On September 25, 2024, Gatos Silver, Inc. (the “Company” or “GSI”) issued a press release, as previously disclosed in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 25, 2024, reporting an updated mineral reserve estimate, mineral resource estimate and life of mine plan for the Cerro Los Gatos Mine (“CLG”) in Mexico.
A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 8.01.
The following description of the Company’s mineral reserve and mineral resource estimates reflects the material elements of the Company’s June 21, 2024 response to a comment letter issued by the SEC, dated June 6, 2024, relating to the SEC’s review of the Company’s Form 10-K for the fiscal year ended December 31, 2023.
Mineral Reserve Estimates
Below is a reconciliation comparing the mineral reserve estimate as of the previous two fiscal year ends: (1,2,3,4,5,6,7,8,9,10)
2023 CLG Mineral Reserve Estimate as at December 31, 2023 (70% attributable basis)
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Reserve Classification |
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Mt |
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Ag (g/t) |
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Zn (%) |
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Pb (%) |
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Au (g/t) |
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Cu (%) |
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Ag (Moz) |
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Zn (Mlbs) |
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Pb (Mlbs) |
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Au (koz) |
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Cu (Mlbs) |
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Proven |
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2.15 |
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320 |
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4.45 |
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2.21 |
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0.31 |
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0.09 |
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22.0 |
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210.3 |
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104.6 |
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21.6 |
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4.3 |
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Probable |
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3.21 |
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141 |
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4.27 |
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2.22 |
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0.20 |
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0.19 |
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14.6 |
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302.0 |
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157.5 |
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20.3 |
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13.6 |
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Proven and Probable |
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5.36 |
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213 |
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4.34 |
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2.22 |
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0.24 |
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0.15 |
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36.6 |
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512.3 |
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262.1 |
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41.9 |
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17.9 |
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2022 CLG Mineral Reserve Estimate as at December 31, 2022 (70% attributable basis)
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Reserve Classification |
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Mt |
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Ag (g/t) |
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Zn (%) |
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Pb (%) |
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Au (g/t) |
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Cu (%) |
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Ag (Moz) |
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Zn (Mlbs) |
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Pb (Mlbs) |
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Au (koz) |
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Cu (Mlbs) |
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Proven |
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1.39 |
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313 |
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4.34 |
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2.19 |
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0.32 |
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— |
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13.9 |
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132.6 |
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66.9 |
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14.1 |
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— |
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Probable |
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2.60 |
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204 |
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4.58 |
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2.12 |
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0.24 |
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— |
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17.1 |
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262.2 |
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121.2 |
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19.9 |
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— |
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Proven and Probable |
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3.98 |
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242 |
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4.50 |
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2.14 |
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0.27 |
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— |
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31.0 |
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394.8 |
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188.1 |
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34.1 |
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— |
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CLG Mineral Reserve Estimate Percentage Change from December 31, 2022 to December 31, 2023
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Reserve Classification |
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Mt |
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Ag (g/t) |
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Zn (%) |
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Pb (%) |
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Au (g/t) |
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Cu (%) |
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Ag (Moz) |
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Zn (Mlbs) |
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Pb (Mlbs) |
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Au (koz) |
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Cu (Mlbs) |
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Proven |
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55 |
% |
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2 |
% |
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2 |
% |
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1 |
% |
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(1 |
%) |
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— |
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58 |
% |
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59 |
% |
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56 |
% |
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53 |
% |
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— |
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Probable |
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24 |
% |
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(31 |
%) |
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(7 |
%) |
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5 |
% |
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(17 |
%) |
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— |
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(15 |
%) |
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15 |
% |
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30 |
% |
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2 |
% |
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— |
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Proven and Probable |
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34 |
% |
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(12 |
%) |
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(4 |
%) |
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4 |
% |
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(8 |
%) |
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— |
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18 |
% |
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30 |
% |
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39 |
% |
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23 |
% |
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— |
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(1) |
Mineral reserve estimates are reported on a 70% GSI attributable basis and exclude all mineral reserve material mined prior to the dates indicated. |
(2) |
Specific gravity has been assumed on a dry basis. |
(3) |
Tonnage and contained metal have been rounded to reflect the accuracy of the estimate and numbers may not sum exactly. |
(4) |
Values are inclusive of mining recovery and dilution. Values are determined as of delivery to the mill (point of reference) and therefore not inclusive of milling recoveries. |