Prime Meridian Resources Corp. (TSXV: PMR) is aggressively increasing its footprint in the prolific Red Lake Gold District of northern Ontario and is conducting exploration on its Kelly Property near Sudbury, Ontario. However, the Company made its most significant strategic move to date with the planned acquisition of the 2,439-hectare La Verde copper-silver property in Sonora, México.
Located 50 kilometres northwest of Hermosillo City and comprising of 9 concessions which are already permitted, the project has excellent power and road infrastructure with water approvals and local labour force nearby. The significance of the permitted concessions is that PMR must begin limited production from the current resource as soon as it can. The La Verde transaction, which was announced on December 9, 2021, is now believed to be near final regulatory approval, given that the company has resumed trading on the TSX Venture.
The La Verde mine had historical production of copper and silver from 1903-1935 and there are multiple old small and limited mining works within the entire property package.
As a past-producing mine, La Verde has historical proven and probable reserves of 409,000 tonnes at 2.29% copper, 98 g/t silver, and 0.38 g/t gold, however this estimate predates 43-101 guidelines. The geology of the La Verde Project area is favourable for bulk-tonnage copper skarn deposits. To date, 6 skarns have been identified on the property over an approximately 2-kilometre strike. The La Verde Project has the potential to host economic skarn-style copper-silver-zinc-gold mineralization and the geological setting is favourable for proximal copper porphyry style mineralization
While there are underground workings on the property, much of the mineralization is near the surface, therefore supporting a cost-effective open-pit operation. The copper can be recovered through a lixiviation operation with sulfuric acid, and flotation for recovering the silver, gold and zinc. In this instance, lixiviation is simply a process of separating soluble from insoluble substances by dissolving the soluble substance in sulfuric acid. The ore at La Verde responds well to this process.
Prime Meridian will aggressively work to develop and initiate production on the property while continuing to explore the property to expand the size and scope of the deposit and increase its resources toward 10 million tonnes. The skarn deposit at La Verde Grande remains open along strike to the southwest and northeast and the company will conduct exploration to expand the size of the deposit, as it believes it can quickly move towards a preliminary economic assessment.
“We have been financing and developing copper projects in Canada, the USA and Mexico for over 20 years and the opportunity at La Verde is the best I have seen over that time period, as it provides a potentially significant value proposition from the combination of a near-term production opportunity from the skarns and the exciting prospect of a new copper porphyry discovery in one of the world’s most productive copper belts,” said CEO Brian Leeners at the time of the announcement of the planned property acquisition.
Prime Meridian’s management approaches the mining business like a cash flow business, and it is seeking new projects that are production-ready, or advanced stage projects with near-term production potential. The La Verde Project certainly meets this criteria, and pending initiation of production at La Verde could generate enough cash flow to negate the necessity of going to market for dilutive financings, which would also help to somewhat de-risk the company.
As a refreshed company with only 71.8 million shares outstanding, and a recent market capitalization of $5.02 million, Prime Meridian Resources appears to represent a potential ground-floor opportunity for junior exploration investors.
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