RE:RE:One road map to 100 million silver ounces
Hey Pointguard, with regards to grade, we will have to wait and see what the additional drilling provides on all of the various zones. Early drilling underneath the current 2.1 km long resource were somewhat consistent with grades shown within the official resource, if I recall correctly. The only reason the underneath area is not in the 43-101 resource count as yet is due to needing an infill drilling program (holes are currently spaced at about 100m). Grades from early drilling at La Borracha were varied, but were competitive. Early indication is La Borracha has less bulk/volume/width than San Gregorio and Las Carolinas, but nonetheless it should still be a solid contributor to the project. The current M&I (51M of the 54M total silver resource) has a grade of 76 g/t Ag. That is a good grade for this type of wide width surface deposit. La Cigarra is an open-pittable bulk tonnage silver deposit, which is not all that common in Mexico. Most Mexican silver deposits are high grade narrow width mineralized structures. The bulky nature of La Cigarra deposit (solid grades in veins, surrounded by plenty of lower grade disseminated silver) substantially increases the probability of economical viability at La Cigarra, as a result of being able to use bulk tonnage methods and equipment for mining and processing. The deposit is set up nicely for mining also. It is a predictable deposit. It is strung along consistently over a know 3 km of continuous length (will likely prove to be 6.5 km of continuous length, after future drill programs). The deposit is nicely shaped (angled downwards to the east) to carve out an efficient open pit. This allows for a somewhat nice strip ratio of around 3.2 to 1 (waste material to be moved vs ore material to be mined). We will have to wait and see if it remains at 3.2 to 1 in the PEA – I don`t expect it to change much. Also, metallurgy looks very good. The first 2 initial rounds of metallurgical tests produced strong results. This is very important as recovery rates can often make or break a project. I really haven`t seen any red flags with La Cigarra as yet - knock on wood. Here is a note on the water situation (from the technical report, pg 1-3): ``There are no rivers or large bodies of water in the immediate project area; however water is available from the San Felipe de Jesus aquifer which underlies the project area. It is anticipated water will be attained by purchasing existing permitted water wells in the area or by applying for new water rights from the government.`` The Parral mining district has been producing silver continuously for 500 years. It has a good track record. Specifically, the La Ciggara area is located in ranching country. It is nicely positioned, as the project has excellent access to skilled mining people and mining equipment to work the mine, being located within good proximity to a mining town, while at the same time it is located far enough away from towns/people centres to not have concerns about town folks protesting local mine developments – a side note, Fresnillo`s smelter is only about 600 km away, to address smelting needs. We also do not have to worry about dishing out huge amounts of money and delays in project development timeline to move a town. Osisko is a company that comes to mine (they had to move the town of Malartic in Quebec), but there have been plenty others. With regards to silver projects in Mexico right now, Oremex Silver is one that comes to mind. I haven`t looked into their story recently. They have lots of silver ounces in 43-101 resource, but they might lose it all due to a situation with a town located right next door (I think). Silver Bull Resources is another company people should be careful with. They have a large silver resource asset in Mexico (though their recovery rate and other aspects of the project doesn`t impress me), but at some point they will likely have to address local town situations as well. One more important note I wanted to make. Mexico is one of the great mining countries in the world. Still, there are many parts of Mexico that is not open to mining (virtually impossible to get a mining permit in those areas). One needs to be careful which projects they invest in. Mexico has these huge areas that are dedicated to environmental (preservation) reserves (or whatever the official name). La Cigarra (and the Parral Mining district in general) doesn`t appear to be in one of these reserves, best I can tell. P.S. Not sure as yet, but I might post a separate post with a brief comment on Orka Silver`s project. I looked at their published data about 3 or 4 years ago (only after the initial PEA though). I didn`t like it at all, even though they had a huge resource and high grades.