Long-term readers of this humble corner of cyberspace will know its opinion of Americas Gold & Silver (USAS) (USA.to), a disaster of a company that has made a long-term mess of mining in three different countries over the Americas continent and only manages to survive because of schmoozy Blasutti, a CEO with his tongue so far up Eric Sprott’s rectum he also provides pre-digestive poisons checks for his lord and master’s victuals. Therefore, when USAS added “...and Provides Operational Update” to the end of Monday’s NR entitled “Americas Gold and Silver Corporation Reports First Quarter 2021 Results…“, then proceeded to explain the FUBAR at Relief Canyon, there wasn’t much surprise registered at this desk. Not so the market, of course, which did this to the stock price…
…but point of fact didn’t truly punish USAS and Blasutti, they’re only back at the insto-designated reset price.
Instead of going to where they should be going. That is zero, ladies and gents, because even now USAS isn’t being straight with you about the issues faced by Relief Canyon. We can pick up the thread in the Monday NR too, because the offered excuse sticks out like a sore thumb:
“As part of this analysis, the Company identified naturally occurring carbonaceous material within the Relief Canyon pit. The identification of this material was not recognized in the feasibility study.”
Oh cute, passive voice. By whom? When? Where? So it was off to SEDAR for this pseudo anal yst, the 2018 feasibility study compiled by MDA and the thing that stands out isn’t how the material “was not recognized” in as much as it was ignored. Supposedly FS, the distinct lack of met testing on show would be telling in a PEA and my stars, it screams at you here. A table, a screenshot…
…which shows all the test result averages from five different gold-bearing mineralizations at the project. Scant already, now focus in on the problem child “LSBXL”, designated because it’s limestone breccia with low cyanide solubility,. Time to quote the 43-101:
The limestone breccia with low cyanide solubility composite (2-LSBXL) gave significantly lower gold recoveries than the four other composites. Gold recoveries for the crushed feeds were somewhat erratic and ranged from 16.7 percent at the 80 percent -3/4 inch feed size, to 30.8 percent at both the 100 percent -2 inch and 80 percent -3/8 inch feed sizes. Gold recovery from the 80 percent -200M feed was moderately higher (40.0 percent). There were some indications of a mild preg-robbing character for this composite. Locking of contained gold in sulfide mineral grains or in silica are among other possible explanations for the low gold recoveries obtained from this composite.
You just read a 43-101 compiler whistling past a graveyard. Take a closer look at the LSBXL results using five different treatments and you see they got recoveries of 16.7%, 28.6%, 30.6%, 30.8% and 40.0%, so it’s already fun to see how that got to average 38.5%. But the above table also shows the Master tests, i.e. what the clever people expect from recoveries once the whole deposit is under operation and blended on the leach pads. Those vary from 72.7% to 81.8% and ultimately, a main input for costs assumptions. To do that they must have assumed encapsulation rather than preg-robbing and that shows in this column test result table, these guys just blended their percentage recoveries with the amount of each rock type. If this is FS-level work, I’m Bob Moriarty’s punkah wallah:
This desk invites you to spend time with that 43-101 document and read it more closely, if you do, it’s highly likely you’ll come to the same conclusions about it. Pershing, MDA and ultimately USAS rested the fate of their mine on the met results of a tiny proportion of their deposit. Just five composites from the main zone, each of which crushed to four or five size and from those 20 or so results they got the numbers they wanted from most of them. However, when one area of the pit returned persistently low recoveries and the compiler suspected preg-robbing, instead of any further investigation, checking, met work, drilling, follow-up, or time to consider the potential of an epic failure, USAS ploughed ahead and pretended it didn’t matter. This is how the joke end of mining works, the worst management teams imaginable, full of their own self-importance and deal-making abilities, but unable to use a pocket calculator, or consider new risk, or damage in any way their carefully preened image. There are only so many billionaires to fellate, Darren.