Southern Cross Gold Consolidated Ltd. press release

Lumina Gold Announces Positive Cangrejos Pre-Feasibility Study; US$2.2 Billion NPV, 26 Year Mine Life and Production of 371,000 Gold Ounces Per Year and 41 Million Pounds of Copper Per Year

2023-04-17

TSX - Toronto Stock Exchange · Australia

Canada NewsWire

VANCOUVER, BC , April 17, 2023 /CNW/ - Lumina Gold Corp. (TSXV: LUM) (OTCQX: LMGDF) (the "Company" or "Lumina") is pleased to announce it has received positive results from the Preliminary Feasibility Study (the "PFS"), prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects ("NI 43-101"), for its 100%-owned Cangrejos Project ("Cangrejos" or the "Project"). The work that was completed as the basis for the PFS was managed by Ausenco Engineering Canada Inc. ("Ausenco"), along with oversight and input from Lumina's representative, MTB Enterprises Inc. The PFS demonstrates further improvements upon the Company's two prior preliminary economic assessments for the Project, with the latest being the 2020 Preliminary Economic Assessment (the "2020 PEA"). The following is a summary of improvements at Cangrejos since the 2020 PEA :

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Probable gold reserves increased to 11.6 million ounces (see Table 4) The indicated gold mineral resource increased to 16.8 million ounces from 10.4 million ounces (see Table 3) Project after-tax NPV of US$2,238 million at US$1,650 /oz gold and US$3.75 /lb copper The mineral resource expansion makes Cangrejos the 26 th largest primary gold asset in the world by contained gold in mineral resources (Source: S&P Capital IQ)

Marshall Koval , President and CEO, commented: "This study not only confirms the tremendous value of the Cangrejos Project, but also allows the Company to commence negotiating terms for its Investment Protection Agreement and begin the permitting process required for Cangrejos to begin construction. We believe that this is one of the best gold and copper development assets globally based on its surrounding infrastructure, scale and multi-decade mine life."

PFS Summary

The PFS was initiated in 2022 and was produced by a team of independent consultants that possess extensive expertise in their respective fields. Details on the contributors can be found in the "Qualified Persons" section below.

All amounts are in United States dollars unless otherwise specified. Base case economics were calculated using a gold price of $1,650 per ounce, copper price of $3.75 per pound and a silver price of $20.00 per ounce. The effective date of the PFS is April 7, 2023 and a technical report relating to the PFS will be filed on SEDAR within 45 days of this news release.

The PFS highlights include the following estimates:

Life of mine ("LOM") average annual payable production of 371 thousand ounces gold ("koz") LOM average annual payable by-product production of 41 million lbs copper 469 koz of average annual gold equivalent production over the LOM 26-year mine life with a LOM revenue mix of 79% gold, 20% copper and 1% silver 30,000 tonnes per day processing operation from years 1-3, with an expansion to 60,000 in year 4 and 80,000 in year 7 After-tax NPV (5%) of $2.2 billion and IRR 17.2% using base case prices Average cash operating costs of $602 /oz and all-in sustaining costs of $671 /oz, net of by-product credits LOM processed grades of 0.55 grams per tonne ("g/t") gold and 0.10% copper Years 1-6 processed grades of 0.71 g/t gold and 0.12% copper Initial capital costs of $925 million include working capital and exclude refundable value added tax ("VAT")

Table 1: Summary of Cangrejos Economic Results by Gold and Copper Price

| Percentage of Base Case Prices | 80 % | 100 % | 120 % | | Gold Price (per oz) | $1,320 | $1,650 | $1,980 | | Copper Price (per lb) | $3.00 | $3.75 | $4.50 | | Pre-Tax NPV (5%) ($M) | $1,516 | $3,511 | $5,505 | | Pre-Tax IRR | 13.1 % | 21.3 % | 28.2 % | | Post-Tax NPV (5%) ($M) | $817 | $2,238 | $3,540 | | Post-Tax IRR | 10.0 % | 17.2 % | 23.1 % |

