Tinka Resources Ltd. press release

Nexa Resources Announces 2023 Year-End Mineral Reserves and Mineral Resources

2024-03-27

TSXV - TSX Venture Exchange · Zinc · Silver · Tin · Lead · Indium · Gold · Copper · Canada · Resource Estimate

LUXEMBOURG / ACCESSWIRE / March 27, 2024 /Nexa Resources S.A. ("Nexa Resources" or "Nexa" or the "Company") (NYSE Symbol:NEXA) announces its 2023 Year-End Mineral Reserves and Mineral Resources ("MRMR") relating to its operations and projects located in Peru and Brazil.

Commenting on the MRMR update, Ignacio Rosado, CEO of Nexa Resources, said "Our mineral exploration program in 2023 was focused on identifying new mineralized zones in our operating mines including Aripuanã, where significant results from the Babaçu infill drilling program defined new Mineral Reserves, and increased Mineral Resources.

As a major polymetallic mine operator and the 5thlargest zinc producer worldwide, Nexa has a unique portfolio of operating mines with excellent exploration potential and a pipeline of greenfield exploration projects. In 2024, our mineral exploration program will remain focused on the replacement of Mineral Reserves and upgrading Mineral Resources through infill drilling campaigns."

2023 Year-End Mineral Reserves and Mineral Resources Highlights

Mineral Reserves

Note: "Addition" refers to new tonnages from brownfield and infill drilling and "Revision" refers to changes in Mineral Reserves due to changes in mine design, changes in economic parameters, leading to a model review and update. Reserve numbers refer to zinc mines and projects.

As of December 31, 2023, Proven and Probable Mineral Reserves estimates amounted to 110.4 million tonnes containing 4,031kt of zinc (at higher average zinc grade) compared with 100.6 million tonnes containing 3,540kt of zinc as of December 31, 2022. The increase was mainly driven by infill and brownfield drilling at Aripuanã, partially offset by mining production depletion. Nexa's 2023 Year-End Mineral Reserves estimate also reflects changes in continuous refining of its geological modelling. Another addition to Mineral Reserves is the re-inclusion of the Atacocha Mineral Reserves from the underground and open pit mines, which were not included in 2022. Positive results from the Cerro Pasco Integration Project economic study carried out during 2023 support the declaration of Mineral Reserves. The Pasco Integration Project is designed to further integrate the Atacocha and El Porvenir mines to increase production and extend mine life by eliminating the main bottlenecks in each operation, increasing mill capacity, and opening up additional exploration potential including at the integration mineralized body. The net revision of -34kt of zinc was primarily due to the increase in cut-off at Aripuanã (-140kt) balanced by stope layout and cut-off revisions at Cerro Lindo, and El Porvenir (106kt). The Proven and Probable Mineral Reserves at the Cerro Lindo Mine were estimated to total 41.15Mt at 1.49% Zn, 0.22% Pb, 0.55% Cu and 22.6 g/t Ag as of December 31, 2023, a 0.7% decrease from 41.43Mt at 1.57% Zn, 0.22% Pb, 0.59% Cu and 22.5 g/t Ag as of December 31, 2022. The decrease was the result of mining production depletion during 2023, balanced by infill drilling in mine extensions (+23kt of zinc), and stope layout and cut-off revisions (+28kt of zinc). Mineral Reserve depletion during 2023 accounted for -5.98Mt containing 90kt of zinc. The Proven and Probable Mineral Reserves at the Vazante Mine were estimated to total 11.33Mt at 9.62% Zn, 0.21% Pb, and 13.8 g/t Ag as of December 31, 2023, down 16% from 13.50Mt at 9.64% Zn, 0.27% Pb and 15.2 g/t Ag as of December 31, 2022. The decrease was the result of mining production depletion during 2023, and geotechnical revision at Lumiadeira area (-28kt of contained zinc). Mineral Reserve depletion during 2023 accounted for -1.70Mt containing 184kt of zinc. In 2023, Nexa added 2.11Mt of Probable Mineral Reserves with 87kt of contained zinc from the Aroeira tailings deposit after a hydrogeological and environmental study. The Proven and Probable Mineral Reserves at the El Porvenir Mine were estimated to total 14.65Mt at 4.11% Zn, 1.20% Pb, 0.23% Cu and 72.9 g/t Ag as of December 31, 2023, a 5.5% decrease from 15.50Mt at 3.60% Zn, 1.07% Pb, 0.19% Cu and 66.0 g/t Ag as of December 31, 2022. The decrease is the balance result from mining depletion, and the addition of 106kt of contained zinc from stope layout and model revision. Mineral Reserve depletion during 2023 accounted for -2.20Mt containing 62kt of zinc. The Proven and Probable Mineral Reserves at the Atacocha (Underground) Mine were estimated to total 5.66Mt at 4.33% Zn, 1.34% Pb, 0.40% Cu, 79.8 g/t Ag, and 0.07g/t Au as of December 31, 2023. The Proven and Probable Mineral Reserves at the Atacocha (Open Pit) Mine were estimated to total 4.38Mt at 0.99% Zn, 1.15% Pb, 34.9 g/t Ag, and 0.27g/t Au as of December 31, 2023. The Proven and Probable Mineral Reserves at the Aripuanã Mine were estimated to total 31.07Mt at 4.35% Zn, 1.66% Pb, 0.15% Cu, 40.6 g/t Ag and 0.22 g/t Au as of December 31, 2023, a 3.2% increase from 30.12Mt at 3.42% Zn, 1.25% Pb, 0.17% Cu, 32.1 g/t Ag and 0.23 g/t Au as of December 31, 2022. The Babaçu infill drilling program carried out during 2023 provided new Probable Mineral Reserves of 9.10Mt at 5.56% Zn, 2.19% Pb, 0.11% Cu, 49.6 g/t Ag, and 0.14g/t Au as of December 31, 2023, totaling an increase of 506kt of contained zinc in the reserves. We reported a loss of -140kt of contained zinc due to an increase in cut-off impacting mostly low-grade ores. Mineral Reserve depletion during 2023 accounted for -1.56Mt containing 44kt of zinc.

