Equinox Gold Announces Updated Feasibility Study for Los Filos Expansion

2022-10-19

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Mineral Reserves Increased 44% to 5.4 Million Ounces of Gold 360,000 Ounces of Average Annual Gold Production from 2025-2030 Mine Life Extended to 14.5 Years with 280,000 Ounces of Average Annual Gold Production NPV 5% of $625 million and IRR of 26% at $1,675 /oz Gold

all dollar figures in US dollars, unless otherwise indicated

VANCOUVER, BC , Oct. 19, 2022 /CNW/ - Equinox Gold Corp. (TSX: EQX) (NYSE American: EQX) ("Equinox Gold" or the "Company") is pleased to announce the results of a Feasibility Study for an expansion at the Company's 100%-owned Los Filos Mine Complex ("Los Filos") located in Mexico . Current Los Filos operations consist of both run-of-mine ("ROM") and crushed ore heap leach facilities. With continued development of the Bermejal Underground deposit and construction of a 10,000 tonnes per day ("t/d") carbon-in-leach ("CIL") processing plant, the Los Filos mine life would be extended to 14.5 years with life-of-mine ("LOM") average annual production increasing to 280,000 ounces ("oz") of gold (2023-2036) at all-in sustaining costs 1 ("AISC") of $1,081 per oz. Total LOM production is estimated at 3.97 million oz of gold. Peak production during 2025-2030 averages 360,000 oz of gold per year. Using the base case $1,675 /oz gold price, the expansion project has an after-tax net present value discounted at 5% ("NPV 5% ") of $625 million with an internal rate of return ("IRR") of 26%.

Gold mineralization at Los Filos extends beyond the drilled area, and it is expected that additional drilling along the contact between intrusive and carbonate rock could identify further skarn mineralization. With exploration success and conversion of Mineral Resources to Mineral Reserves, considerable potential exists to extend the Los Filos mine life beyond 2036.

LOS FILOS EXPANSION HIGHLIGHTS

After-tax NPV 5% of $625 million at base case $1,675 /oz gold After-tax IRR of 26% at $1,675 /oz gold 5.4 million oz gold of Proven and Probable Mineral Reserves 7.9 million oz gold of Measured & Indicated Resources (exclusive of Reserves) 3.97 million oz LOM gold production 11.83 million oz LOM silver production $993 million after-tax LOM cumulative net cash flow $981 /oz average LOM cash costs 1 $1,081 /oz average LOM AISC 1 $318 million initial capital cost to build the CIL plant and associated infrastructure 14.5-year mine life with extension potential from Mineral Resource conversion and exploration success

| _ | | 1. Cash costs and all-in sustaining costs are non-IFRS measures. See Non-IFRS and Other Financial Measures . | | |

The Feasibility Study includes an updated Mineral Reserve and Mineral Resource estimate incorporating a revised mine plan and 101,407 metres of exploration drilling since October 31, 2018 . Factoring 681,000 oz of mining depletion over almost four years, Los Filos Mineral Reserves have increased 44% over the 2018 estimate, with 193.2 million tonnes ("Mt") of Proven & Probable Mineral Reserves grading 0.86 grams per tonne ("g/t") gold for 5.4 million oz of contained gold. An additional 325.3 Mt of Measured & Indicated Mineral Resources (exclusive of Mineral Reserves) grading 0.75 g/t gold for 7.9 million oz of contained gold, and 135.9 Mt of Inferred Mineral Resources grading 0.74 g/t gold for 3.2 million oz of contained gold demonstrate the potential for mine life extension with successful conversion of Mineral Resources to Mineral Reserves. Refer to the detailed Mineral Reserve and Mineral Resource tables that follow in this news release.

Los Filos encompasses three main open-pit mining areas: Los Filos, Guadalupe and Bermejal, and three underground mines: Los Filos South, Los Filos North and Bermejal Underground. Bermejal Underground development recommenced in Q2-2021 and the deposit has been contributing higher-grade ore since mid-2022. Ore from all six mining areas is currently processed on heap leach pads.

The Feasibility Study contemplates construction of a CIL plant commencing in 2023 with an 18-month timeline for construction and commissioning, which would allow higher-grade ore to be directed to the CIL plant commencing in mid-2024. While the economic and production estimates outlined in the Feasibility Study and in this news release are predicated on that timeline, Equinox Gold has not approved construction for the CIL plant.

Greg Smith , President & CEO of Equinox Gold, commented: "The Feasibility Study confirms a path to expand Los Filos to a large-scale, long-life gold mine with a substantial reserve and resource endowment and opportunity for further growth. We are pleased with the results of the Feasibility Study; however, we have not made a decision to proceed with the expansion. Any decision to proceed with the Los Filos expansion will be made considering the operating stability in the region, market conditions and availability and cost of capital. Equinox Gold is currently focused on construction of its Greenstone Mine in Ontario, Canada , and advancing the permitting to expand its Castle Mountain Mine in California, USA ."

