Silver Elephant Mining Corp. [ELEF-TSX, SILEF-OTCQX, 1P2N-Frankfurt] said it intends to begin phase one mining of sulphide materials this year at its Paca silver project in Potosi department in Bolivia.
The company said it has completed the design for a phase one underground mine at Paca aimed at extracting approximately 10,000 tonnes of mineralized materials. The objective is to generate cashflow, and verify the Paca resource model. The Paca sulphide project is outside the scope of the oxide sales and purchase agreement and master services agreement with Andean Precious Metals Corp. [APM-TSXV, ANPMF-OTCQB] and detailed in a press release on September 12, 2023.
Under the agreement, Silver Elephant agreed to deliver 800,000 tonnes of silver-bearing oxide material from the Paca project to Andean’s plant in Potosi, which is approximately 191 kilometres from Paca. Andean will reimburse Silver Elephant for certain operating expenses and other expenses, under an agreement which will expire either on January 31, 2029, or when 800,000 tonnes of products has been delivered.
The Paca project hosts an indicated resource of 6.5 million ounces of silver (1.09 million tonnes of grade 185 g/t silver) in oxide form near surface.
The Paca project is part of Silver Elephant’s Pulacayo project with a total indicated resource of 106.7 million ounces of silver, 1.4 billion pounds of zinc and 690 million pounds of lead. Silver Elephant recently said it has spent over $35 million on Pulacayo and Paca, which is considered to be an advanced mining project with over 96,000 metres of drilling and a historic feasibility study.
Silver Elephant entered into a Mining Production Contract (MPC) with Corporacion Minera de Bolivia (COMIBOL), a branch of the Bolivian Ministry of Mining and Metallurgy in Ocober, 2019. The MPC grants Silver Elephant the 100% exclusive right to develop and mine the Pulacayo and Paca concessions for up to 30 years.
The Pulacayo Project is at the centre of a thriving Bolivia silver mining district and is within 250 kilometre driving distance from the San Cristobal mine, the Cerro Rice mine and Pan American Silver Corp.’s [PAAS-TSX, NASDAQ] San Vicente mine.
Silver Elephant said Phase one of the Paca sulphide project plan is expected to last approximately five months, starting in September 2024. It begins with the development of a 367-metre tunnel at level 0 that will provide access to the mineralized materials, which will be mined using the shrinkage stopping method. The expected average grade of extracted and sorted sulphide materials is 412 g/t silver, 1.09% lead and 0.38% zinc. This material is contained within the Paca resource estimate (1.81 million tons of indicated resources with a grade of 256 g/t silver, 1.22% lead, and 1.22% zinc). The company said 95% of the estimated resource is within 100 metres from surface.
During Phase one, the company will truck the mined materials from Paca to Potosi town for toll milling.
Silver Elephant shares were unchanged at 52 cents and trade in a 52-week range of 55 cents and 21.5 cents.
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