Magna Gold Corp. (MGR:TSX.V; MGLQF:OTCQB) recapped in a news release what it has accomplished at its San Francisco mine in Sonora, Mexico, since acquiring it in May 2020. The company noted that it is on track to achieve full operations there in 2021.
"Mining, development and processing activities at San Francisco are progressing well, and initial mine performance has exceeded expectations," President and CEO Arturo Bonillas said in the release. "With pre-stripping activities in full progress, we are poised for an exciting and profitable 2021."
In August, Magna began mining and processing fresh ore from the La Chicharra and San Francisco open pits. Together, with processing of the low-grade stockpile, the company is now placing about 9,400 tons per day of ore on the heap-leach pads. Metallurgical testing of the ore resulted in average gold recovery rates between 68% and 72%.
Since acquiring San Francisco mine, the Canada-based explorer sold 12,408 ounces of gold, generated US$22.4 million (US$22.4M) in revenue and a cash operating margin of US$7.3M.
Magna reinvested CA$5.8M back into the project, spending CA$1.8M on restart costs including urgent plant repairs and major refurbishments, CA$3.5M of open pit pre-stripping costs and CA$0.5M on underground mine development. At Sept. 30, 2020, the quarter's end, Magna's consolidated cash position at the company level was US$11.2M.
The company, through drilling, realized the possibility of delineating a higher-grade underground mineral resource and advanced an underground decline below the San Francisco pit.
"Gold production from fresh ore is to be realized in Q1/21, in accordance with the San Francisco mine gold recovery model," the release noted.
In its continued optimization of the San Francisco project, Magna identified four ways to improve future mine operations and economics, each of which it is tackling. They include expanding the mineral reserves and the production scale, reducing operating costs and conducting additional metallurgical testing to improve capacity and metal recoveries.
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