Plata Mining advances Hualilan property to final feasibility

A program of underground exploration has been completed at the Hualilan property, a former producer in Argentina’s San Juan province.

Owner Plata Mining (PMT-A) says it has established the nature and extent of seven past-producing deposits, confirming that they continue to depth.

The work included mapping and sampling of extensive underground workings and delineation of reserves and resources, as well as a preliminary economic assessment based on minable reserves.

The company plans to start a feasibility study to bring the property into production.

The preliminary economic assessment was based on proven and probable minable reserves of 289,340 tonnes at a diluted grade of 12.71 grams gold and 47.54 grams silver per tonne, plus 2.25% zinc, 0.2% copper and 0.72% lead. However, it did not give consideration to possible geological resources (693,950 tonnes at 14.16 grams gold, 49.07 grams silver, 2.04% zinc, 0.21% copper and 0.59% lead); nor did the assessment take into account reserves, or potential resources (9.3 million tonnes with the same grades as the possible resources).

The preliminary study projects operating costs of US$65 per tonne and a net profit of US$76.54 per tonne based on the gross, recovered value of the minable reserves (including zinc, copper and lead). This estimate excludes working capital and a capital cost allowance.

The operating costs are based on an underground mine with a daily production rate of 250 tonnes. Based on an operating schedule of 300 days per year, such a mine would produce 75,000 tonnes annually. The initial mine life is estimated at 3.8 years but could be extended as resources are upgraded to reserves.

The deposits at Hualilan are oxidized near surface and correspond to supergene enrichment zones that extend to a depth of 100 metres below surface and continue to depth as deposits of primary gold-silver-massive sulphides (pyrite, sphalerite, chalcopyrite and galena).

A dacite porphyry has also been identified on the property, though it has yet to be explored.