Mexican Hat, Arizona USA

Mexican Hat is a low sulphidation, epithermal gold deposit in Tertiary volcanic rocks. Similar deposits within the same basin and range province in Nevada, such as Round Mountain and the Midas Deposit, host many million ounces of gold. Since acquiring the property, GMV has increased its land position significantly to 4,800 acres. The property is now unfolding with multiple target zones.

Mexican Hat Highlights

  • Located in Cochise County, Arizona – 72 miles ESE of Tucson
  • Mexican Hat claims and exploration licenses cover approximately 4,800 acres and form one of the most promising gold development opportunities in the western United States
  • GMV has a 100% interest
  • Extensive past exploration by Placer Dome (USA)
  • Over 180 drill holes from past programs (approx. 22,000m)
  • Preliminary metallurgical studies demonstrate recoveries ranging from 88.4% to 96%
  • 2015 Column Leach Metallurgical results reconfirmed gold recoveries of 96.6% and 91.6%

Property Description

GMV Mineralization Map

GMV Mineralization Map

The Mexican Hat is a unique feature located on the west side of the property that rises about 150m above ground level at an elevation of approximately 1,585m.

The property is a low sulphidation, epithermal gold system with good size potential, access and metallurgy. The property lies within the southeastern portion of the Basin and Range Province, a physiographic domain encompassing much of Nevada, southeast California, southern Arizona and part of New Mexico. Mineralization appears structurally controlled by fault-fracture (joint) zones and related breccias, commonly encountered in alkaline volcanic rocks. Gold has manifest itself in the free form within fractures that are typically intensely hematite altered. Hematized fractures have been found in all rock types found on the property. All units within the volcanic package may act as a possible gold mineral host.

No sulphides have been encountered on the property to date.

The geology and the stratigraphy of Mexican Hat consists of a Tertiary volcanic assemblage with main lithologies, occurring from oldest to youngest, that are described as a basal rhyolite breccia overlain by a trachy-basalt, a trachy-andesite, latite and an upper rhyolite tuff.

Recent Work Programs

Results from recent drilling at the Mexican Hat were reported on February 1, 2017, February 21, 2017, February 27, 2017 with final assays for the entire step-out drill campaign released on March 28, 2017. Headline intersections include 0.92 gpt over 33.5 m (22.5 m true) in the H Zone from GMV 2016-11, 0.74 gpt over 21.3 m (15.4 m true) in the A Zone from GMV 2016-8, 2.03 gpt over 9.1 m (6.4 m true) in the AN Zone from GMV 2016-9 and 0.56 gpt over 21.3 m (true width) in the VF Zone from GMV 2016-14. Known mineralization has now been extended by another 420 meters. The technical team is currently developing a Mine Plan of Operation while undertaking metallurgical testing, data compilation, and LIDAR and geophysical surveys.

On Dec 6th, 2016, GMV announced a new target known as the Hernandez Hill target, located approximately 500 meters northeast of the existing Mexican Hat gold resource. Based on soil geochemistry and recent mapping, it is believed that the Hernandez Hill target may be the top of an epithermal precious metal deposit. The distribution of anomalous pathfinder elements is characteristic of the upper levels of gold and silver bearing epithermal systems that are common in the Basin and Range of the southwestern US. This is a new deposit style at Mexican Hat and represents a strong and compelling drill target. Drilling at the Hernandez Hill target has now been completed with results pending.

The property consists of unpatented lode mining claims and State of Arizona Mineral Exploration Permits.

Location and Access

Mexican Hat Feature

The property is located in the southeastern part of the State of Arizona, and can be accessed from Old Ghost Town Road. Arizona, a mining-friendly state in the southwest United States, is home to many large mines and development projects including copper, gold, uranium, coal, and copper/moly mines. Mining had a $4.29 billion impact on Arizona’s economy in 2014, with 66% of the nation’s copper coming from the state.

