Acquisitions trump drilling at current silver prices - CEO
Excellon Resources is focused on acquisitions over exploration given current weak silver prices, CEO Brendan Cahill told BNamericas.
EXPLORATION AIMS
The company has two planned phases of exploration over the longer term at the Platosa silver-lead-zinc mine in Mexico's Durango state, Excellon's sole operating asset.
The first is to find additional small, high-grade manto deposits, which have sustained operations at Mexico's highest grade silver mine so far.
Exploration, funded by cash flow, is expected to restart once Platosa's all-in sustaining costs (AISCs) fall below US$10/oz silver, partly through a US$6mn optimization project aimed at tackling water issues, due to conclude in 2016.
AISCs dropped by US$10 to US$15.67/oz in Q3.
The second exploration phase will target the source of the manto deposits, which will be a large, scarn deposit, which typically have resources of 10-100Mt ore.
"That big deposit is going to be much deeper. We are going to want to see higher silver prices before we really focus on exploring for it," Cahill said.
ACQUISITIONS
While the near-term exploration focus is on mantos, the company's aim is then to use cash flow from Platosa to make acquisitions, the CEO said.
"Buying ounces in the ground right now is a far more effective way of building resources than drilling for them," Cahill said.
With silver currently trading around US$14-15/oz, undeveloped silver deposits can be acquired at 10-15 cents per silver ounce, making them potentially attractive acquisition targets for development when silver prices rise.
"If silver stays at US$14-15/oz for the next 20 years, who wants to be in this business anyway? You have got to believe in higher silver price and acquire assets.
"Maybe you don't build them at US$14-15/oz silver, maybe you need US$20-25/oz prices to build them, but if you don't see those prices again it's a very penurious industry," he said.
Silver hit a six-year low of US$14.17/oz on Wednesday (November 18).
Subscribe to the leading business intelligence platform in Latin America with different tools for Providers, Contractors, Operators, Government, Legal, Financial and Insurance industries.
News in: Mining & Metals (Mexico)
Luca Mining’s Tahuehueto expansion in final commissioning
The gold mine is in Mexico's Durango state.
Lack of water at Buenavista mine impacts Southern Copper output
In its Q4 results report, Southern Copper also said that it initiated the commissioning process of its Buenavista Zinc project in Mexico's Sonora s...
Subscribe to Latin America’s most trusted business intelligence platform.
Other projects in: Mining & Metals (Mexico)
Get critical information about thousands of Mining & Metals projects in Latin America: what stages they're in, capex, related companies, contacts and more.
- Project: Sandra (ex Sandra-Escobar)
- Current stage:
- Updated:
3 months ago
- Project: Sandy
- Current stage:
- Updated:
3 months ago
- Project: Ariel
- Current stage:
- Updated:
3 months ago
- Project: Gavilanes
- Current stage:
- Updated:
3 months ago
- Project: La Mina (México)
- Current stage:
- Updated:
3 months ago
- Project: Project EP (Evelyn-Plomo)
- Current stage:
- Updated:
3 months ago
- Project: San Acacio (Zacatecas Project)
- Current stage:
- Updated:
3 months ago
- Project: Cervantes
- Current stage:
- Updated:
3 months ago
- Project: Tayahua Expansion - Primary Copper
- Current stage:
- Updated:
3 months ago
- Project: Pinos
- Current stage:
- Updated:
3 months ago
Other companies in: Mining & Metals (Mexico)
Get critical information about thousands of Mining & Metals companies in Latin America: their projects, contacts, shareholders, related news and more.
- Company: Molymex S.A. de C.V.  (Molymex)
-
Molymex S.A. of C.V. (Molymex México) is a molybdenum processor, subsidiary of Chilean consortium Molibdenos y Metales S.A since 1994. It was incorporated in 1979 for production...
- Company: Samson Control S.A. de C.V.  (Samson Control México)
-
The description contained in this profile was taken directly from an official source and has not been edited or modified by BNamericas researchers, but may have been automatical...
- Company: Minera Teck S.A de C.V.  (Minera Teck)
-
Minera Teck S.A de C.V., a wholly-owned subsidiary of Canada's Teck Resources Limited, is a Mexican metals exploration company based in Guadalajara, Jalisco State. The company i...
- Company: Minera Titán S.A. de C.V.  (Minera Titan)
-
The description included in this profile was taken directly from an official source and has not been modified or edited by the BNamericas’ researchers. However, it may have been...