Golden Minerals (TSX: AUMN; NYSE-AM: AUMN) has elected to stop mining at its Velardeña silver-gold properties in Mexico just two months after restarting the operation.
Golden had hoped the newly restarted mines would be able to deliver positive cash flow in the first half of 2024 after progressively increasing the production rate. However, the performance of the mine and processing plant during the first few months has not achieved the projected results, the miner said in a press release Thursday.
Located in Durango, Mexico, Velardeña hosts two former underground mines and two processing mills.
Mining officially restarted Dec. 18, 2023, with mining occurring in six stopes. The plan was to steadily ramping up daily production to 150 tonnes per day in March, and ultimately reach a full production rate of 325 tonnes in the second quarter.
A month before that, it began producing gold-rich pyrite flotation concentrates from Velardeña, which have been stockpiled at the mines since late 2015, when they were last operational. Mining activities were suspended at that time due to combination of low metals prices, mining dilution and metallurgical challenges.
The company said it will now evaluate potential alternatives for the Velardeña properties, which may include a sale of properties or winding up of certain of its Mexico operations. Its primary focus at the moment is the exploration-stage Yoquivo property in Chihuahua state, containing an inferred resource of 17.2 million oz. gold equivalent within 937,000 tonnes grading 410 grams silver per tonne and 2.1 grams gold.
Golden Minerals’ stock plunged 37.5% to 45¢ by midday Thursday following the announcement, recovering slightly from a 45.5% drop earlier in the day to a 52-week low of 37¢.
The company’s market capitalization is US$4.4 million.
Be the first to comment on "Golden Minerals pulls plug on Velardeña silver-gold restart"