Panuco Project
Preliminary Economic Assessment
On July 24, 2024 the Company announced a Preliminary Economic Assessment on the Project:
After-Tax NPV (5%) of US$1,137 million, After-Tax IRR of 85.7%, Initial Capex of US$224 million, Average Annual Production of 15.2 million oz AgEq at AISC of US$9.40 per oz AgEq.
The PEA considers two contiguous underground mines, the Copala Mine and the Napoleon Mine, with onsite treatment of the mined material processed through a 3-stage crushing-grinding circuit, along with a leach and Merrill Crowe circuit to produce silver-gold doré bars. The mines will be contractor-operated utilizing ramp-access and a combination of long-hole stoping and drift-and-fill mining methods.
The processing throughput capacity of 3,300 tonnes per day for the first three years, expanding to 4,000 tonnes per day in year four, results in an initial mine life of 10.6 years. The PEA leverages Panuco’s existing infrastructure, including all-weather access roads, permits, power and its proximity to the Concordia Municipality with its skilled labour pool. The PEA is derived using the Company’s mineral resource estimate published on September 01, 2023. The effective date of the PEA is July 24, 2024, and a technical report will be filed on the Company’s website and SEDAR+ within 45 days of the news release.
PEA Highlights
| Resource | Tonnes (Mt) | AgEq(1) (g/t) | AgEq(1) (Moz) |
|---|---|---|---|
| Indicated | 9.5 | 511 | 156 |
| Inferred | 12.2 | 433 | 170 |
1. AgEq = Ag ppm + (((Au ppm x Au price/gram) + (Pb% x Pb price/t) + (Zn% x Zn price/t))/Ag price/gram) with price assumptions $24.00/oz Ag, $1800/oz Au, $2,425/t Pb and $2,976/t Zn. All numbers are rounded.
2. Initial CapEx includes 20% contingency and AgEq grades include base metals and are undiluted. The Company cautions that the results of the PEA are preliminary in nature and include inferred mineral resources that are considered too speculative geologically to have economic consideration applied to them to be classified as mineral reserves. There is no certainty that the results of the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.