Sierra Madre Gold & Silver (SM.V) has confirmed it will release the mine restart study (‘MRS’) in the second quarter of this year as it has now engaged the technical consultant to help out with the study. As part of the MRS, an updated calculation of available underground mine material at Guitarra, Coloso and Nazareno while the Los Angeles bulk tonnage deposit will also taken into consideration. The restart study obviously won’t just look at the available material, but it will also include an estimate on operating costs based on the currently available data. And of course, there will be a capex estimate to bring the mine back into production while an expansion scenario will also be assessed.
The initial plan is to use three (existing) ball mills while the fourth (smaller) ball mill will not be refurbished at this time. This should be sufficient for an initial production capacity of 350 tonnes per day but as mentioned above, the company seems keen on rapidly expanding the throughput as that will unlock economies of scale. That’s why Sierra Madre already provided an overview of the anticipated capacity of the equipment that’s currently in place. As you can see below, an expansion to 500 tonnes per day shouldn’t require too much effort, but let’s wait for the mine restart study to get all the details.
Sierra Madre recently also received an explosives permit which obviously is an important requirement for an underground mine and it was the only outstanding required permit as Sierra Madre once again confirmed all other permits are in good standing.
Disclosure: The author has a long position in Sierra Madre. Sierra Madre is a sponsor of the website. Please read the disclaimer.
