Southern Silver Exploration Corp (TSX-V:SSV, OTCQX:SSVFF) has announced results from a Preliminary Economic Assessment (PEA) on its 100% owned Cerro Las Minitas project in Mexico, with highlights that included an After-Tax Net Present Value (NPV), using a 5% discounted rate, of US$349 million, an Internal Rate of Return (IRR) of 17.9%, and a 60-month payback.
The resource project developer said the PEA also estimates a large-scale underground mining operation with a 15-year mine life, with an annual average plant feed of 14.2 million ounces of silver equivalent at all-in-sustaining costs (AISC) of US$13.27 per ounce of silver equivalent sold.
“Since acquisition of the property in 2010 and subsequent identification of the mineral resources, a very profitable and valuable mine has been modelled in the results of the PEA disclosed today,” Southern Silver Exploration President Lawrence Page said in a statement.
READ: Southern Silver Exploration reports expanded mineralization in new drill results at CLM project in Mexico
“This presentation of the results of the PEA marks a significant milestone in the development of the property and the best is yet to come,” Page added.
Southern Silver also noted the PEA outlines base case gross revenues that could total as much as US$3.7 billion with an initial CapEx of US$341 million.
The company added that the PEA modelling is based upon a mineral resource estimate prepared in late 2021, with data derived from 171 drill holes, and with 24 additional drill holes having been completed since it has resulted in the identification of a further 400 metres (m) of mineralized strike-length.
The PEA uses metal price assumptions of US$21.95 per ounce of silver, US$3.78 per pound of copper, US$1.33 per pound of zinc, and $0.94 per pound of lead, the company said.
Southern Silver is focused on its 100% owned Cerro Las Minitas silver-lead-zinc project located in the heart of Mexico's Faja de Plata, which hosts multiple world-class mineral deposits such as Penasquito, Los Gatos, San Martin, Naica and Pitarrilla.
In all, 196 drill holes for 84,872m have been completed at the asset with exploration expenditures of over US$30 million equating to exploration discovery costs of around C$0.09 per silver-equivalent ounce.
Contact Sean at sean@proactiveinvestors.com