8/14/2019 Excellon Resources Gaining Momentum

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Chris HopkinsChie Financial OfcerExcellon Resources is a mineral resource

company operating in Durango and Za-

catecas States, Mexico. The Company is

producing silver, lead and zinc ore rom

high-grade manto deposits on its Pla-

tosa Property, strategically located in the

middle o the Mexican silver belt. It pro-

cesses this ore at its concentrator in the

town o Miguel Auza 220 km south o 

the mine and produces silver-lead and

silver-zinc concentrates, which are sold

under the terms o a long-term contract

to an international trader. Miguel Auza

hosts an indicated and inerred mineral

resource and was the site o consider-

able historic mining or silver, gold, lead

and zinc over the centuries. Chris Hop-

kins, Excellon’s CFO tells us more about

where his company is headed.

Excellon Resources GainingMomentum on Strong Cash Flow

Booth # 2107www.excellonresources.com

416.364.1130

Resource Intelligence: Can you give us a little his-tory on Excellon’s involvement in Mexico?

Chris Hopkins: Certainly, Excellon became involvedin Mexico in the early 1990s. It acquired thePlatosa property in 1996 and in 1998 enteredinto a joint venture on part o the property 

 with Apex Silver Mines Ltd. We began produc-tion in 2005. In June o last year, the Company completed the acquisition o all the outstand-ing common shares o TSX-listed Silver EagleMines Inc. or a purchase price o $5,488,722

comprised o $3,370,000 in common shares and

$1,200,000 in net cash payments or transactioncosts. e purchase included Silver Eagle’s Mex-ican assets, in particular its Miguel Auza mineand newly expanded 650 tonne per day mill. Webegan processing Platosa ore at Miguel Auza inMarch 2009 while acquisition negotiations wereunderway. e mine has been on care and main-tenance since December 2008.

 Another important 2009 development was thepurchase o the re-maining 49% jointventure interest ina large portion o the Platosa Prop-erty rom GoldenMinerals Com-pany, (successorto Apex Silver) orUS$2.0 million in

cash and a 1% NetSmelter Returnsroyalty.

On December 10,2009 we reportedthat the PlatosaIndicated Mineral Resource has increased toa total o 579,000 tonnes grading 909 g/t (27oz/T) Ag, 9.09% Pb, and 10.51% Zn (as at Oc-tober 31 2009), up nicely rom 396,000 tonnesgrading 986 g/t (29 oz/T) Ag, 9.00% lead, and10.10% zinc (as at February 3, 2008). e In-erred Mineral Resource also increased rom

72,700 to 160,000 tonnes at a somewhat lowergrade than that o 2008.

RI: So what are the details on your Platosa Prop-erty?

CH: Platosa is located in the northeast corner o the State o Durango, Mexico approximately 45 km north-northwest o the city o Torreon,Coahuila State, where the largest silver, zinc, leadsmelter and refning complex in Mexico is locat-ed. e Property consists o 71 contiguous min-ing concessions covering a total area o 24,065hectares. It is nominally divided into three areas

based on underlying agreements and/or conces-sion ownership:

• Excellon 100%/Golden Minerals Royalty  Area: is area comprises 46 concessions total-ling 10,118 ha. It contains the Platosa mantos,current Mineral Resources, and Platosa Mineplus the surrounding area, which prior toNovember 2009 had been held in Joint Ven-ture with Apex Silver Mines Limited (Apex).In November 2009, Apex’s successor GoldenMineral Corp. sold to Excellon its interestin the ormer Joint Venture concessions orUS$2,000,000 and a 1% Net Smelter Returnroyalty.

• Altiplano Area: is area comprises 20 conces-sions owned by Excellon totalling 11,076 ha.ese 20 concessions are subject to a 3% NSRpayable to Exploraciones de Altiplano, S.A. deC.V., a private Mexican company.

• Others: is area comprises fve concessions

totalling 2,870 ha. ey are owned 100% byExcellon and are not subject to any underlyingagreement or royalty.

In addition we ownor lease 1,841 ha osurace rights.

RI: And what are youdoing there now?

