New Pacific Metals, progressing two of the worlds most significant silver discoveries

hello welcome back we're at pedak and it's day two I'm with my favorite Silver Company in Bolivia that's new Pacific medals and I'm with the president CEO Andrew Williams again Andrew good to have you back on the show pleasure to meet here be uh we caught up I think what was it Beaver Creek was it Zurich yeah Beaver Creek Beaver Creek yeah so that's back in September what's happened since then well um shortly after the conference we announced uh a financing so we in a very difficult Market uh raised Canadian $35 million uh with very good participation from our strategic shareholders uh silver cor and an American silver uh silver Corp put in US 5 million pan amican silver uh put in US 10 million it went in excess of their prata um as well as uh some institutional participation so alog together uh a very good show of support for uh what we've got ahead of us as a company and so we are in an enviable position in this tough Market to not have to worry about our balance sheet at least here in the short run right that that amount of uh of cash is sufficient for us to achieve our near-term objectives which is to continually deris can progress silver standing brangus to the point where they're developed ready so um very fortunate to now be in a position financially to execute those uh those PL good and just remind people where you're located and the current resource and and I guess say of play in in bivia with the two different projects sure so we actually have three projects um or most advanced silver sand project our intermediate project kangus and our third project Silver Strike however we focus mostly on our first two uh our flight sh and all three projects located in Bolivia they're all three projects we've made organic green fields discoveries the oldfashioned way and our most advanced silver sand project the one that brought us to the country in 2017 we've drilled 135,000 M we released a paa study at Silver sand last year highlighting a 14-year mind life producing an average of 12 million is silver a year low cost $10 an ounce on its staining $700 million UV 39% IR sub to it's a fantastic project San is one of the best if not the best uh undeveloped precious metals deposits anywhere in the world and so we are progressing this year towards releasing our pref feasibility study at Silver sand really tightening up the uh the econom parameters there from our pea study our second project kangus we drilled it in 20 21 made a second major Discovery and released our resource estimate um going to just just before I talked to you at Bieber Creek news there and is Big it's Silver Sands a 200 million ounce deposit gangus is in the indicated category 560 million silver equivalent ounces and another in the there's another 110 million ounces in the inferred category silver but the silver component is both similar to Silver sand roughly 200 milon out is silver and so this year we're progressing we can get into some specifics uh further on in this conversation but we're working towards our paa study good for silver sand or for FR of me for fangus young man at Silver Strike we're continuing to uh keep that project on pause this year to focus on our on our two main projects okay okay good I I love the fact that you're just focusing on those two because there's enough in the ground there to to be advancing those but obviously 35 million in the bank um how are you diving that up between the projects cuz obviously one's a bit further Advanced usually the further Advanced projects to get to the next economic stage takes a little bit more cash um but at the same time you got a bit of a behemoth there at grer so how are you going about the expiration model and advancing the two projects simultaneously yeah I love the question because we're still trying to figure it out Y and the way you characterized it is is the way that we've been talking about it for a while which is silver sand is this nice tight high grade high term project with roughly $300 million of capital needed to build this something that we could plausibly finance and and build ourselves whereas kangus is is you five times the amount of tonnage as silver sand and so it will take a lot more capital a lot more financing a lot more complexity and and therefore we move silver sand forward as our number one priority and look at kangus to do just enough to keep pushing it forward but not with the necessary conviction that we would a silver sand project where we could credibly Finance them build ourselves MH and but we're looking at more recently and I just being open with you we haven't yet released any specific numbers I won't talk specifics but we're starting to say well what about if kangus could be more silver sand like so again order of magnitude kangus IS 250 million tons Silver Sands roughly 50 million tons but when you look at the kgus resource model and we've got a some slides in our corporate deck and in our technical report where you can see that it's not a homogenous system rangus has got a very high grade or relatively I should say high grade silver deposit right near surface okay and then there's a transitional Zone in the middle and then a nice gold Zone at dep um that you could mine as a monstered scenario with a very high npv uh but what if we just focused on more buildable kangus and maybe we just focus The Lion Share of the attention on that near surface silver Zone you'd have a project that would be much more similar to Silver sand and scale therefore again we have it done the work similar amount of capital and you have two projects going that could both be plausibly financed and built by us of course we we pick the winner yeah but um and so the work that we're doing right now with the kangus paa we're having these philosophical discussions do we go with the the project philosophy that maximizes the npv but requires more capital or do we go for the one that optimizes a little more for irr but more financeable and buildable and of course in that latter scenario we still retain the option ality of expanding down the road but at least something that it's the scale where it could be more of a new pafic scale project for us to finance and develop rather than just committing ourselves down we need a partner track well I was going to I was going to ask could you not do both given that you could definitely focus on Silver sand yourselves but then you have quite large shareholders already that are have operating experience could could you not potentially do one you guys focus on Silver sand then bring in a partner to help you develop a much larger scale where obviously like you said the MPV is going to be quite substantial so maybe getting a split of that versus the whole thing if if then someone else is progressing it for you could make sense you've got optionality there I assume yeah they're not they're not be exclusive but um like generally speaking I mean uh my experience in the industry is that the more control you have over the outcomes the more value you can create to your shareholders just so many unforeseen SE issues scenarios that can arise that the more control we retain the better off we are now that not being said if there's an offer or an outcome