Torex Gold updates Morelos mine plan, including EPO deposit
Torex Gold Resources Inc. [TXG-TSX, OTC-TORXF] has released an updated life-of-mine plan for its Morelos complex, which incorporates the EPO underground deposit, following completion of an internal prefeasibility study on the deposit.
Torex shares advanced on the news, rising 1.9% or 46 cents to $24.46. The shares trade in a 52-week range of $26.85 and $12.40.
“With the addition of the EPO mineral reserves, the production profile of the Morelos complex is now firmly established at a minimum of 450,000 ounces of gold equivalent (AuEq) per year through 2030 on the mineral reserve case alone,’’ the company said in a press release.
Torex is an intermediate gold producer, engaged in development and exploration at its 100%-owned Morelos Gold Property, which covers an area of 29,000 hectares in the Guerrero Gold Belt, about 180 kilometres southwest of Mexico City. The company has said it plans to produce 410,000 to 460,000 ounces of AuEq this year.
Within the Morelos Gold Property, the company’s principal assets are the El Limon Guajes (ELG) Mining Complex, which consists of the El Limon, Guajes and El Limon Sur open pits (the ELG Open Pits), The El Limon Guajes underground mine, including zones referred to a Sub-Sill and El Limon Deep (ELD) and the processing plant and related infrastructure.
These operations reached in the commercial production stage in April 1, 2016.
Torex has been working to develop the Media Luna deposit, which is located on the same concession as The Guajes, El Limon and Sub-Sill deposits.
Torex has said it was planning US$848 million in capital expenditures to bring the Media Luna project into commercial production. That includes US$85 million worth of underground development during the pre-commercial production period from the fourth quarter of 2023 to the fourth quarter of 2024.
“EPO is a low-risk brownfield addition to the life of the mine plan; the close proximity to Media Luna infrastructure requires approximately 2,200 metres of upfront lateral development to access EPO and connect the Media Luna ore handling system (including a 550-metre ventilation adit), which facilitates overlapping use of the Media Luna mobile fleet and personnel, and minimizes permitting requirements,’’ the company said.
EPO will further complement the company’s exposure to the copper market – with 143 million pounds at a grade of 1.29% copper within the inaugural EPO mineral reserve of 781,000 ounces of AuEq (gold equivalent).
EPO upfront capital expenditures are estimated at US$81.5 million. The company said its strategy in constructing Media Luna was to ensure that the relevant infrastructure was sized sufficiently to handle further additions from the Media Luna cluster and south side of the Morelos property. The Guajes tunnels, conveyor and ore handling systems, paste plant, mineral processing facilities, and power and water infrastructure will all be utilized for EPO.
Media Luna contains 4.6 million ounces of AuEq of measured and indicated resources as well as 1.0 million ounces of AuEq of inferred material.