OVERVIEW

Los Filos has produced 3.4 million oz of gold since the mine commenced operations in 2005, with ore from all deposits processed using heap leach facilities. The Feasibility Study contemplates building and operating a 10,000 t/d CIL processing plant to operate concurrently with the existing heap leach facilities. All underground ore and higher-grade open-pit ore (generally above 0.5 g/t gold) would be directed to the CIL plant, with lower-grade ore going onto the heap leach pads as either crushed or run-of-mine stacked ore. Ore that contains higher levels of copper and sulphur would also be directed to the CIL plant to optimize the economic recovery of gold from all ore types.

Constructing and operating the CIL plant, compared to a heap leach only scenario, extends the Los Filos mine life by approximately four years and adds more than 1.1 million ounces of gold to LOM production.

Los Filos Expansion Highlights

ECONOMIC SENSITIVITIES

Using the base case gold price of $1,675 /oz and incorporating only Proven & Probable Mineral Reserves, the expansion project has an after-tax NPV 5% of $625 million and an after-tax IRR of 26%. The expansion project economics are most sensitive to fluctuations in the gold price, followed by changes in operating costs and capital costs. Approximately 40% of capital costs for the expansion project are priced in Mexican Pesos.

After-tax NPV 5% Sensitivity to Economic Changes ($M) )

| Variation in Parameter | Operating Costs | Capital Costs | Gold Price | | −15% | 920 | 755 | 172 | | −10% | 822 | 712 | 323 | | −5% | 724 | 668 | 474 | | 0 % | 625 | 625 | 625 | | 5 % | 526 | 582 | 776 | | 10 % | 427 | 538 | 926 | | 15 % | 328 | 495 | 1,076 |

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CAPITAL AND OPERATING COSTS

Initial capital costs for construction of the CIL plant are estimated at $318 million , which is included in total LOM non-sustaining capital of $718 million . Closure and reclamation costs of $51 million are also included in non-sustaining capital. LOM sustaining capital is estimated at $349 million .

Los Filos Life-of-Mine Capital Costs

| Item | Non-Sustaining Capital Costs ($M) | Sustaining Capital Costs ($M) | Total Capital Costs ($M) | | Open pit mobile equipment and workshop upgrade | 125 | 133 | 252 | | Los Filos Open Pit - capitalized stripping | 112 | - | 112 | | Bermejal Open Pit - capitalized stripping | 77 | - | 77 | | Guadalupe Open Pit - capitalized stripping | - | 44 | 44 | | Los Filos Underground development | - | 16 | 16 | | Bermejal Underground development | 35 | 70 | 106 | | CIL plant | 318 | - | 318 | | Heap leach pad expansion | - | 86 | 86 | | Closure and reclamation | 51 | - | 51 | | Total | 718 | 349 | 1,067 |

| | | Note: Numbers may not sum due to rounding. | | |

Total LOM operating costs are estimated at $4 ,015 million. Approximately 83% of the LOM operating costs are related to mining and processing, with the remainder attributable to general and administrative costs, land access payments and social collaboration payments to local communities.

Los Filos Life-of-Mine Operating Costs

| Item | ($M) | $/oz | | Mining (Open pit and Underground) | 2,072 | 521 | | Open pit | 1,118 | 281 | | Underground | 954 | 240 | | Processing | 1,288 | 324 | | General and administrative, community, and land access | 655 | 165 | | Total operating costs | 4,015 | 1,010 | | Royalties | 34 | 9 | | Refining and transport | 22 | 6 | | Silver credits | (172) | (43) | | Cash costs | 3,899 | 981 | | Sustaining capital | 349 | 88 | | Reclamation costs | 51 | 13 | | AISC | 4,299 | 1,081 |

| | | Note: Numbers may not sum due to rounding. | | |

LOS FILOS MINERAL RESERVES & MINERAL RESOURCES

The mine plan is based on Proven & Probable Mineral Reserves of 180.6 Mt grading 0.65 g/t gold for 3.8 million oz of contained gold in the open pit deposits, and 12.6 million tonnes grading 3.94 g/t gold for 1.6 million oz of contained gold in the underground deposits.

