Reserves and Resources

POSSE GOLD PROJECT ON MARA ROSA PROPERTY

Mineral Resource Estimate

A Mineral Resource can only be declared for material that has the potential for economic extraction at some point in the reasonable future. Mineral Resources are reported at a cut-off grade that meets this criterion and do not include material that has no reasonable potential to be mined and processed.

In the economic model of the Posse Gold Deposit, the lowest grade of mineable ore is 0.37 g/t gold. Consequently, the cut-off grade for the Mineral Resource has been set at 0.35 g/t. The Mineral Resource Estimate includes the Mineral Reserves (see below).

Mineral Reserve Estimate

A Mineral Reserve is that part of the Measured and/or Indicated Resources which, after the application of all relevant economic, legal and technical factors, results in an estimated tonnage and grade which is the basis of an economically viable project.

Posse’s Mineral Reserves were based on guidelines set out by the Canadian Institute of Mining Metallurgy and Petroleum. The economic portion of the Measured and Indicated Resources is identified as 23.8 million dry tonnes grading 1.18 g/t gold.

NI 43-101 MINERAL RESOURCE AND RESERVE ESTIMATE FOR POSSE GOLD PROJECT
(AUGUST 2020)

Category Tonnes (millions) Grade (g/t gold) Contained gold (000 ounces)
Mineral Resources
Measured 14 1.2 510,000
Indicated 19 1.1 640,000
Total M&I 32 1.1 1,200,000
Inferred 0.1 0.6 1,700,000
Mineral Reserves
Proven 11.8 1.20 456,000
Probable 12.0 1.16 446,000
Total Proven and Probable 23.8 1.18 902,000
Notes

Butia initial resource estimate ON LAVRAS DO SUL PROPERTY

An NI 43-101 compliant gold resource was released in September 2010. The first table shows a resource estimate using a cut-off grade of 0.3 gold g/t, and the second table shows a resource estimate at a cut-off grade of 0.5 gold g/t.

Category Tonnes (millions) Grade (g/t gold) Contained gold (ounces)
Cut-off grade 0.3 g/t gold
Indicated 6.4 1.05 215,000
Inferred 12.9 0.74 308,000
Cut-off grade 0.5 g/t gold
Indicated 5.3 1.18 201,000
Inferred 16.8 1.07 235,000
Notes

For a description of the key assumptions, parameters, and methods used to estimate mineral reserves and resources at Amarillo’s material properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing, or other relevant factors, please see the technical reports for the company’s material properties as filed by Amarillo on SEDAR at www.sedar.com.

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