Durango State, Mexico
Gold open pit mine located 80km (115km by road) from Velardeña
Gold and silver
100% owned; 2 claims
Current Activities & Work
Completed drill program aimed at expanding the resource - Oct. 2021
Complete and current
Rodeo is a 1,866-hectare gold project located in Durango State, Mexico approximately 80 kilometers (115 km via road) west of the Company's Velardeña Properties and processing mills. We began gold & silver production at Rodeo in January 2021. We are transporting the material via truck to the oxide mill at Velardeña for processing, where in April 2021 we successfully installed a second regrind mill used in the production process given the harder characteristics of Rodeo's mined material. Processing began at a rate of approximately 200 tonnes per day in January, then reached the 450 tonnes per day production throughput goal in late April 2021 when we successfully commissioned a second ball mill. The company announced a first pour of gold-silver doré bars on schedule at the end of January 2021.
Golden conducted an exploration drilling program aimed at expanding the resource between March and October, 2021. The program encompassed approximately 5680 meters of shallow hole exploration drilling at selected near-surface targets located immediately adjacent to the current pit. We believe the program has the potential to modestly extend the life of the Rodeo mine beyond the currently estimated life of around 2.25 years. Full results will be available in Q4 2021, and any newly added resources will be incorporated into the Company’s production plans.
On November 4, 2021, management provided the following Rodeo forecast for full year 2021. The company anticipates total tonnes processed for the full year 2021 will be approximately 145,000 to 150,000, which is higher than the previously forecasted range of 135,000 to 140,000. Due primarily to lower projected full year 2021 mill recoveries for gold of approximately 80%, as compared to our previous projections based on PEA results of approximately 85%, payable production for the full year 2021 is expected to be at the higher end of our prior guidance of 12,000 to 14,000 ounces of gold and above our prior guidance of 25,000 to 30,000 ounces of silver. Gold recoveries have been slightly lower year to date as we continue to balance the operating performance of the plant between higher throughput and recovery. We continue to optimize the mill circuit for increased recovery with a focus on a finer grind and additional aeration in the leach tank train.
Using an assumed gold price of $1,800/oz and an assumed silver price of $25.00/oz (our realized prices for the nine months ended September 30, 2021, as shown above, were $1,797 and $25.64 for gold and silver, respectively), estimated operating margin for the full year 2021 from the Rodeo Property (defined as revenue from the sale of metals less the cost of metals sold) is estimated at approximately $10.0 million to $11.5 million with after-tax net cash flow from Rodeo for the full year, net of capital expenditures and working capital, estimated at approximately $8.0 million to $9.0 million, consistent with prior guidance provided in our Form 10-Q for the quarter ended June 30, 2021.See the Third Quarter 2021 Form 10-Q for additional risk disclosures related to 2021 financial estimates.
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.
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.
Final Drill Results, reported November 10, 2021
Rodeo 2020 Drill Program: Final Drill Results
Rodeo 2016 Drilling Results
Mineral 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