www.extorre.com
Extorre Gold Mines is an emerging gold & silver producer in Argentina, which is listed under the symbol XG on the Toronto Stock Exchange (TSX) and the NYSE-AMEX Exchange. The cash position on November 1, 2011, is $35 million. Cerro Moro is Extorre's flagship gold-silver property located in mining friendly Santa Cruz Province.
Extorre Gold Mines expands production scenario for Cerro Moro economic study
Extorre Gold Mines (TSE:XG) (AMEX:XG) said Tuesday that it has expanded the scope of its economic study for the company's Cerro Moro project in Argentina, including a larger production scenario to reflect recent drilling success and the increasing gold and silver inventory on the property.
The preliminary economic assessment (PEA) study is due out in the middle of July, the company said, and will be categorised as a PEA instead of a pre-feasibility study (PFS) to allow for the inclusion of additional mineralized zones, with a portion of the resource now being inferred, as opposed to higher confidence categories.
The company chose to do this as prefeasibility studies can only be followed by another of the same kind, or a feasibility study, and the recent Zoe find at the property would thus have to be fully drilled off to the "indicated" resource category before Extorre could undertake a PFS - potentially taking up to one year.
Extorre said the daily throughput levels being modelled in the study will be both 750 and 1,000 tonnes per day. In the last report from October last year, only the 750 tonne per day scenario was evaluated.
The upcoming report will also use a silver/gold ratio of 50:1, as opposed to the 60:1 ratio used in the earlier study, while gold and silver prices used will be US$1,320 and US$26 per ounce, respectively.
The company said that a new PEA based on a further 50% production expansion scenario is planned before year-end, and will include the recent Zoe discovery, as well as a number of additional veins not included currently.
In June, Extorre announced a $25 million bought deal financing, which allows it to maintain its drill program through the remainder of the year with six rigs, of which two are infill drilling the Zoe find.
Last April, Cerro Moro had indicated resources of 662,440 ounces of gold equivalent and inferred resources of 430,880 ounces of gold equivalent. The latest PEA in October estimated average production of 144,400 ounces gold equivalent per year from the project during the first five year of operations, at a cash cost of US$185 per ounce.