Table 2: Comparison of the 2020 PEA to the PFS

Mineral Reserves and Resources

Table 3: Estimate of Mineral Resource – Cangrejos & Gran Bestia Deposits (0.25 g/t Au Eq Cut-off) – Inclusive of Mineral Reserves

(g/t) | Cu (%) | Ag (g/t) | Mo (ppm) | Au (Moz) | Cu (Mlbs) | Ag (Moz) | Mo (Mlbs) | | | | Indicated | 1,079.9 | 0.48 | 0.09 | 0.7 | 17.8 | 16.8 | 2,166 | 24.3 | 42.4 | | Inferred | 296.3 | 0.39 | 0.07 | 0.7 | 11.7 | 3.7 | 483 | 7.0 | 7.6 |

| Mineral Resource Estimate Notes: | | (1) The mineral resource estimate has an effective date of January 30, 2023. (2) Mineral resources that are not mineral reserves do not have demonstrated economic viability. (3) The mineral resources in this estimate were calculated with the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Definition Standards for Mineral Resources and Mineral Reserves (2014) and the CIM Estimation of Mineral Resources and Mineral Reserve Best Practice Guidelines (2019). (4) Gold equivalent values were calculated using the following prices: a gold price of $1,600 per ounce, a copper price of $3.50 per pound, a molybdenum price of $11.00 per pound and a silver price of $21.00 per ounce. Gold equivalent values can be calculated using the following formula: AuEq = Au g/t + (Ag g/t x 0.0131) + (Cu % x 1.50) + (Mo ppm / 10,000 x 4.71) x 0.97. (5) Using the assumed metal prices, operating costs, and metallurgical recoveries, the base case cut-off grade for mineral resources is estimated to be 0.25 g/t AuEq. (6) The indicated and inferred mineral resources are contained within a limiting pit shell and comprise a coherent body. There are no adjustments for mining losses or dilution. (7) It is reasonably expected that the majority of inferred mineral resources could be upgraded to indicated mineral resources with continued exploration. (8) Lumina is not aware of any legal, political, environmental, or other risks that could materially affect the potential development of the mineral resources. |

This mineral resource estimate was prepared in accordance with NI 43-101 and was based on a total of 98,759 metres of diamond drilling in 280 holes. Of these, 90,142 metres in 248 holes were drilled by Lumina, 5,595 metres in 22 holes were drilled by the Project's previous operator, Newmont Mining Corporation ("Newmont"), in joint venture with Lumina's predecessor company, Odin Mining and Exploration Ltd ("Odin"), and 3,022 metres in 10 holes were drilled by Odin after the joint venture was dissolved. Indicated and inferred mineral resources are estimated using a three-dimensional block model with a nominal block size of 15 x 15 x 15 metres. Drill holes penetrate the Cangrejos deposit and Gran Bestia deposit at a variety of orientations to depths approaching 750 metres below surface. The mineral resource estimate was generated using drill hole sample assay results and the interpretation of a geological model which relates to the spatial distribution of gold, copper, silver and molybdenum. Interpolation characteristics were defined based on the geology, drill hole spacing, and geostatistical analysis of the data. The effects of potentially anomalous high-grade sample data, composited to two metre intervals, are controlled using both traditional top-cutting as well as limiting the distance of influence during block grade interpolation. Block grades are estimated using ordinary kriging and have been validated using a combination of visual and statistical methods. Resources in the indicated mineral resource category are delineated by drilling spaced at maximum 100 metre intervals. Resources in the inferred mineral resource category are within a maximum distance of 150 metres from a drill hole. The estimate of the indicated and inferred mineral resource is constrained within a limiting pit shell derived using projected technical and economic parameters.

