The feasibility report IDs lead, zinc, copper and gold in other accurances around their property. They never mention any lead or zinc in the Shafter deposit. The la Negra mine's silver revenues are doubled up, by the associated base metals.
In future years I hope they find good sized mineable deposits with associated base metal revenues like La Negra.
After getting home from the mine trip Sunday and looking at the drill results I got out the old pen and paper and went to work and want to share what I think is some very good news. When AURCANA starts running the block 3 ore thru the ball mill,in about one month, at a low ball grade of 7.75 oz/ton running 1,500 tons/day with 84% recovery rate equals 9765 oz/day X 365 = 3,564,225 oz/silver per year now for the gold factor at 10% gold that 356,442.5 oz/ per year gold. If the ore grade holds at say 15oz/ton then the figures change to 6,898,500 oz silver/year and 689,850 oz gold. Now think about that and lets compare ARCANA to say AUY with a float of 746 million share and production of 1.2 million oz gold and 8-9 mill oz silver per year market cap of 11.6 billion. While little AUNFF with a float of 446 million shares and a market cap of 405 million and in a years time with the La Negra mine it possible that little AUNFF will be producing around 8 million oz of silver and 600,000 to 700,000 oz of gold to me that puts it on a par with AUY with 300 million less shares. Don't get to excited just yet but the way I see and figure it if you want in I think now is the best time to do so.
<<<Rodriguez is a warm and affable guy with a quick wit. When I asked him about the surprisingly high gold content within the first couple of dore bars poured at Shafter, he joked about his supposedly pure silver deposit being "contaminated" with gold. You see, the Shafter mine plan does not call for any appreciable gold by-product, so the project's robust economics are solely a reflection of the deposit's solid average silver grade of 8.6 ounces per ton (in measured and indicated resources).
Aurcana CEO Lenic Rodriguez demonstrates one of the very first dore bars produced at Shafter since the Presidio mine closed in 1942. Rodriguez has two reasons to smile, as he celebrates not only the project's timely completion under budget, but also the encouraging gold content of these early realized results.
Shafter produced 35 million ounces of silver between 1883 and 1942 at an average grade of 15 ounces per ton (467 grams per ton). Former property owner Gold Fields (NYSE: GFI ) conducted $20 million worth of exploration and development work between 1977 and 1982. Nowhere within that deep well of history was the project thought to contain significant quantities of gold. And yet, gold accounts for roughly 11% by weight of the first dore bars poured at Shafter! While there can be no guarantee that these surprising gold values will continue, at 11% of the dore content, gold accounts for roughly 88% of the anticipated revenue from these first dore bars. Expressed another way, the market value of a dore bar containing 11% gold is roughly seven times that of its silver-only counterpart.
While I don't expect gold values to remain that elevated throughout the orebody, any appreciable gold by-product could significantly enhance the mine's economics.>>>
8.6 oz. average silver grade at 84% recovery for 350 days (15 days for mill maintenance and holidays) x 1500 tpd equates 12900 x .84 = 10836 x 350 days = 3,792,600 oz's Ag for 12 months full production. That is pretty close to Aurcana's estimation of 3.8M oz's the first year of production. 3.8M oz X CONSERVATIVE $32 avg. per oz Ag = $121,363,200. Let's say $121M.
Let's go with Chris thinking that 11% Au will not continue and figure the recent hole results of Block 3. Let's take a CONSERVATIVE 1.4% avg. off that exploration drilling of Au for tonnage mined. 3,792,600 x .014 = 53,096 lets say 53,100 oz Au. 53,100 x $1750 CONSERVATIVE Au avg = $92,925,000 - lets say $93M.
La Negra achieved a 9% reduction in silver production cost per silver equiv. this past year. Let's throw CONSERVATIVE to the wind and say Shafter achieves the same 9%.
121M + 93M = $214M. Minus $9.50 mining cost x 3.8M = 36.1M. - ($9.50 x .09% = .855) is $9.5 - .85 = $8.70 cost/oz. $214M - $33M = $181M. Just at Shafter. CONSERVATIVELY.
18 month payback at $15 oz/Ag for Shafter on feasibility. Before the gold and $28 Ag currently.