Capstone releases ‘best ever’ Cozamin results

Capstone Mining Corp. [CS-TSX] on Thursday January 16 released additional high grade copper and silver results from 21 infill and six step-out drill holes from its Cozamin polymetallic mine in Zacatecas, Mexico. The highlight intercept from the latest batch of results includes 6.3 metres of 5.3% copper.

The expansion and infill drilling results released on Thursday morning includes some of the best ever drilling results from the Cozamin Mine, the company said in a news release. This brings the total drilled to date to 150 holes out of a 200-hole program. The aim of the program is to double the existing reserve base.

Drill results to date continue to demonstrate greater widths and grades than current mineral reserves, as well as the potential for an expanded high-grade resource. Mineral resources and mineral reserves will be updated in late 2020.

Cozamin is expected to achieve a 50% increase to annual copper and silver production of 50-55 million pounds and 1.5 million ounces respectively by 2021.

Capstone shares advanced on the news, rising 3.7% or $0.03 to 84 cents on volume of 258,530. The shares are currently trading in a 52-week range of 41 cents and 87 cents.

Capstone is a Canadian base metals mining company with a focus on copper. Its two producing mines are the Pinto Valley copper mine in Arizona, and the Cozamin Mine in Mexico. In addition, Capstone has the large scale 70%-owned copper-iron Santo Domingo development project in Chile as well as a portfolio of exploration properties.

The Santo Domingo Project is located 50 km southwest of Codelco’s El Salvador copper mine. The project is expected to be ready for a construction start in 2020.

Cozamin is located 3.6 km northwest of Zacatecas City. It is a copper-silver underground mine with a surface milling facility. In 2019, the mine was expected to produce 30-35 million pounds of copper at a cash cost of between US$0.90 and US$1.05/oz.

“The most recent drill results are exceeding our expectations for the Mala Noche Footwall Zone,” said Brad Mercer, senior vice-president exploration and operations with Capstone. “The two-year drilling initiative is more than two months ahead of schedule, allowing us to add more holes for a new mineral resource and mineral reserve estimate and technical report by the end of 2020,” he said.

“These results will ensure that this mine will remain a first quartile cost, cornerstone asset well into the future,” added Capstone President and CEO Darren Pylot. “Development work on both the underground one-way ramp and ventilation are both on budget and ahead of schedule to be completed by the end of 2020,” he said.

Torex Gold releases Media Luna resource estimate

Torex Gold Resources Inc. [TXG-TSX, OTC-TORXF] has released an updated resource estimate for the Media Luna Project on its Morelos Gold Property in Mexico.

The Morelos Gold Property is an area of 29,000 hectares in the Guerrero Gold Belt, about 180 km southwest of Mexico City.

Within the Morelos Gold Property, the company’s principal assets are the El Limon Guajes (ELG) Mining Complex, which consists of the El Limon, Guajes and El Limon Sur open pits (the ELG Open Pits), the El Limon Guajes underground mine, including zones referred to a Sub-Sill and El Limon Deep (ELD) and the processing plant and related infrastructure.

These operations reached in the commercial production stage in April 1, 2016.

At full production, the mine ranks amongst the largest and lowest cost gold operations in the world. Last year, Torex achieved gold production of 454,810 ounces. The full year result in 2019 established a new annual production record at El Limon Guajes, surpassing a prior record achieved in 2018 by 28%.

On Tuesday, Torex said it expects to produce in the range of 420,000 to 480,000 ounces of gold this year at an all-in-sustaining cost of US$900 to US$960/oz.

The Media Luna deposit is an early stage development project that is located on the same concession as The Guajes, El Limon and Sub-Sill deposits.

Torex said its long-term strategy is to develop a sustainable multi-asset mining business by executing operationally in order to generate strong free cash flow from El Limon Guajes, and by advancing, de-risking and bringing Media Luna successfully into production.

In a news release that came after the close of trading on January 13, 2019, Torex announced in-fill drilling on the first portion of Media Luna’s Inferred Resource, resulted in essentially a 100% conversion to Indicated Resources.

A second phase of in-fill drilling is planned to further upgrade remaining Inferred Resources with the second update to also be included in the feasibility study that the company aims to complete by late this year or 2021.

