Email from Investor RelationsI fired off an email to Darren and IR, specifically Jack Perkins today and received the response that I posted below. I asked the following question which can be found below in red text. Sorry about the formatting issues.
Will any positive news releases be forthcoming regarding the developments/progress of your mines (Cosala, Relief Canyon and Galena) within the next week or so?
Good to hear from you. Although I cannot disclose when our next press release will be, I can say that we are moving forward with positive developments at all three of our assets.
At Cosal, the Mexican government has lifted suspension of mining activities due to Covid. As you know, the mine has not been producing due to an illegal blockade. While the Mexican government has been shut down due to Covid, they are re-opening in the third quarter. This should allow us to takes the steps necessary to allow a legal and legitimate legal representative for the workers at Cosal to be put in place, which would give us the ability to resume production the second half of 2020. This illegal blockade has been very frustrating, but it is important to note that production from Cosal only accounts for approximately 10% of our 2021 gold equivalent ounce production. This, while not insignificant, is only a small portion of our production profile. Additionally, silver prices were significantly depressed earlier this year, with over 1 million silver ounces expected in 2021 and the potential to increase production to over 2.5 million ounces in 2020, the short term shut down of Cosal may actually result in a benefit to the company as silver prices continue to appreciate.
Galena is seeing significant progress with the the recapitalization plan proceeding better than expected. Equipment has arrived on site and additional equipment will continue to mobilize in the coming months. The Silver Valley has had significant discoveries at depth and the Galena complex is one of the shallowest operations in the area. Previous development had been stopped as the result of a lack of capital, which has now been remedied through the Sprott joint venture. Ongoing repair through the recapitalization plan will allow the Company to establish additional, deeper diamond drill stations, and we plan to continue pursuing the encouraging recent drilling with further exploration at depth.
At Relief Canyon we continue to ramp-up to commercial production, expected this quarter. We have mined 7.5 million tonnes of material, including 1.2 million tonnes of ore, to date. We have 0.1 millions of ore stockpiled ahead of the crusher, waiting to be placed on the leach pad, with ~1.1 million tones of ore stacked on the leach pad. With an AISC of ~$800/oz, an average annual production estimate of $90,000 oz, and gold prices hitting near decade highs, we are very encouraged that Relief Canyon can be an extremely profitable project for the company and our shareholders.
If you have any further questions, please let me know.
Best regards,
Jack