Salave Gold

Project Overview

Black Dragon Gold Corp. (TSX-V:BDG, FWB: BCD) has implemented a strategic structural changes including a new Board of Directors and management team to aid in the development of its 100% owned Salave Gold Project in Asturias (northern Spain).

The project is comprised of five mining concessions and associated extensions covering 662 hectares and an investigation permit covering another 2765 hectares. Drilling to date totals 67,508m in 440 holes (245 diamond drill holes) and metallurgical tests indicate gold recoveries over 90% are possible.

Location and Infrastructure

Spain has a long history of mining, particularly in northern Spain, as well as strong support industries. As a political and economically stable member of the EU, civil law jurisdiction reigns which makes it good for business, with an educated labour force and excellent heavy engineering and mining skills.

There is great infrastructure in and around the project, making this location ideal.

  • Local towns have capacity to supply services and skilled workers
  • Sealed road access to the site for staff and equipment
  • Capital of the province, Ovideo is nearby and has an airport
  • Power Supply within 2 kilometers of the mine site
  • Two ports in close proximity for the export of concentrate

Geology & Resources

Deposit Type

  • Intrusion related, sheer zone hosted gold deposit
  • Similar to other intrisions related gold deposit models including Fort Knox, Pogo and Donlin Creek in Alaska and Telfer and Boddington in Western Australia

Mineralization

  • Granodiorite and metasedimentary rocks along granodiorite contact in a NE trending, 350m wide shear zone
  • Associated with pyrite, arsenopyrite, stibnite and minor base metals
  • > 70% of the gold is refractory and associated with arsenopyrite and/or pyrite

Positive Metallurgy Testwork

> 90% recovery from previous test work based on:

  • Crushing
  • Conventional grinding to 80% passing 75 microns
  • Bulk flotation
  • Concentrate marketed and shipped out of country

Resource Statement

NI43-101 resource base for underground mine

Cut-offMeasuredIndicatedMeasured + IndicatedInferred
TonnesAu g/toz AuTonnesAu g/toz AuTonnesAu g/toz AuTonnesAu g/toz Au
2.0514,0005.8797,0006,008,0004.39847,0006,522,0004.51944,0001,078,0003.05106,000
2.5409,0006.8189,0004,338,0005.21727,0004,747,0005.35816,000631,0003.6374,000
3.0338,0007.6583,0003,257,0006.04632,0003,595,0006.19715,000378,0004.2452,000
5.0191,00010.5665,0001,251,0009.68389,0001,442,0009.80454,00069,0006.8915,000
7.0129,00012.7853,000704,00012.66286,000833,00012.68339,00022,0009.307,000
10.078,00015.6740,000387,00016.22202,000465,00016.13242,0006,00012.692,000

Notes:

  • Rounding may cause apparent discrepancies
  • Resource estimate conducted by Mine Development Associates, Inc., with an effective date of October 7, 2016 and supported by the amended technical report dated January 31, 2017
  • Mineral resources that are not mineral reserves do not have demonstrated economic viability
  • The quantity and grade of reported Inferred Mineral Resources in this estimation lack sufficient geological evidence to verify the geological, grade or quality continuity required to define these Inferred resources as an Indicated or Measured resource. It is reasonably expected that the majority of the Inferred resources could be upgraded to Indicated mineral resources with continued exploration.

The resource cut-off grade of 2.0 g/t Au was chosen to capture mineralization that is potentially amenable to underground mining, sulfide concentration, and gold recovery using off-site processing. This cut-off grade was selected based on a gold price of US$1,300 per ounce, a gold recovery of 92%, a mining cost of US$50 per tonne, a processing cost of US$18/tonne, and a G & A cost of US$6/tonne. The reported resources occur in bodies of sufficient size and continuity to meet the requirement of having reasonable prospects for eventual economic extraction. Due to the necessity to maintain a surficial crown pillar in a potential underground operation, all material from the present surface to a depth of 40 meters is not included in the Salave resources.

History of Salave

Gold mining in the vicinity of Salave and other areas in Asturias dates to the Romans in the first century AD, Romans. 2 to 6 million tonnes of material mined in that period with recovery of an estimated 5,000 to 7,000 kilograms of gold.

In the 1940’s quartz veins were mined in shallow underground drifts to extract molybdenum

Modern exploration in the late 1960’s recognized the Salave area as a prospective mineral area with Northgate Exploration Limited, Rio Tinto, Goldfields South Africa, Anglo American Corporation of South Africa Limited and related Charter Consolidated P.L.C. (collectively referred to as “Anglo”); Oromet Joint Venture (“Oromet”); Empresa Minera Newmont Inc. San Diego Gold Minery, S.A and Rio Narcea Gold Mines, Ltd. (“Rio Narcea”).

From Northgate drilling in 1970-1971 through to Rio Narcea in 2004-2005, at least 325 core holes and 139 percussion/reverse circulation (“RC”) holes were drilled on the property; this historic drilling totaled 65,965.5 meters.

Astur acquired the Salave property in 2010. Since December 2011, Astur Gold Corp. has drilled 3,031 meters in infill drilling to upgrade the resources in preparation for the completion of a feasibility study.

BDG: TSX-V $0.04
CDC: FWB €0.02
Gold: $1281.75