The company said the updated resource estimate for the Media Luna Project includes an Indicated Resource of 2.24 million gold equivalent ounces at a gold equivalent grade of 5.55 g/t and an Inferred Resource of 4.56 million gold equivalent ounces at a gold equivalent grade of 4.23 g/t.

Of the gold equivalent metal inventory (comprising the Indicated and Inferred Resource categories) 58% of the contained metal value is attributable to gold, 34% to copper and 8% to silver.

On Tuesday, Torex shares eased 4.9% or 96 cents to $18.37 and trade in a 52-week range of $11.41 and $21.91.

“The purpose of the planned 175-hole infill drill program was to upgrade approximately 13 million tonnes (25%) of the Inferred Resource to the Indicated Resource category,” said Torex President and CEO Fred Stanford. “The program was successful, 166 holes were drilled, 12.6 million tonnes were upgraded, and there was a modest increase in the gold equivalent grade,” he said.

Stanford went on to say that learnings from the infill program, and other analyses, have led to an updated geological model, which has been applied to the area of the Inferred resource as well.

As of December 31, 2019, the mineral resource estimate for Media Luna stands at 12.6 million tonnes of 5.55 g/t gold equivalent or 2.24 million gold equivalent ounces. On top of that is an Inferred Resource of 33.5 million tonnes of 4.23 g/t or 4.56 million gold equivalent ounces.

The updated estimate is compliant with NI 43-101 standards of disclosure and is based on 393 drill holes (approximately 194,000 metres), of which 166 holes (approximately 70,000 metres) were drilled as part of the recent infill drill program, which cost approximately $15 million to complete.

“With the confidence provided by the success of the infill drill program, part of the de-risking of the Media Luna Project will be an early stage works program to start excavating the access tunnel to the deposit. This is a long tunnel,” Stanford said.

He said excavation work is expected to start in the second half of 2020. “We expect to fund development of Media Luna via cash flow from El Limon Guajes,” Stanford said. The company hopes to complete this work in time to meet the schedule of commissioning of Media Luna in 2024.

Torex is also on the planning stage of an additional infill drill program with a purpose of increasing the tonnes in the Indicated confidence class, so as to increase the mine life in an upcoming feasibility study.

Orla Mining poised for construction at Camino Rojo

Orla Mining Ltd. [OLA-TSX] said Thursday December 19 that its board of directors has approved the start of construction spending at the company’s Camino Rojo Oxide gold project in Zacatecas, Mexico.

Orla shares rallied on the news, rising 6% or 10 cents to $1.79 on volume of 2.37 million. The shares are trading in a 52-week range of 85 cents and $1.83.

This will allow the continuation of detailed engineering and the ordering of long lead items, such as the crushing system. Commencement of project construction has also been approved, subject to receipt of all required permits.

The announcement comes after Orla said it has entered into a loan agreement with Trinity Capital Partners Corp. and certain other lenders in connection with a previously announced US$125 million project financing facility. That money will be used for the development of Camino Rojo.

The credit facility was arranged by Trinity Capital and includes a syndicate of lenders led by Agnico-Eagle Mines Ltd. [AEM-TSX, NYSE], Pierre Lassonde and Trinity Capital, creating a key alignment between debt and equity holders who will support the company’s development going forward.

Pierre Lassonde is best known for his long association with Franco Nevada Mining Corp. [FNV-TSX, NYSE]. He holds an 11.6% stake in Orla, according to company documents.

The Camino Rojo Oxide Gold Project is an advanced gold and silver open-pit heap leach project. The project is 100%-owned by Orla and covers over 200,000 hectares.

Hosting 1.03 million ounces of gold and 20.1 million ounces of silver reserves Camino Rojo will be Orla’s first mine. It is expected to produce 97,000 ounces of gold annually at an all-in-sustaining cost of US$575 an ounce

“Securing this US$125 million credit facility and one of the key permits marks two more critical milestones in the evolution of Orla, allowing us to maintain our schedule for advancing the Camino Rojo towards production in mid-2021,” said Orla President and CEO Jason Simpson.

“We have accomplished a great deal to get to this point in just two years since the acquisition of the project,” he said. “With the continued support of local communities, various levels of government, shareholders and now lenders, we can advance towards construction in the coming months once the final permit is received.”

