I think your thoughts might be very prescient. A few years back, one of our neighbors to the north had some underground operations. Later their engineers told management that this project would be more economic if we changed over to bulk mining methodologies via an open pit operation. This cost them a couple of years of delays from SERNAGEOMIN from a permitting point of view because it is dangerous to excavate an open pit over and through existing adits and tunnels.
My ”Doesn’t quite make sense list” currently has on it: Why is Hochschild so quiet? They did a 6 line-kilometer IP/IR study and then the “cone of silence” descended. Were they told to stand down for a bit until the final attack plan was drafted? What did their IP’s reveal? Recall that Hochschild reviewed all of the previous drill cores from the LDM before signing the JV. They also channel sampled the 2 existing adits there BEFORE SIGNING THE JV. The IP results aren’t something that after they came in Hochschild would decide to walk away. No, they’re designed to confirm and add to the adit channel sampling and to prioritize drill targets. Noticed that we did not hear that Hochschild walked but most JVs have a scheduled work commitment wherein the optionee has to do “X” amount of exploration tasks over “Y” timeframe. Recall that Hochschild was going to follow the Sillitoe-designed attack plan and Bustamante over at Hochschild made a comment to the press that “the geology over at the LDM IS PRETTY INTERESTING.
Note that the deposit style that Hochschild is going after is a “Lacustrine sediment hosted stratabound copper deposit”. There is a very well-defined “belt” of these deposits that extends north of and south of the ADL. To the north is the El Soldado mega mine operated by 4 majors: Anglo American, Codelco, Mitsubishi and Mitsui. To the immediate south of us is the Lo Aguirre Mine. THERE THE ENGINEERS DECIDED THAT AN OPEN PIT ATTACK WAS THE PROPER WAY TO GO.
At the eastern ADL plateau there is a large confluence of epithermal veins near the Merlin 3 Vein and some of the various Fortuna Veins. Management already told us that this might be open pittable.
My “Doesn’t quite make sense” list also includes: what the heck happened over at the Pegaso Nero? The hyperspectral imaging satellite survey revealed “about a dozen” intrusives over a 7 Km stretch aligned in a SW to NE orientation across the southern downslope off of the plateau. OK, I get it, it’s big. The ridge crest sampling along the westernmost extent of this swath revealed high grade moly and copper OVER A 3.6 KM NORTH TO SOUTH ORIENTED SWATH. OK, the westernmost intrusive of the “about a dozen” is loaded and VERY BIG.
There are about 6 ridge crests descending down from the plateau in this 7 Km swath. Management told us they were going to head east and explore the other ridge crests. Then crickets! If the easternmost of those ridge crests had similar results over similar distance then the inference (subject to being verified by drilling) would be the existence of a 7 Km by 3.6 Km MASSIVE RECTANGLE of goodies. Type 21 A (Singer/Cox classification) Cu-Mo porphyry deposits, the largest subdivision of these elephantine deposits known as “porphyries”, are almost always open-pitted.
Note that the original attack plan at the Caren was to produce from 3 different “production adits” simultaneously, while drifting a “crosscut exploration adit” from west to east under the plateau. You don’t want to do the crosscut adit if an open pit is a possibility. The baseline environmental study is already done. It was done by IAL Ambiental.
Other “list” components include how to value Medinah’s $40 to $50 million tax loss carryforward. Junior explorers do nothing but raise and spend money, A LOT OF MONEY IN THE CASE OF SUCCESSFUL FUND RAISERS. This is a huge bonus for those lucky enough to go into production. From what I can glean, these assets are transferable to other companies in the same business especially if they’re working on the same project. One of Raul’s communications contained the phrase “a full legal opinion” was being waited on. When I read that I immediately thought that the “full” phraseology might have referred to the AUMC share distribution as well as the fate of the tax loss carryforwards but I do not know this to be a fact.
For me, this entire scenario has been a gigantic exercise in TRUST YOUR GUT. I did not trust my gut when it came to Aurelian’s Fruta del Norte deposit and I got “Masuched”!
Here’s a link to Don Singer’s masterpiece on pretty much every porphyry deposit on the planet: