The silver price has remained steady since the deal closed two weeks ago, but Mitre has hit the ground running with a doubling of resources to 50.2 million ounces grading 311 grams per tonne silver equivalent – or 605,000oz gold equivalent.
Much of the resource is just 300m from surface.
Within the resource is a high-grade subset of 25.5Moz AgEq grading 655gpt, primarily associated with the Coyita and Delia underground deposits.
Mitre’s update comes from a review of historical drilling, including a significant re-sampling and re-logging campaign at the Delia vein.
Interim executive director Ray Shorrocks said it was an early indication of the quality and value of the acquisition, and showed the scope for further increases.
“The underground grades are exceptional and the mineralisation remains open. In addition, the more data we review, the more prospectivity we see,” he said.
The Mitre team, which includes Steve Parsons and Michael Naylor, is now looking to deliver more growth with the company’s maiden drilling program underway and the expectation of an even larger resources later this year.
The program will cover a mix of extensional drilling at the Taitao, Coyita and Delia veins, which are open in multiple directions, and new areas such as that have returned some extremely high grades such as 1.13m at 13,218gpt AgEq (5291gpt silver and 95.5gpt gold) at Pegaso and 24m at 538gpt silver and 9.3gpt gold, including 8m at 1592gpt silver and 26.5gpt gold at Cristal.
It promises a steady stream of assays as it has its own lab, which can turn the core in around 48 hours.
Some 91Moz AgEq has been produced from Cerro Bayo since 1996.
There has been very little production from the project since flooding in the last decade. After optioning the asset from Mandalay Resources in 2018, ASX-listed Equus Mining completed some small-scale stockpile processing, but failed to turn a profit.
Mitre estimates the existing infrastructure has a replacement value of over $150 million, including a 500,000tpa mill that is ready to return to production at the flick of a switch.
The company’s strategy is to define significant exploitable resources within about 3km of the plant before resuming production, with a targeted of around 100Moz AgEq in the picture.
Mitre started February with around $8.5 million in cash.
