Cascabel Project

Key Highlights of the Pre-feasibility STUDY¹

• $5.4bn pre-tax Net Present Value (“NPV_8%”) and 33% internal rate of return (“IRR”) 
• $3.2bn after-tax NPV_8%, 24% IRR and 4-year payback period from the start of processing²
• Average production³ of 123ktpa of copper, 277kozpa of gold and 794kozpa of silver – 182ktpa copper equivalent (”CuEq”)⁴ – with peak⁵ copper production of 216ktpa (370ktpa CuEq)
• Pre-production capital of $1.55bn for the initial mine development, first process plant module and infrastructure
• 85% of Mineral Reserves are classified as Proven in updated Mineral Reserve Estimate
• Initial 28-year mine plan of 540Mt containing 3.2Mt Cu @ 0.60%, 9.4Moz Au @ 0.54 g/t and 28Moz Ag @ 1.62 g/t based on the updated Mineral Reserve Estimate⁶
• The Project economics have been calculated based on the economic terms and conditions previously negotiated with the Ecuadorian Government⁷

¹ See News Release dated 16 February 2024 available on SEDAR under the Company’s profile at www.sedarplus.ca

² Based on long-term commodity price assumptions of (US$): $3.85/lb for copper, $1,750/oz for gold and $22.50/oz for silver.

³ Average based on years 6 – 23 at full nameplate capacity.

⁴ Assumptions for copper equivalent calculations as provided in Table 1 for commodity prices, grades and recoveries. Copper equivalent production (by-product basis) = Recovered Cu tonnes + (Au Price US$/oz) / (Cu Price US$/t) x (Recovered gold ounces) + (Ag Price US$/oz) / (Cu Price US$/t) x (Recovered silver ounces).

⁵ Peak based on year 6 from start of production. 

⁶ See Table 3: Cascabel Project Alpala Underground Mineral Reserve Estimate for details including cut-off assumptions. 

⁷ See SolGold press release dated 20 July 2023 for additional details.

Detailed information can be found in the Technical Report available on SEDAR

Geology & Mineralisation

Northern Ecuador is in the captivating and lesser-known northern region of the abundant Andean copper belt. This remarkable belt stretches from the southern reaches of Chile to the expanses of the north of Colombia and even extends towards the northwestern part of Panama. The concession itself is positioned at the frontier of the Eocene and Miocene metallogenic belts, both highly acclaimed for their remarkable capacity to harbor some of the planet’s most colossal porphyry copper and gold deposits. An exemplary illustration of this potential is the colossal La Escondida copper mine, a global leader in copper production, nested within rocks of the same age as those found in the Cascabel region.

The project finds its home within the majestic Cordillera Occidental, also known as the Western Cordillera, in Ecuadorian Andes. The foundation of this terrain is composed of oceanic basalt and sedimentary deposits dating back to the Cretaceous period. Majestic batholiths from the Eocene era, potentially extending into the Late Miocene, emerge at higher elevations, permeating the volcanic and sedimentary rocks spanning the Cretaceous through the Tertiary periods. It is through the intricate interplay of three-dimensional geological dynamics that gold and copper mineralization are localized at Cascabel. These dynamics involve the profound interaction of dominant first-order structures, aligning in a NE-trending pattern parallel to the volcanic arc, with secondary NW-trending faults perpendicular to the arc, and tertiary NNW-trending structures.

Within the Cascabel concession, volcanic and sedimentary rocks are intruded by a number of Quartz diorite, diorite and hornblende diorite stocks and dykes. The SolGold field teams completed 1:500 scale, “Anaconda” style geological mapping over the concession area, and all high-priority porphyry target centres have been elevated to drill-ready status.

• State of the Art Magnetic Modelling
• Coincident Geochemical Signatures (Soil & Auger)
• Highlighting Multiple Porphyry Centres

Cascabel Project Alpala Underground Mineral Resource Estimate MRE#4
(Effective Date November 11, 2023)

