Equus Mining Ltd Well Set to Become a Self-Funded Au-Ag Explorer

History and projects
Equus Mining has a long history with Chile, initially focused on copper and coal tenements before acquiring the Los Domos gold-silver project in 2016, adjacent to the Cerro Bayo mine. In 2019, the company executed an agreement with TSX-listed Mandalay Resources (TSX:MND) for a three-year option to acquire all of the mining properties, resources and infrastructure at the Cerro Bayo project in exchange for 19% of Equus’ share capital at the time of the exercise and a 2.25% NSR on production from the Cerro Bayo mining claims, subject to a re-purchase option in favour of Equus. Throughout the Cerro Bayo mining property, there are nine historical mines which, between 1995-2017, produced approximately 0.65Moz Au and 45Moz Ag, with average grades of 2.81g/t Au and 196g/t Ag. The acquisition, which has now been completed, delivers a fully operational 0.5Mtpa processing plant currently processing low-grade stockpiles at a rate of about 40kt per month with an expansive 295km2 mining claim package hosting current Inferred Mineral Resources of 302k Au equivalent at 2.5g/t Au equivalent (Taitao Pit) and; numerous prospective brownfields and greenfields exploration targets. Since recommissioning the 0.5Mtpa plant in February 2021, Mandalay has processed 311kt of ore at an average head grade of 0.52g/t Au and 29g/t Ag and generated net income for the nine months to September 2021 of US$4.276mn. Equus is evaluating the potential for future higher-grade feedstock for the plant based on the Taitao Inferred Resource, the remnant resource at the Marcela Mine and potential extensions to mineralisation adjacent to the numerous other historic mines throughout the project area.

Funds in hand to advance exploration and resource evaluation
In tandem with the Cerro Bayo acquisition, Equus has raised $3.304mn, before costs, in a share placement at $0.17/share to institutional and existing shareholders and undertaken a one-for-20 share consolidation. The company intends to use the funds from the raise to advance exploration and drill test a vast number of targets and for working capital. These targets include potential resource extensions at depth and along strike at the Taitao Pit; the Pegaso targets host potential extensions over a cumulative 3.5km length along trend from high-grade historic mines located 2km from plant infrastructure; and the Droughtmaster prospect which is a newly generated target located 12km south-east of the processing plant. Drill results from Pegaso received to date include 1.66m @ 2.88g/t Au and 152.25g/t Ag (5.22g/t Au equivalent) from 189.02m, and 2.77m @ 1.09g/t Au, 262.34g/t Ag (5.14g/t Au equivalent) from 55.95m. Droughtmaster drill results to date include 3.81m @ 20.4g/t Au and 55.5g/t Ag (21.25g/t Au equivalent) from 109m and 3.0m @ 9.17g/t Au, 172.9g/t Ag (11.83g/t Au equivalent) from 68.75m.

Look to other precious metals explorers for peers
Precious metals explorer peers with a similar market capitalisation and/or focused on gold equivalent opportunities include Australian Gold and Copper, Austral Gold, Canterbury Resources (also a RaaS client), and Tesoro Resources. Equus’ access to cashflows from the Cerro Bayo processing plant will, however, be a strongly differentiating feature for this company. We expect the peer group to evolve over time as Equus progresses its development options.