Deposit Type	High-sulphidation epithermal vein system
Location	San Juan Province, Argentina 177km SE of Copiapo, Chile; 264km NW of San Juan, Argentina Approximate latitude and longitude of the Lunahuasi discovery is 28.4196˚ S, 69.6226˚ W
Ownership	100% NGEX

Summary

Lunahuasi is a significant copper-gold-silver high-sulphidation epithermal vein deposit discovered by NGEx Minerals in 2023, and the most recent discovery in the emerging Vicuña District which encompasses the Caserones mine, and the Josemaria, Filo del Sol and Los Helados deposits.

The first ever drill program at Lunahuasi returned the highest grades encountered to date in Vicuña District, and to date only a very small portion of the 11 km² alternation zone has been tested, leaving significant additional exploration upside.

Location

The Lunahuasi project is located in the Andes Mountains of San Juan Province, Argentina, approximately 10 kilometres south of the Los Helados project located in the Atacama Region, Chile. The approximate latitude and longitude of the Lunahuasi discovery is 28.4196º S, 69.6226º W (decimal degrees, WGS84 datum).

Access to both Lunahuasi and Los Helados can be made via Copiapó, Chile, a driving distance of about 177 kilometres, or from San Juan, Argentina, a total driving distance of approximately 264 kilometres.

The property is in a high altitude dry to arid climate, which is characterized by low temperatures throughout the year, typically below 15˚C in the summer. Precipitation is almost always in the form of snow with most precipitation happening during the winter. The average annual precipitation is approximately 193 millimetres.

Exploration fieldwork is typically carried out from mid-October to early-May, although year-round operations would be possible with additional preparation.

Geology

The new discovery at Lunahuasi is situated in the central part of the Vicuña structural magmatic corridor, approximately mid-way between the Los Helados porphyry-copper-gold deposit 10 kilometres to the north, and the Filo del Sol porphyry-epithermal system 9 kilometres to the south. It occurs in a structurally complex area within the district where northeast-trending faults that are related to a deep-seated lithospheric-scale structure transect the dominant north-northeast trend of the Vicuña belt.

Drilling in early 2023 at Lunahuasi Bajo discovered a copper-gold-silver mineralized vein swarm within pre-mineral host rocks. Massive pyrite and enargite occur within mineralized structures that have siliceous cores, vuggy silica, and advanced argillic alteration. The veins are vertical to steeply subvertical and appear to trend primarily north-northwest, although additional work is required to fully understand their orientation, and analogy with similar deposits suggests there may be several orientations of mineralized structures. Where drilled to date, they have a true thickness to approximately 20 metres. Limited surface mapping suggests at least a one kilometre continuous trend to the vein system, although further work needs to be completed to adequately test the dimensions of the system.

The discovery area, Lunahuasi Bajo, is situated near the base of a steep east-facing slope at the head of the Rio Blanco valley. While the veins themselves display advanced argillic alteration, they are emplaced into propylitic altered wall rock. Upslope to the west, however, the alteration changes quickly to a thickness of 500 metres of sericitic alteration capped by advanced argillic alteration. The indication is that the new discovery is likely part of a much larger epithermal system with over 800 metres of vertical thickness to the west, above the new discovery, that is yet to be explored.

Exploration Potential

The mineralization at Lunahuasi was discovered in 2023. Six holes were drilled into the discovery zone, all of which had multiple high-grade intersections, and it remains open in all directions. The surface manifestation of the vein system has been mapped along a domain that is at least one kilometre long. Given the challenging terrain and limited time spent so far on the ground in the area, there remains excellent potential for expanding the system.

The vein system at Lunahuasi is part of an alteration system that is mapped as being at least four kilometres wide by six kilometres long. The Lunahuasi veins overprint porphyry-related propylitic alteration near the base of a steep slope with more than 800 metres of vertical relief. Exploration for similar style veins within the area immediately below the current drilled depth, as well as the entire thickness of rock below the advanced argillic and sericitic alteration to the west of the existing discovery remains wide open; almost a one kilometre thick package of rock.

The Lunahuasi vein mineralization is comparable in style and width with the mineralized veins at the El Indio deposit. At El Indio, however, there were also late-stage gold-quartz veins that carried gold grades. Gold grades in excess of 40 g/t were encountered in some of the mineralized structures at Lunahuasi and there is the possibility of a similar discovery.

In addition to the large area open to exploration for further high-sulphidation epithermal veins, the system is almost certainly linked to a porphyry copper centre. Alteration and geological relationships suggest that the porphyry system is likely to be lateral to, rather than underlying,the Lunahuasi veins, and it is suggested to be nearby. The potential for a third Miocene porphyry centre in the Vicuña belt is high, with Los Helados 10 kilometres to the north and Filo del Sol 9 kilometres to the south, all along the same structural corridor

Resource

A Mineral Resource estimate has not yet been established for Lunahuasi.

Metallurgical Testwork

No metallurgical test work has yet been conducted for Lunahuasi.

Ownership

NGEx has a 100% interest in Lunahuasi.

The Argentine Mining Code (AMC) sets out rules under which surface rights and easements can be granted for a mining operation, and covers aspects including land occupation, rights-of-way, access routes, transport routes, rail lines, water usage, and any other infrastructure needed for operations.

In general, compensation must be paid to the affected landowner in proportion to the amount of damage or inconvenience incurred. However, no provisions or regulations have been enacted as to the nature or amount of the compensation payment.

In instances where no agreement can be reached with the landowner, the AMC provides the mining right holder with the right to expropriate the required property.

History

The initial drill program in the Lunahuasi area was conducted in the 2022-2023 season, following surface exploration work and targeting in the later part of 2022. Prior to exploration by NGEx Minerals, there was no known history of any exploration activity in the Lunahuasi area.

The initial 2023 discovery hole, DPDH002, intersected multiple sulphide veins and massive to semimassive breccias, returning 60 metres at 5.65% copper, 2.04 g/t gold and 44.0 g/t silver, including 10 metres at 14.19% copper, 4.07 g/t gold and 94.0 g/t silver and 6 metres at 10.57% copper, 3.73 g/t gold and 80.0 g/t silver. During the maiden campaign, a total of six holes were drilled into the discovery zone, all of which had multiple high-grade intersections.

Based on the drilling results of the initial 2022-2023 drill program, a vein swarm with minimum dimensions of 570 metres east-west, 170 metres north-south, and 940 metres vertical was identified.