Highlights on the Fourth Week of February, 2017. Mineral Exploration in Mexico

During the 8th week of the year (20th to 26th February, 2017) at least 23 press releases were announced by companies working in Mexico, including financing rounds by two companies. ON EXPLORATION, Prospero Silver completed additional field work at a shallow epithermal system in Chihuahua. ON MINING, First Majestic, Torex Gold and Alamos Gold reported financial and/or operational results for 2016.  ON FINANCING, Two companies announced financing rounds for $3 M and C$40. ON RESOURCES AND DEVELOPMENT, Gold Resources, Great Panther Silver, Consolidated Zinc, Kootenay Silver, Primero Mining, Timmins Gold, HECLA Mining, and Alamos Gold presented press releases relating to mineral reserves and resources to the end of 2017, or the commissioning of scoping studies.   ON DEALS AND CORPORATE ISSUES, American International Ventures completed the acquisition of a group of concessions in Baja California, whilst Argonaut Gold entered into an agreement with Fresnillo PLC to buy a concession adjacent to a mine.

ON MEXICO ISSUES

  • The president of Mexico, Enrique Peña Nieto, presented a constitutional controversy at the Supreme Court regarding the controversial “ecological tax” recently implemented in Zacatecas. The unpopular tax was set to impose a tariff on every tonne mined in the state, arguing environmental affectations.
  • CyPlus Idesa, a JV between German Evonik Industries and Mexican Grupo IDESA, inaugurated the Coatzacoalcos plant in Veracruz to produce sodium cyanide, with a yearly capacity of 40 K tonnes to supply the mining industry.

ON EXPLORATION

  • Prospero Silver Corp. has completed additional sampling and mapping at its Bermudez property in Chihuahua, where 4.5 km of strike length of outcropping high-level banded, low sulphidation veins. The fifty one samples collected carry the total to 144 samples, with strongly anomalous Au, Ag, Ba and Zn and peaks of 1.9 g/t Au, 35 g/t Ag. “Fluid inclusion temperature data (153°C to 224°C and salinities between 0 wt% and 3.2 wt% NaCl equivalent) indicate that the current surface expression of the vein system sits between 150m to 280m below the elevation of the now-eroded-off paleo-water table……. Prospero’s fluid inclusion and geochemical work indicates that drilling at Bermudez should target depths of 200m to 400m below the exposed high level portion the system”.

ON MINING

  • First Majestic Silver Corp. delivered its 2016 consolidated financial results, which include 18.7 M Oz AgEq at an AISC of $10.79 per Ag Oz, ending the year with $129 M in cash and cash equivalents. At Santa Elena in Sonora 988 K tonnes were processed to produce 2.6 M Oz Ag (6.2 M Oz AgEq) at AISC $1.75 per Ag Oz; at La Encantada in Coahuila 881 K tonnes were processed to obtain 2.7 M Oz Ag; at La Parrilla in Durango 610.5 K tonnes were processed and 2.2 M Oz Ag obtained (3.4 M Oz AgEq); at Del Toro in Zacatecas 337 K tonnes were treated to obtain 1.5 M Oz Ag (2.6 M Oz Ag); at San Martin in Jalisco 298 K tonnes were treated to produce 1.9 M Oz Ag (2.2 M Oz AgEq); at La Guitarra in Mexico State, 115.7 K tonnes were milled to obtain 0.9 M Oz Ag (1.5 M Oz AgEq).
  • Torex Gold Resources Inc. presented its financial and operational results for 2016. Its El Limon-Guajes mine in Guerrero started commercial production on April, extracting 279,937 Oz Au by the end of the year. Plant throughput averaged 9,226 tonnes per day (tpd) @ 3.25 g/t Au (3.49 g/t Au during the fourth quarter), with 86% gold recovery and cash cost of $543 and AISC of $733 per ounce.
  • Alamos Gold Inc. reported financial results for 2016, including figures for its Mexican operations. At Mulatos in Sonora, 154 K Oz Au were produced, at cash cost $877 and AISC $931 per gold ounce, while at El Chanate, also in Sonora, 68 K Oz Au were produced, at cash cost $1,171 and AISC $1,190 per gold ounce. At Mulatos 6.5 M tonnes were placed on the heaps @ 0.81 g/t Au, while 113.7 K tonnes were milled @ 11.23 g/t Au. At El Chanate 6.3 M tonnes were processed @ 0.60 g/t Au (17,300 tpd) and a recovery ratio of 56%. Guidance for 2017 includes the production of 150-160 K Oz Au at Mulatos and 50-60 K Oz Au at El Chanate. About 17 M are to be spent in exploration in the Mulatos district. Updated exploration efforts include the Mulatos district in Sonora, where $16 M were spent in 2016, mainly on La Yaqui, Cerro Pelon and Los Bajios targets. At La Yaqui 46,809 m were drilled, whilst upgrading resources and reserves, with mine development in progress and mining expected to start in mid-2017. At Cerro Pelon 19,081 m were drilled, with exploration and drilling expanding from the initial zone. At Los Bajios mapping, sampling and induced polarization surveys were carried out, and form the base to the coming 2017 drill programs.

