Summary:
Deposit Type
Gold-silver mineralization on the Mercedes property is hosted within epithermal, low-sulfidation (adularia-sericite) veins, stockwork, and breccia zone (Buchanan 2016). These deposits form on predominately felsic subaerial volcanic complexes in extensional and strike-slip structural regimes. Near-surface hydrothermal systems, including surface hot springs and deeper hydrothermal fluid-flow zones, are the sites of mineralization. Mineral deposition took place as the hot mineralizing fluids underwent cooling by fluid mixing, boiling, and decompression.
The veins at Mercedes are typical of most other epithermal silver-gold vein deposits in Mexico in that they are primarily hosted in the Tertiary Lower Volcanic series of andesite flows, pyroclastics and epiclastics, overlain by the Upper Volcanic series of rhyolite pyroclastics and ignimbrites.
Geology
The geology of the Mercedes area is dominated by two northwest-trending arches, cut by numerous northwest and north trending high-angle structures, which have exposed older marine sediments and overlying interbedded volcaniclastic sediments and lithic to quartz crystal lithic tuff units.
A total of 16.5 km of gold-silver bearing epithermal low sulfidation veins have been identified within a width of some 6 km across the northwest-trending Mercedes corridor or along the margins of the andesite-filled basins, which constitute the primary exploration target on the property. Major veins, like those of the Mercedes vein system, typically trend N30º -70ºW at 60º to 90º dips northeast or southwest, following the major regional structural pattern. Other veins trend variably from east-west to north-south, or even northeast. Veins typically dip at greater than 60º but locally range as low as 25º.
Mineralization
Gold-silver mineralization on the Mercedes property is hosted within epithermal, low-sulfidation (adularia-sericite) veins, stockwork, and breccia zones. Over 18.2 km of veins have been identified within or marginal to the andesite-filled basins, which constitute the primary exploration corridor targeted on the property.
A total of 22 low-sulfidation, epithermal vein/stockwork/breccia zones, have been identified on the Mercedes property and based principally on their relative localities, have been divided into three subdistrict areas:
• Mercedes Area (Mercedes-Marianas);
• Klondike Area (Klondike-Rey de Oro);
• Diluvio Area (Diluvio-Lupita-San Martin).
Most of the veins are found hosted within the andesite package, or locally at the fault contact between andesite and the underlying rhyolitic tuffs. Only in the Diluvio zone at Lupita and the Anita veins is economic grade mineralization found hosted in the lower tuff package.
Vein Morphology
Major veins typically trend N30º-70ºW at 60º to 90º dips following the major regional structural pattern. Veins typically dip at greater than 60º, but locally range as low as 25º, and only the San Martin vein system presented a N45°-50°E has the lowest 10° to 20° dips. Post-mineral latite dikes are emplaced into and around some of the same northwest trending structures that host certain veins, locally destroying previously emplaced mineralized structures.
Mineralized vein-sets display a combination of fissure vein, stockwork, and breccia morphologies that change rapidly along strike and down dip. Mineralization ranges in width from less than one metre to composite vein/stockwork/breccia zones up to 15 m wide. In the Diluvio zone, gold-silver bearing vein/stockwork zones locally attain widths in excess of 100 m. The length of individual veins varies from 100 m to over three kilometres. Property-wide, gold-silver bearing veins occur over a vertical elevation range of 700 m (600 masl to 1,300 masl).
The most favorable exploration zones occur in andesite host rock. The northwestern strike extension of prospective outcropping andesite host rock plunges below younger progressively thicker post-mineral cover (conglomerate) towards the northwest along Mercedes corridor extensions. Barrancas, Lagunas, Marianas and Diluvio are amongst eight blind-to-surface discoveries.
Left-lateral strike-slip indicators have been noted along NW-trending faults like those associated with the Mercedes and Rey de Oro occurrences. Some large areas with potential to host parallel Mercedes-style structures remain untested.
Mercedes Vein System
The Mercedes gold-silver vein system, emplaced into and associated with the Mercedes fault, is the most prominent and continuous mineralized zone identified on the property, consisting of multiple-event quartz-carbonate veining, traced almost continuously on strike for nearly 4.2 km. The Mercedes fault system consists of numerous anastomosing strands within a zone over 50 m wide, where complex, multistage, anastomosing vein/breccia/stockwork zones from 1 m to 15 m wide are emplaced in extensional open areas.
The vein mineralogy (multiple quartz and carbonate stages) and morphology is quite variable along strike and down dip, where highly brecciated mineralized green-grey sugary to chalcedonic quartz is found cemented by 15 to 80% late-stage grey calcite, rhodochrosite, and/or brown-black manganese-iron carbonates.
Klondike Vein System
The Klondike vein system trending N70ºW, dipping 65º to 80º southwest and approximately 800 m long, differs from that at Mercedes in that it forms within a tectonic breccia zone rather than a fissure fill structure. Variable lenses of brecciated white to green or grey quartz and abundant manganese carbonates and calcite are found within the breccia zone.
The overall width of this ´crackle´ brecciation zone which includes stockwork veining in association with silicification and strong manganese-iron oxide content, may be up to 50 m in width. Associated but rare fissure-filling veins over 0.5 m wide can be observed. The Klondike system is developed over a maximum vertical range of approximately 300 m and ranges in width from 0.5 to over 50 m.
Diluvio-Lupita-San Martin Vein System
The Lupita vein zone outcrops on the surface for a distance of 1,800 m, ranging from 1 to 5 m in thickness. Consisting of multi-stage quartz-carbonate ± adularia veining, the vein follows a contact between the overlying andesite package and underlying felsic package and extends continuously down dip in places more than 450 m along most of the western half of the surface outcrop. Results from ongoing exploration activities towards the east identify eastwards extensions over a distance more than 2 km into the Margarita East area. This prospective area remains open towards the north and east.
Most importantly, at depths of 200 m to 300 m, Diluvio reveals an extensive zone of multistage quartzcarbonate ± adularia vein breccias, stockwork, and hydrothermal breccia up to 150 m thick that is primarily hosted in a lithic tuff-volcaniclastic sequence underlying the traditional andesite exploration target for new discoveries.
Based on geologic interpretation, it is proposed that mineralized fluid that circulated along the Lupita Fault, under pressure infiltrated the tuff/volcaniclastic sequence due to the elevated porosity of the fractured footwall lithology, creating a large scale stockwork deposit. Diluvio therefore is the only known mineral deposit in the district with the lower lithic tuff/volcaniclastic sequence as the primary host.
Commodity Production
All 2025 production figures are based on the nine-month period ended September 30, 2025. Full-year data is unavailable as Bear Creek Mining Corp. was delisted from the TSX Venture Exchange on March 2, 2026, following its acquisition by Highlander Silver Corp. on February 26, 2026. The latest available data covers production through Q3 2025.
| Commodity | Units | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|
Gold
|
oz
| ....  | .... | .... | .... | .... | .... | 59,901 | 68,719 | 82,534 | 92,755 | 84,137 |
|
Silver
|
oz
| .... | .... | .... | .... | .... | .... | 191,306 | 309,165 | 337,983 | 425,277 | 382,943 |
All production numbers are expressed as metal in doré.