Callinex Mines Inc. announced a new high-grade copper, zinc, gold and silver discovery at the Company's 100% owned Pine Bay Project (the "Project"), located near Flin Flon, MB (Pine Bay Project Plan View). The discovery hole, DSC-111, intersected four separate volcanogenic massive sulphide lenses ("VMS") with significant base and precious metal values within a total core width of 67.7m. The most significant section returned 7.14m grading 1.70% copper equivalent ("CuEq") containing 3.34% Zn, 0.29 g/t Au, 14.38 g/t Ag, and 0.11% Cu. Additional massive sulphides intersected include a 10.57m grading 1.36% CuEq, with 1.47% Zn, 0.58 g/t Au, 16.51 g/t Ag, and 0.26% Cu and 2.15m of 1.27% CuEq, made up of 0.87% Zn, 0.52 g/t Au, 18.3 g/t Ag, and 0.43% Cu (Descendent Discovery Long Section). The intersection in DSC-111 is the deepest to date associated with the Cabin Horizon and is located 350 meters below PBM-024 which intersected 2.58m of 0.53% Zn, 0.92% Au, 34.60 g/t Ag, and 1.64% Cu (See news release dated May 1, 2017). The Descendent is situated 550m from the Pine Bay deposit, 1.4km from the Rainbow deposit and 2.9km from the Alchemist deposit, which are all located within a mineral lease. Since the discovery of Rainbow and Alchemist, Callinex's technical team has a deeper understanding of how the VMS deposits sit along the stacked horizons located within the main controlling growth fault corridor at the Project. This refined geological based target, supported by geophysical and geochemical data, led the Company to renew exploration efforts in this area of the Project and the discovery of the Descendent. The Descendent was intersected at a down-hole depth of 1,318m and remains open in all directions. Many of the largest deposits within the Flin Flon Greenstone Belt have been discovered at depth, such as the 777 Mine that was discovered at a down-hole depth of 1,278m, the Lalor Mine that was discovered at a down- hole depth of 781m and the Company's Rainbow deposit which was discovered 933m down-hole. The abundance of zinc, gold and silver indicates that the hole may have intersected the edge of the VMS system similar to what occurs at the Rainbow deposit. Additionally, the significant width of the massive sulphide intervals suggests that the system is long-lived and robust. The four VMS lenses are separated by dykes and sills, which is typical in many VMS systems, and allows for the potential for one large massive sulphide body. The geophysical interpretation also supports the geological interpretation. The Company's geophysical data from previously drilled hole PBM-024 is modeled to have similar conductance as the intersected zone and extends for approximately 400m along strike and 850m in vertical extent. The intersected zones consist primarily of lower conductivity or non-conductive minerals including zinc. Several historic deposits at the Pine Bay Project, along with the Centennial Mine to the south, are poor geophysical conductors. This discovery hole is located within the Baker Patton Felsic Complex, one of the largest and most highly altered accumulations of felsic rocks within the Flin Flon
Greenstone Belt. A major alteration zone had previously been identified at surface and spans 1,100m by 700m as defined by values of more than 90 using the Hashimoto (Ishikawa et al.) Alteration Index, a quantitative approach to evaluate alteration trends that ranges from 0 to 100. Since the huge alteration zone seen at surface is structurally overturned, the exploration thesis is that the massive sulphides associated with this mineralizing event would be preserved at depth. Typically, there is a correlation between the size of an alteration zone and the size of the VMS deposit it is associated with. The exploration model for large VMS deposits within the Flin Flon Greenstone Belt, such as the Lalor and 777 deposits, includes having several smaller deposits in close proximity to a large alteration system within a major felsic volcanic center. Historic and recent exploration has identified seven VMS deposits, along with the new Descendent discovery, located in close proximity to the huge Baker Patton alteration zone. Assay results are still pending from other samples taken from the Descendent discovery hole DSC-111. Earlier in the campaign drill hole PBM-194 was drilled to test the down plunge extent of the Rainbow deposit but veered too far to the north and the deposit remains open at depth (Pine Bay Project Long Section and Pine Bay Project Cross Section). Drill hole ALC-117 was drilled to test the Alchemist deposit but is interpreted to have veered just north of the plunge line and intersected 2.0m of 1.90% CuEq including 1.44% Cu, 0.14 g/t Au, 7.76 g/t Ag, and 0.80% Zn. The Alchemist and target area Odin will continue to be followed-up this winter after freeze up allows access to necessary drill pads. At the Descendent discovery, a BPEM survey was recently completed and results are being interpreted by Callinex's technical team. An aggressive fully funded step-out drilling campaign will immediately be carried out at the Descendent.