Los Filos Mineral Reserves Statement ( June 30, 2022 )

| Classification | Mining Method | Tonnes (kt) | Gold Grade (g/t ) | Contained Gold (koz) | Silver Grade (g/t) | Contained Silver (koz) | | Proven | Open Pit | 35,154 | 0.74 | 837 | 5.0 | 5,677 | | Underground | 299 | 4.15 | 40 | 13.7 | 132 | | | Total | 35,453 | 0.77 | 877 | 5.1 | 5,809 | | | Probable | Open Pit | 145,476 | 0.62 | 2,921 | 6.3 | 29,303 | | Underground | 12,297 | 3.94 | 1,556 | 18.9 | 7,458 | | | Total | 157,773 | 0.88 | 4,477 | 7.2 | 36,761 | | | Proven & Probable | Open Pit | 180,629 | 0.65 | 3,758 | 6.0 | 34,980 | | Underground | 12,597 | 3.94 | 1,596 | 18.7 | 7,590 | | | Total | 193,226 | 0.86 | 5,354 | 6.9 | 42,570 | |

| | | Notes: Mineral Reserves have been estimated in accordance with CIM _Definition Standards for Mineral Resources and Mineral Reserves _(2014), which are incorporated by reference in NI 43-101. The open pit Mineral Reserve estimate was prepared under the oversight and review of Mr. Eugene Tucker, P.Eng., and the underground Mineral Reserve estimate was prepared under the oversite and review of Mr. Paul Salmenmaki, P.Eng. Mr. Tucker and Mr. Salmenmaki are "Qualified Persons" as defined by NI 43-101. Mineral Reserves are estimated using a long-term gold price of $1,450 per troy oz and a long-term silver price of $18 per troy oz for all mining areas. Mineral Reserves are stated in terms of delivered tonnes and grade before process recovery. Mineral Reserves are defined by pit optimization and are based on variable break-even cut-offs as generated by process destination and metallurgical recoveries. Metal recoveries are variable dependent on metal head grades as outlined in the Technical Report. Open pit dilution is applied at 5% at a zero grade for Au and Ag for Bermejal Open Pit and Guadalupe Open Pit, and 7% at zero grade for Au and Ag for Los Filos Open Pit. Open pit mining recovery is applied at 95% for Bermejal Open Pit and Guadalupe Open Pit, and 93% for Los Filos Open Pit. Heap leach process recovery varies based on rock type. The Qualified Persons responsible for this item of the Technical Report are not aware of any mining, metallurgical, infrastructure, permitting or other relevant factors that could materially affect the Mineral Reserve estimates. Effective date of Mineral Reserves is June 30, 2022. Tonnage and grade measurements are in metric units. Contained gold and silver ounces are reported as troy ounces. Underground Mineral Reserves are reported based on a variable net processing return cut-off value varying between $65.8 and $96.6/t Underground dilution is assigned an average of 10% at a zero grade for gold and silver. Underground mining recovery is set to 97%. Numbers may not sum due to rounding. Additional details regarding the Mineral Reserve estimation, classification, reporting parameters, key assumptions and associated risks for Los Filos are provided in the Feasibility Study. In addition, Mineral Reserves and Mineral Resources may be materially affected by legal, political, environmental and other risks, including the factors identified in the Company's Annual Information Form dated March 24, 2022 for the year ended December 31, 2021. Both documents are available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar. | | |

Los Filos Mineral Resources Statement ( June 30, 2022 ) (Exclusive of Mineral Reserves)

| Area | Classification | Tonnes (kt) | Gold Grade (g/t) | Contained Gold (koz) | Silver Grade (g/t) | Contained Silver (koz) | | Bermejal / Guadalupe Open Pit | Measured | 9,898 | 0.76 | 243 | 6.4 | 2,034 | | Indicated | 184,152 | 0.59 | 3,492 | 7.6 | 45,186 | | | Measured & Indicated | 194,050 | 0.60 | 3,734 | 7.6 | 47,220 | | | Inferred | 44,292 | 0.55 | 777 | 9.8 | 13,932 | | | Bermejal Underground (below $1,500 pit shell) | Measured | - | - | - | - | - | | Indicated | 998 | 3.97 | 127 | 16.3 | 522 | | | Measured & Indicated | 998 | 3.97 | 127 | 16.3 | 522 | | | Inferred | 1,501 | 4.98 | 241 | 22.7 | 1,093 | | | Los Filos Open Pit | Measured | 35,327 | 1.09 | 1,238 | 6.4 | 7,315 | | Indicated | 90,544 | 0.79 | 2,290 | 6.5 | 18,857 | | | Measured & Indicated | 125,870 | 0.87 | 3,528 | 6.5 | 26,172 | | | Inferred | 87,552 | 0.68 | 1,914 | 7.7 | 21,657 | | | Los Filos Underground | Measured | 2,081 | 4.13 | 276 | 22.8 | 1,527 | | Indicated | 2,326 | 3.09 | 231 | 25.7 | 1,920 | | | Measured & Indicated | 4,407 | 3.58 | 507 | 24.3 | 3,446 | | | Inferred | 2,590 | 3.67 | 306 | 27.5 | 2,287 | | | Total | Measured | 47,306 | 1.15 | 1,757 | 7.2 | 10,876 | | Indicated | 278,020 | 0.69 | 6,140 | 7.4 | 66,485 | | | Measured & Indicated | 325,326 | 0.75 | 7,897 | 7.4 | 77,360 | | | Inferred | 135,935 | 0.74 | 3,237 | 8.9 | 38,969 | |

