Ramping Up Two Profitable "Gold" Mines | CEO Interview Detailing its two operational and producing mines in Mexico, mid-tier producer Luca Mining's (LUCA.v, LUCMF) CEO, Dan Barnholden, joined Stijn Schmitz to highlight the ramp-up of their mines, and what investors should expect from in 2025: https://www.youtube.com/watch?v=ckJ_zT0j3Ww
Campo Morado Mine (VMS Style Deposit, Guerrero)
- Metals Produced: Primarily zinc, followed by gold, copper, silver, and lead.
- Current Production: Ramping up with contract mining (2,000 tons/day capacity).
- Expected Output: ~70,000 ounces of gold equivalent by 2025.
- Mine Life: 5–7 years based on current resources; potential to extend mine life to 10–15 years with aggressive exploration.
- Exploration Goal: Double mine life, aiming for new resource discovery.
Tahuehueto Mine (Epithermal Deposit, Northwest Durango)
- Current Status: Construction completed, commissioning underway.
- Production Capacity: Targeting 1,000–1,200 tons per day with ~30,000 ounces of gold equivalent in 2025.
- Mine Life: ~10 years, with about 400,000 ounces of gold equivalent.
- Exploration Potential: High-grade areas could be found, possibly leading to multi-million-ounce gold deposits.
Financials & Cash Flow
- Operating Cash Flow: Each mine is projected to generate $20–30 million annually by 2025, potentially matching or exceeding the company's market cap (~$100 million CAD).
- Market Cap & Financing: Current market cap is around $100 million CAD. Luca Mining is closing an $11.3 million financing.
- Debt: $18 million debt, with $12 million repayable starting in October 2024, and $6 million convertible debt (due in January 2026).
Exploration & Future Plans
- Campo Morado Exploration: The CEO emphasizes a major focus on aggressive exploration, aiming to replicate past drilling successes with high-grade zinc and gold discoveries.
- Tahuehueto Exploration: Early drilling could lead to a higher-grade deposit, significantly boosting production and profitability.
- Long-Term Vision: Investing heavily in exploration to expand resources, improve production efficiency, and possibly engage in M&A or return cash to shareholders.
Strategic Focus
- Incremental Improvements: Focus on optimizing current operations at both mines before exploring growth opportunities.
- Exploration as a Game Changer: Exploration results at both sites, particularly high-grade discoveries, could significantly enhance company valuation and operational potential.
- Risk & Opportunity in Mexico: The company views the current Mexican mining climate as an opportunity to acquire undervalued assets and leverage its expertise to unlock value.
Providing a natural hedge with gold, copper, silver, zinc, and lead amid ongoing exploration and improvement efforts, LUCA offers a compelling investment case with two producing assets, significant growth potential, and strong management alignment.
Latest News Release: https://lucamining.com/press-release/?qmodStoryID=6691662991925432
Posted on Behalf of Luca Mining Corp.