We are taking a disciplined approach. We plan on issuing a revamped PEA in H2 2021 focused on high-grade early in the mine life and subsequent staged expansions to support manageable capital expenditures.
Our revamped PEA is planned to include:
- A target life of mine head grade of +100 g/t AgEq
- Target initial mill throughput of 8,000-12,000 tonnes per day (tpd)
- Expand mill to 20,000-25,000 tpd once initial capex is paid off
The most recent PEA, updated in April 2018, was based on a “bigger is better” approach. “The project, as it is currently scoped, is taking shape as a major open pittable project with projected mineral resources supporting 29 years of production at 40,000 tpd,” states the 2018 PEA. Although our approach will be different, the 2018 PEA clearly demonstrates the exceptional scaleability of Cordero at higher commodity prices.
Highlights of the base case from the 2018 PEA conducted by Independent Mining Consultants and M3 Engineering:
- At $20/oz silver, $1.30/lb zinc, $1.00 lead, and $1,300/ oz gold.
- Internal rate of return: 16.5%
- Mill capacity: 40,000 tpd
- Strip ratio: 0.98:1
- Payback: 4.8 years
- Net annual cash flow: $77.4M
Other key points:
- Average annual production of 8 Moz of Ag, 99 Mlb of Zn, 69 Mlb of Pb and 12koz of Au.
- 29-year mine life includes total mineralized material of 417.5 Mt at a 46 g/t AgEq
- Life-of mine production: 231 Moz of Ag, 2,863 Mlb of Zn, 1,992 Mlb of Pb and 0.35 Moz of Au.
- Simple metallurgy (side by side lead and zinc conventional floatation mills) with 88% overall silver recoveries.
- Capital costs estimated at $570 million for initial project capital and $271 million for sustaining capital over the mine life.
For more information, please see: NI 43-101 Technical Report / Cordero Project PEA Update (March 2018)
*A Preliminary Economic Assessment should not be considered to be a prefeasibility or feasibility study, as the economics and technical viability of the Project have not been demonstrated at this time. The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Furthermore, there is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The Technical Report: Cordero Project, Preliminary Economic Assessment was authored and approved by Daniel H. Neff, P.E., who is the Qualified Person for purposes of this Preliminary Economic Assessment and the associated updated resource calculation. The revised PEA is available for viewing at SEDAR.