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Q3/17 Mexican Silver Production Report Shines

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A producer/explorer active in Mexico and Peru released third quarter production results that were in line with one analyst's expectations.

For the last 100 years, the average gold/silver price ratio was 47:1. It now takes 75 ounces of silver to purchase one ounce of gold.

The silver-spring is coiled tight and may be poised for a rebound.

On October 12, 2017, Great Panther Silver Limited (GPR:TSX; GPL:NYSE.MKT) announced Q3 production results from the Topia Mine in Durango, Mexico, and the Guanajuato Mine Complex, which includes the San Ignacio Mine, also in Mexico.

Great Panther Mexico Project Map

Q3/17 compared to Q3/16:

  • Metal production increased 13% to 1,080,483 silver equivalent ounces
  • Silver production increased 4% to 532,803 silver ounces
  • Gold production increased 8% to 5,848 gold ounces
  • Lead and zinc production increased 78% and 74%, respectively
  • Ore processed decreased 1%, with 94,080 tonnes milled

"The results are consistent with the previous quarter and fall in line with the Company's annual guidance," stated James Bannantine, Great Panther's president & CEO. "The increase in gold production compared to the second quarter 2017 is a direct result of the improved gold grades and recoveries."

Total metal production for the Guanajuato Mine Complex was 755,008 silver equivalent ounces—a 1% increase over the previous quarter—but a decrease of 4% compared to Q3/16.

According to the press release: "The decrease is attributed to lower tonnes milled due to narrower than anticipated veins at the San Ignacio mine and lower silver grades. These factors were partly offset by improved gold grades and recoveries."

Total metal production at the Topia Mine decreased 8% compared to Q2/17 but increased 79% over Q3/16. All tailings continued to be deposited at the Phase I Tailings Storage Facility, while Great Silver awaits the decision on its formal application, which must include an environmental assessment study.

A recent report by ROTH Capital Partners gives Great Panther a "BUY" recommendation with a US$2.00 price target (58% higher than its current price of US$1.26).

ROTH analyst Jake Sekelsky said this about the Topia Mine Tailings issue: "We expect Great Panther to receive the TSF2 permit in 4Q17, we are maintaining our 2017 production estimate of 2.0 million ounces of silver and 22,628 ounces of gold for total silver equivalent production of 4.0 million ounces while updating our production and EPS estimates."

As well as the two Mexican mines, Great Panther has acquired the Coricancha Mine in Peru. The property includes 126 mining licences, a 600-tonne per day processing permit and a transportation permit, all valid and in good standing.

"We expect an updated resource estimate at the Coricancha Mine to be released in 4Q17," stated Sekelsky, "In our opinion, the updated resource estimate should form the basis of an upcoming economic study. We expect to revisit our assumptions for Coricancha once an economic study is released in 1H18."

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1) Lukas Kane compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
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