On Thursday, Orla said it has received notification from the Mexican federal government environment department known as SEMARNAT, granting approval of the Change of Land Use Permit, one of two key permits required for the development of Camino Rojo.

The other key permit required prior to the start of construction is the Environmental Impact Statement (MIA). Review of the MIA application by SEMARNAT is ongoing, the company said in a press release.

Orla acquired the Camino Rojo from Newmont Goldcorp Corp., [NGT-TSX, NEM-NYSE] in November 2017 in return for the issuance of 32 million Orla shares, or 19.9% of the shares outstanding.

Orla also owns 100% of the Cerro Quema Project in Panama. It includes a near-term gold production scenario and various exploration targets. It will also be developed as a proposed open pit mine and heap leach gold operation.

Company Updates From Management – Thu 19 Dec, 2019

Goldplay Exploration – More information on the large land acquisition beside the San Marcial Project

On December 17th Goldplay Exploration (TSX.V:GPLY & OTCQB:GLYXF) entered into a Letter Of Intent (LOI) to acquire a large package of land surrounding the Company’s San Marcial Project. Marcio Fonseca, President and CEO of Goldplay joins me to outline the deal. We also discuss how the new land will play into the current exploration strategy for next year.

If you have any follow up questions you can email me at Fleck@kereport.com. I will get your questions in front of Marcio and get back to you.

Click here to read over the full news release.

Click here for the press release from Maco Mining that outlines some additional information.

Mako, Goldplay sign Mexico LOI

Mako Mining Corp. [MKO-TSXV] said Tuesday December 17 that it has entered into a non-binding letter of intent with Goldplay Exploration Ltd. [GPLY-TSXV; GLYXF-OTCQB; GPE FSE] in relation to the proposed sale to Goldplay of Mako’s Mexican operations.

The sale would allow Mako to focus on its San Albino gold project in Nicaragua, where the first gold pour is anticipated by late summer of 2020.  Life-of-mine production at San Albino is expected to be 675,345 gold equivalent ounces or 41,300 ounces annually.

Under the proposal, Goldplay would have the right to acquire 100% of the common shares of Mako subsidiary Marlin Gold Mining Ltd., a private British Columbia company that owns Oro Gold de Mexico, S.A. de C.V., which in turn holds the La Trinidad open-pit, heap leach gold mine in Sinaloa State, Mexico.

The La Trinidad facilities are currently being decommissioned.

Oro Gold also controls 100% of nine concessions, covering 104,094 hectares that lie adjacent to Goldplay’s existing portfolio in the historic Rosario gold-silver mining district in Sinaloa.

The final transaction structure will be determined by the parties, subject to receipt of all necessary legal, financial and tax advice.

“We are happy that we have entered into an LOI to sell our Mexican operations to our neighbour,” said Mako CEO Akiba Leisman. “We are nearly finished producing gold at La Trinidad, and the sale of our Mexican operations will allow us to focus solely on our San Albino gold project, currently under development in Nicaragua.”

“Subject to the successful completion of this transaction, a substantial tax liability currently ring-fenced at our Mexican subsidiaries is expected to be removed from Mako’s balance sheet,” Leisman added.

Mako has said the La Trinidad mine was severely damaged by Hurricane Willa in October, 2018.

However, the company has yet to receive any insurance proceeds from its claims against its insurers and reinsurers, which currently exceed US$7 million. “Finally, it is proposed that Mako will retain a small NSR royalty on a district scale land package to benefit from future exploration success,” Leisman said.

When trading in Mako resumed on Tuesday, the shares were unchanged at 23.5 cents. They are currently trading in a 52-week range of $0.09 and 24.5 cents.

Goldplay advanced on the news, rising 2.8% or $0.005 to 18.5 cents. The shares traded in a 52-week range of 10.5 cents and 30 cents.

The definitive terms of the transaction are subject to negotiations and are expected to include a nominal cash payment and the issuance of a small net smelter royalty to Mako on the concessions currently owned by Oro Gold.

All proceeds from the previously lawsuit that Mako, Marlin, and Oro Gold have filed against their insurers and reinsurers related to damages from Hurricane Willa, will be for the benefit of Mako, and Mako will be responsible for the costs of this litigation.

Meanwhile, after Mako receives a $50,000 payment from Goldplay, the two companies have agreed to a binding exclusivity and non-solicitation period from the date of the signing of the LOI until December 31, 2021 or potentially a later date that the parties can agree on.

