Issue link: http://resourceworld.uberflip.com/i/685011
J U N E / J U L Y 2 0 1 6 www.resourceworld.com 43 MAG Silver Corp. [MAG-TSX, MVG-NYSE MKT] is currently focused on developing an underground decline towards the high- grade Valdecañas and Juanicipio silver veins in Zacatecas State, Mexico. These veins are part of the Juanicipio joint ven- ture property between MAG Silver (44%) and Fresnillo PLC (56%). Fresnillo is the operator. In order to fund the remainder of the project, MAG Silver closed a US $65 mil- lion bought deal financing at US $7.30 per share in March. The money was raised via a syndicate of underwriters led by Scotia Capital Inc, BMO Nesbitt Burns Inc. and Raymond James Ltd. With this latest financing the company reports it has a US $24 million buffer, over and above the original US $132 million CAPEX cost (MAG Silver's 44% share) to build the Juanicipio Mine. The company now has US $142 million in cash, no debt, 79.7 million shares issued and outstanding and 83.9 million on a fully diluted basis. Its market capitalization now stands at about CDN $ 1.27 billion. Together the Juanicipio and Valdecañas veins boast a NI 43-101 compliant indicated resource totaling 160 million ounces silver averaging 601 g/t silver and an inferred resource containing an additional 48 million contained ounces averaging 626 g/t silver. At last report, development was focused on ramp advancement and associated underground mining infrastructure, as well as on some metallurgical and geotech- nical studies. So far 2,600 metres of the 3,500 metre- long ramp has been completed. The decline needs to reach a vertical depth of 450 metres in order to reach the footwall of the Valdecañas vein and begin stope access and development. At current advance rates, the company anticipates reaching the Valdecañas footwall in early 2017. In addition to the ramp advance, two venti- lation raises have been bored and brought into service, the mechanical shop and multi-use buildings have been completed, electrical lines and substations have been installed and road-widening is substan- tially complete. Production is expected to start in 2018 at a mill throughput rate of 2,650 tpd over a projected 15-year mine life. Average annual payable silver production is expected to top 10 million ounces of silver year (MAG Silver's share is 4.5 million oz/ year). All in cash costs are estimated to be US $6.61 per silver equivalent ounce. On the exploration front, three holes drilled in late 2015, at Juanicipio, inter- sected the widest and deepest intercepts ever cut at Juanicipio ranging in true width of 11.69 to 32.09 metres. These intercepts carried high-grade silver and gold. This new zone remains open to depth along the entire strike length within the joint venture boundary. With these results in hand, the joint venture partners agreed to fund and additional 10,000-metre drill program. This program began in November 2015 and is ongoing with three rigs on the surface and one underground. Assays are pending. n Mag SilveR – advancing the Juanicipio silver project Underground operations at the Juanicipio Project in Zacatecas, Mexico. Photo courtesy MAG Silver Corp. SilvER