Southern Silver Announces Updated PEA on Cerro Las Minitas: US$501M After-Tax NPV5%; 21% IRR; 48 Month Payback

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Vancouver, British Columbia--(Newsfile Corp. - June 10, 2024) - Southern Silver Exploration Corp. (TSXV: SSV) ("Southern Silver") reports results from its Preliminary Economic Assessment ('PEA") on its 100% owned Cerro Las Minitas project ("CLM").

PEA Highlights (all figures in $US unless otherwise noted):

  • Robust Project Economics - Base Case1: after-tax NPV5% of $501M (C$682M) and IRR of 21.2% with a 48-month payback;

  • Excellent Silver and Zinc Price Leverage - Base-case + 20% Metal Prices2: after-tax NPV5% of $876M (C$1,193M) and IRR of 30.1% with a 37-month payback;

  1. Base Case Metal Prices: Ag- $23.00/oz, Au - $1850/oz, Cu - $4.00/lb, Pb - $1.00/lb and Zn - $1.25/lb

  2. Base Case +20% metal prices: Ag- $27.60/oz, Au - $2220/oz, Cu - $4.80/lb, Pb - $1.20/lb and Zn - $1.50/lb

The 2024 Preliminary Economic Assessment features:

  • A Large-Scale Underground Mining Operation with a 17-year mine life and an annual average plant feed of 14.3 Mozs AgEq3 (inc. 5.8 Mozs Ag) and life-of-mine (LOM) feed totalling 243.2 Mozs AgEq3; (inc. 98.6 Mozs Ag). LOM product sales total 194.3Mozs AgEq3 at an AISC of $13.23/oz AgEq3 sold;

  • A High-Revenue Project with gross revenues totalling $4.47B with silver and gold representing 45% of revenues, and zinc representing 35% of projected revenues. The project has an Initial CapEx of $388M, an NPV5%-to-CapEx ratio of 1.3X and a paydown of 48 months on a post-tax basis; and

  • A Well-Located Project in a mining friendly jurisdiction with excellent infrastructure in southeast Durango state, Mexico;

  1. AgEq is calculated on a (contained metal x metal price)/ Ag price basis

In comparison to the earlier 2022 economic model, the updated PEA now:

  • Increases the Life of Mine (LOM) production by 5Mt, representing an approximate 20% increase;

  • Increases daily mine production capacity to 5300 tonnes per day ("tpd"), representing an approximate 18% increase;

  • Extends the mine life by 2.6yrs;

  • Increases the LOM Revenue by $765M, representing an approximate 17% increase in revenues.

  • Increases the after-tax NPV5% by 45% to $501M; and

  • Similarly, increases the post-tax IRR by 3.3% to 21.2%

Lawrence Page. K. C. President, said: "This latest economic update of Cerro Las Minitas represents a new milestone in the ongoing evolution and development of the project which is the culmination of a number of smaller technical improvements, developed over the last 18 months, which together result in a significant increase in the value of the Cerro Las Minitas asset. This includes the addition of new mineral resources from the North Felsite zone as first reported in March 2023; the standardization of the metallurgical recoveries and charges across each of the deposits, including the addition of gold revenues into the project cash-flow; improvements in the mine scheduling and optimization both the Operating and Capital costs of the project."