Under the LOI, Mako has also agreed to a binding $50,000 break fee that would be payable to Goldplay upon certain agreed-upon circumstances.

Mako said Goldplay is now moving forward with its legal, financial and technical due diligence review of Marlin, Oro Gold and La Trinidad, as well as other assets owned by Marlin.

Pan American outlines resource estimate at La Colorada

Pan American Silver Corp. [PAAS-TSX, NASDAQ] on Wednesday December 11 announced an initial mineral resource estimate for a large polymetallic deposit discovered in 2018 at the company’s La Colorada Mine in Zacatecas, Mexico.

Pan American said the La Colorada Skarn Deposit contains an inferred mineral resource of 72.5 million tonnes, averaging 44 g/t silver, 0.17% copper, 2.02% lead, and 4.40% zinc. The estimate assumes a cut-off value of US$60 per tonne after accounting for transportation, smelting, and refining costs.

It said the deposit remains open in nearly all directions for resource expansions.

Pan American shares advanced on the news, rising 2.2% or 58 cents to $26.75. The shares are currently trading in a 52-week range of $13.83 and $27.56.

“The initial inferred mineral resource estimate containing 102 million ounces of silver and a large volume of base metals indicates the significance of this new discovery,” said Christopher Emerson, Pan American’s Vice-President Business Development and Geology.

“In just over a year since we first announced the discovery, we have completed 54,000 metres of drilling into the deposit and developed the geological model for this initial resource estimate,” he said. “An aggressive drilling program is planned for 2020 to further explore the deposit’s potential.”

The majority of the mineralization is contained within a larger polymetallic mineralized skarn covering an area measuring 500 by 600 metres. The deposit, as currently defined, is located between 600 to 1,700 metres below surface and east of the current La Colorada Mine workings.

In 2020, Pan American plans to invest US$10 million to drill 44,000 metres, focusing on infill and exploration drilling to further define, expand and add confidence in the mineral resource.

Pan American recently acquired Tahoe Resources in a US$1 billion transaction that created the world’s second largest primary silver producer. The company owns and operates mines in Mexico, Peru, Canada, Argentina and Bolivia. It also owns the Escobal Mine in Guatemala, which is not operating right now.

Strong free cash flow in the third quarter of 2019 allowed Pan American to repay US$20 million on its credit facility and advance the skarn discovery at the La Colorada Mine, which ranks as Pan American’s largest silver producing mine. There are three separate active mining areas on the property, including the Candelaria, Estrella, and Recompensa.

La Colorada generated just over 2.0 million ounces of silver and 12,000 ounces of gold in the third quarter.

Company-wide third quarter silver production of 6.7 million ounces and gold production of 150,200 ounces have put Pan American on track to achieve management’s guidance for 2019. The company has guided the market to anticipate silver production this year of between 25.3 and 26.3 million ounces and gold production to between 550,000 and 600,000 ounces.

Lobo Tiggre – The Independent Speculator – Wed 4 Dec, 2019

Thoughts on the PM reaction to falling markets and a look into Mexico for metals investors

Lobo Tiggre, Editor of The Independent Speculator joins me to share his thoughts on how gold has been playing its roll as a safe haven, or risk off investment. When the markets have sold off gold has benefited and throughout this year when the Fed was cutting rates gold was also moving up. So for the investor that thinks things are not all good in the US or around the world gold should still have a place in a portfolio.

We wrap up the cal by revisiting a recent article Lobo wrote focused on the investment narrative for Mexico. We look at the recent gang violence and assess what areas of Mexico can still be considered safe.

Click here to visit Lobo’s site – The Independent Speculator – and read his article focused on Mexico.

SilverCrest raising $80 million for Las Chispas development

SilverCrest Metals Inc. [SIL-TSXV; SVCMF-OTCQX] said Tuesday December 3 that it is raising $80 million from a bought deal offering of 11 million common shares priced at $7.28 per share.

The company said it intends to use the proceeds of the offering for the continued exploration and development of its Las Chispas Project in Sonora, Mexico.

Las Chispas is the third highest grade primary silver deposit in the world. According to a Preliminary Economic Assessment announced in May, 2019, it is expected to produce an average of 13.7 million ounces of silver equivalent annually during the first four years of operations at an all-in-sustaining cost of US$4.89/oz. The initial capital expenditure is forecast at US$100.5 million.

