The Unkur Copper-Silver Project is a sediment-hosted stratiform copper-silver deposit. The copper-silver bearing horizon has been traced, from historic drill holes, trenches and outcrop, for a length of about 5 kilometers northwest-southeast in the southwest limb of the Unkur Syncline.

Unkur was initially explored during the 1960s through 1980s.Various non-NI 43-101 resource estimates were prepared during that time. A ‘prognostic’ resource estimate was 143 million tonnes at 0.77% copper and 68.3 g/t silver.Historic resource estimates were prepared before the Company acquired an interest in the project.They have not been reviewed by a Qualified Person in the context of NI 43-101 and so cannot be considered as a current Mineral Resource.

Azarga Metals Corp. acquired Unkur Copper-Silver Project in 2016 and commenced an exploration program shortly thereafter. To date, work has comprised surface geologic mapping and geochemical sampling, approximately 130 line-kilometers of ground magnetics geophysics, 4,580 meters of diamond drilling (16 drill-holes) and 186 meters of channel sampling from four trenches.

In 2017, the initial results of Azarga Metals’ program led to a maiden NI 43-101 Resource estimate.The estimate was an Inferred Mineral Resource of 42 million tonnes at 0.52% copper and 38g/t silver, containing 220,000 tonnes (ie, 480 million pounds) of copper and 52 million ounces of silver. The Mineral Resource estimate was independently prepared by SRK Consulting (Russia) Ltd. ("SRK"), in accordance with NI 43-101. In 2018, the Resource estimate was subsequently updated to an Inferred Mineral Resource estimate of 62 million tonnes at 0.53% copper and 38.6 g/t silver, containing 328,600 (724 million pounds) of copper and 76.8 million troy ounces of silver. This equates to a copper equivalent grade of 0.90%, assuming a copper price of US$3.00/lb, silver price of US$20/ounce and 100% recovery for copper and silver.The updated Mineral Resource estimate was prepared by Tetra Tech, Inc.

Azarga Metals engaged Tetra Tech Mining and Minerals (“Tetra Tech”) to complete a NI 43-101 compliant Preliminary Economic Assessment (“PEA”) on the Unkur Project, based on the updated Resource estimate. The PEA as at 30 August 2018:

  • Positive PEA result achieved based only on 2018 Mineral Resource as an ‘initial option’ with significant growth potential
  • Open-pit mine with annual production rate of 2 million tonnes of mill feed per year and conventional processing circuit to produce a very high-grade copper and silver concentrate
  • Average of 13,217 tonnes of copper and 3.70 million ounces of silver metal contained in concentrate production per year over 8-year life of mine
  • Pre-tax net present value of US$203.6 million (post-tax US$147.5 million) and internal rate of return of 28.9%
  • Updated ‘follow-on’ PEA to be prepared following completion of exploration works to grow the Mineral Resource at Unkur