Table 4: Probable Mineral Reserves – Cangrejos & Gran Bestia Deposits (Declining NSR Cut-off from $23.00 to $7.76 /tonne milled) – Included in the Mineral Resource Estimate

| Probable Reserves | Tonnes

(Mt) | NSR

($/t) | Grade | Contained Metal | | | | | | Au | Cu | Ag | Au | Cu | Ag | | | | | (g/t) | ( %) | (g/t) | (Moz) | (Mlbs) | (Moz) | | | | | Saprolite & Saprock | - | - | - | - | - | - | - | - | | Partially Oxidized | 18 | 23.07 | 0.57 | 0.09 | 0.80 | 0.34 | 36 | 0.48 | | Fresh Rock | 639 | 24.80 | 0.55 | 0.10 | 0.68 | 11.22 | 1,384 | 13.90 | | Total Mineral Reserves | 659 | 24.76 | 0.55 | 0.10 | 0.69 | 11.56 | 1,421 | 14.38 |

| Mineral Reserve Estimate Notes: | | (1) The mineral reserve estimate has an effective date of March 30, 2023. (2) Mineral reserves on Table 6 are contained within the mineral resource estimate, (3) The mineral reserves in this estimate are based on declining NSR cut-off grade between $23.00/t milled to $7.76/t milled. (4) Net Smelter Return ("NSR") values were calculated using the following prices: a gold price of $1,500 per ounce, a copper price of $3.00 per pound and a silver price of $18.00 per ounce. NSR values are calculated using the following costs & recoveries: Costs of metal in copper concentrate: $7.50/oz Au, $0.51/lb Cu and $0.65/oz Ag; Costs of metal in dore: $0.30/oz Au and $0.30/oz Ag; Recoveries of metal in copper "oxide" rock concentrate: 60% Au, 50% Ag and 50% Cu; Recoveries of metal in copper "fresh" rock concentrate: 62% Au, 50% Ag and 86% Cu; Recoveries of metal in copper "oxide" rock dore: 20% Au and 10% Ag; Recoveries of metal in copper "fresh" rock dore: 20% Au and 20% Ag; Payables of metal in copper concentrate: 97.5% Au, 60% Ag and 93.58% Cu; Payables of metal in dore: 99.95% Au and 99.5% Ag; (5) The mineral reserves estimate were calculated with the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM"), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions. (6) The probable mineral reserves are contained within an engineered pit design that is based on a pit optimization associated with an $1,100/oz gold price. (7) Gold is reported in millions of troy ounces and the gold grade is reported in grams per metric tonne (8) Totals may not add up due to rounding. (9) The qualified person for the mineral reserve estimate is Joseph McNaughton P.E., a Senior Engineer at Independent Mining Consultants, Inc. (10) Lumina is not aware of any legal, political, environmental, or other risks that could materially affect the potential development of the mineral reserves. |

This mineral reserve estimate was prepared in accordance with NI 43-101. The mineral reserves are contained within an engineered pit design. The engineered pit was designed based on the geotechnical slope guidance provided by Wyllie & Norrish Engineers, Inc. The engineered pit incorporates access and sufficient working room for the planned fleet. The mineral reserves are reported from a twenty-five-and-a-half-year mine plan that has been scheduled based on a declining NSR cut-off grade strategy produced from seven engineered phase designs (pits/pushbacks). The phase designs were developed from pits that were optimized to increasing metal prices. The final (ultimate) pits targeted optimized pits consistent with $1,000 to $1,100 /oz gold prices.

Mining and Processing Facility

The proposed processing plant for Cangrejos is a conventional copper-gold flotation concentrator and hybrid leach-carbon-in-leach ("L/CIL") circuit. It has been designed to treat 30,000 tonnes per day (10.95 Mtpa) during the first three years of operation, expanded to 60,000 tonnes per day (21.9 Mtpa) during the next three years and then expanded to 80,000 tonnes per day (29.2 Mtpa) thereafter.

