Great Panther Mining Limited (TSE:GPR) (NYSEAMERICAN:GPL) has unveiled its first resource and reserve for the Tucano gold mine in Brazil and says it is aggressively exploring at the project to extend the resource and the mine life.
The firm bought Tucano in March last year and the latest assessment uses a more "rigorous approach" to the estimates compared to the 2017 study of the previous operator, said Great Panther.
At Tucano, after adjustments for depletion since June 30 2017, the reserves are now estimated to be around 646,000 ounces, a decline of around 489,000 gold ounces on the 2017 estimate. The resources, excluding reserves, declined by around 500,000 ounces, it added.
"While our inaugural update has resulted in a lower reserve and resource estimate, it provides us with a higher level of confidence for future mine and operational planning and the increase in average grades provides additional operational flexibility," said Jeffrey Mason, Great Panther's interim president and CEO.
"At Tucano, we are drilling new near-mine and regional targets in our more than 2,000 square kilometer, largely under-explored land package," he added.
"We are also evaluating the potential for upgrading confidence in resources for conversion to reserves, and looking to improve and enhance the existing prefeasibility study supporting the development of an underground mining operation at Tucano. At GMC, in addition to the potential re-start of the Guanajuato Mine, we are advancing expanded exploration programs at both the Guanajuato and San Ignacio mines."
The miner also posted on Monday an updated resource estimate for its two mines at its Guanajuato mine complex (GMC) in Mexico, which showed measured and indicated resources stood at around 3.7 million silver equivalent ounces for the Guanajuato Mine, in increase by around 1.5 million silver equivalent ounces from the previous 2017 estimate due to successful exploration last year.
Measured and indicated resources at San Ignacio Mine were around 5 million silver equivalent ounces, a decline of approximately 6.4 million silver equivalent ounces compared to 2017, due mainly to mining depletion of 3.8 million silver equivalent ounces.
Meanwhile, in Mexico, the firm said it had temporarily stopped depositing tailings (waste) at the Phase II tailings storage facility (TSF) at the Topia mine, following the receipt of a report on the facility from the independent tailings management and geotechnical consultants hired by the firm. The report showed evidence of mass movement underlying Phase I and Phase II of the TSF.
Mining and processing are expected to continue at current levels for several more days, with tailings being deposited at a permitted alternative location, the firm said.
After that, processing and potentially mining activities will temporarily cease unless an alternative temporary tailings storage solution can be found.
The company is in the process of permitting a Phase III TSF site for continuing operations at Topia in the longer term and expects it can obtain the necessary documentation within the next three to six months.
Fifteen percent of production
Topia accounts for around 15% of Great Panther's consolidated production on a gold equivalent ounce basis.
The miner added that it was assessing the impact of potential lost production on its 2020 production guidance which will be released at the end of March this year and expects to provide further updates prior to or at that time.
Shares slipped 11% in New York to US$0.43. In Canada, shares slipped 10.7% to C$0.58.
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