| | | Notes: Mineral Resources are exclusive of Mineral Reserves and have been estimated in accordance with CIM _Definition Standards for Mineral Resources and Mineral Reserves _(2014), which are incorporated by reference in NI 43-101. The Mineral Resource estimate was prepared under the oversight and review of Mr. Ali Shahkar, P.Eng., a "Qualified Person" as defined by NI 43-101. Mineral Resources that are not Mineral Reserves do not have a demonstrated economic viability. Mineral Resources are reported to a gold price of $1,550/oz. Open pit Mineral Resources are defined within pit shells that use variable mining and recovery estimates depending on the geometallurgical domain and whether mineralization is projected to report to crush-leach or is considered typical run-of-mine for processing requirements. Open pit Mineral Resources are reported to a gold cut-off grade of 0.2 g/t. Open pit Mineral Resources use variable mining costs of $1.27-$1.43/t and variable processing costs of $3.40-$12.81/t. Recovery ranges from 50% to 85% depending on ore treatment method. Underground Mineral Resources use variable mining costs of $57.21-$93.12/t and variable processing costs of $9.53-$11.64/t, and a process recovery of 90%-95%. Underground Mineral Resources are reported to a gold cut-off grade: Los Filos South Underground, 1.71 g/t gold; Los Filos North Underground, 2.05 g/t gold; Bermejal underground 2.71 g/t gold. Quantity of material is rounded to the nearest 1,000 tonnes; grades are rounded to two decimal places for gold, one decimal place for silver. Numbers may not sum due to rounding. Additional details regarding the Mineral Resource estimation, classification, reporting parameters, key assumptions and associated risks for Los Filos are provided in the Feasibility Study. In addition, Mineral Reserves and Mineral Resources may be materially affected by legal, political, environmental and other risks, including the factors identified in the Company's Annual Information Form dated March 24, 2022 for the year ended December 31, 2021. Both documents are available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar. | | |

LOS FILOS MINE PLAN

Open pit mining will remain owner-operated with conventional load, haul, drill and blast. Loading is currently undertaken by 250-tonne shovels and large front-end loaders, and haulage by 136-tonne trucks. A larger mining fleet composed mainly of 180-tonne electric-drive trucks and 400-tonne face shovels is proposed to progressively replace the existing mining equipment as it reaches the end of its useful life, accounting for $125 million of costs considered growth capital and $133 million of sustaining capital costs over the mine life. Over the estimated 14.5-year mine life, total open-pit material moved is estimated at 982.4 Mt, with 180.6 Mt of ore and 801.7 Mt of waste for an open-strip ratio of 4.4:1. The mine plan contemplates 34.8 Mt of open pit ore at an average grade of 1.53 g/t gold going to the CIL plant, 24.6 Mt at an average grade of 0.67 g/t gold going to crush heap leach and 121.2 Mt at an average grade of 0.39 g/t gold going to ROM heap leach, for total gold production from all open-pit sources of 2.56 million oz.

Mining methods for the underground deposits vary depending on the ore type and ground conditions. In the Los Filos Underground, mining methods include overhand cut and fill in narrow areas, overhand drift and fill in wider areas, and longhole open stoping in areas with vertical ore body continuity and good rock conditions. In the Bermejal Underground, oxide ore will be mined using overhand drift and fill, which constitutes the majority of the deposit, and underhand drift and fill will be used to mine ore in intrusive host rock.

Los Filos Underground production is expected to average 960 t/d until the end of its mine life in 2025. Bermejal Underground stope development with multiple headings is expected to advance by approximately 180 metres per month, which is equivalent to approximately 250 t/d per stope mining horizon. A second portal will provide two points of access by 2025, at which point Bermejal Underground is expected to operate at steady-state production of 2,740 t/d (1 Mt/a) from 2025 to 2032. Los Filos Underground mining is owner-operated. Bermejal Underground is mined by a contractor.

For its remaining mine life Los Filos Underground is expected to contribute 1.2 Mt of ore at an average grade of 3.50 g/t gold. Bermejal Underground is expected to contribute 11.4 Mt of ore at an average grade of 3.99 g/t gold. Underground ore will go to crush heap leach until the CIL plant is operating at which point all underground ore will be directed to the CIL plant, for total gold production from all underground sources of 1.41 million oz over the remaining 14.5-year mine life.

LOM mining costs are estimated at $1.38 /t for open-pit mining, including capitalized waste stripping, and $75.70 /t for underground mining.

Earlier from Equinox Gold Corp.

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