San Agustin

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(1)Gold equivalent ounces ("GEO” or “GEOs”) are based on a conversion ratio of 70:1 (2018), 75:1 (2019), 80:1 (2020) and 85: 1 (2021) for silver to gold. The conversion ratios are based on three year trailing average silver to gold exchange ratio.

Key Facts
Location Durango, Mexico
Ownership 100%
Status Operating Mine
Mine Type Open Pit
Metals Gold & Silver
Acquisition December 2013

San Agustin Mineral Resources at december 1, 20211

Mineral Resource Category Tonnes (millions) Grade (g/t Au) Grade (g/t Ag) Contained Au Ounces (000s) Contained Ag Ounces (000s)
Indicated 60.0 0.27 7.6 531 14,766
Inferred 94.0 0.46 14.1 1,380 42,774

San Agustin Mineral Reserves at DECEMBER 1, 20212

Mineral Reserve Category Tonnes (s) Grade (g/t Au) Grade (g/t Ag) Contained Au Ounces (000s) Contained Ag Ounces (000s)
Probable 33.2 0.32 9.1 336 9,742

Mineral Reserves and Mineral Resources have been estimated as at December 31, 2021 in accordance with NI 43-101 as required by Canadian securities regulatory authorities. Mineral Resources are presented inclusive of Mineral Reserves. Numbers may not sum due to rounding.

(1)Notes to accompany the San Agustin Mineral Resources table:
The M&I Mineral Resources and Inferred Mineral Resources for El Castillo and San Agustin, which together form the El Castillo Complex, set out in the above table were based on pit cones using $1,800 per ounce gold and $24.00 per ounce silver. Cut-off grades range from 0.07 g/t Au to 0.48 g/t Au for El Castillo and 0.11 to 0.42 g/t AuEQ for San Agustin, depending on ore type.

(2)Notes to accompany San Agustin Mineral Reserves table:
The Mineral Reserves for El Castillo Mine and San Agustin Mine set out in the above table are based on updated models, mine plans and topography, including depletion through mining activities and changes to recovery and cost assumptions as of December 31, 2021. El Castillo used a gold price of $1,650 per ounce; San Agustin used a gold price of $1,500 per ounce and silver price of $20.00 per ounce. Cut-off grades for El Castillo range from 0.10 g/t Au to 0.24 g/t Au depending on ore type; cut-off grades at San Agustin were 0.16 g/t AuEQ.


The San Agustin property consists of four mineral claims totalling 1,065 ha and is located in the northern San Lucas de Ocampo Mining District. The main part of the San Agustin property is composed of two concessions acquired from Silver Standard Resources Inc. (Sliver Standard) in December of 2013. In December of 2013 the San Agustin Project was purchased by Argonaut from Silver Standard. Argonaut began mining operations at the San Agustin property in February of 2017, pouring gold and silver doré in September of 2017, and commencing commercial production in October of 2017.

San Agustin

The San Agustin property is located approximately 10 kilometres southwest of the El Castillo Mine so the regional geology described at El Castillo is very applicable. The oldest rocks in the San Agustin area are Cretaceous siltstones, sandstones and limestones. These rocks are unconformably overlain by a thick sequence of Tertiary volcanic rocks comprised of older andesites and younger pyroclastic dominated rhyolites. A dacite dome complex and associated hydrothermal breccias host the majority of the Mineral Resources at San Agustin. The dacite is poorly exposed and typically forms areas of low relief. The deposit has an oxide zone from surface that averages approximately 60 metres deep.

San Agustin

The immediate area of the San Agustin property has a documented exploration history of about 30 years. A few small adits, shafts and pits focusing on narrow veins are situated throughout the San Agustin Mine area but no commercial production took place prior to Argonaut’s ownership.

Monarch Resources Ltd. ("Monarch") acquired 4,800 hectares in the San Agustin area including the current claims. Its surface work defined a distinct gold anomalous zone over a 1.5 square kilometre area.

Monarch carried out a Phase I drilling program consisting of 35 RC drill holes totaling 3,703 metres and four diamond drill holes totaling 1,002 metres.

An additional 29 RC holes totaling 5,651 metres were completed.

Monarch abandoned the property.

In December, Silver Standard Resources Inc. ("Silver Standard") located the current San Agustin claims.

After an extensive mapping and sampling program, Silver Standard completed an RC drilling program consisting of 23 holes totaling 3,917 metres. Most of this work was focused in better defining mineralized areas originally identified by Monarch.

In August, Silver Standard optioned the San Agustin property to Geologix Explorations Inc. ("Geologix"). Its work included drilling of 40,717 metres in 176 core holes.

In February, Geologix returned the San Agustin property to Silver Standard.

In December, Argonaut purchased the San Agustin property from Silver Standard.

In early 2014, Argonaut initiated a drilling campaign designed to better define the San Agustin resource area that was partially outlined by previous operators. By mid-2014, Argonaut had completed 24,765 metres in 240 RC holes and 999 metres in 13 core holes. The core holes were used for metallurgical testing and twinning of RC holes. Subsequent to this resource drilling a Phase 2 program totaling 5,277 metres in 31 RC holes was completed. This wide-spaced Phase 2 drilling was mainly positioned along the Northwest Trend and was designed to help identify the overall resource potential on the property. Starting in late March and continuing into early July of 2015, an additional 35 RC drill holes totaling 4,179 metres were completed with most of this positioned within the Northwest Trend. The Phase 2 drilling in 2014 and 2015 was successful in expanding the deposit potential.

Argonaut commenced construction on the San Agustin Mine during November.

The San Agustin Mine poured its first gold during September 2017 and achieved commercial production during October 2017.

Argonaut Gold has a strong operating history of delivering profitable production from low grade, heap leach mines. The grade at the El Castillo Complex often runs 0.3 to 0.4 grams per tonne gold. Yet, due to a relatively low strip ratio and good leach kinetics, we are able to operate efficiently and profitably.

Technical Reports

El Castillo:

San Agustin: