Introduction

New Pacific’s flagship property is its Silver Sand project in Bolivia. New Pacific acquired 100% interests of Minera Alcira S. A. (“Alcira”), the owner of the Silver Sand project in July 2017.

Alcira has six silver-polymetallic mineral properties in Bolivia. The most significant property is the Silver Sand Property located in the Potosí Department, which has been subjected to some small-scale, historic mining since the Spanish colonial time in mid-1500’s. The other five are early-stage exploration projects, which have either been subject to limited small-scale mining or historical drilling.

 
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Location and Access and Mineral Concessions

Approximately 4,050 m above sea level, Silver Sand is located in approximately 25 km northeast of the world-famous Cerro Rico silver and base metal mineral system near Potosi. Access is relatively easy with a road distance of 54 km to Potosi, of which 27 km are paved road, the Bolivia National Highway 5. The rest is year-round gravel road for mining purpose of the Colavi mining district. (Location Map)

Silver Sand mineral property originally consisted of 17 Temporary Special Authorizations (ATE’s) for a total area of 3.17 square kilometers. According to the new Mining and Metallurgy Law 535 enacted in May 2014 in Bolivia, all ATE’s must be consolidated to new 25 hectare-sized concessions called “Cuadriculas”, and must be converted to Mining Administrative Contracts with Jurisdictional Administrative Mining Authority (Autoridad Jurisdiccional Administrativa Minera, “AJAM”). New Pacific submitted to AJAM all required documents for the consolidation and conversion through its wholly owned subsidiary Minera Alcia S.A. in February 2018, and currently the consolidation and conversion has been initially approved by AJAM, and the process is expected to complete with approval by Bolivia national legislative body by the end of 2019 or early 2020. The core area of Silver Sand property will be expanded to five square kilometers consisting of twenty Cuadriculas after the consolidation. In addition, New Pacific acquired 100% interests of a local private miner who owned two mineral concessions for an area of 1.75 square kilometers about three kilometers to the north of Silver Sand in July 2018.

New Pacific, through its wholly owned subsidiary Minera Alcira S.A., entered a Mining Production Contract (“MPC”) with the Bolivian Mining Corporation (“COMIBOL”) in Potosi, Bolivia on January 11, 2019. The MPC covers 29 ATE’s and 201 Cuadriculas are owned by COMIBOL, for a total area of about 57 square kilometers surrounding Silver Sand core area. Therefore, New Pacific has full exposure to the district potential of silver mineralization in a broad area of more than sixty square kilometers.

Location of Silver Sand Project

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Regional Geology and Mineral Concessions

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History

Silver Sand Property is one of the earliest mineral discoveries in Bolivia, before the discovery of Cerro Rico in the mid-1500’s, made by Spanish Colonials. Silver was mined at Machacamarca, the core area of Silver Sand Property by Spanish Colonials since the early 16th century until the end of 19th century. Thereafter, tin was mined from Colavi and Canutillos during the Tin Baron period and until the time of the tin price crash in 1985. There are widespread small mine workings, artisanal mining dumps and numerous abandoned miners’ villages in the Property. Currently there still are some small active mining activities in the district.

The previous owner had a limited amount of exploration carried out at the Property during the period 2012 through 2015, including simplified surface geological mapping, chip sampling and minor diamond core drilling.

Geology and Mineralization

Silver mineralization is hosted by zones of sheeted veinlets, stockwork veinlets, crackle veins and breccia zones in brittle fractures in quartz arenites or sandstones of the Cretaceous La Puerta Formation which were bleached white due to sericite alteration of original reddish sandstones. Hydrothermal fluids carrying metals were likely sourced from the nearby dacitic intrusions and subvolcanic rocks of Miocene age. The hosting fracture zones of mineralization are mostly striking NNW and subvertical or slightly dipping west at high dip angles. Above the brittle quartz sandstone units of La Puerta Formation is the dark reddish siltstone and mudstone unit of Tarapaya Formation of Cretaceous age. Mineralized fracture zones are developed near the contact of the two formations but within the underlying brittle sandstones, hardly penetrating upward into the overlying ductile siltstone and mudstone horizons of Tarapaya Formation. These mineralized fractures could extend downward in the sandstone for more than two hundred meters, making an overall mineralized horizon beneath the Tarapaya siltstone and mudstone, whereas along the contact within the Tarapaya Formation formed lenses of tin mineralization called Bolivian type strata-bound tin deposit.

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Silver mineralization is characterized by various silver-contained sulfosalt minerals. The most common sulfosalt mineral is freibergite [(Ag,Cu,Fe)12(Sb,As)4S13], associated with small amount of miargyrite [AgSbS2], proustite (Ag3AsS3), polybasite [(Ag,Cu)6(Sb,As)2S7][Ag9CuS4], bournite [PbCuSbS3], andorite [PbAgSb3S6] and boulangerite [Pb5Sb4S11].

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Oxidation is common throughout the mineralized fracture zones, controlled by connectivity of individual fracture zones to ground surface, and could extend downward for more than three hundred meters deep from surface.

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Resource Drilling

The first stage of resource drilling program at Silver Sand started in late October 2017, and completed in mid-December 2018. A total of 55,000 meters of diamond coring drilling were completed in 195 holes, of which silver mineralization was hit in 190 holes. The holes were drilled on a grid of 50 meters spacing orienting N60°E direction at dips of 45 degrees, approximately normal to the strike and dipping of mineralized fracture zones.

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Property Geology Plan Map and Drill Section

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Based on the successful first stage of resource drilling program, a second stage of resource drilling commenced in late April 2019 after the local rainy season, for which a total of 55,000 meters were budgeted. The targets of the second stage drilling includes infill drilling in selected areas to confirm continuity of mineralization, prospects showing good silver grades from artisanal mining dumps to expand the mineralization zones at Silver Sand, and regional prospects surrounding Silver Sand showing similar silver mineralization as revealed by artisanal mining. An initial resource estimate of NI43-101 standards is expected from the drill results by the end of 2019.

District Mineral Potentials

In addition to the resource drilling program at the core area of Silver Sand, New Pacific had surface prospecting programs in the year 2018 including surface mapping, chip sampling at surface mineralized outcrops and artisanal underground crosscuts and drifts as well as grab sampling of old artisanal mining dumps. The sampling results outlined a broad mineralized corridor of about six kilometers long in northwest direction by two and half kilometers wide in northeast direction. Within the mineralized corridor, nine prospects were identified for drill testing: Snake Hole, San Antonio, El Fuerte, Esperanza, Mascota, North Plain, Aullagas, Jisas and El Bronce. Mineralization style in these prospects is similar to that of Silver Sand core area. Some of the prospects will be drill tested in 2019, and the others in the following years.

Metallurgy Tests

New Pacific initiated preliminary metallurgy testwork of the mineralized drill cores from Silver Sand in late 2018. The testwork is carried out at SGS Peru including rougher and scavenger flotation, bottle roll leaching, column leaching, comminution and mineral characterization. Currently all testwork is close to completion. The preliminary results from the testwork are very encouraging and summarized below:

· Sulphide materials have reported 96.0% silver recovery by rougher-scavenger flotation and 96.7% by bottle roll leaching test with cyanide solution at atmospheric pressure.

· Transition materials achieved 86.8% recovery of silver by flotation and 97.0% by bottle roll leaching test with cyanide solution.

· The mineralized materials were measured to be mostly in the soft to-medium competent level and abrasion from low-to medium values, indicating easy to be grinded.

· Silver recovery test results of Oxidized materials by flotation and bottle roll leaching as well as column are pending.