1. Dr Arseneau, P. Geo. Associate Consultant with SRK Consulting (Canada) is responsible for this Mineral Resource statement and is an “independent Qualified Person” as such term is defined in NI 43-101.
2. Reasonable prospects of eventual economic extraction were assessed by enclosing the mineralised material in the block model estimate in a 3D wireframe shape that was constructed with adherence to a minimum mining unit with geometry appropriate for a block cave.
3. The cut-off grade for the shape was defined as the cut-off grade under a breakeven, eventual economic extraction criterion. The cut-off grade of 0.21% CuEq was calculated using (copper grade (%)) + (gold grade (g/t) x 0.683).
4. All material within this shape was reported in the Mineral Resource statement as block caving is a non-selective method, and all material extracted is treated as mill feed.
5. The material inside the shape without a Mineral Resource category was reported as planned dilution.
6. The resulting shape contained planned internal and edge dilution that the QP considers appropriate.
7. Cut-off inputs included:
   1. Metal prices of Cu at US$3.60/lb and Au at US$1,700/oz,
   2. Recoveries of Cu 93% and Au 83%,
   3. Costs including mining, processing, general and administration (G&A), and
   4. off-site realization (TCRC), including royalties.
8. The QP considers that the Mineral Resource has reasonable prospects for eventual economic extraction by an underground mass mining method such as block caving.
9. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
10. Mineral Resources are reported inclusive of Mineral Reserves.
11. Figures may not add up due to rounding.

Cascabel Project Alpala Underground Mineral Reserve Estimate 
(Effective Date December 31, 2023)

Notes:

1. CIM Definition Standards were followed for Mineral Reserves.
2. Mineral Reserves for the Cascabel Project have an effective date of December 31, 2023
3. The Mineral Reserve reported above was not additive to the Mineral Resource.
4. The Mineral Reserve is based on the November 11, 2023 Mineral Resource.
5. Totals may not match due to rounding.
6. Mineral Reserves are reported using long-term metal prices of US$1,700/oz Au, US$3.60/lb Cu, US$19.90/oz Ag.
7. Mineral Reserves are constrained within a block cave design, using the following input parameters: height of draw of 400 m; mixing horizon of 350 m; 15% dilution (at 350 m column height); overall operating cost of US$15.00/t; metallurgical recoveries that range from 85-92% for copper and 70-81% for gold; a footprint development cost of US$1,750/m2; cut-off value of US$15.00/t.
8. Units are metric tonnes, metric grams, troy ounces and imperial pounds. Gold ounces and copper pounds are estimates of in-situ material and do not account for processing losses.
9. The Mineral Reserve Estimate as of 31 December 2023 for Alpala was independently verified by Jarek Jakubec, C.Eng., FIMMM. Mr. Jakubec fulfils the requirements to be a “Qualified Person” for the purposes of NI 43-101 and is the Qualified Person under NI 43-101 for the Mineral Reserve.

Tandayama-Ameríca Mineral Resource Statement
(Effective Date November 11, 2023)

Notes:

1. Dr. Gilles Arseneau, P. Geo., Associate Consultant with SRK Consulting (Canada), is responsible for this Mineral Resource statement and is an “independent Qualified Person” as such term is defined in NI 43-101.
2. Reasonable prospects of eventual economic extraction were assessed by:
   1. First presenting the mineralised material in the block model estimate to a conventional Lersch-Grossman open pit optimisation routine based on a cut-off grade of 0.16 % CuEq, and the cost and revenue assumptions listed below. Mineralised material inside the revenue factor one pit and above the cut-off grade were then reported in the “Open pit” section of the Mineral Resource statement.
   2. Subsequently, the remaining material was enclosed in a 3D wireframe shape that was constructed with adherence to a minimum mining unit with geometry appropriate for a block cave.
3. The Cut-off grade for the underground shape was defined as the cut-off grade under a breakeven, eventual economic extraction criterion. The cut-off grade of 0.19% CuEq was calculated using (copper grade (%)) + (gold grade (g/t) x 0.683).
4. All material within the underground shape was reported in the “Underground” section of the Mineral Resource statement, as block caving is a non-selective method, and all material extracted is treated as mill feed.
5. The resulting shape contained planned internal and edge dilution that the QP considers appropriate.
6. Cut-off/Cut-off inputs included:
   1. Metal prices of Cu at US$3.60/lb and Au at US$1,700/oz,
   2. Recoveries of Cu 93% and Au 83%,
   3. Costs including mining, processing and general and administration (G&A) and
   4. Off-site realization (TCRC), including royalties.
7. The QP considers that the Mineral Resource has reasonable prospects for eventual economic extraction by open pit or an underground mass mining method such as block caving, as presented in the Mineral Resource statement.
8. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
9. Mineral Resources are reported inclusive of those Mineral Resources that were converted to Mineral Reserves.
10. Numbers may not add up due to rounding.

Metallurgical Overview