It wasn’t even a month ago that this humble corner of cyberspace ran its post on the Coricancha (CMC) PEA, delivered to and by Great Panther Silver (GPR.to) (GPL) which told of the extra work, time and expense that would be needed by a serious mining company in order to make a reasonable decision on whether to put the shuttered mine back into production.
However, GPR is not a serious mining company. This from the company yesterday (IKN highlights):
VANCOUVER, Aug. 2, 2018
/CNW/ – GREAT PANTHER SILVER LIMITED (TSX: GPR; NYSE American: GPL)
(“Great Panther”; the “Company”) is pleased to provide an update on the
progress of the trial stope and bulk sample program (the “Bulk Sample
Program” or “BSP”) at its 100% owned Coricancha
gold-silver-lead-zinc-copper underground mine (“Coricancha”). Coricancha
is located approximately 90 kilometres east of Lima, Peru, and has a 600 tonne per day processing plant, well established infrastructure, and is fully permitted for production.Coricancha was placed on care and maintenance in 2013 and acquired by Great Panther in June of 2017. In December 2017,
the Company released an updated mineral resource estimate for
Coricancha. The Bulk Sample Program was initiated following the release
of the results of the Preliminary Economic Assessment for Coricancha
(the “PEA”), as detailed in the Great Panther news release dated May 31,
2018. The BSP will process about 6,000 tonnes of material and is
expected to be finished in the first quarter of 2019. Its objective is
to validate key mine and processing plant operating parameters in the
PEA and further de-risk Coricancha. The Company will use these results
as a basis for a formal decision to restart production.
Yup, they’re running a Bulk Sample Program (BSP) and on the back of that, some time in Q1 they’ll make a decision on whether to open the mine. Please compare the GPR plan, i.e. rushing to production decision in eight months max on the back of a BSP, to the recommendations of the 43-101 PEA. We quote:
CMC is highly sensitive to process plant head grades, gold and silver
prices, and operating costs. Variances associated with these factors
pose a high risk to the project economics.
And
Based on this TR, the Qualified Person recommends additional drilling
and exploration activities designed to upgrade the existing Resource
classifications and expand the current Mineral Resource inventory.
Details on the extent of exploration programs are to be determined
however are estimated to cost up to US$1M to US$2M per annum over the
next two to three years. In addition, associated mine rehabilitation and
development costs could be up to US$3M.
And
The Qualified Person also recommends additional technical studies
aimed to reduce risks and increase the level of confidence regarding CMC
advancement. Depending on the level of detail for technical work, these
are estimated at US$600,000 to US$1,000,000 over the next one to two
years.
The QP who put the PEA together knows that a tiny, 6,000 tonne BSP won’t be anything close to enough to gauge the risk of turning Coricancha back on. They recommend study and caution, they know this one is difficult. The resource is not understood to anything near the extent necessary and what GPR plan to do is little more than go back into production on the back of a PEA and relying on inferred resources. Now, if it were a reasonably predictable orebody they might get away with it, but this is a deposit that’s been a widowmaker for a decade, not even Nyrstar could make it work. But GPR isn’t like that, they’re going for the bluster. With this, GPR is showing the world exactly what it is, a bunch of cowboys who prefer to cut corners and BS investors rather than do things the right way.