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Wholly Owned Subsidiary

Pinguico Mine Project


The Pinguico Project is located 5 kilometers southeast from Guanajuato city, the property consists of two mining concessions (El Pinguico and 2ª Ampl. El Pinguico) for a total of 71 hectares.

The property has an approximate altitude of 2200 meters above sea level, and the terrain consists of gentle slopes and some abrupt terrain changes. Access is via the city of Guanajuato by land transportation. The nearest operating mines are El Cubo and Las Torres located 4.5 kilometers and 2.5 kilometers from the property respectively.

El Pinguico
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The Guanajuato Mining District is located on the border between the Mesa Central physiographic region and the Transmexican Volcanic Belt (Aranda-Gómez et al., 1989) of Mexico. Within the property there are Mesozoic rocks with low grade metamorphism; schistosity is associated with folds with northeast dipping axes. In the mine area there are mineralized normal faults of the Guanajuato Mining District.

On the property there exist different types and ages of lithologies: Esperanza Formation, Red Conglomerate, La Luz Formation and a sequence of volcanic rocks (Loseros Formation, Bufa Rhyolite tuff, Calderones Formation, Cedros andesite and Chichindaro Fm) (Carta geológico Minera Aldama F14-C53 SGM, 2002). Some authors suggest that the El Pinguico vein is a splay from the Veta Madre.


The mining history of Guanajuato dates back to the sixteenth century, when the Spanish conquerors started mineral explorations in the region in 1520. Between 1548 and 1554 silver was discovered in the area of the San Bernabé and Rayas. This discovery led to the settling of people in the area and the city of Guanajuato as a population center. Guanajuato was one of the premier mining districts of Nueva España (New Spain) at this time.

In 1548 the first silver vein, San Bernabé (La Luz), was discovered by a local mule driver. In these early years the silver ore was hand mined and transported by mule to Zacatecas to be milled.

In 1558 the first mine shafts were sunk at Rayas and Mellado mines, which led to the discovery of the famous Veta Madre Vein of Guanajuato. Today this vein runs along the hills that border the glen of Guanajuato in the north and northwest, marked by mines and shafts along its way. This discovery triggered an exploration rush that saw the discovery of the Valenciana, Tepeyac, Mellado, Cata and Sirena silver occurrences.

In 1771 large inventories of silver sulphides, mixed with ruby silver and native silver were discovered at Valenciana and the Valenciana Mine was estimated to be producing one-third of the world’s silver.

During the period of 1760 to 1810, the Guanajuato mines accounted for 30% of the entire Mexican production and 20% of the entire world’s output of silver

The first rich deposits on the property began to be exploited in 1904, a year after the former owner of the El Pinguico mine, Mr. Amado Delgado, transferred the mine to The Guanajuato Development Company, directed by Mr. C.W. Bryant and renamed it The Pinguico Mining and Milling Company. The mine was in production from the late 1800’s to 1913 and produced over 200,000 ounces of gold equivalent during this time (EMBSA, Proyecto El Pingüico, 2014) after a few years of operation, the mines closed due to the Mexican revolution.

In 1932-1933 an engineer Luis Frausto, carried out feasibility studies at the two mines El Carmen and El Pinguico, and according to his calculations, 75,000 tons metric tonnes of economic mineral was estimated with grades (in average) of 300 to 400 gr/t Ag and 4 to 5 gr/t of Au, in addition to some mineral shoots below level 8 (Meave, 1959). In the year 1944 Mr. Fernando Cueto Fernández reactivated the El Carmen-El Pinguico mine for a brief period.

In 1959 the governmental organization “Consejo de Recursos Minerales” (CRM, the Mexican Geological survey agency in 1959) made a topographic survey of the stockpile and also made a calculation of tonnes in the stockpile, and estimated a total of 103,415 tonnes of mineral only in the stockpile with an average grade of 3.2 gr/ton Au and 288 gr/ton Ag. The CRM also made a calculation of 4921 tonnes in situ, with an average grade of 5.4 gr/ton Au and 424 gr/ton Ag. EMBSA carried out a topographic survey of the stockpile in 2011 to make a comparison with the topographic survey of the CRM of 1959, and was able to verify (without presence of a QP) that there was no major mineral extraction of mineral from the stockpile since that year.

Vangold is treating the resources and reserves from the CRM report as historical mineral resources and reserves. The QP has not done sufficient work to classify the historical estimates as current mineral resources or reserves and Vangold is not treating the historical estimates as current. These historical estimates are not to be relied upon and Vangold will undertake future work to assess the potential in these areas.

In 2012, EMBSA asked the “Servicio Geológico Mexicano” (SGM, the Mexican Geological Survey agency) to make a (non-NI43-101) “reserve” certification and a topographic survey on the same stockpile as the CRM. The result were an average grade of 1.667 gr/ton Au and 167 gr/ton Ag, with SGM certified tonnage (non NI 43-101) of 25,600 tones and a potential of 96,828 tonnes in the total stockpile.


The El Carmen-El Pinguico Vein is considered part of the top of the Veta Madre Vein system, the main vein in the historic Guanajuato Silver District, and remains open a depth. The Veta Madre vein is associated with a mega fault that outcrops for 25 kilometers with an orientation of 135°/47°SW and is displaced in its middle part by the Amparo fault that moves it to the northeast.

The El Pinguico Vein is one of the most important veins of El Pinguico-Carmen Mine. This vein was emplaced fault/fissure zone with associated gold and silver mineralization. The average width of the vein system is 6.95 meters and has a maximum width of 12 meters.


The property is located in Guanajuato Municipality of Guanajuato State in Mexico and is centered near 20°58′ Latitude N, 101°13′ longitude W, at Universal Transverse Mercator coordinates 269530 E, 2320054 N (WGS84 datum, Zone 14) and on Mexican government 1:50000 map sheet Aldama F14-C53 (Figure 1).

The El Pinguico project covers an area of 71 hectares. The Project is located 6.5 kilometers to the southeast of the downtown of Guanajuato City and 1.8 kilometers to the southeast of Calderones community in the State of Guanajuato, Mexico.


VANGOLD hired FINDORE S.A. DE C.V. to take samples of the underground stockpile, to compare to the sampling done by CRM in 1959 and SGM in 2012 (all the field work supervised by the author). Vangold took these samples to initiate a due diligence review of the historical resource reserves and resources by comparing the historical sample results from the CRM and SGM studies.

A total of 57 samples from hand dug trenches in the stockpile in the same places (and where safety allowed) where there has been historical sampling in different years. The results of the sampling performed by VANGOLD were an average grade of 1.75 gr/ton Au and 183.58 gr/ton Ag
The results from the 2017 sampling program confirm the grades found by SGM (2012) as most of the individual sample results and the overall average grades a close in gold and silver values. There is a week bias in the results where the 2017 samples returned a slightly higher averaged value (1.75 g/t Au and 183.58 g/t Ag) than SGM samples (1.662 g/t Au and 167 g/t Ag).

The samples from the CRM (1959) study, show much higher gold and silver values than SGM or the 2017 samples, 3.2 g/t Au and 228 g/t Ag. The higher results in the 58 year old study may be correct as the stockpile may not have been so covered or diluted by falls of waste rock from the walls of the mine as they appear to be in 2017.