Highlights on the first week of August 2016, Mineral Exploration in Mexico

/ Gambusino Prospector

During the first week of August, at least 33 press releases from companies working in Mexico were published, with several companies producing second quarter financial reports. In our view, the most important news of the week is the announcement by the government of works in the creation of a much needed Mining Secretary. ON EXPLORATION, SilverCrest has hit bonanza grades on drilling its property in Sonora. Azure Minerals presented some more gold intercepts at its property in Sonora, and HECLA presented brownfield drilling results from Durango. ON MINING, Excellon, Gold Resource, Endeavour Silver, Great Panther, McEwen Mining, HECLA and Primero Mining presented second quarter results, while Starcore presented fiscal year end results. US Antimony continues mill testing in Guanajuato, and operations at Great Panther‘s mine in Durango were halted. ON FINANCING, three companies announced the closing or oversubscription of financing rounds, for total gross proceeds of $16.15 million. Goldgroup closed a right of sale consideration and Premier Gold entered in an agreement to secure the funding for paying a mine. ON DEALS. Arian Silver is selling a property in Zacatecas. ON PROJECT DEVELOPMENT. Mexus Gold is completing a leach pad in Sonora, Minera Alamos is performing environmental studies on its properties in Sonora and Durango, and Fresnillo PLC is to invest a sizeable amount from 2016 to 2018 on its development projects.

MEXICO GOVERNMENT NEWS

  • Taking advantage of his participation on the ceremony for the creation of a new Servicio Geológico Mexicano campus in Hidalgo, the head of the Secretaría de Economía, Ildefonso Guajardo Villareal announced works are underway for the creation of a dearly needed Subsecretaría de Minería in Mexico.

ON EXPLORATION

  • SilverCrest Metals Inc. reported the first drill results from its Las Chispas property in Sonora. To date drilling has focused in three of fourteen known veins of the project, this release covering the results of the Las Chispas vein. The results include up to 4.6 m true width (TW) @ 4.5 g/t Au, 621 g/t Ag (including 0.8 m @ 18.5 g/t Au, 2,460 g/t Ag) , 7.2 m TW @2.4 g/t Au, 311 g/t Ag and 0.7 m TW @ 14.4 g/t Au, 1,900 g/t Ag. Drilling has encountered mineralization intervals considerably wider than what has been encountered in the underground workings.
  • Azure Minerals Ltd. continues the infill drilling at its Mesa de Plata discovery in Sonora, to take the Resource from the Indicated to the Measured category. More than three tonnes of mineral have been collected for metallurgical testing. At Loma Bonita (adjacent to Mesa de Plata) good drilling results include (previously reported) 18.4 m @ 1.6 g/t Au, 40 g/t Ag, 48 m @ 2.7 g/t Au, 48 g/t Ag and 25 m @ 0.78 g/t Au, 52 g/t Ag. Metallurgy tests show excellent recoveries for ground material, averaging 94%, and 71% for crushed material. At Promontorio, Chihuahua, core drilling begun last march with its JV partner Kennecott Exploration. To date 5,515 m have been completed, to depths of 600 to 1,507 m, showing veining and mineralogical and alteration patterns coincident with the upper parts of a porphyry copper system.
  • HECLA Mining Co. Presented brownfield drilling results on its San Sebastian property in Durango, which include true width assays of up to 3m @ 290 g/t Ag, 3.7 g/t Au, 1.3 m @830 g/t Ag, 8.1 g/t Au, 2.4 m @ 2,023 g/t Ag, 21.1 g/t Au and 1.8 m @ 1,794 g/t Ag, 8.7 g/t Au. Exploration continues on extensions of the Middle vein, the East Francine Vein and the West Francine vein.

