In February of 2021, Tarachi Gold signed a purchase agreement with Manto Resources for the acquisition of the Magistral del Oro Mill and Tailings Project located in Durango, Mexico. Magistral is a highway-accessible project 5km north of the town of Santa Maria del Oro with a population of 5,000 and 100km by air south of Parral, Chihuahua. The project includes a 1,000tpd cyanide leach mill with a Merrill-Crowe recovery circuit custom built for reprocessing tailings, a new tailings storage facility and access to an estimated 1.3 million tonnes of tailings material with a grade of 2.05g/t Au (non-NI 43-101 compliant historical estimate).
Tarachi expects to have the results of a preliminary economic assessment (“PEA”) in the 2nd quarter of 2021 with plant commissioning and first gold production planned for 2022.
Mining in the Santa Maria del Oro area first began in the 1600’s with significant gold production starting in 1890 using mercury amalgamation until 1915 and with a flotation plant from 1942-1960. Ore with an estimated average grade of 15g/t Au was mined from underground workings targeting a series of high-grade veins. It is estimated that up to 1,000,000oz of gold was mined from these workings.
Some of the mine tailings were mined and processed in a heap leach operation in the mid-1990’s for several years. The Magistral plant was built in 2014 originally as a carbon-in-leach system to reprocess the tailings material and was later converted to a Merrill-Crowe system in 2018 to better manage the presence of cyanide-soluble copper in the material. It is believed that only 35,000t of tailings material was run through the current plant before a storm water event overflowed the tailings storage facility (“TSF”), shutting down the operation until modifications could be made to the TSF. The plant has been idle since that time. Tarachi management visited Magistral in January 2021 and confirmed that the plant is in excellent condition.
The Magistral facility is located adjacent to the tailings material and consists of a ball mill, four agitated leach tanks, a thickener, counter-current decantation system (“CCD”), Merrill-Crowe circuit and various other tanks, support equipment, offices and storage buildings. The mill has an estimated feed capacity of 1,000tpd and is expected to recover 70-75% of the gold from the tailings material. Tarachi management estimates that the available tailings material could provide feed to the plant for approximately four years and produce up to 15,000oz Au per year at full capacity.
Ausenco Engineering was engaged in February 2021 to conduct a PEA for the Magistral Project including additional metallurgical test work to determine the final flow sheet design and what modifications could be made to the existing facility to maximize gold recoveries and reduce operating costs.