Agnico Eagle Mines (TSX: AEM; NYSE: AEM) has upped its interest in Candelaria Mining (TSXV: DCAND; US-OTC: CDELF), with an additional $6 million investment bringing its ownership in the Mexico-focused junior up to 19.6% from 7.8% on a partially diluted basis.
Agnico Eagle's total holding in Candelaria is now 23.45 million common shares and 6.67 million warrants.
Candelaria owns 100% of two advanced exploration projects in Mexico, the Pinos gold-silver project in Zacatecas state and the Caballo Blanco project in Veracruz state.
Development of the Pinos epithermal gold vein system is fully permitted. A 2018 preliminary economic assessment envisioned a mine with an initial life of seven years, during which time 90,000 oz. of gold and 1 million oz. of silver would be recovered. Mining is to begin at 200 tonnes per day, ramping up to 400 tonnes per day with cut-and-fill methods. A 400 tonne per day conventional cyanide agitated leach and Merrill-Crowe mill is planned.
The estimated indicated resource is 175.7 million tonnes grading 5.8 grams gold per tonne and 47.4 grams silver per tonne, for 25,029 oz. contained gold and 496,637 oz. silver. The inferred resource is 629.3 million tonnes grading 5.8 grams gold per tonne and 78.5 grams silver per tonne, containing 60,671 oz. gold and 811.082 oz. silver. In addition, there are 85,847 tonnes in the Candelaria dumps considered a measured resource grading 1.6 grams gold per tonne and 82.9 grams silver per tonne.
Pinos is 12 to 14 months away from production. Candelaria says most of the former mine is accessible with minor rehabilitation. Equipment for the mine is readily available. A team has been assembled and major construction contracts signed.
The Caballo Blanco gold-copper project covers two large centres of epithermal and porphyry hosted gold mineralization. The most advanced is La Paila in the Northern zone. It is oxidized at surface and to at least 300 metres in depth. The 2012 PEA for La Paila proposed a 100,000 oz. per year open pit and heap leach operation with an eight-year life.
Candelaria has mounted a 12-month, 13,500-metre exploration program at Caballo Blanco on six priority targets similar to La Paila.