Two exciting projects in mining-friendly Mexico
Near term development project in Pinos
What Candelaria Mining does:
Candelaria Mining Corp (CVE:CAND) is a gold-focused explorer, whose flagship project is Caballo Blanco, which lies on the eastern coast of Mexico, 65km northwest of the city of Veracruz.
It also holds the Pinos underground gold development project in Zacatecas - the second biggest gold producing state in Mexico after Sonora.
The firm says its main aims are to begin production at Pino, and explore at Caballo, where seven 'high impact' targets have been identified.
Caballo, envisaged as a simple open-pit heap leach operation, already boasts an NI 43-101 indicated resource of 521,000 ounces of gold and 2.17 million ounces of silver, while the inferred category holds 95,000 ounces of gold and 590,000 ounces of silver. There is potential to increase all resources via continued drilling and exploration.
The deposit, the discovery of which is relatively new for this region of Mexico, remains open to the south, southwest, northeast and at depth and the current oxide resource is contained in just one zone - La Paila.
Pinos consists of around 3,800 hectares of concessions covering 17km of veins containing gold and silver. Over 80% of the district has yet to be explored.
A preliminary economic assessment (PEA) for this property was completed in September, last year which envisaged a 200 tonnes per day (tpd) operation, ramping up to 400 tpd, with a seven-year mine life from production start.
Initial capital expenditure required was low, put at US$13.5 million. Candelaria continues to optimize mining methods for the project, the crushing circuit and grinding alternatives.
The company is targeting annual production of around 12,700 ounces of gold equivalent beginning in the first quarter of 2021 with a competitive all-in sustaining cost of US$835 per ounce.
Notably, mining major Agnico Eagle has invested C$9.75 million in Candelaria and owns 9.95% of the firm.
How's it doing:
La Paila is an outcrop at Cabollo Blanco - which covers 14 contiguous claims - and is one of seven targets in the area that has been drilled. These targets also include Highway North and Las Cuevas, Bandera Norte and Bandera Sur. The last three show the same characteristics as La Paila, namely high sulphidation gold epithermal mineralization.
New targets at Highway North identified by soil sampling showed values varying from 0.1 grammes per tonne (g/t) of gold to 4 g/t of gold, covering a surface area of around 1.5 times 0.7 kilometres (km).
In November last year, Candelaria unveiled high-grade drill assays from its Pinos Gold development project, which showed the potential to expand the resource.
The 20-holes were part of an in-fill program to confirm grade and continuity of the Cinco Estrellas vein and highlight assays included an intersection of 1.8 metres (m) at 7.3 g/t of gold equivalent.
- More exploration results from Cabollo
- Start of production at Pinos
What the boss says:
"Our exploration programs continue to find high gold grades throughout the district," Curtis Turner, CEO of Candelaria has told investors.
“The Cinco Estrellas Vein mineralization suggests the vein has increased continuity and is open at depth and to the south of the Pinos District, with potential to expand the resource," he added.