ON FINANCING

  • Riverside Resources Inc. arranged a non-brokered private placement to raise aggregate proceeds of up to $3.025 M. Part of these funds are to be used for a first phase exploration program at La Cecilia project in Sonora.
  • Argonaut Gold Inc. entered into a bought deal basis agreement with a syndicate of underwriters to raise gross proceeds of up to C$40 M. The net proceeds of the offering will be used for the acquisition of properties adjacent to the El Castillo Mine (see below) and for general corporate purposes.

ON RESOURCES AND DEVELOPMENT

  • Gold Resource Corp. increased gold reserves by 31% and silver reserves by 17% during 2016 at its Oaxaca Mining unit. Proven and probable reserves totaled 1.89 M tonnes @ 2.75 g/t Au, 165 g/t Ag, 0.3% Cu, 1.3% Pb, 3.6% Zn, for a total of 167 K Oz Au and 10 M Oz Ag, 5,543 tonnes Cu (12.2 M Lb), 24,020 tonnes Pb (53 M Lb), 66,517 tonnes Zn (146 M Lb). In addition to reserves, measured and indicated mineralized material was reported from four zones: 774 K tonnes @1.45 g/t Au, 153 g/t Ag, 0.2% Cu, 1.4% Pb, 3.6% Zn at the Arista vein system; 959 k tonnes @ 1.61 g/t Au, 97 g/t Ag, 0.4% cu, 1.8% Pb, 5.7% Zn at the Switchback vein system. At Alta Gracia project 297 K tonnes @ 0.36 g/t Au, 232 g/t Ag and at Margaritas 58 K tonnes @ 0.72 g/t Au, 276 g/t Ag.
  • Great Panther Silver Ltd. updated mineral resource estimates at the Guanajuato Mine Complex. Measured and Indicated Resources(Guanajuato and San Ignacio mines) stand at 693 K tonnes @ 144 g/t Ag, 2.5 g/t Au, or 3.2 M Oz Ag and 55,787 Oz Au. Inferred Resources (including El Horcon) stand at 954 K tonnes @ 115 g/t Ag, 2.36 g/t Au, or 3.5 M Oz Ag, 72,587 Oz Au.
  • Consolidated Zinc Ltd. has commissioned a scoping study at its Plomosas project in Chihuahua, on which a maiden resource of 568 K tonnes @ 16.9% Pb+Zn, 24 g/t Ag was announced on December 2016. The study is to include the refurbishment and expansion of the existing plant to treat 75 K tonnes of ore per year, the mining infrastructure, and the metallurgical and engineering processes.
  • Kootenay Silver Inc. announced continued activities for 2017 on La Cigarra, Chihuahua (51 M Oz Ag @ 86.3 g/t Ag), Promontorio, Sonora (92 M Oz AgEq @ 64 g/t Ag) and La Negra, Sonora, (JV with Pan American Silver). At La Cigarra, work envisaged includes up to 7,500 m of drilling planned on peripheral targets and up to 7,500 m for resource expansion along extension of La Cigarra deposit, advanced metallurgical testing, updated resource estimate and setting the timeline for a preliminary economic assessment (PEA). At Promontorio and La Negra more drilling is planned for late second quarter.
  • Primero Mining Corp. presented year-end 2016 updated mineral reserves and resources, including figures from its Mexican operations. At San Dimas, Durango, measured and indicated mineral resources totaled 5.0 M tonnes grading 5.2 g/t Au, 387 g/t Ag, for 832 K Oz au, 61.9 M Oz Ag, while inferred resources stood at 7.2 M tonnes @ 3.7 g/t Au, 317 g/t Ag, for 860 K Oz Au, 73.5 M Oz Ag. Recent drilling at La Victoria vein include 5.8 m true width (TW) @ 56.9 g/t Au, 3,367 g/t Ag, 3.4 m @ 45.6 g/t Au, 2,147 g/t Ag, and 3.0 m @ 28.9 g/t Au, 1,398 g/t Ag.