that makes sense it is compelling for our shareholders like I'm a shareholder and I want nothing more than to do what's right for myself and my fellow shareholders but good it's just another option on the table and it um I think it helps you with that if we go down that scenario it also helps um us be able to convey get a little bit of a Kickstart on the permitting process cuz being something that is uh a scale and a scope that we can say hey we could be the ones to develop this so hey is long story short you asked about prioritization where maybe um when we spoke back in September it was silver sand would be the the majority of the focus but now with this this new potential philosophy of carangas where we could have more of a silver sand scale project I think we might get get into a situation here where both projects can um move forward um in yeah at a similar pace so good it's uh it's evolving but it's it's a really good story and and it's evolving for the right reasons we're trying to be uh more thoughtful about how we move our projects forward so um I think we probably look for maybe a more Equitable split uh between the new projects pending the release of our PE study by the middle of this year so I'm getting a little bit ahead of myself because we haven't put the numbers out yet but um you know just I guess priming you for the uh the potential for that to happen good I would mind actually just going back onto the PA of of silver sand and you were talking about a very low Asic there around $10 how's that possible braid a strict ratio and recoveries so um silver is less intuitive I feel like there's just so many gold project as talk gold at uh it's 2.4 million oun of gold at 1.3 G per ton 3.6 to1 strip ratio 91% recoveries um relatively low mining costs uh as far as per ton moved uh we've got fors from contractors power in Bolivia we're us 5 and a half cents a kilowatt hour um there's fantastic local local labor available it's a mining country so you factor all those things together and um it just the math works out I mean the grade's really is the big kicker grade is King but um it just boils down to you know that's that's what spits out at the end of the calculation and and it all makes intuitive sense when you build it up from the bottom up um it's just um it's just it's funny guys refer to the project as one that would have been mined in the 9s at you $300 silver or $5 sorry $300 gold $5 silver it's it's that those kinds of Economics but the project was just discovered a bit later yeah yeah okay um so just talk me through because I'm obviously I know you're still the line alien whether or not you it sounds like you're doing a bit more of an equal approach to these projects and you're still evaluating how you're looking at carangas but over the next 12 months what what can investors and and those potential shareholders be looking out for obiously you mentioned another PA coming out soon but I'm just really trying to get my head around OB whil you're still figuring certain things out what what what do you what do you know for sure that we should be expecting yeah it's for us it's it's it's progressing our project deising them and trying to build that four Foundation of value which is our resources and our Reserve so um going from an abstract drill hole into something that's been fully engineered and permitted is a significant value creation exercise is your proverbial Lon curve where uh you're at the trough and and as you continually drisk your project and make it closer to reality we see that value creation it's very very um time tested empirical phenomenal it's that's that's the path that we're on right now and so splitting between our two projects silver sand uh it's getting our PFS done we've done some more metallurgical test work that we're still uh incorporating into the revise uh PFS as long as some more detailed engineering work and so as we tighten up those economic parameters uh in parallel continue working towards obtaining our environmental permit got a community agreement that we're working towards we've got an MPC agreement which ties on a partial of contiguous Lin or silam project um all these little pieces of the puzzle we're slowly snapping them together and building a project that is one step closer to becoming a mine and and in that process that's how we drive the for our shareholders and secondly at kangus which I think is probably a little torquier in the near term because we put the the resource out we feel like we're just not getting any credit for kangus and perhaps part of that is like well it's such a big resource how could you ever plausibly Finance it and build it as a mine and um firstly that that's still these things happen this m our mining industry can pull off incredible things and and a big crous scenario is is certainly one that could also look attractive but but also focusing maybe there is a smaller scenario that we can do and and scale it and and showcase that with good economics this year and highlight that what we found in Kangas is actually a real Discovery and it has the the the grade and the strip ratio and the metaler characteristics to One Day become a mine I think there's a lot more near-term opportunity for us to solidify that story and then again in parallel it worth with the community get the uh agreements signed uh you make advancements on the permitting process that we are going to kick those up a little bit more at kangus this year collecting some environmental social gine so pushing both projects together in parallel with a balance sheet that is sufficient to support that project advancement with a very strong and supportive strategic shareholder base in a country that is opening up to foreign investment Libya is in a position right now where the economic situation is somewhat challenging and the government gets it and we are seeing them make a decis it's a subtle but decisive shift towards embracing uh private investment of which mining has historically been the go-to for the country during more challenging Economic Times it's been through these Cycles before and we're certainly sitting there in all position and having three discoveries two of which are Advanced one of which is really Advanced we put over $60 million us into the ground discovering these projects moving them along so we're feel very fortunate to be in the position we're in today and I think that's what our shareholders can expect from us is to continue checking the boxes in a method methodical and diligent way uh as we Mo these projects more necessary good to hear Andrew thank you for your time thank you very much always say chat

Channel: Mining Network

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Keywords: Silver Production, silver producer, silver mining, silver investing, investing in silver, mining silver, silver mining company, silver mining investment, investing in mining, mining silver investment, High Grade Silver, best silver project, best silver company, silver investments, New Pacific Metals, New Pacific, NUAG, TSX NUAG, NUAG TSX, Silver mining Bolivia, mining in bolivia, bolivia mining, silver stocks, silver exploration, Crux, Kitco, Kitco News, mining news, drill

Id: bnE7HsjFdIw

Length: 15min 29sec (929 seconds)

Published: Tue Mar 12 2024