Sonoro Gold Corp (TSX-V:SGO, OTCQB:SMOFF) this week announced that it intends to raise up to $1 million in a non-brokered private placement to fund its ongoing development activities at its Cerro Caliche gold project in Sonora, Mexico, in addition to working capital.
CEO Kenneth MacLeod joined Proactive to run through the company’s plans to advance the project through additional drilling as it awaits the Mexican government’s federal permitting authority’s approval of its Environmental Impact Statement.
The program has been designed to increase the size of the resource and extend the currently estimated life of mine.
“We look at this as the first step of a multi-phase program to fully realize the value of the central collegiate project,” MacLeod told Proactive.
“We believe the ultimate value is many times greater than the approximately half million ounces we have currently within the pit shells.”.
Cerro Caliche hosts an estimated 440,000 ounces of gold in pit shells, which when taking a recovery rate of 74% in the lab and 72% in the field ends would result in production of approximately 300,000 ounces, MacLeod said.
The upcoming drilling will target areas close to the pit shells.
“The expectation is that we will go in there and do some infill drilling and a bit of expansion drilling and classify much of that material, if not all of that material, as pit shell material which would add to the overall size of the resource and make the project even more economic,” the CEO said.
“We have a US$77 million net present value, discounted 5% and internal rate of return of 63%, so the project is very robust as it currently stands but by adding additional ounces and maybe even increasing the average grade, it will add to the overall economics in a very, very positive manner.”
Sonoro Gold is a publicly listed exploration and development company holding the development-stage Cerro Caliche project and the exploration-stage San Marcial project in Sonora State, Mexico.