Great Panther Mining Ltd. [GPR-TSX; GPL-NYSE American] said Monday July 8 that it has approved a positive production decision for its 100%-owned Coricancha gold-silver-zinc-copper mine in Peru.
The company said the decision was based upon the final results of the trial stope and bulk sample program (BSP) which confirmed the key operating assumptions for Coricancha contained in a Preliminary Economic Assessment that was announced in May 2018.
“We are pleased with the results of the BSP and look forward to advancing Coricancha towards commercial production,” said Great Panther President and CEO James Bannantine. “The actual restart date is expected in the first half of 2020 and will be aligned with our other mining operations to ensure the project has the necessary planning and resources in place to optimize operations and profitability.”
“Coricancha is expected to produce approximately 40,000 ounces of gold equivalent annually and will be an important addition to Great Panther’s production portfolio going forward, Bannantine said.
Great Panther shares advanced on the news, rising 0.97% or $0.01 to $1.04. The shares are trading in a 52-week range of 70 cents and $1.58.
Great Panther is a low-cost producer with a very strong leverage to the price of silver. Already holding two mines in Mexico, the company has successfully expanded into Peru and Brazil.
The company said its primary focus for 2019 will be on the integration and optimization of the recently acquired Tucano Gold Mine in Brazil.
The company plans to produce up to 200,000 ounces of gold equivalent this year.
Coricancha is located 90 km east of Lima, Peru and was acquired by Great Panther in June 2017.
The mine has a 600 tonne-per-day processing plant and is fully permitted for production. However, production was suspended by a previous operator in 2013.
According to the 2018 PEA, the average annual production at Coricancha is estimated at 3.1 million silver-equivalent ounces or 149,000 gold equivalent ounces over the life of the mine. All-in-sustaining cost is estimated to be US$2.20 per payable silver ounce or US$547 per payable gold ounce over the life of the mine.
The PEA contemplates the use of standard cut-and-fill mining techniques, providing ore to support a target annual throughput rate of 550 tonnes per day to the mill. Saleable products include lead, zinc, and copper concentrates, as well as gold-silver doré.
Given that there is a processing plant in place, existing infrastructure, and a history of recent production up to 2013, total capital costs are relatively small. Initial capital expenditures of $8.8 million, consisting of an internal ramp and ore pass system required to upgrade and improve the materials handling.
Life-of-mine sustaining capital is estimated at $23.6 million.