CH:   We’re contining to drill and ex-pand our resources

at Platosa. On Janu-ary 14, 2010 we an-nounced assay resultsor thirteen addition-al drill holes, mosto which intersected

high-grade massive sulphides. Hole LP708 cut3,300 g/t (96 oz/T) Ag, 11.8% Pb, 0.13% Znover 1.15 metres (m) and hole EX09-LP692intersected 1,470 g/t (43 oz/T) Ag, 4.9% Pb,7.3% Zn over 1.77 m. Both represented exten-sions to the 623 Manto, which as reported in thepress release dated December 10, 2009, has anIndicated Mineral Resource o 62,000 tonnesgrading 1,183 g/t (34 oz/T) Ag, 10.27% Pb and8.52% Zn. Our 2010 drilling program has threedrills working in the vicinity o the mine explor-ing or extensions o existing sulphide bodies andor new ones based on targets developed usingboth geophysical techniques and geological dataand modeling developed during our several yearso drilling in the area. A ourth drill will probetargets in the Saltillera/Zorra area fve kilometres

 west o the mine where we continue to see thepotential or a large-tonnage proximal carbonatereplacement deposit (CRD).

RI: e acquisition o the Miguel Auza Propertyhas made an important addition to your holdingsand capabilities. Can you ocus on that a little?

CH: Certainly. e Miguel Auza Property is alarge property with great potential or the dis-covery and exploitation o additional epithermalsilver/gold, lead and zinc veins similar to thosethat have been worked so proftably or decadesin the Fresnillo camp, 150 km to the south as

 well as elsewhere in the Mexican Silver Belt. Italso presents evidence o a potential carbonatereplacement deposit (CRD) which could be veryimportant. Although mining has taken place in

“We have world class

exploration upside and

exposure to silver, lead

and zinc prices through

the highly proftable op-

erations at Platosa.”

~ CFO Chris Hopkins

8/14/2019 Excellon Resources Gaining Momentum

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Excellon Resources- Continued

Booth # 2107www.excellonresources.com

416.364.1130

the camp since the 1500s very little systematicmodern exploration has actually been carriedout and the historic data record is almost non-existent. Silver Eagle ocused on developing theCalvario Vein system and only began a con-

centrated review o the potential o the overallproperty shortly beore ceasing activities. Sev-eral additional vein systems are known includingthose exploited by the Spaniards, and the prop-erty remains largely under-explored. We beganan initial exploration program on the property inthe all o 2009. Its ocus is on determining i portions o the Calvario Vein system can be ex-ploited economically and whether other areas o the large property warrant concentrated explora-tion eorts.

ere was a small otation mill on the prop-erty when Silver Eagle acquired it, which was

expanded and used to process oxide material asSilver Eagle developed the King Ramp and thesulphide portion o the Calvario Vein system.Further expansion and modernization took placeduring 2008 and it processed Calvario sulphidemineralization or three months until mid-De-

cember 2008. We began shipping our Platosa oreto the mill in mid-March 2009.

RI: So you are shipping all your Platosa ore to theMiguel Auza mill?

CH: Yes, and since mill capacity is greater thanproduction rate at Platosa the mill operatingschedule is set to match shipments and have athroughput rate that maximizes metallurgical re-sults. For the mid-March to December 31, 2009period throughput averaged 280 tonnes per oper-ating day and was as high as 375 tonnes per day.

 A total o 57,902 tonnes o Platosa ore grading994 g/t Ag, 8.04% Pb, 8.81% Zn were processedduring that period. Recoveries averaged 80% or

 Ag reporting to the Pb concentrate, 9% or Agreporting to the Zn concentrate or a total o 89% Ag recovery. Pb recovery averaged 74.0%

and Zn recovery 68.0%. Concentrate productiontotalled 5,733 tonnes o silver-lead and 6,656tonnes o silver-zinc.

RI: In summary, why should investors considerExcellon or their portolio?

CH: Excellon is a well-established operator in thehigh-grade mining business in Mexico. We haveassembled very large land positions, which haveseen considerable historic production and as

 well, hold the potential or signifcant discoverieso much larger resources. We are well undedexpect to generate over $45 in revenues in fsca2010 with greater revenues expected as produc-tion increases in the uture. We have world classexploration upside and exposure to silver, leadand zinc prices through the highly proftableoperations at Platosa. is sel-unded explora-tion play provides investors with great potential

 without the risk o a pure exploration companyExcellon is an established operator.

Milestones:• Continue exploring the large

under-explored, strategicallylocated properties at Pla-tosa with a $12 million budgetdevoted largely to diamonddrilling

• Develop drilling targets atMiguel Auza with a modestbudget of close to $1 million.

• Increase the mining capacity atPlatosa and continue process-ing ore at the Miguel Auza mill

• Continue to operate Platosaon a sustained and consistentbasis generating strong cashows.

• Continue multi-tooled, focusedexploration to increase MineralResources at Platosa

• Conrm indications of large-scale mineralization on bothour properties

• Evaluate additional strategicacquisition possibilities

Main underground pump station at the 100 metre level