Sonoran Contracted for Oroco's Cerro Prieto Mine
The Northern Miner, October 31, 2011
Oroco Resource (OCO-V) has entered an engineering, procurement and construction management (EPCM) agreement with Arizona-based Sonoran Resources for building an open-pit, heap-leach gold mine and refinery at Oroco's Cerro Prieto project in Sonora state, Mexico.
According to the terms of the agreement Sonoran will provide EPCM services related to the construction of the mine and refinery through the first pour.
Oroco Resource will pay Sonoran a US$260,900 monthly fee to a maximum aggregate of US$3,130,800.
Subject to TSX Venture Exchange approval and a series of construction milestones, Oroco will issue 1 million shares to Sonoran and 500,000 options to purchase shares at 30c apiece for three years from the date of the agreement.
Sonoran has experience operating in the area, having recently worked at Silvercrest Mines' (SVL-V) nearby Santa Elena gold-silver mine.
"We are extremely pleased to have Sonoran Resurces on board as our construction management group," Oroco president Craig Dalziel said in a press release.
He added that the company's "recent experience and central role in bringing the Santa Elena mine into operation on schedule and under budget makes [Sonoran] the ideal management group for Oroco's Cerro Prieto project."
Oroco Enters Into EPCM Agreement for Construction of Cerro Prieto Gold Mine
Oroco Press Release, August 30, 2011
VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 30, 2011) - Oroco Resource Corp. (TSX VENTURE:OCO)(FRANKFURT:OR6) ("Oroco" or "the Company") is pleased to announce that it has entered into an engineering, procurement and construction management agreement ("the EPCM Agreement") with Sonoran Resources, LLC ("Sonoran") for the construction of an open pit, heap leach gold mine and refinery at the Company's Cerro Prieto project in Sonora State, Mexico. Oroco obtained a positive Preliminary Economic Assessment for the Cerro Prieto Project in January, 2011, has subsequently advanced the engineering, permitting, and pre-construction for the project, and now has procured the services of Sonoran for the construction of the mine and refinery.
Under the terms of the EPCM Agreement, Sonoran will provide all necessary engineering, procurement and construction management services related to the construction of the mine and refinery through to "first-pour." In consideration for these services, the Company will pay Sonoran a monthly fee of US$260,900 to a maximum aggregate of US$3,130,800. In addition, subject to the approval of the TSX-Venture Exchange and the successful completion of a series of construction milestones, the Company intends to issue to Sonoran an aggregate total of 1,000,000 common shares of the Company and 500,000 options to purchase common shares of the Company at a price of $0.30 per share for a period of 3 years from the date of the EPCM Agreement.
Sonoran, based in Arizona, and with offices in Hermosillo, Mexico, is a construction management group with a proven track record in mine construction, including the nearby, recently completed Santa Elena mine owned by SilverCrest Mines Ltd.
Speaking of the EPCM Agreement, Oroco President Craig Dalziel states, "We are extremely pleased to have Sonoran Resources on board as our construction management group. Their recent experience and central role in bringing the Santa Elena mine into operation on schedule and under budget makes them the ideal management group for Oroco's Cerro Prieto project. We feel very fortunate to have Sonoran's considerable in-country expertise available to Oroco throughout the mine construction and initial production phases at Cerro Prieto."
Jesse Munoz, President of Sonoran states, "We are thrilled at the opportunity to work with the team at Oroco and confident in the success that we will achieve given our expertise in bringing a mine through construction and into production. This is a very attractive project from both a logistics and economics perspective."
Sonoran Resources, LLC is a management group comprised of accomplished professionals experienced in every stage of mine development, including: exploration, due-diligence, permitting and construction, organizational development, human resources and training, commissioning and production start-up and reclamation. Sonoran maintains a recognized presence in both the U.S. and Mexico, headquartered in Arizona with offices in Hermosillo, Mexico. Sonoran and its subsidiaries utilize expansive strategic alliances and over 100 years of collective mining experience in both underground and surface operations within their multilingual, multi-cultural management team. Sonoran has established a proven track record in mine construction and operation.
Sonoran was the construction management group for the Santa Elena project in Sonora State, Mexico. The Sonoran team played a vital role in the construction of the project from the original ground breaking, to crusher installation, commissioning of the Merrill Crowe plant, first pour and recruitment. Sonoran's expertise and dedication to the project resulted in completing the construction at Santa Elena Mine on schedule and under budget.
Oroco Press Release, October 26, 2010
VANCOUVER, British Columbia - Oroco Resource Corp. ("the Company") (TSX-V: OCO) is pleased to announce that it has received details of the initial capital and operating cost estimates for its Cerro Prieto deposit located in northern Sonora, Mexico.
