Golden Minerals reports promising economics for Mexico project
Colorado-based miner Golden Minerals has reported positive findings in a preliminary economic assessment (PEA) and updated mineral resource estimate for the Velardeña Properties, which is the company’s silver and gold project located in Durango state, Mexico.
Engineering company Tetra Tech was responsible for preparing the PEA, which assigned the project a net present value of almost $86-million and a possible internal rate of return of 138% after one year.
The total pre-production capital cost of the project is $10.2-million, with a pre-production development time of one year. The post-production, sustaining capital needed will be nearly $16-million.
The PEA envisions a ten-year mine life, for 188 000 oz of gold contained and 12.3-million ounces of silver contained in the resource. The average gold grade achieved is anticipated to be 5.15 g/t, while the average silver grade is expected to be 337 g/t.
The project also has 33-million pounds of contained lead and 40-million pounds of contained zinc, grading 1.32% and 1.63%, respectively.
Golden Minerals president and CEO Warren Rehn remarks that the Velardeña mines now present an attractive scenario for a potential restart.
“The most difficult challenge we previously faced at the Velardeña mines was the low payable gold recovery, a challenge which we believe is solved with the addition of a relatively low-cost bio-oxidation circuit at our existing processing facility.
“Because we already have most of what is required for restarting mining and processing, the capital needs for the project are modest. The one-year payback on pre-production capital signifies a very robust project. The projected cash costs for silver production at less than a dollar per ounce net of byproducts points to the strong projected profitability of this operation,” he adds.
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