#Mexico #Kootenay Silver #Chihuahua #La Cigarra #Silver Project

Kootenay Silver's La Cigarra Project: A Promising Economic Assessment

Kootenay Silver Inc., a key player in the silver exploration sector, has revealed significant updates regarding its La Cigarra Silver Project located in Chihuahua, Mexico. The company is thrilled to share the results of a promising Preliminary Economic Assessment (PEA), which outlines a bright economic outlook for this venture. The PEA highlights an impressive after-tax net present value (NPV) of $763 million, coupled with an internal rate of return (IRR) of 41%, firmly placing La Cigarra among noteworthy projects in the mining landscape.

Project Overview

The La Cigarra Silver Project is structured as a 14-year open-pit mining operation, emphasizing strong economic viability. The initial capital cost is estimated at $332 million, with an after-tax payback period of just 1.9 years. Total payable silver production is projected to reach 63.6 million ounces, showcasing a robust extraction potential that supports Kootenay Silver's vision of establishing a long-lasting mine in the region.

The project is strategically situated within the well-known Parral Mining District, which is home to two active silver mines, further validating the potential of La Cigarra due to its location. This area boasts a rich mining history and existing infrastructure that enhance operational efficiency.

Key Economic Highlights

Details of the PEA present impressive economic metrics:

• - After-tax NPV: $763 million at a 5% discount rate
• - After-tax IRR: 41% with potential for further growth at spot metal prices leading to an NPV of $1.295 billion and an IRR of 64%.
• - Annual Production: Average annual production is projected at approximately 6.22 million ounces for the first five years.
• - Operating Costs: An all-in sustaining cost of $18.73/oz for silver demonstrates strong profit potential.

Moreover, the PEA outlines a robust average after-tax revenue of around $107 million per year, making La Cigarra a significant opportunity for investors and stakeholders alike.

Management Insights

James McDonald, President and CEO of Kootenay Silver, emphasized the importance of the PEA results as a stepping stone towards advancing La Cigarra’s development. He noted the attractive economic fundamentals coupled with existing infrastructure as key components positioning the project favorably in the competitive mining sector. Furthermore, he mentioned the potential for extensive resource growth, indicating that the company sees a compelling pathway for stakeholder value enhancement.

Ken Berry, Chairman of Kootenay Silver, also highlighted the study’s support for their strategic direction of developing silver assets through a comprehensive pipeline approach, with La Cigarra now acting as a pivotal asset for growth and value addition.

Future Steps and Opportunities

Looking ahead, Kootenay Silver intends to undertake significant actions following the PEA completion. Plans include:

• - Initiating resource expansion drilling to augment the current estimates.
• - Advancing environmental baseline studies and geotechnical investigations to pave the way for a feasibility study.
• - Continuing dialogues with stakeholders to ensure a smooth permitting process.

The explorers are also keen on potential optimization studies and mine plan revisions that could yield further value. Importantly, the La Cigarra Project remains open for additional exploration along a promising 9-kilometer mineralized trend that could deliver further upside.

Conclusion

In conclusion, Kootenay Silver's La Cigarra Project is advancing with positive momentum, thanks to its PEA findings that lay a solid foundation for further development. With a strong economic outlook, formidable resource potential, and a strategic location within Mexico's renowned mining districts, La Cigarra symbolizes an exciting opportunity in the silver market. As the company continues its efforts in resource expansion, stakeholder engagement, and engineering optimization, the future seems bright for both Kootenay Silver and its investors.