El Castillo

Latest Updates

48,311

GEOS PRODUCED IN 2018(1)

66,509

GEOS PRODUCED IN 2019(1)

46,183

GEOS PRODUCED IN 2020(1)

48,861

GEOS PRODUCED IN 2021(1)

(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 2009

El Castillo Mineral Resources at DECEMBER 1, 20211

Mineral Resource Category Tonnes (millions) Grade (g/t Au) Contained Au Ounces (000s)
Measured 1.3 0.46 19
Indicated 30.0 0.35 332
Inferred 3.5 0.30 34

El Castillo Mineral Reserves at DECEMBER 1, 20212

Mineral Reserve Category Tonnes (millions) Grade (g/t Au) Contained Au Ounces (000s)
Proven 0.3 0.49 4
Probable 9.4 0.39 118

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 El Castillo Mineral Resource 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 El Castillo 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.


Overview

The El Castillo Complex is comprised of the El Castillo Gold Mine and San Agustin Gold/Silver Mine. The El Castillo Complex mining concessions are located in the municipality of San Juan del Rio in the central part of the State of Durango, Mexico approximately 100 km north of the city of Durango.

The El Castillo project, which consists of an open pit gold mine, two crushing facilities, two cyanide heap leach pads, two gold recovery plants, and associated support infrastructure, is located on seven mining concessions totalling approximately 2,045 hectares (ha), and on land where surface rights are owned by Argonaut. The gold mine commenced construction and operations in 2007 with commercial production reported in 2008. With a $15 million investment in the infrastructure of the property, the production profile was brought up to a 72,000 ounce run rate by Q4 2010, within just one year of acquiring ownership of the company.

El Castillo

The El Castillo property lies in the Altiplano Sub-province of the Sierra Madre Occidental (SMO) region of Central Mexico. The SMO represents an island arc assemblage of early Mesozoic age rocks comprised of metamorphosed, deep-water sediments and island arc volcanics. The Mesozoic rocks are overlain in - 13 - places by lower Tertiary andesites and rhyolites. The oldest rocks in the El Castillo Mine area are Cretaceous flysch-sequence sediments that correspond to the upper member of the Mezcalera Group. These consist of arenites, shales and thin-bedded limestone dipping moderate to steeply to the northeast with local zone folding. Mineralization at El Castillo is hosted in both Mezcalera Group sedimentary rocks and porphyry intrusives. Gold occurs in fracture-controlled quartz stockworks and as disseminated mineralization. Alteration consists primarily of quartz-sericite-clay (phyllic) overprinting zones of chlorite-epidote alteration (propylitic). Some secondary biotite – K feldspar alteration (potassic) has been identified in the deeper parts of the system. Mineralization is associated with pyrite and relatively minor chalcopyritesphalertie-galena-arsenopyrite-tetrhedrite. Oxidation has oxidized the sulphide and base metal minerals to depths as deep as 300 metres, leaving free gold in hematitic oxides. The conglomerate and rhyolite have been drilled extensively to the west of the existing El Castillo pit and have been found to be unaltered, unmineralized and exist as post mineral cover to underlying gold mineralization.

El Castillo

The El Castillo Mine, which was formerly called El Cairo, was a grass roots discovery that resulted from a regional exploration program initiated by Battle Mountain Gold while exploring for bulk tonnage, disseminated gold deposits.

Battle Mountain Gold completed 207 RC drill-holes and six diamond core holes (drilled as twins to six of the RC holes) within the El Castillo Mine area. Battle Mountain Gold completed a resource estimate, scoping study, preliminary mine plan and reserve estimate that indicated the potential for a viable mining operation.

Morgain Minerals Inc. took over the project. Its exploration work included completion of six twin diamond drill holes, and 136 RC drill holes.

Castle Gold Corporation, as successor to Morgain Minerals Inc., began its work and changed the project name from "El Cairo" to "El Castillo" in reference to a nearby rock monument of the same name. Castle Gold's work included additional sampling and completion of 21 shallow, close-spaced air-track drill holes in the mining area to up-grade near surface gold resources.

Castle Gold Corporation's work combined with previous work by Morgain Minerals Inc. and Battle Mountain Gold were the basis for a preliminary reserve estimate by A.C.A. Howe International Limited dated January 31, 2008.

The El Castillo Mine sold its first gold in September 2007 from heap leaching begun the previous July. The El Castillo Mine completed the commissioning of commercial production in July 2008 as an open pit/heap leaching operation.

Acquired by Argonaut Gold in December 2009.

Produced an estimated 566,711 ounces of gold as of January 1, 2018. Of this production, Argonaut has produced 520,923 ounces of gold since taking ownership of the El Castillo Mine in 2009.

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: