Wednesday, 2 May 2012

Orko Silver "one step closer" to La Preciosa mine

Orko Silver Corp. (CVE:OK) said Wednesday that it is "one step closer" to mining its 100% owned La Preciosa project in Mexico, after a Preliminary Mineability Assessment (PMA) concluded mining could be done at the site.

Orko said the results of the PMA, carried out by independent consultant AMEC Americas Limited (AMEC), cover both open pit and underground mining options that were presented in its Preliminary Economic Assessment (PEA) released by the company and its former partner Pan American Silver Corp., in mid-August, 2011.

Orko reported that AMEC's PMA is based on a detailed examination of selected drill cores during two site visits in January and February, of 2012.

La Preciosa is located in Durango State, which envelops the heart of Mexico’s prolific Sierra Madre Mining Belt, and includes large silver deposits such as Fresnillo and Pitarrilla.

As the result of their work, AMEC concluded "that there is no readily identifiable reason to suppose that both open pit and underground mining could not productively and safely be carried out in the La Preciosa deposit.

"There are persistent joint planes that trend parallel to the average dip and strike of individual veins, but the instability potential that could arise from these structures could readily be controlled through the use of appropriate support types, densities and strategies."

"We have always had faith that all criteria essential to a successful mining operation exist at La Preciosa," Orko Silver's president and CEO Gary Cope said.

"With this study, AMEC has taken us one step closer to that eventuality."

Orko noted that the results presented in the PMA are preliminary.

The company said that more detailed geotechnical investigations and characterizations are still required, at the pre-feasibility level of project development, before firm and final conclusions can be derived concerning the details of access, open pit slope
configurations, stoping strategies, layouts and support systems.

Full recommendations to complete the pre-feasibility study will be included as part of the new independent AMEC authored PEA that is anticipated in August or September.

The company reported that the August 2011 PEA gave an estimated mineral resource containing 113 million ounces of silver classified as indicated and a further 46 million ounces of silver classified as inferred.

In addition, the deposit contains over 222,000 ounces of indicated gold and 83,000 ounces of gold in the inferred category.

The PEA showed an after-tax net present value of $315 million at a five percent discount rate, and a 24.3 percent internal rate of return. The results assumed prices of $25 per ounce of silver and $1,250 per ounce of gold.

At the time, Orko's management called the PEA's findings "conservative" and had been expecting "significant upside potential" in the pending feasibility study.

Orko is anticipating the results of a new independent resource estimate currently being prepared by Mining Plus, an international mining consulting firm.

This resource estimate scheduled to be completed and released in May, will be an integral component of the new PEA which is set to be released in late July.

Earlier this month, Orko announced it had regained 100 percent ownership in its La Preciosa property.

In early April, Pan American Silver (TSE:PAA)(NASDAQ:PAAS) relinquished its right to earn a 55 percent interest in the La Preciosa project, one of the world's largest primary silver deposits, after it decided not to deliver feasibility study before an April 13, 2012 deadline.

Orko Silver's chief executive Gary Cope confirmed that four unnamed mining companies had "expressed an interest" in the project, with Orko signing standstill agreements with two of these parties.

No comments:

Post a Comment