A. de C.V. (“Minera Apolo” or “Apolo”) and its subsidiary Minera Catanava S.A de C.V.

Description: The concessions which contain the Pinos Project consist of roughly 17km of mineralised veins containing gold and silver. The veins have been mined historically to a depth of only 180 meters, coinciding with the water table, but mineralization has been shown to continue at depth.

The Pinos mining district dates back to the XVII century. It was one of two bonanza gold districts discovered by the Spanish. Towards the end of the XIX century, the Cornish miners revived the district and continued mining throughout the Dorada era. Zacatecana Mining Company and Pachuca Mining Company operated the district between 1920 and 1940 where they mined more than 500,000 tonnes of mineral.

Location and Access: The Pinos Project is located in the central part of the Mexican Republic, adjacent to the municipality of Pinos, in the south-eastern portion of Zacatecas State, the second largest gold producing district in the country after Sonora. The Project is 80 km west from the city of San Luis Potosí and 140 km east from Zacatecas, the State capital.

The town of Pinos has accommodation and is a source of skilled and unskilled labour and basic supplies. Electric power and water are readily available in Pinos, along with gas stations, telephone, internet, bank facilities etc.

The nearest airport is in San Luis Potosí. Non-basic supplies can be easily sourced from the cities of San Luis Potosí and Zacatecas. Zacatecas State is well known for its availability of highly skilled personnel in mining and drilling.

Technical Report: A preliminary economic assessment was completed in September 2018 (see Candelaria News Release dated September 13, 2018), which envisioned an initial 200 tpd underground cut-and-fill operation ramping up to 400 tpd. The Company continues to optimize mining methods, the crushing circuit and grinding alternatives.

Key metrics from the 2018 PEA:

Production Estimated 12,700 oz gold equivalents per year
Location 140 km southeast of Zacatecas City
Access Asphalt paved road directly to project entrance
Property 3,816 hectares; 29 concessions
Deposit Geology Low sulfidation epithermal deposit. Large, multi-vein gold & silver-rich historic district 7 km long by 5 km wide. Average vein grades vary from 3.6 g/t Au to almost 6 g.t Au, depending on individual structures
Resources Measured and Indicated of 25,029 oz Au and 496,637 oz Ag; Inferred Resources by 60,671 oz Au and 811,082 oz Ag
Widths 1-4 m, True Vein Width Average 1.5 m
Mine Initial 200 tpd underground ramping up to 400 tpd, cut-and-fill mining method
Plant 400 tpd capacity conventional cyanide agitated leach and Merrill Crowe precipitation
Recoveries Estimated recoveries >90% gold and >80% silver.
Infrastructure On power grid, readily available water and labour in Zacatecas
Life-of-Mine Initial 7-year LOM recovering 90koz Au and 1Moz Ag
Pre-Production Capital Cost USD 13.5m
Operating Cost Total operating cost USD 80/tonne. Total cash cost USD 670/oz AuEq (using 73.5:1 gold ounce equivalent ratio)
PEA 2018 Robust economic returns at USD 1250 per oz gold and USD 17 per oz silver, 25% after tax IRR. AISC below USD 900/oz AuEq. FCF USD 7-10m p.a.
Exploration 9 untested vein targets at the Pinos property related to historical Au bonanza veins and an extensive Au anomaly of stockwork and dissemination hosted in quartz rhyolitic porphyry

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