Callinex Announces Results of Initial Preliminary Economic Assessment that Generates a 34% IRR and a $230M NPV(8)% at the Nash Creek and Superjack Projects

VANCOUVER, May 14, 2018

• Average annual production of 77M pounds of zinc, 15M pounds of lead and 437K ounces of silver over a ten year mine life;
• Life of Mine ("LOM") undiscounted pre-tax net cash flow of C$483M (C$293M post-tax);
• Pre-tax IRR of a 34.1% (25.2% post-tax) and a pre-tax NPV^8% of C$230M (C$128M post-tax) with a payback period of 2.4 years (2.8 years post-tax);
• LOM all-in sustaining costs ("AISC") of C$0.37 per pound of zinc produced, net by-product credits;
• Total pre-production capital costs of C$168 million (including 18% contingency);
• Assumed metal prices of US$1.25 per lb of zinc, US$1.10 per lb of lead, US$17 per ounce of silver and a C$/US$ exchange rate of 0.77; and
• Potential to materially enhance the economic return with additional drilling over the district-scale land package.

VANCOUVER, May 14, 2018 /PRNewswire/ - Callinex Mines Inc. (the "Company" or "Callinex") (TSX-V: CNX; OTCQX: CLLXF) is pleased to announce results from an independent initial Preliminary Economic Assessment ("PEA") on the Company's 100% owned Nash Creek and Superjack Projects located in the Bathurst Mining District of New Brunswick, Canada (See Figure 1 and Figure 2).

The initial PEA outlines a 10-year, 3,900 tpd open-pit mining operation with a Dense Media Separation ("DMS") plant and 1,950 tpd conventional flotation process facility at the Nash Creek Project (the "Project"). The mine plan generates a strong economic return with a pre-tax internal rate of return ("IRR") of a 34.1% (25.2% post-tax) and a pre-tax Net Present Value ("NPV") at an 8% discount rate of C$230 million (C$128 million post-tax) based on pre-production capital costs of C$168 million and a zinc price of US$1.25/lb (See Tables 1 and 2). The Company believes there is a clear opportunity to significantly enhance the project's economics with additional exploration that allows for higher grade material to be scheduled earlier in the mine plan (See Figure 3).

Max Porterfield, President and CEO, stated, "We are very pleased with the results of this initial PEA that outlines the potential for a new zinc mine at our Nash Creek Project. The results of this PEA, combined with close proximity to infrastructure and a district-scale land package, represents a highly attractive scenario for Callinex shareholders."

Click here to view a two-minute video for an overview of the Nash Creek Project 

Cautionary Note on PEA. The PEA is preliminary in nature and it includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. There is no certainty that the PEA will be realized.

The Nash Creek Deposit is open for expansion in several directions with relatively few drill holes located outside of the Mineral Resource area. The 2017 drilling campaign on the Nash Creek Deposit, the first to ever be completed by the Company, led to a 74% increase in Indicated Mineral Resource zinc equivalent ("Zn Eq.") pounds and a 385% increase in Inferred Mineral Resource zinc equivalent pounds (See News Release dated April 16, 2018). Additionally, the Project encompasses several untested high-grade mineral occurrences over a highly prospective 20 km long trend. The Company plans to commence permitting while aggressively advancing exploration opportunities within this underexplored 150 km² district-scale land package.