The Mexican Hat Property hosts an Inferred Mineral Resource of 23,452,000 tonnes grading 0.70 grams of gold per tonne hosting 531,400 troy ounces of gold, using a 20 gpt capping grade and a 0.20 gpt cut-off grade (See Feb 20, 2015 NI 43-101 Technical Report, SEDAR)

Resource

Cut-off (g/t Au)TonnesGramsGrade (Au g/t)Ounces Au
0.4012,735,00013,482,0001.06433,500
0.3016,819,00014,901,0000.89479,000
0.2023,452,00016,528,0000.70531,400

Grades, tonnes, grams and ounces are rounded and totals may not add up. A gold price of US$1,225 is assumed.

Note that mineralization is open in all directions.


Oblique west-facing image of the resource blocks within selected solids presented to show the orientation of blocks relative to the solids models.

Map-view image of the resource blocks within selected solids presented to show the orientation of blocks relative to the solids models- North points to the top of the image, grid is 100m.

History

Further back in history, the area around and immediately south of the project area underwent mining activity during the 16th or 17th century, in particular for the turquoise. Spanish explorers also prospected the area targeting gold.GMV Minerals acquired 100% of the leasehold interest in the Mexican Hat Property by way of an assignment agreement with the previous lessee and the underlying claim owner. The Mexican Hat property received considerable exploration between 1989 and 2004, most notably by Placer Dome (USA) between the years 1989-1992 when they drilled 137 holes totaling 18,939 metres (62,120 ft). Overall there are more than 180 drill holes in historical data associated with the property.


Location of the Basin and Range physiographic domain and five subdomains, from www.geomaps.wr.usgs.gov/parks/province. 2014. Red star marks Mexican Hat location.

Simplified Property Geology

Ground magnetic survey reported by Game (2013) with structural map

Ground VLF-EM survey reported by Game (2013) with structural map.

Bulk Sample Recoveries

GMV is undertaking an 18 tonne bulk sample as part of 2016’s development program at Mexican Hat. A bedrock exposure of low-grade material has been selected as appropriate to test the Run of Mine (ROM) potential. The broken bedrock has been shipped to a certified metallurgical facility as ROM material for a leach recovery test in 1.2 m diameter by 6m columns on -150 mm (-6”) material. In addition, other samples will be collected from drill core and exposures on the property to further assess other significant rock types. Together, this work will assist planning for the development of a Mine Plan of Operation.

Three bottle roll tests from the 18 tonne sample returned a combined average better than 91% recovery for gold.

Infrastructure

The Towns of Willcox, Benson and Sierra Vista are the supply centers of Cochise County, as well as distribution hubs for agricultural, tourism and mineral industries. These towns have the necessary resources to support mineral exploration such as accommodations, communications, equipment and supplies, plus an available, knowledgeable work force.

Water may be obtained from privately-owned and operated wells in the vicinity. Expanded operations will likely require purpose-built access to subsurface waters.

The Courtland-Pearce, Ghost Town Trail Road extends along the western project area along with an active power line. Storage facilities such as tailings, waste, potential heap leach areas and processing plant sites may be acquired either through the State, private land holder or BLM.

Net Smelter Royalty

The Mexican Hat Property is subject to a 3% net smelter returns royalty (NSR Royalty) in favour of Manual R. Hernandez, created pursuant to the terms of the Lease. The NSR Royalty is subject to a buyback right pursuant to which 1.5% of the NSR Royalty can be purchased by GMV in consideration of US$1,500,000. Pursuant to the terms of the Lease, the Company will be required to make advance royalty payments to Hernandez in the amount of US$4,500, payable quarterly. In addition, the Company will be required to undertake sufficient assessment work, make annual filings, and pay taxes, fees and rents as required to maintain the Mexican Hat Property in good standing.

Qualified Person

Dr. D.R. Webb, Ph.D., P.Geol. P.Eng. is the Qualified Person within the meaning of NI 43-101 and has reviewed and approved the technical content of this website.

NI 43-101: Technical Report on a Geological Assessment of the Mexican Hat Property, Cochise County, Arizona, USA