Mineral Resources

Note: "Addition" refers to new tonnages from brownfield and greenfield drilling and "Revision" refers to changes in Mineral Resources due to changes in reclassification, mine design, changes in economic parameters, leading to a model review and update. Mineral Resource numbers refer to zinc mines and projects.

As of December 31, 2023, Nexa estimated Measured and Indicated Mineral Resources (exclusive of Mineral Reserves) were 3,259kt of contained zinc compared with 3,432kt as of December 31, 2022. The Addition and Revision accounted for a net decrease of -173kt of contained zinc mostly due to conversion of Mineral Resources to Mineral Reserves at Aripuanã after the Babaçu infill drilling, and at the Atacocha (Underground) and Atacocha (Open Pit) Mines following the Pasco Integration Project study. At Vazante Aroeira tailings, a hydrogeologic and environmental study resulted in conversion of 108kt of contained zinc from Indicated Mineral Resources to Mineral Reserves. At the Atacocha (Underground) and Atacocha (Open Pit) Mines, the Pasco Integration Project accounted for a -175kt and -44kt reduction in contained zinc, respectively, after conversion to Mineral Reserves. As of December 31, 2023, Nexa estimated Inferred Mineral Resources of 6,897kt of contained zinc, compared with the total of 6,626kt at the end of 2022. The addition of 543kt of contained zinc was mostly incorporated through the Babaçu drilling at Aripuanã. The net revision reduction of -271kt of contained zinc is mostly due to model revisions and reclassification at Vazante and conversion of Inferred Mineral Resources to Mineral Reserves at Babaçu.

Exploration Outlook

Our exploration strategy for 2024 is aimed at focusing on Mineral Resource expansion through brownfield and infill drilling near operating mines and extension drilling on advanced projects.