ON MINING

  • United States Antimony Corp. reported continuing test milling at its Puerto Blanco test mill in Guanajuato. Estimated recoveries from ore of its Reynaldo pit in Queretaro are 75% Sb, 95% Au and 90% Ag.
  • Starcore International Mines Ltd. presented its year end results to April 30, which in this case entails a nine month period due to a change of its fiscal end year from July to April. During such period 229.6 K tonnes of ore were milled at its San Martin mine in Queretaro, at a grade of 1.96 g/t Au and 18.4 g/t Ag, producing 12.3 K Oz Au and 70.2 K Oz Ag, with recoveries of 84.9% gold and 51.5% silver, at an operating cost of $846 per AuEq Oz. Cash and short term investment stands at $10 M.
  • Excellon Resources Inc. announced second quarter 2016 results for its Platosa mine in Durango. With 13.9 K tonnes mined and 14.4 K tonnes milled @ 536 g/t Ag, 5.1% Pb and 6.3% Zn, with recoveries at 90%, 81.2% and 78.7% for silver, lead and zinc respectively. Production for the period was 227.8 K Oz silver, 1.3 M Lb lead and 1.5 M Lb zinc.
  • Gold Resource Corp. reported second quarter 2016 results, milling 104 K tonnes of ore at a rate of 1,228 tpd, averaging 3.27 g/t Au, 182 g/t Ag, 0.4% Cu, 1.4% Pb and 4.4% Zn. Recoveries were 92% gold, 94% silver, 77% copper, 71% lead and 84% zinc, for a total production of 10 K Oz Au, 572.5 K Oz Ag, 320 tonnes Cu, 1 K tonnes Pb and 3.8 K tonnes Zn. Total cash cost after by-product credits per AuEq ounces sold was $317, and total all-in sustaining cost per AuEq ounce sold was $649. Cash at quarter end totaled $13.3 M (El Aguila, Oaxaca).
  • Endeavour Silver Corp. presented its financial results for the second quarter of 2016, including the production of 1.55 M Oz Ag and 15.6 K Oz Au at cash cost of $5.37 and all-in sustaining cost of $10.53 per silver ounce. Cash stands at $56.8 M and working capital at $72.1 M (Guanaceví, Durango; Bolañitos and El Cubo, Guanajuato).
  • Great Panther Silver Ltd. presented second quarter 2016 financial results, including 99.9 K tonnes milled to produce 536.7 K Oz Ag and 6 K Oz Au at cash cost $1.72 and AISC $7.19. Cash and working capital stand at $28.8 M and $49.4 M (before a $29 M bought deal offering in July). (Guanajuato Mine Complex, Guanajuato; Topia, Durango).
  • Great Panther Silver Ltd. informed of the death of the general manager of the Topia mine in Durango. The company temporarily suspended operations at the site.
  • HECLA Mining Co. announced second quarter results 2016, which include numbers from its San Sebastian mine in Durango. 37.4 K tonnes of ore were processed at a 411 tpd rate, and a grade of 1,114 g/t Ag and 8.4 g/t Au, for the production of 1.26 M Oz Ag and 9,482 Oz Au. Cash and cash equivalents and short-term investments stand at $159 million.
  • McEwen Mining Inc. presented financial results for the second quarter of 2016, which include the production of 15.5 K Oz Au and 7.8 K Oz Ag from its El Gallo mine in Sinaloa, at a cash cost of $719 per AuEq Oz and all-in cost $1,201 per AuEq Oz. The company has liquid assets of $55.7 M, of which cash stands at $36.7 M. The exploration budget at El Gallo is $2.8 M.
  • Primero Mining Corp. reported second quarter 2016 financial results, on which there is a note regarding the current litigation with the federal government regarding a tax arrangement, stressing that the issue will be taken to international arbitration under the NAFTA. The San Dimas mine in Durango produced 29 K Oz Au and 1.6 M Oz Ag, at cash cost $843 and AISC $1,063 per gold ounce. The company liquidity totals $79.5 million, of which cash stands at $54.5 million.
  • Candente Gold Corp. announced its non-brokered private financing has been fully subscribed, raising gross proceeds of $500 K (El Oro, Mexico State).

ON FINANCING

  • Golden Tag Resources Ltd. completed its previously announced financing, which raised $900 K. Of the proceeds raised, $500 K will be used to purchase the remaining 50% interest in the San Diego silver project in Durango, and the remaining funds will be used for general working capital.
  • Vista Gold Corp. announced a US$15 million bought deal with a syndicate of underwriters led by Cantor Fitzgerald Canada Corporation and Rodman & Renshaw a unit of C. Wainwright & Co., LLC. (non-core Mexico assets. Guadalupe de Los Reyes, Sinaloa).
  • Goldgroup Mining Inc. closed the sale of rights to the contingent consideration on the Caballo Blanco project in Veracruz. The consideration for the right is US$2.5 M, of which US$1.9 M was paid at execution and an additional US$600 K will be paid in the event the owner of Caballo Blanco receives the approval of the project’s environmental impact statement from SEMARNAT (Cerro Prieto, Sonora).
  • Premier Gold Mines Ltd. announced it has entered into a letter of agreement with Orion Mine Finance to fully-fund the cash component of the recently announced acquisition of the Mercedes Mine from Yamana Gold Inc. for a total purchase price of US$140.0 million.
  • Silver Spruce Resources Inc. increased its non-brokered placement to $550 K due to an oversubscription.

ON DEALS

  • Arian Silver Corp. announced a binding agreement with Endeavour Silver Corp. to sell the 75 has Calicanto project in Zacatecas for US$400 K.

ON PROJECT DEVELOPMENT

  • Mexus Gold Us. and JV partner MarMar Holdings are building a 250 K tonnes leach pad at its Santa Elena mine in Sonora.
  • Minera Alamos Inc. hired a contractor to perform environmental studies and compile information necessary for the application of permits at Los Verdes in Sonora and at La Fortuna in Durango.
  • Fresnillo PLC. announced that the company will invest US$1,900 million in the 2016-2018 period, starting with $600 million on 2016 and almost 800 million on 2017, of which 68% is to be spent on new projects.

Content like what you have just read can be seen at https://gambusinoprospector.com/ and at LinkedIn’s Mexico Mineral Exploration Group.

On the picture below, quartz veining on quartz-tourmaline flooded porphyry associated to a quartz-tourmaline breccia, the orange hue is characteristic of tourmaline oxidation. La Lamosa project, Sonora.

Quartz tourmaline breccia detail

Leave a Reply