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Endeavour Silver: consistently beating expectations

Thursday, January 5, 2017 4:13
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Endeavour Silver Corp (TSE:EDR) has three high grade silver-gold projects located in two historic mining districts of in Mexico, which combined can produce nearly 10 million ounces of silver equivalent annually.

The company has consistently beaten silver production and cost guidance in successive years from 2013 to 2015 and looks like it will beat 2016 guidance too when the numbers come out. It has been successful in pushing mining costs down throughout 2016, such that by the end of the third quarter they stood at just US$11.47 per silver ounce payable net of gold credits.


Core assets: Guanaceví, Bolañitos and El Cubo

In 2016, third quarter production beat expectations, as 1.2 mln ounces of silver and 14,300 ounces of gold were produced from the company’s three key mines, equating to 2.4 mln ounces of silver equivalent.

At the largest project, Guanaceví, the company reckons full year production will come in at between 3.4 mln and 3.7 mln ounces of silver equivalent. The current reserve stands at 6.1 mln ounces, with a total of 24.5 mln ounces in the measured and indicated resource categories and a further 12 mln ounces inferred.

At Bolañitos, the company reckons that the 2016 production total will amount to between 2.6 mln and 2.8 mln ounces of silver. Resources and reserves here are smaller, although it is noteworthy that past production from this project amounts to a hefty 1.2bn ounces of silver and 5 mln ounces of gold. Bolañitos is the company’s lowest cost project

At El Cubo, the company reckons that the 201 production total will amount to between 3 mln and 3.3 mln ounces of silver equivalent. The current resource base stands at over 12 mln ounces.


El Compas likely to become company’s fourth producing mine this year


Endeavour recently bought the 3,990 hectare El Compas project in Zacatecas for US$6.7 mln in shares. This project shows huge exploration upside, but also has a historic resource, a permitted mine and a 500 tonnes per day plant which has been leased for 10 years. The plan is to produce more than 1.2 mln ounces of silver in fairly short order, so watch this space


Parral discovery showing real potential


Another recent acquisition is Parral, a 3,432 hectare exploration project in a historic mining district that has already produced 250 mln ounces of silver. The project has a historic resource of 32.1 mln ounces of silver and multiple targets for the discovery of further ore. The plan is to spend US$2 mln on exploration at two prospects over the next two years.


Terronerra silver-gold discovery moving through the development phase


Meanwhile, at the Terranova gold-silver project, a prefeasibility study for development is underway, following the completion of a preliminary economic assessment in 2015. Once the current studies are completed, the company will look for finance for development.

Story by ProactiveInvestors


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