The run of mine ore is trucked from the open pit and is direct dumped into the primary crusher adjacent to the pit and an overland conveyor transports the crushed ore to uncovered course ore stockpile. The processing facility consists of secondary crushing, high pressure grinding rolls ("HPGR"), ball mills, copper-gold flotation circuits, L/CIL treatment, cyanide detox and thickening, and filtering of the combined L/CIL and flotation tailings. The tailings are conveyed to the dry stack tailings facility. The plant is designed to produce precious metal (gold and silver) doré and a copper-gold concentrate. The copper-gold concentrate that makes up most of the Project revenue will be trucked to an Ecuadorian port approximately 40 km away, Puerto Bolivar , from which it will be shipped to smelters and refiners for further processing.

Table 5: Mined Material Summary

| Mining Material Summary (Mt) | | | Ore Material | 659 | | Waste Material | 827 | | Total Mined | 1,486 | | Strip Ratio | 1.26 |

| Note: Totals may not add up due to rounding. |

Table 6: Processing and Production Schedule

| | Years 1-3 | Years 4-6 | Years 7-26 | LOM | | Avg. Processed Tonnes (Mt/a) | 10 | 21 | 28 | 26 | | | | | | | | Avg. Gold Grade (g/t) | 0.73 | 0.71 | 0.52 | 0.55 | | Avg. Copper Grade (%) | 0.13 | 0.11 | 0.09 | 0.10 | | Avg. Silver Grade (g/t) | 0.61 | 0.67 | 0.68 | 0.68 | | | | | | | | Avg. Gold Production (koz) | 190 | 401 | 394 | 371 | | Avg. Copper Production (Mlbs) | 20 | 40 | 45 | 42 | | Avg. Silver Production (koz) | 68 | 181 | 262 | 236 | | Avg. Gold Eq. Production (koz) | 237 | 493 | 498 | 469 |

| Note: Equivalents calculated using $1,650 per ounce gold, $3.75 per pound copper and $20.00 per ounce silver. |

Table 7: Cangrejos LOM Capital Expenditure Estimate Breakdown

| Initial Capital ($M) | | | | Process Plant, Infrastructure & Dry Stack Tailings Storage Facility | $603 | | | Equipment (Mining and Ancillary Facilities) | $73 | | | Pre-production Mine Development | $43 | | | Other Direct and Indirect Costs, Including Working Capital | $97 | | | Sub Total | $816 | | | Contingency (13% weighted average) (1) | $101 | | | Freight, Duties and Taxes | $8 | | | Total Initial Capital (excl. VAT) | $925 | | | Refundable Taxes (12% VAT on certain items) (2) | $82 | | | | | | | Expansion Capital ($M) – Year 4 and Year 7 | 30 to 60 ktpd | 60 to 80 ktpd | | Process Plant Expansion Capital | $300 | $97 | | Contingency (17% weighted average) (1) | $38 | $12 | | Freight and Duty | $5 | $1 | | Total Expansion Capital (excl. VAT) | $342 | $111 | | Refundable Taxes (12% VAT on certain items) (2) | $27 | $8 | | | | | | Sustaining Capital and Closure Costs ($M) | | | | LOM Sustaining Capital | $598 | | | Average Annual LOM Sustaining Capital | $24 | | | Net Closure Costs (Closure, Severance and Salvage) | $64 | |

| Note: Totals may not add up due to rounding. | | (1) The contingency allowance was developed on an area-by-area assessment of estimate confidence. The assessment considered scope, quantification, and pricing factors to assign a contingency amount to each area. | | (2) VAT is recoverable on 12% of the export value once the Project is in production. |

