Aztec Minerals (TSX-V: AZT)(OTC: AZZTF) CEO Simon Dyakowski on Hitting High-Grade Near Surface Oxide Gold at Cervantes

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Aztec Minerals, Mr. Simon Dyakowski. Simon, how are you? Great having you back on.

Simon Dyakowski: I'm doing well. Thanks for having me on today, Gerardo. Big day for us in terms of news. We have our first drill result out of our Cervantes JV, which we've been drilling now for the better part of the last two months.

Gerardo Del Real: Let's get right into it. Look, there was a four year drilling pause at Cervantes. This is a project that I've always liked. Starting a first set of results with 88.4 meters of 1.1 grams per tonne gold from 22.9 meters, is a heck of a way to start putting results out to the market. Gold looks like it's firming up a bit. We talked a bit off air. I believe that we're close to seeing that psychological turn, once we breach that $2,000 price target. And if you continue delivering these types of results on this project in Sonora, Mexico, I think it's going to get the attention of the market. Certainly a tepid response today, but again, it doesn't take much for the market to turn. Can you give us a little bit of context on these results?

Simon Dyakowski: Absolutely. So, as you pointed out, it has been a four year drilling hiatus. We did a substantial core drilling program as a first pass back in 2017 and early 2018, and it was a very successful campaign. Where we focused on is the zone known as California. And it's about a kilometer long mountain ridge line, where in our initial drilling, we drilled a fence pattern, so along the top of the ridge line, and it was very successful. The headline intersection there was 160 meters at 0.77 grams gold. Most of this is oxide gold, so we think it's an oxide gold cap to what could be a much larger porphyry system. Now, we haven't had a chance to follow up on that drilling until late 2021, and that's largely driven by the fact that we drilled Cervantes initially during a real lull in the gold market.

I mean, investors now are forlorn with $1,800 gold, but when we had the results in 2018, gold was around $12 to $1,300. So it was not a great time to be drilling, but we did make a great discovery. So we've now refocused on doing a big step out and infill campaign, and we've announced the first result today. So this is hole one. We hit a nice high grade zone within a much broader 88.4 meter interval of 1.1 grams gold, most of that in oxides near surface. And this is a step out to the northwest of the main mineralized California zone. And bearing in mind that we have 20 holes to report still on this, it's a great start. We've now drilled two, what we call fence patterns, one north of that initial setup of 2018 and one south.

So we'll have some good width to this California zone. We've also extended the strike hole 19, which was recently finished. It's about a hundred meters east of the furthest extended drilling. So it's really shaping up to be a nice sized target here and excited to have a very consistent first drill hole here in line with what we drilled back in 2018. And in fact, it actually would be, I think, the second best drill hole, if you compare it to the 2018 drilling. So a great start where we're excited to just really remind the market of what the potential of heap leach gold is in Sonora. It's an area that has established heap leach gold production, some very famous mines, and most of them actually operated by Canadian companies. La India, which is Agnico Eagle. You have Mulatos which is Alamos Gold, and then Argonaut has La Colorada to our west. And then Minera Alamos more recently has started up. Santana, they're ramping into commercial production. And finally Osisko Development, even closer to us. They are working off the San Javier deposit. So a great area to be working in, and fresh discovery hole.

Gerardo Del Real: Obviously every company you just mentioned has a market cap much, much bigger than yours. What's the current market cap at, Simon?

Simon Dyakowski: Last I checked, it was 17 and a half million dollars. We've had a little bit of a bump today, but obviously, we think there's a lot more potential for the project. So, we're still in that microcap zone, but we're confident in this project. Historically, other companies that have had results like these have over time with continued step outs and demonstration of size, re-rated quite rapidly. And obviously some of them have been acquired. Agnico Eagle buying Grayd in 2011 is obviously the highlight. They got an all cash takeout bid of $2.80 per share on about a hundred million shares out in 2011 for just over a million ounces of gold and around an average grade of 0.88 grams. So these projects can command a premium once they're proven out.

Gerardo Del Real: And you're testing four main targets, right? That was the goal with this phase two drilling program. Is that accurate?

Simon Dyakowski: Yes, we're testing four targets, but really the bulk of the drilling, I'd say 90% of it, is at the California zone. So we do have an additional drill hole at Jasper. And then we did put some drills into Purisima East, which is a bit of a puzzle for us. They did return anomalous results. So our real focus going forward will be at the California zone. And of course, I'd be remiss to not mention California Norte, which is a 350 meter step out to the north, which, if it shows continuity would be very, very positive, but waiting patiently for those results that was drilled later on in the program.

Gerardo Del Real: You've had preliminary metallurgical tests done on this California zone. And I believe the bottle roll test recoveries ranged from 75% to 87%. Are you contemplating further met work?

Simon Dyakowski: So the initial met work was very positive. And what I'll highlight in that analysis, that even the sulfide, we were seeing about 50% gold recovery out of the sulfide. So, that's a very strong indication of the leachability of this rock. In terms of follow up met work, that will come upon more drilling. I think, with what we've seen so far, this is going to require or deserve a much, much bigger look, once we have the results of this program in hand and summarized. So I think more drilling will be the next step. And then we'll look to do this further economic studies as we move along.

Gerardo Del Real: Simon, heck of a start. Congrats. Appreciate the time, and obviously with assays pending, I'm looking forward to having you back on. Thanks again.

Simon Dyakowski: Thanks for the time. Have a great day.

Gerardo Del Real: All right. Chat soon.

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