A total of 66,050 meters of drilling is planned for 2024, including 42,100 meters in Peru (63%) and 23,950 meters in Brazil (37%). At Cerro Lindo, we plan to drill a total of 23,100 meters including exploratory drilling at Patahuasi Millay, Pucasalla and its extensions, located in the northern side of the Cerro Lindo Mine and extension drilling at Orebodies 8B, 9, 5 and 6A, located southeast of the mine.

At the Cerro Pasco Complex (El Porvenir and Atacocha), we plan to drill 8,500 meters divided between Pasco Integration Project targets to extend the mineralized hydrothermal breccia to upper levels of the deposit and at Don Lucho, VAM and Porvenir 9 targets. At the Hilarión and Florida Canyon Zinc projects, our focus will be to advance geological mapping and integration of geological data to define the exploration strategy for the years ahead.

At Aripuanã, the strategy will be to drill 9,000 meters to identify the mineralization in the Massaranduba target to validate the continuation of the deposit in the southeast side of the Aripuanã Mine. At Vazante, we plan to carry out 12,350 meters of brownfield drilling, 7,050 to extend known orebodies such as Sucuri and Sucuri North and 5,300 meters of infill drilling at the BDMG Orebody to convert Inferred Mineral Resources into Indicated Mineral Resources.

In Namibia, we plan to drill 3,000 meters of exploratory drilling to continue investigating copper mineralization in the Tsumeb trend.

We expect to continue advancing our drilling campaigns and developing our pipeline of projects in regional areas with additional 13,100 meters of diamond drilling, prioritizing belts for exploratory drilling and Mineral Resource expansion to consolidate our Zinc and Copper portfolio with optimized investments between them.

Mineral Reserves and Mineral Resources Tables

MINERAL RESERVES

The following table shows our estimates of Mineral Reserves prepared with an effective date of December 31, 2023 (except as indicated below).

Table 1. Nexa Year-End Mineral Reserves as of December 31, 2023 (except as indicated below) for Zinc operating mines on a 100% basis

NOTES TO MINERAL RESERVES TABLE

The total amounts and content presented in Table 1 have not been adjusted to reflect our ownership interest. The information presented in this table includes 100% of the Mineral Reserve estimates for each property. Please refer to our ownership percentage for the amounts attributable to our ownership interest in each property.

Subpart 1300 of Regulation S-K definitions were followed for Mineral Reserves, which also are consistent with the CIM (2014) definitions. Mineral Reserves have an effective date as of December 31, 2023.

The Qualified Person for the Mineral Reserves estimates for Cerro Lindo is Cristovão Teofilo dos Santos, B.Eng., FAusIMM, a Nexa employee; for Vazante and Vazante Aroeira Tailings it is Vitor Marcos Teixeira de Aguilar, B.Eng., FAusIMM, a Nexa employee; for Aripuanã it is Vitor Ferraz Viana, B.Eng., FAusIMM, a Nexa employee; and for El Porvenir, Atacocha (Underground) is Varun Bhundhoo, ing., a SLR Consulting (Canada) Ltd. employee, and for Atacocha (Open Pit) is Hugo Miranda, MBA, SME (RM), a SLR International Corporation employee.

Cerro Lindo Mine: Mineral Reserves are estimated at an NSR break-even cut-off value of US$40.86/t processed. Some incremental material with values between US$32.99/t and US$40.86/t was included. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); copper: US$7,669.61/t (US$3.48/lb); lead: US$2,000.29/t (US$0.91/lb); and silver: US$21.17/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 88.36% for Zn, 85.23% for Cu, 66.53% for Pb, and 68.78% for Ag. A minimum mining width of 5.0 m was used. Dilution and extraction factors are applied based on stope type and location. Bulk density varies depending on mineralization domain.

Vazante Mine: Mineral Reserves are estimated at a NSR cut-off value of US$66.31/t processed. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); lead: US$2,000.29/t (US$0.91/lb); and silver: US$21.17/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 87.19% for Zn, 23.93% for Pb, and 42.00% for Ag. A minimum mining width of 4.0 m was applied.

