PAAS: Xali Gold’s Due Diligence at Pico Machay Confirms Major Exploration Upside and Strong Data Integrity
Comprehensive Site Visits Confirm Data Integrity and Opportunity at Pico Machay
Following three detailed site visits between June and November, Xali Gold Corp.—under its acquisition agreement with Pan American Silver (PAAS) and Aquiline Resources—has now validated the historic geological data at the Pico Machay Gold Project in Peru. The project, previously believed to be limited in scope, has been shown to have an extensive alteration footprint of about 4.1 km by 1.3 km, or roughly 533 hectares, vastly outscaling the previously focused 28-hectare resource area. This validation was achieved through rigorous verification of drill collar locations and independent check sampling by Xali’s technical team and independent consultants.
Resource Estimate and Exploration Footprint Indicate Substantial Upside
Pico Machay is home to a historic Measured and Indicated Resource of 264,600 ounces of gold (10.6 million tonnes at 0.78 g/t) and an Inferred Resource of 446,000 ounces (23.9 million tonnes at 0.58 g/t). The current resource, occupying only 5% of the altered system, signals substantial remaining potential for discovery and expansion—especially since these figures were based on a conservative gold price of just US$700 per ounce. The company’s ongoing preparation of a National Instrument 43-101 compliant resource report could convert these historic estimates into current standards in the near term.
| Category | Ounces | Tonnage (M) | Grade (g/t Au) |
|---|---|---|---|
| Measured & Indicated | 264,600 | 10.60 | 0.78 |
| Inferred | 446,000 | 23.90 | 0.58 |
Rock Chip Assay Results Highlight Robust System Integrity
The recent due diligence included collecting and independently analyzing 26 samples—9 surface and 17 pulp/coarse reject—from the site. The results show a mix of higher and lower grade gold and silver, reinforcing the integrity and robustness of historic sampling and geology at Pico Machay. See below for a summary of the most recent rock chip assay data:
| Sample Number | Gold (g/t) | Silver (g/t) |
|---|---|---|
| 74122 | 0.21 | 0.50 |
| 74123 | 3.98 | 25.80 |
| 74124 | 2.23 | 11.20 |
| 74125 | 2.86 | 7.30 |
| 74126 | 0.14 | 1.40 |
| 74127 | 0.16 | <0.50 |
| 74128 | 2.60 | 1.30 |
| 74129 | 2.07 | 1.00 |
| 74130 | 1.80 | 1.00 |
Data Validation Supports Progress Towards Updated Resource Estimate
The independent verification of sample integrity, drilling collar accuracy, and overall geological model means that Xali Gold is positioned to deliver a new NI 43-101 compliant resource estimate soon. Notably, management emphasized that only a fraction of the large alteration system has been drill-tested, which opens the door to further discoveries and potential resource upgrades if exploration continues successfully.
Risks, Limitations, and the Path Forward for PAAS Investors
It’s important to note that current resource estimates remain “historic” until verified by further data compilation and NI 43-101 compliant reporting. There is no assurance all historic resources will prove viable or be upgraded to current categories. However, with demonstrated sample integrity and a significantly larger mineralized footprint than previously realized, this due diligence signals that both Xali Gold and Pan American Silver are positioned to benefit from possible upside should continued exploration efforts confirm additional resources.
For PAAS stakeholders, this update underscores why Pico Machay remains a project to watch closely in 2025. While there are risks around resource classification and further exploration results, the scale and quality now verified suggest the groundwork is in place for meaningful future news flow as Xali Gold moves to finalize the acquisition and advance resource work.
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