RE:Golden Minerals Velardena updateRareEarth1, I was not paying attention and missed the processing news. I came here to post some news on Argentina.
News is quite promising, They need to declare comercial production and even better show the market things are going well cost wise.
In the mean time Fundamental Research put out a Research Report containing the following information
Project Updates
Rodeo: As expected, at the end of Q3, AUMN suspended operations upon processing all remaining economic stockpiles.
Velardea: In Q3, AUMN generated $0.2M in revenue from processing mineralized materials extracted during test mining last year. We anticipate management will announce commercial production shortly. A recently completed PEA returned an AT-NPV8% of $88M, using $1,826/oz gold, and $23/oz silver.
Santa Maria – AUMN expects to close the previously announced sale of this project in Q4 for $2.5M, including $1.5M in cash, and $1M in royalties.
El Quevar silver property in Argentina: AUMN expects Barrick (TSX: ABX) to conduct additional geophysical studies, followed by a drill program in 2024.
Sarita Este gold property (located 1.5 hours from El Quevar): Subject to the availability of capital, management intends to resume drilling next year to support a maiden resource estimate.
Yoquivo gold-silver project (Chihuahua): Management intends to resume drilling next year, subject to the availability of capital.
We are reiterating our BUY rating, and lowering our fair value estimate from $11.36 to $6.97/share.
We believe the market is overlooking AUMN's potential to advance Velardea to production. We believe the current price level offers an attractive entry point for speculative investors, given our anticipation of an imminent commercial production announcement.
Risks: We believe the company is exposed to the following key risks (not exhaustive):
The value of the company is dependent on silver & gold prices
Exploration and development
Access to capital and potential share dilution
No guarantee that Velardea will be advanced to production
Highlights
We are expecting AUMN to commence commercial production at Velardea (a silver-gold-lead-zinc mine in Mexico) in the coming weeks. A recently completed PEA returned an AT-NPV8% of $88M, using $1,826/oz gold, and $23/oz silver. AUMN is trading at just 4% of the AT-NPV8%.
As we expected, production at Rodeo (a gold-silver mine located 80 km west of Velardea) ended in September 2023.
AUMN has completed a $4M equity financing to fund working capital, and initial operations at Velardea.
Despite the completion of this financing, and the imminent production potential, AUMN is down 93% YTD. AUMN is trading at $0.03 per silver equivalent oz vs the sector average of $0.67/oz, implying a 96% discount.