  • Timmins Gold Corp. has carried 7,903 m of infill drilling in 34 holes at its Ana Paula project in Guerrero, since October 2016. Highlights include 48.4 m @ 12.16 g/t Au and 151 m @ 8.98 g/t Au. A variety of metallurgical methods have been tested, with overall gold recoveries improving to 80-85%. M3 Engineering was selected to provide the feasibility study (FS), while the environmental base line study has already been filed. The company expects to reach a construction decision by the second quarter 2018, and commissioning on the fourth quarter 2019.
  • HECLA Mining Co. reported mineral reserves and resources to the end of 2016. At San Sebastian, Durango, reserves stand at 326 K tonnes @ 535 g/t Ag, 3.42 g/t Au for 5.6 M Oz Ag, 37 K Oz Au; M&I resources are 1.5 M tonnes @ 168 g/t Ag, 2.18 g/t Au, for 8.2 M Oz Ag, 114 K Oz Au, 14.6 K tonnes Pb, 19 K tonnes Zn, 8.4 K tonnes Cu; and inferred resources stand at 2.8 M tonnes @ 171 g/t Ag, 0.93 g/t Au, for 15.4 M Oz Ag, 89 K Oz Au, 23 K tonnes Pb, 32.7 K tonnes Zn, 19.2 K tonnes Cu. During 2016 4.3 M Oz Ag, 34,042 Oz Au were produced with the mill working at a 375 tpd rate. Production was achieved at cash cost $(3.35) and AISC $(1.99) per silver ounce after by-product credits. The company is planning to go from open pit to underground mining by the end of 2017.
  • Alamos Gold Inc. reported mineral reserves and resources to the end of 2016. At Mulatos in Sonora (including Main Pits, San Carlos u/g, stockpiles, La Yaqui and Cerro Pelon areas) reserves stood at 50 M tonnes @ 1.17 g/t Au for 1.885 M Oz Au; M&I resources were 76 M tonnes @ 1.14 g/t Au for 2.8 M Oz Au; inferred resources stood at 10.3 M tonnes @ 0.98 g/t Au for 325 K Oz Au. At El Chanate, also in Sonora, reserves stood at 10.8 M tonnes @ 0.84 g/t Au, or 293 K Oz Au; M&I resources were 4.4 M tonnes @ 0.66 g/t Au, for 93 K Oz Au and 112 K tonnes of inferred resources @ 0.71 g/t Au for 3 K Oz Au.

ON DEALS AND CORPORATE ISSUES

  • American International Ventures, Inc. completed the acquisition of a group of concessions in the Alamo district in Baja California, comprising over 1,900 hectares. The Company currently has a pilot plant gold mining operation at its La Sorpresa IV Property in the same area.
  • Argonaut Gold Inc. entered into an agreement with a subsidiary of Fresnilllo PLC, whereby Argonaut is to acquire the 420 ha. San Juan concession, adjacent to the Argonaut’s El Castillo mine in Durango for a cash consideration of $26 M, half of which is payable upon the execution of the transaction. “Currently, Argonaut holds the surface rights to the San Juan Concession. Over the past three years Argonaut and Fresnillo have collaborated as Fresnillo completed 34,510 metres of exploration drilling in 132 drill holes. The Company reviewed these results and has found evidence that the El Castillo mineral system continues onto the San Juan Concession…”

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, beautiful weather-carved Mesozoic granitoids as seen from the road between San Luis Rio Colorado and Sonoita, in Sonora.

octubre-2011-baja-024-copia

 

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