Silver Tiger Reports US$222M NPV for Mexico’s El Tigre Silver-Gold Mine
Silver Tiger Metals Inc. (TSXV: SLVR) has published its latest Preliminary Feasibility Study (PFS) for the silver-gold El Tigre Project, located in Sonora, Mexico. The company is focusing on the Stockwork Mineralization Zone, using updated economic data to determine the viability of an open-pit mining operation.
The project is valued at an after-tax net present value (NPV) of US$222 million, with an internal rate of return (IRR) of 40%, based on conservative commodity price assumptions.
The PFS projects a mine life of 10 years, during which El Tigre will produce a total of 43 million payable silver equivalent ounces (AgEq), equivalent to approximately 9 million silver ounces and 408,000 gold ounces.
The open-pit operation is expected to require an initial capital investment of US$86.8 million, with a payback period of just two years. Total project cash flow, after taxes, is projected to reach US$318 million.
“We are very pleased with the work completed by our consultants and our technical team on the PFS for the open pit at El Tigre. The open pit delivers robust economics,” CEO Glenn Jessome stated. He highlighted the promising parameters, including the project’s low strip ratio (1.7:1) and high grades (48 g/t AgEq), which contribute to its strong financial outlook.
“This is a pivotal point for our company as we now have a clear path forward to making a construction decision for the open pit,” he added.
Jessome further noted that the open-pit is only part of the overall potential of the El Tigre Project, which also includes significant underground resources that will be studied in a Preliminary Economic Assessment (PEA) set to be released in the first half of 2025.
The El Tigre project will require an estimated $86.8 million in initial capital expenditures, which includes a $9.3 million contingency. Over the 10-year life of the mine, sustaining capital costs are projected to total $6.2 million, while expansion capital in the third year will require $20.1 million as production ramps up. This is in line with the company’s plan to increase production capacity from 7,500 tonnes per day in the first three years to 15,000 tonnes per day thereafter.
The PFS builds upon the significant increase in the Mineral Resource Estimate (MRE) for the project, with a 132% increase in total Measured & Indicated silver equivalent ounces since the last report in September 2023. The updated MRE includes 200 million AgEq ounces in the Measured & Indicated category and 84 million AgEq ounces in the Inferred category.
Additionally, the out-of-pit resources, which consist of 5.3 million tonnes (Mt) of Measured & Indicated material at 255 g/t AgEq and 10.1 Mt of Inferred material at 216 g/t AgEq, contribute to the overall resource potential.
These resources, which remain largely unexplored, form part of what Jessome calls a “prolific property” that has only been 30% explored to date. Silver Tiger has outlined an ambitious exploration program to uncover more potential resources in the area, aiming for a possible additional 73 to 100 million AgEq ounces.
While the open-pit represents a significant opportunity for near-term production, Silver Tiger’s long-term strategy includes the development of its underground resources, which are equally promising. The company plans to initiate underground drilling immediately and aims to deliver a PEA for these resources in the first half of 2025.
The underground resources, which contain an additional 113 million AgEq ounces, will require a different approach, including potential underground mining methods like cut and fill and long-hole stoping. With further exploration and development, Silver Tiger expects these resources to significantly enhance the project’s value.
The PFS was based on a base case scenario using a silver price of $26 per ounce and a gold price of $2,150 per ounce. It demonstrates that even under less favorable conditions—such as lower commodity prices—the project remains economically viable.
Silver Tiger Metals last traded at $0.32 on the TSX Venture.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