Table 8: Summary of Cangrejos Operating Cost Estimates and Cash Costs

| Average Operating Costs | Years 1-3 | Years 4-6 | Years 7-26 | LOM | | Mining Costs per Tonne Mined | $2.38 | $2.16 | $2.14 | $2.16 | | | | | | | | Per Tonne Milled | | | | | | Mining Costs | $10.66 | $6.27 | $4.37 | $4.84 | | Processing and Tailings Management Costs | $8.32 | $8.54 | $7.44 | $7.59 | | General, Administrative, Environmental and Site Costs | $2.19 | $1.04 | $0.70 | $0.80 | | Total Operating Costs | $21.16 | $15.85 | $12.51 | $13.23 | | | | | | | | Average Net Cash Costs per Ounce | Years 1-3 | Years 4-6 | Years 7-26 | LOM | | Operating Costs | $1,161 | $840 | $899 | $908 | | Refining and Transport | $66 | $55 | $63 | $63 | | By-Product Credits | ($407) | ($379) | ($437) | ($428) | | Government 3% NSR Royalty | $60 | $59 | $61 | $60 | | C1 Cash Cost Net of By-products | $880 | $575 | $586 | $602 | | Sustaining Capital and Net Closure Costs | $266 | $115 | $44 | $69 | | All-in Sustaining Net Cash Cost | $1,146 | $691 | $630 | $671 | | | | | | | | Average Gold Equivalent Cash Costs per Ounce | Years 1-3 | Years 4-6 | Years 7-26 | LOM | | Operating Costs | $932 | $683 | $711 | $721 | | Refining and Transport | $53 | $45 | $50 | $50 | | Government 3% NSR Royalty | $48 | $48 | $48 | $48 | | C1 Gold Equivalent Cash Cost | $1,033 | $776 | $809 | $818 | | Sustaining Capital and Net Closure Costs | $213 | $94 | $35 | $55 | | All-in Sustaining Gold Equivalent Cash Cost | $1,246 | $870 | $844 | $873 |

| Note: Totals may not add up due to rounding. By-products and equivalents calculated using $1,650 per ounce gold, $3.75 per pound copper and $20.00 per ounce silver. | | Net Cash Cost: (Operating costs including transportation and refining costs + Royalties – By-product credits) / Payable Au oz. | | Gold Equivalent Cash Cost: (Operating costs including transportation and refining costs + Royalties) / Payable Au Eq oz. | | All-in Sustaining Cash Cost: Adds sustaining capital and closure costs to the Net Cash Cost and Gold Equivalent Cash Cost. |

Metallurgical Recoveries and Test Work Summary

Test work (2015-2023) was completed by C.H. Plenge & CIA S.A. at its laboratory in Lima, Peru , using representative composites, that confirmed the material from Cangrejos and Gran Bestia is amenable to a conventional crush, grind, flotation and L/CIL flow sheet. The selected processing scheme produces separate saleable gold-silver doré and copper-gold flotation concentrates. C.H. Plenge & CIA S.A. is independent of Lumina.

Comminution tests indicate that the materials are hard and moderately abrasive. The average Bond Ball Work Index for all the Cangrejos and Gran Bestia composites was 15.5 kWh per metric tonne.

Locked-cycle flotation indicates that copper-gold flotation results in recoveries of 79%, 78% and 53% for copper, gold, and silver, respectively. Cyanidation tests on cleaner scavenger tails and sand flotation concentrates indicate that 7% of the gold and 2% of the silver can be recovered into precious metal doré. Overall gold recovery is projected to be 85% (including both doré and flotation recovery methods). Partially oxidized material is blended at various ratios with fresh rock for processing throughout the project life. The metal recoveries and product production estimates are representative of the blended materials. The LOM average grades of the copper-gold concentrate are forecast to be 22% copper, 122 g/t gold and 103 g/t silver (see Table 10 for a summary of the applied recoveries).

Whole rock cyanidation tests using fresh rock samples extracted 89% of the gold, however this processing method was not pursued as it does not recover copper.

Table 9: Selected Metallurgical Recoveries Summary

| Total Recoveries | | | | | Processed Material Type | Au | Cu | Ag | | Fresh Rock w/ Partially Oxidized Blend | 85 % | 79 % | 55 % | | Total Recovery | 85 % | 79 % | 55 % |