Kootenay Silver's La Cigarra Project Reveals Impressive Economic Prospects

Overview of La Cigarra Silver Project

On June 15, 2026, Kootenay Silver Inc. made headlines with the announcement of a promising Preliminary Economic Assessment (PEA) for its La Cigarra Silver Project, located in the highly regarded Parral Mining District of Chihuahua, Mexico. The assessment reveals that the project has an after-tax net present value (NPV) of $763 million, along with an impressive internal rate of return (IRR) of 41%. These results suggest significant economic potential that could boost the local economy and provide value to stakeholders.

Project Highlights

The La Cigarra Silver Project is designed as a 14-year open-pit operation, which is poised for substantial economic success. The PEA indicates that the mine will achieve rapid profitability, with a payback period of just 1.9 years. It estimates a total payable silver production of 63.7 million ounces over its lifespan, along with a robust preliminary average annual silver output projected at 6.22 million ounces during the first five years of operation. This is further supported by an average annual after-tax revenue of around $107 million.

The economic viability of this project is greatly enhanced by initial capital costs of approximately $332 million, along with sustaining capital needs projected at $80 million. Notably, the project's estimated all-in sustaining costs are around $18.73 per ounce of silver, positioning it competitively within the market.

Key Economic Indicators

In terms of production profiles, the following key metrics have been highlighted:

- After-tax NPV at consensus metal prices: $763 million
- After-tax IRR: 41%
- After-tax NPV at spot metal prices: $1,295 million; IRR of 64%
- Estimate of 4.55 million ounces of payable silver production annually (life of mine)

Management Insights

James McDonald, President and CEO of Kootenay Silver, emphasized that this PEA marks a pivotal milestone towards the advancement of the La Cigarra Project. He remarked on the potential of establishing a long-lasting silver operation within one of Mexico’s eminent mining districts, which has a rich history of production stretching back nearly 500 years. He added that the project is positioned favorably, leveraging attractive economic indicators, significant resource growth potential, and existing local infrastructure.

Ken Berry, Chairman of Kootenay Silver, also highlighted the validation of their strategic approach in advancing their portfolio of silver assets. The company is now reassessing its next steps to maximize value through further resource expansion and engineering optimization, steering towards permitting and conducting feasibility studies.

Opportunities for Expansion

The La Cigarra Project is not only about immediate returns; there's substantial exploration upside along a nine-kilometer mineralized trend, which remains largely underexplored. The company has outlined several enhancement strategies, which include:

- Further resource expansion drilling
- Conversion of inferred mineral resources to more confident classifications
- Exploration of satellite deposits and extensions
- Optimization studies of the metallurgical processes
- Adjusting mine plans to explore staged development options

Path Forward

Following the completion of the PEA, Kootenay Silver plans to take several progressive steps: initiating additional resource expansion drilling, advancing baseline environmental studies, and evaluating the feasibility of the project's next phases. Furthermore, the full technical report, adhering to the National Instrument 43-101 Standards applicable to mineral projects, is set to be filed on SEDAR+ within 45 days of this announcement.

Conclusion

In summary, Kootenay Silver’s La Cigarra Silver Project stands out not only for its promising economic indicators but also for the potential to significantly impact the region's mining landscape. With a team dedicated to advancing the project responsibly, stakeholders can look forward to exciting developments ahead.