The big news this week concerns clarification of the open pit mining ban by the new President of Mexico, Claudia Sheinbaum, titled "100 PASOS PARA LA TRANSFORMACIN 2024 -2030". Here is a link to the document.
It now appears an open pit mining ban will not happen. I believe this is a significant step in removing the negative sentiment that has depressed mining in Mexico for the last few years, and should remove the uncertainty going forward for investors in general, as well as attract financial institutions and mining companies to invest in Mexico.
It now appears that any reference to open-pit mining has been totally eliminated in subsequent versions of this document and basically replaced with softer language requiring better environmental and socio-economic processes during the approval stage. This is largely intended to protect resources and impacts around larger cities where open pit mining has been a problem for years. The good part is that this will allow mining companies to proceed with their plans without concern of being shut down by the Mexican Government.
I believe this will impact Tocvan in a direct and positive manner since the risk going forward eliminates the risk of receiving approvals for the 50,000 ton Pilot plant and full production facility. I don't think anyone will argue that a ban on open pit mining has been a concern for shareholders, and likely one of the main reasons the price of Tocvan has been depressed.
Gran Pilar is located in a remote part of Sonora where every step has been taken to be inclusive by hiring local residents and allowing Placer mining in the river beds located at lower elevations. Tocvan has further reduced risk by attracting experienced Board members who have worked for decades within Mexico, well known, and fully understand the approval process.
If you refer back to the report produced by Atrium Research, titled "Tocvan Ventures - Strong Assets with a Near Term Path to Production", one of the key risk factors centered around the issue of an open pit mining ban. Now that this risk has been eliminated, I believe this directly impacts the fair market value of Tocvan as it potentially allows for investment and acceleration of Tocvan's timeline. For those that haven't reviewed this report, it is a good perspective of the past progress, present catalysts, and future plans.
Shareholders are still waiting for the assay results from 476 samples collected during the summer and the start of drilling. I don't know why there have been delays as these events were anticipated in September, but one thing I have learned, nothing is ever on time (there are many factors out of a company's control). My guess is that the return of assays from the lab is likely the cause of the delay, but what do I know? I am certain that these results are required to more accurately design the next drill program, and with Sonora's rainy season just ending, I think this is the time to make sure everything is done correctly.
Trading was light for Tocvan this week with only 96,000 shares passing hands. The vast majority of shareholders are holding their shares waiting for news and also the clarification of Sheinbaum's position on the open pit mining ban proposed by the previous Government. Tocvan traded only 21,000 shares on Friday consisting of small trades across several financial institutions, even the selling from Anonymous has reduced to a trickle.
I do expect drilling to start and the flow of news to increase once assays are received.
On a more positive note, Coeur Mining (CDE on NYSE) announced yesterday the acquisition of Silvercrest Metals (SIL) for $1.7 B, but what I found more interesting was that it was at an 18% premium. This premium indicates that major mining companies are very aggressively looking for assets located in Mexico.
This is a good sign for Tocvan, as a "Major" has been conducting extensive due diligence early in the year on Gran Pilar. Apparently, the implications of this will be discussed at an upcoming mining conference in Mexico, "Congreso Internacional Minero", on October.22 to 26, when the two companies are expected to meet.
Have a great weekend, plenty of football and baseball, and soon hockey will be in full swing.