Durango State, Mexico
Gold project; intended source of open-pit material for Velardeña’s oxide mill
Gold and silver
100% owned; 2 claims
PEA completed April 2020; Resource Estimate dated Jan. 26, 2017
Current Activities & Work
Planning infill drilling and additional testing to prepare for intended 2021 production
Seeking environmental & mining permits for open-pit operation
Rodeo is a 1,866-hectare gold project located in Durango State, Mexico approximately 80 kilometers west of the Company's Velardeña Properties and processing mills. The project represents a potential future source of open-pit minable material that could be transported to Velardeña’s oxide mill for processing after that mill’s lease to Hecla Mining Company concludes. Hecla has secured the right to use the mill through December 31, 2020.
In April 2020, we announced completion of a Preliminary Economic Assessment for Rodeo. The PEA was compiled (by the independent engineering firm Mineral Resources Engineering) in accordance with Canadian NI 43-101. We plan to initiate a small drilling program in 2020 at Rodeo to provide greater resource definition for a mine plan and to provide samples for additional metallurgical testing. We have begun the process of obtaining the required mining and environmental permits for an open pit mining operation, a process that could take up to one year.
Independent engineering firm Mineral Resources Engineering has prepared the PEA for Golden Minerals in accordance with Canadian National Instrument 43-101 “Standards of Disclosure of Mineral Projects” (“NI 43-101”). The resource used for the PEA was developed in accordance with Canadian NI 43-101 by the independent engineering firm Tetra Tech (report dated January 26, 2017: NI 43-101 Technical Report; Mineral Resource Estimate; Rodeo Project; Rodeo, Durango, Mexico). The PEA assumes prices of $1,622/oz gold and $14.38/oz silver.
Preliminary results of the economic analysis are shown below in after-tax U.S. Dollars. The complete PEA will be published on SEDAR and posted to our website within 45 days of April 15, 2020.
After-Tax Economic Results of the Project:
Golden conducted a 2,080-meter core drilling program at Rodeo in 2016. Partial results from the first round of drilling, released in September 2016, showed a gold and silver bearing epithermal vein and breccia system with encouraging gold and silver values over an approximate 50 to 70-meter true width. The system is exposed at the top of a northwesterly striking ridge and dips steeply to the northeast. The drill holes reported previously are spaced about 25 meters apart along 100 meters of the crest of the mineralized ridge. The drill holes are angle holes oriented at 55° to the southwest and cut the vein and breccia system at an angle of approximately 50°. Previous work has shown the mineralized system to be exposed at surface over about one kilometer of strike length.
We completed the drill program in Q4 2016 and released a NI 43-101 compliant Technical Report in January 2017. The Technical Report included two resource estimates based on two processing scenarios and their respective cutoff grades and open-pit optimization models. The first operating scenario reflects a smaller amount of higher-grade material and estimated mineralized material of 0.4 million tonnes containing 3.3 g/t gold and 11 g/t silver for a total of 46,000 ounces of gold and 0.2 million ounces of silver. This scenario provides a potentially shorter time to processing with lower capital costs since we already own the mill, located within trucking distance of the Rodeo property. The second operating scenario reflects a larger amount of lower grade material and estimated mineralized material of 3.6 million tonnes containing 0.8 g/t gold and 12 g/t silver. The second mineralized material estimate envisions a standalone heap leach operation, depending on leachability of the material and development and operating costs. We believe this material, as currently identified, could provide additional mined material for our Velardeña oxide mill following the completion of the Hecla lease, currently set to expire December 31, 2020.
In initial test work conducted in 2017, we received confirmation of good gold and silver metallurgical recoveries for milled material in initial test work. Bottle roll cyanide leach testing of the high-grade samples resulted in gold extractions of 80 to 86 percent. Silver extractions ranged from 72 to 76 percent for all tests. Test work also indicates that the material is not suitable for gold and silver recovery by heap leaching.
See the Resources and Geology and Technical Reports pages for additional information about the Technical Report and its estimates.
Rodeo is located two kilometers east of the town of Rodeo in Durango State, Mexico and is accessed by a short stretch of unpaved road from the Nazas-Rodeo highway. Basic amenities are available in the town of Rodeo. The property is located approximately 80 kilometers west of our Velardeña Properties -- within trucking distance of the oxide mill at Velardeña.
We own the Rodeo and Rodeo 2 claims covering 1,866 hectares of land located 80 kilometers west of our Velardeña Properties in Durango State, Mexico. Golden acquired the Rodeo property subject to a royalty interest (due to La Cuesta International) in 2015.
Gold and silver mineralization at Rodeo is hosted by Tertiary felsic volcanic rocks in fault contact with Cretaceous Mescalera group calcareous sedimentary rocks. Precious metal mineralization is low sulfidation epithermal in character and associated with chalcedonic quartz veins and breccias. Strongest gold mineralization outcrops near the top of a north-south trending ridge covering a strike distance of about 300 meters and a width of around 200 meters. The near-surface and outcropping setting presents an opportunity to exploit the deposit by low strip ratio open pit methods. The only sulfide observed at Rodeo is fine-grained pyrite which is disseminated in quartz.
Rodeo 2016 Drilling Results
Resources Engineering, NI 43-101 Technical Report: Preliminary Economic Assessment, Rodeo Project, April 1, 2020
Tetra Tech, NI 43-101 Technical Report - Mineral Resource Estimate, Jan. 26, 2017