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Falco Provides Update on Collaborative Work Program With Glencore

Feb 12, 2021

Falco Resources Ltd. says significant progress has been made on the previously announced work plan collaboration with Glencore Canada Corporation. In October Falco announced that the Work Plan would include additional technical work, modelling and studies towards the further identification, mitigation and allocation of risks at its flagship Horne 5 Project, located in Rouyn-Noranda. The goal of the Work Plan is to allow the two parties to negotiate towards a Principal Operating License and Indemnity Agreement, which would allow the commencement of dewatering phase.

Geotechnical Work 

Two key Work Plan milestones have been achieved in relation to the three major components of the established geotechnical work program.

For the Quemont North area (in proximity to the future infrastructure of the Horne 5 Project), on December 17th, Falco’s team completed the planned 14 holes and approximately 1,120m of drilling. The investigation work confirmed our initial assumptions and the planned mitigation work is underway to secure the crown pillar and will be completed before the end of the First Quarter.

A second milestone was also achieved at the end of January. Falco received the detailed report and analysis on the potential risk associated with seismicity generated by the Horne 5 Project’s life of mine mining sequence. The study was initiated in the first quarter of 2020 and included different stages of numerical modelling. From Falco’s perspective, the results of the seismicity report were positive and disclosed no reasons to believe that seismicity risk cannot be mitigated and managed to prevent impact on smelting operations within the parameters to be defined in the Principal Operating License and Indemnity Agreement. The report is currently under review by Glencore and will serve as an important element for future discussion for the conditions of the Principal Operating License and Indemnity Agreement.

The investigation work at the Horne Smelter site for the crown pillar, under dewatering conditions, which began in mid-December is now well advanced and is expected to be completed by mid-February. To date 23 holes out of the 25 originally planned have been completed, leaving only 165m of drilling to complete the program. Falco’s technical team will be completing the analysis of the investigation work and will be providing the report and conclusions to Glencore before the end of February. Discussions have been initiated with Glencore’s on the development of mitigation measures to secure the crown pillar for the dewatering stage of the Horne 5 Project. Falco intends to present a plan to secure the investigated crown pillars before the end of the First Quarter of 2021.

Luc Lessard, President and Chief Executive Officer of Falco noted that, “Cooperation with the Horne Smelter personnel has been progressing well. They have been very supportive and have demonstrated an openness to find solutions to organize and advance the Work Plan. This is not a simple task for an operating site to complete in the best of times, and it has been complicated by the implementation of COVID-19 mitigation measures. We are pleased with the progress made on the Work Plan execution and have begun the planning of the next steps of our collaboration with Glencore by assessing potential synergies between our Horne 5 Project and the Horne Smelter. Our objective is to complete the Work Plan by June 2021 in order to initiate discussions on the Principal Operating License and Indemnity in Agreement this summer. With the progress to date we are on track to meet our timetable.

Feasibility Study Update

Falco, with the collaboration of a number of industry-recognized consulting firms, is currently preparing an updated feasibility study, in accordance with National Instrument 43-101 for the Horne 5 Project. The updated feasibility study, which is expected to be issued in March 2021, will include project economic analysis and the schedule for the Horne 5 Project.

Subsequent to the release of the updated feasibility study, Falco will be working with its financial advisors and partners to secure the additional financing to fund the development of the Horne 5 Project.

About Falco 

Falco Resources Ltd. is one of the largest mineral claim holders in the Province of Québec, with extensive land holdings in the Abitibi Greenstone Belt. Falco owns approximately 70,000 hectares of land in the Rouyn-Noranda mining camp, which represents 70% of the entire camp and includes 13 former gold and base metal mine sites. Falco’s principal asset is the Horne 5 Project located in the former Horne mine that was operated by Noranda (now Glencore Canada Corporation) from 1927 to 1976 and produced 11.6 million ounces of gold and 2.5 billion pounds of copper. Osisko Gold Royalties Ltd’s subsidiary, Osisko Development Corp. is Falco’s largest shareholder owning 18.2% interest.

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