Those estimates assume a silver price of US$16.68/oz and a gold price of US$1,269/oz.

Proceeds of the bought deal offering could be higher than $80 million as the underwriters have been granted a greenshoe option allowing them to purchase up to an additional 15% of the shares offering within 30 days following the closing of the offering. The underwriting team is led by National Bank Financial Inc., Desjardins Capital Markets, and Scotiabank.

SilverCrest shares advanced on the financing news, rising 6% or 46 cents to $8.10 on volume of 1.09 million. The shares are currently trading in a 52-week range of $3.05 and $8.73.

The Las Chispas property is located approximately 180 km northeast of Hermosillo. It consists of 28 concessions totalling 1,400 hectares.

Between 1880 and 1930, several mines on the property are thought to have yielded approximately 100 million ounces of silver and 200,000 ounces of gold.

Mineralization occurs in 0.5 to 5-metre wide veins with adjacent stockwork and breccias trending northwest-southeast for one to 1.5 km. The company says 14 epithermal veins have previously been defined on the property, of which three have had notable production. The producing veins include Las Chispas, William Tell and Babicanora.

SilverCrest is the first company to successfully drill-test the historic Las Chispas Project, a move that resulted in numerous discoveries that are being evaluated for economic viability and potential production in the future.

SilverCrest said recent drilling has resulted in the discovery of a new high-grade zone called Area 118. It was named after the discovery hole LC19-118, which returned 8.6 metres grading 7,873 g/t silver equivalent.

The approximate high-grade footprint of Area 118 is 300 metres along strike by 125 metres in height, and includes two adjacent and intersecting veins, Las Chispas and Giovanni.

The weighted average (true width, uncut and undiluted grades) of the defined initial high-grade footprint in this zone is 1.6 metres, grading 16.54 g/t gold and 1,837.3 g/t silver, or 3,078 g/t silver equivalent. Despite a limited amount of exploration work done in Area 118 to date, these results outline the potential to delineate a new high-grade resource, the company has said.

“After prioritizing in-fill drilling for the better part of 2019, our team is excited to focus on resource expansion with the announcement of drill hole LC19-118,” said SilverCrest CEO Eric Fier.

There are currently 17 core drills operating at Las Chispas; 16 surface and one underground. This includes 12 rigs completing in-fill and known vein expansion holes in the Babiconara Area, and four rigs working on new vein targets in the Las Chispas Area.

In a press released on November 21, 2019, SilverCrest said 75 holes or 25,000 metres remain to be completed in 2019, of which 20 to 25 holes (6,000 metres) are earmarked for the Las Chispas Area veins. An updated resource estimate, potentially including Area 118, is expected in the second quarter of 2020, along with the results of the ongoing feasibility study for the project.

Company Updates From Management – Mon 2 Dec, 2019

Riverside Resources – More information on the Pichette Gold Project acquisition in Ontario

Last week Riverside Resources (TSX.V:RRI & OTCQB:RVSDF) announced its third project acquisition in Ontario, Canada. The Company added the Pichette Gold Project, located in the Beardmore-Geraldton Greenstone Gold Belt.

A new guest to the show Freeman Smith, Riverside’s VP Exploration joins me to share what attracted the Company to this project. We discuss the largest mine in the area, the Hardrock Gold Mine as well as some of the other projects and deposits. We wrap up the call with the work planned for next year and the permitting process.

Click here to visit the Riverside website and read over the full release.

Please email me with any other questions you have for the team over at Riverside.

Company Updates From Management – Tue 26 Nov, 2019

Goldplay Exploration – More Information On The Recent High Grade Silver Results At The Nava Target

Yesterday Goldplay Exploration (TSX.V:GPLY & OTCQB:GLYXF) released 4 drill holes, drilled at the Nava Target on the San Marcial Project, of which 3 hit mineralization of gold or silver. Marcio Fonseca, President and CEO of Goldplay, joined me to share some more information on these drill results. We discuss the goals of the drill program, significance of the high grade findings, the narrow widths of the results, and what work is planned heading into next year.

If you have any follow up questions for Marcio or I please email me at Fleck@kereport.com.

Click here to read over the full news release at the Goldplay website.