Silver Crest Metals - Bucking the Trend for Extractive Industries

Bucking the Trend for Extractive Industries

PROJECT DIRECTED BY

Gary Smith

SilverCrest Metals

WRITTEN BY

Tom Fogden

Bucking the Trend for Extractive Industries Canadian firm SilverCrest Metals defied industry-wide trends by developing new mining sites during the pandemic. Business Enquirer speaks to SilverCrest’s COO Pierre Beaudoin to find out how they managed it.

A sample of the deposits extracted from Las Chispas

The SilverCrest team outside the mine

The extractive industries are typified by periods of boom and bust. For every gold rush, there comes a period when the mines dry up and the prospectors leave town.

However, the past few years have been far more challenging for businesses around the world – not just those involved with getting shiny rocks out of the ground – than could ever have been imagined. But one mining company has been managing to buck the trend.

Entrance to the mine at Las Chispas

SilverCrest Metals, based in Vancouver, British Columbia, has not only managed to develop new mining sites in Mexico during a global pandemic and with supply chain issues, but it has also managed to keep the project on track and – most importantly – on budget.

SilverCrest is focused on finding new, untapped gold and silver resources in Mexico, as well as targeting value-adding acquisitions. Currently, the company is concentrating on the highgrade, historic Las Chispas mining district in the north-western state of Sonora.

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SilverCrest Metals

Resources Feature

The Las Chispas mine is some 90 miles northeast of state capital Hermosillo but, despite the remarkable speed and success of SilverCrest’s new mine, the area is no stranger to prospecting. Silver and gold mining has been happening at the site since as early as 1640 – though most of the mining happened between 1880 and 1930.

67 muck samples. 301 of the chip samples are graded in excess of 150 grams per tonne of gold equivalent, meaning the overall average is is 4.3 grams per tonne of gold and 332 grams per tonne of silver.

In 1910, annual production reached as high as 3,540 tonnes, with grades on average reaching 1.29 ounces per tonne gold and 173 ounces per tonne silver – exceptionally high thanks to the concentration and formation of numerous secondary sulphides and antimonide minerals.

In 2018, the company appointed Pierre Beaudoin as COO. With more than 30 years’ experience in the mining industry, Beaudoin has been instrumental in driving the development of the Las Chispas mine forward.

“Our progress to date has been solid on all three main project development fronts,” said Beaudoin.

“Finally, our mining team reported a record year of underground development, exceeding both the expectations set in the 2021 budget and the Feasibility Study. The combined efforts of our employees and contractors in 2021 have de-risked the Project construction and paved the way for a successful production start-up in Q2, 2022.”

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Our progress to date has been solid on all three main project development fronts.

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Fast forward to 2016 and SilverCrest is conducting an exploration program. Amassing more than 5,000 underground chip samples, 44 underground channel samples, and 67 historical muck samples. Of this collection, results are available for less than half the chips but all

Those numbers might not be as high as 1910 levels, but they certainly held promise.

“Ausenco’s [one of SilverCrest’s partners] progress on the processing plant construction continued to impress in Q4, 2021 and now stands approximately one month ahead of schedule. The infrastructure construction managed directly by SilverCrest adjusted well to the pace of progress imposed by the process plant construction, and with contingency measures for power, will be capable of supporting the projected earlier plant start-up.

Inside the mine at Las Chispas

2021 marked an extraordinary year of efforts from our team and contractors in Mexico and Canada.

The progress made throughout the year has positioned us well for Las Chispas start-up in Q2, 2022.

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This remarkable development against the most challenging of economic and societal backgrounds was reflected in exceptional market performance, as well.

SilverCrest significantly outperformed its competitors on the New York Stock Exhange’s Silver Miners Index between Q4 2018 and Q4 2020.

While the Index averaged a 100% gain, SilverCrest managed 450% growth.

2021, however, did see some slight underperformance but, with the company set to become one of the sector’s highest-grade producers in the coming months, 2022 and 2023 should see the company rebound quickly.

“2021 marked an extraordinary year of efforts from our team and contractors in Mexico and Canada. The progress made throughout the year has

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SilverCrest Metals positioned us well for Las Chispas start-up in Q2, 2022,” said Eric Fier, SilverCrest’s CEO. Much of the company’s continued success despite the adverse conditions can be attributed to its COVID-19 prevention measures. At its Las Chispas site, the company completed more than 4,800 rRt-PCR tests. No serious outbreaks of the virus were recorded at the site and, although a small outbreak was recorded at SilverCrest’s satellite offsite camp, the company took swift measures to ensure all employees and contractors were tested and closed the camp temporarily.

In fact, the main construction camp remained fully operational the entire time and there was no impact on mine construction. SilverCrest even participated in a local vaccination program to complement Mexico’s federal program. This led to 220 employees and contractors receiving their full vaccination and another 110 receiving their first dose.

Start-up of production is due to begin in the middle of this year and, based on the company’s feasibility study, the company should be able to mine 1,250 tonnes per day for around eight and a half years. This means that the mine could generate an expected at least $486.3 million and could pay itself off in as little as nine months.

Cominvi We are a contractor company in the mining sector, specialized in the construction of underground mining works and exploitation of mineral deposits based in Guanajuato, Mexico. We are committed to safety, ecology, the development of its staff with total social responsibility.

With more than 18 years of experience and business solidity, CoMinVi has managed to position itself as the leading contractor company in the field of underground mining in the Mexican Republic, also making its way abroad.

Our main mining activity is the development of tunnels and production of deposits for national and foreign companies. During our trajectory we have collaborated in more than 36 projects with leading companies in the mining sector dedicated to the exploitation of minerals.

We have the vision of being a nationally and internationally recognized company with high standards of quality and innovation that contribute to the achievement of the goals established by our clients.

engineering / Development / mining fortification / material movement

www.cominvi.com.mx

We are currently operating in 9 projects in different regions, obtaining a monthly development average of 6,000 linear m and around 192,000 tons of mineral.

Our specialized mining services range from engineering, development, mining, fortification and material movement. www.cominvi.com.mx

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SilverCrest Metals

Resources Feature

Of course, SilverCrest hasn’t put all of its eggs into a single basket. The company has other projects across Mexico. Its El Picacho site is 85 kilometres northeast of Las Chipas and covers more than 7,000 hectares and the company has three drill rigs operational at the site. It also has properties at Cruz de Mayo, Angel de Plata, and Estacion Llano, though the rights to mine these concessions are not completely in the company’s hands yet.

The extractive industries – whether mining gold, silver, copper, lithium, or oil – are built on the promise of hidden treasures and potential returns. And, with this, there is plenty of scope for things to go awry – whether in production, management, or even in the face of a global pandemic and supply chain issues.

However, based on the way that SilverCrest has been expanding and conducting its business since 2017, it certainly seems as though the company might be able to buck the trends and prove an exception to the rule. Perhaps, the company’s future is as bright as the minerals it is mining. www.silvercrestmetals.com

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SilverCrest Metals www.silvercrestmetals.com

info@busenq.com www.busenq.com