Vazante Aroeira Tailings: Mineral Reserves are estimated at a NSR cut-off value of US$25.44/t processed. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); lead: US$2,000.29/t (US$0.91/lb); and silver: US$21.17/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Vazante Aroeira Tailings average head grades are 67.86% for Zn, 40.74% for Pb, and 42.00% for Ag. A minimum mining unit of 10 m x 10 m x 2 m was applied.

El Porvenir Mine: Mineral Reserves are estimated at NSR cut-off grade values ranging from US$63.77/t to US$67.04/t for SLS areas and US$65.77/t to US$69.04/t for C&F areas depending on the zone. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); copper: US$7,669.61/t (US$3.48/lb); lead: US$2,000.29/t (US$0.91/lb); and silver: US$21.17/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 89.21% for Zn, 14.60% for Cu, 80.01% for Pb, and 77.51% for Ag. Minimum mining width of 5.0 m for C&F mining and 4.0 m for SLS mining were used for reserves shapes and development design and are reported inclusive of extraction losses and dilution.

Atacocha (Underground) Mine: The Mineral Reserves were estimated at a NSR cut-off of US$69.00/t for SLS areas and US$71.07/t for C&F areas depending on the zone. A number of incremental material (with values between US$45.09/t and US$69.00/t for SLS and values between US$47.16/t and US$71.07/t for C&F mining were included in estimate. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); copper: US$7,669.61/t (US$3.48/lb); lead: US$2,000.29/t (US$0.91/lb); and silver: US$21.17/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 89.30% for Zn, 15.73% for Cu, 80.02% for Pb, and 77.51% for Ag. Minimum mining width of 5.0 m for C&F mining and 4.0 m for SLS mining were used for reserves shapes and development design and are reported inclusive of extraction losses and dilution.

Atacocha (Open Pit) Mine: Mineral Reserves are estimated at a NSR cut-off value of US$16.21/t. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); lead: US$2,000.29/t (US$0.91/lb); silver: US$21.17/oz; and gold: US$1,630.93/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 70.44% for Zn, 83.97% for Pb, 75.76% for Ag and 65.46% for Au.

Aripuanã Mine: Mineral Reserves are estimated at a NSR break-even cut-off value of US$63.40/t processed was estimated from forecasted operating costs and some incremental material between US$49.20/t and US$63.40/t was included. Mineral Reserves estimates are based on average long-term metal prices of: zinc: US$2,799.04/t (US$1.27/lb); copper: US$7,669.61/t (US$3.48/lb); lead: US$2,000.29/t (US$0.91/lb); silver: US$21.17/oz; and gold: US$1,630.93/oz. Metallurgical recoveries are accounted for NSR calculations based on metallurgical testworks and are variable as a function of head grade and ore type. Recoveries at Life of Mine average head grade for a Mix of 80% Stratabound and 20% Stringer material are 90.06% for Zn, 60.00% for Cu, 84.92% for Pb, 68.00% for Ag, and 67.80% for Au. A minimum mining width of 4.0 m was applied.

Numbers may not add due to rounding.

The point of reference for Mineral Reserves in Table 1 is mill feed materials.

MINERAL RESOURCES

The following table shows our estimates of Mineral Resources (exclusive of Mineral Reserves) in operating mines prepared with an effective date of December 31, 2023 (except as indicated below).

Table 2. Nexa Year-End Mineral Resources as of December 31, 2023 (except as indicated below) for Zinc operating mines on a 100% basis

The following table shows our estimates of Mineral Resources (exclusive of Mineral Reserves) for our zinc exploration projects prepared with an effective date of December 31, 2023 (except as indicated below).

Table 3. Nexa Year-End Mineral Resources as of December 31, 2023 (except as indicated below) for Zinc projects on a 100% basis

The following table shows our estimates of Mineral Resources for our copper project portfolio prepared with an effective date of December 31, 2023 (except as indicated below).

Table 4. Nexa Year-End Mineral Resources for Copper projects on a 100% basis

NOTES TO MINERAL RESOURCES TABLES

The Qualified Person for the Mineral Resources estimate for Vazante, Vazante Aroeira Tailings, Morro Agudo and Aripuanã is José Antonio Lopes, B.Geo., FAusIMM, a Nexa employee; and for Cerro Lindo, El Porvenir, Atacocha (Open Pit), Atacocha (Underground) and Hilarión, Florida Canyon Zinc and Magistral projects is Jerry Huaman Abalos, B.Geo., MAusIMM(CP), a Nexa employee. The tonnage and content amounts presented in Tables 2, 3 and 4, represents 100% of the Mineral Resources estimates for each property. Please refer to our ownership percentage for the amounts attributable to our ownership interest in each property.

Mineral Resources have an effective date as of: (a) December 31, 2023, for Cerro Lindo, El Porvenir, Atacocha (Underground), Atacocha (Open Pit), Vazante, Morro Agudo and Aripuanã Mines; (b) December 31, 2022, for the Hilarion project; (c) October 30, 2020, for the Florida Canyon Zinc project, and (d) December 31, 2021, for the Magistral project.

Subpart 1300 of Regulation S-K definitions were followed for Mineral Resources, which also are consistent with the CIM (2014) definitions.

Cerro Lindo Mine: Mineral Resources are estimated at an NSR cut-off value of US$40.86/t. Mineral Resources estimates are based on average long-term metal prices of: zinc: US$3,218.90/t (US$1.46/lb); copper: US$8,820.05/t (US$3.48/lb); lead: US$2,300.33/t (US$1.04/lb); and silver: US$24.35/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 88.36% for Zn, 85.23% for Cu, 66.53% for Pb, and 68.78% for Ag. A minimum mining width of 4.0 m was used to create resource shapes. Bulk density varies depending on mineralization domain.

Vazante Mine and Vazante Aroeira Tailings: Mineral Resources are estimated at various NSR cut-off values appropriate to the mineralization style and mining method. For Supergene Mineralization (Calamine) the resources are estimated at a NSR cut-off value of US$27.91/t for soil and US$32.92/t for fresh rock and transition material. For Aroeira Tailings the resources are estimated at a NSR cut-off value of US$29.06/t and for Hypogene Mineralization (Willemite) a cut-off value of US$66.31/t for all resources shapes. Mineral Resources estimates are based on average long-term metal prices of: zinc: US$3,218.90/t (US$1.46/lb); lead: US$2,300.33/t (US$1.04/lb); and silver: US$24.35/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average hypogene mineralization (Willemite) head grades are 87.19% for Zn, 23.93% for Pb, and 42.00% for Ag. Recovery at supergene mineralization is 55.00% for Zn. Recoveries for Aroeira Tailings are 67.86% for Zn, 40.74% for Pb and 42.00% for Ag. A minimum thickness of 3.0 m for underground SLS, open pit shell for Calamine and above original topography for tailings. Bulk density was assigned based on rock type.

El Porvenir Mine: Mineral Resources are estimated at NSR cut-off grade values ranging from US$63.77/t to US$67.05/t for SLS areas and US$65.77/t to US$69.04 for C&F areas depending on the zone. Mineral Resources estimates are based on average long-term metal prices of: zinc: US$3,218.90/t (US$1.46/lb); copper: US$8,820.05/t (US$3.48/lb); lead: US$2,300.33/t (US$1.04/lb); and silver: US$24.35/oz. Metallurgical recoveries are accounted for in NSR calculations based on historical processing data and are variable as a function of head grade. Recoveries at Life of Mine average head grade are 89.21% for Zn, 14.60% for Cu, 80.01% for Pb, and 77.51% for Ag. A minimum mining width of 4.0 m was used for C&F and a minimum mining width of 3.0 m was used for SLS resource stopes shapes respectively. Bulk density varies depending on mineralization domain.