The Company recently contracted Sonoran Resources, LLC of Somerton, Arizona (Sonoran) to complete an evaluation of the Cerro Prieto deposit based on a 2,100 tonne per day operating throughput. Sonoran was chosen to undertake this study for reason that they had just completed the successful planning, construction and commissioning of SilverCrest Mines Inc.'s Santa Helena mine located approximately 60 kilometers from Cerro Prieto. The Santa Elena mine has a production rate of 2,500 tonnes per day and has very similar characteristics, with respect to logistics, ore type and extraction techniques, to those of the Cerro Prieto deposit.
Sonoran Resources, LLC is a management group comprised of accomplished professionals experienced in every stage of mine development, including: exploration, due-diligence, permitting and construction, organizational development, human resources and training, commissioning and production start-up, and reclamation. Headquartered in Arizona with offices in Hermosillo, Sonora State, Mexico, Sonoran and its subsidiaries have the necessary strategic alliances and over 100 years of collective mining experience in both underground and surface operations within their multilingual, multi-cultural management team, and have established a proven track record in mine construction and operation. More information on Sonoran Resources, LLC can be found at www.sonoranresources.com.
Sonoran's capital cost estimate for Cerro Prieto totals $24.5 million, as follows:
The working capital figure includes $1.6 million of IVA (value-added tax) which the Company expects to recover from the Mexican tax authorities.
Sonoran's operating cost estimate is $7.12 per tonne of ore, summarized as follows:
|G & A||$1.00|
|Total:||$7.12 per tonne|
These estimates have been forwarded to Moose Mountain Technical Services to complete a Preliminary Economic Assessment which the Company expects to receive imminently.
Oroco is a Canadian-based mineral exploration company with its primary focus on the accelerated development of the gold-bearing oxide zones of its Cerro Prieto Project in northern Sonora State, Mexico. The Cerro Prieto Project consists of the 100% owned San Felix, San Francisco, Cerro Prieto and Argonauta 6 concessions totaling 6,843 ha.
SilverCrest Completes First Metals Pour at Santa Elena
SilverCrest Press Release, September 9, 2010
VANCOUVER, BC - SilverCrest Mines, Inc. (the "Company") has successfully completed its first metals pour of gold and silver dore at its Santa Elena Mine located in Sonoroa, Mexico. Gold and silver production will continue to escalate over the next 4 months, as ore tones under leach and recovery rates increase. There are currently an estimated 100,000 tonnes of ore stacked on the leach pad, with approximately 60,000 tonnes under leach. SilverCrest anticipates that the mine will reach design capacity by the end of the year.
"Our first gold and silver dore production marks another significant milestone in the commissioning of the Santa Elena Mine," said Eric Fier, SilverCrest's Chief Operating Officer. "I would like to congratulate those who have worked diligently to bring this deposit from acquisition to production in less than 5 years, a significant achievement in today's mining environment."
Construction at Santa Elena concluded on schedule and under the budgeted capital expenditure of US$20M, including ongoing working capital and contingency. In advancing the Company's objective to become a mid-tier precious metals producer, SilverCrest will commence initiatives to significantly expand production at the Santa Elena Mine.
SilverCrest secures funds to build Santa Elena
The Northern Miner, June 9, 2009
Vancouver - With a US$12.5 million loan lined up, SilverCrest Mines (SVL-V) says it now has the necessary funds to bring its Santa Elena project in Mexico to production.
The loan, from Macquarie Bank, adds to US$12 million SilverCrest is to receive from Sandstorm Resources (SSL-V) in return for 20% of Santa Elena's life of mine gold production. As part of the gold purchase agreement Sandstorm will also pay the lesser of US$350-per-oz. gold or the prevailing price of gold.
If Santa Elena's US$20 million capital cost as forecast in a prefeasibility study holds up then combined the gold purchase agreement and the Macquarie loan will more than pay for construction of the proposed 2,500-tonne-per-day heap leach mine about 150-km northeast of Hermosillo.
SilverCrest's June 2008 prefeasibility estimates annual production of 30,000 oz. gold and 500,000 oz. silver over an 8-year mine life from probable reserves of 6.5 million tonne grading 56.7 grams silver per tonne and 1.61 grams gold per tonne.
In a base case scenario using US$765-per-oz. gold and US$11.95-per-oz. silver the project gives an internal rate of return of 100% and a net present value discounted at 8% of US$67 million.
While overall the stripping ratio is 4.85 to 1, in the first two years of production it is expected to be somewhat less at 3.5 to 1.
Using silver to gold conversion of 64 to 1, SilverCrest estimates cash costs per oz. gold equivalent of US$328. But with higher grades and less stripping SilverCrest forecasts cash costs in the first two years at US$250-per-oz. gold equivalent.
SilverCrest chief operating officer Eric Fier says the company has contracted Sonoran Resources to operate the mine and that major equipment has been ordered.
Fier also notes there is potential to expand the operation underground and that beyond the proposed mine SilverCrest has outlined four more near parallel targets with similar geochemical signatures as Santa Elena, a low sulphidation epithermal system.
Production is expected to start in 2010.
Macquarie's fee for extending the loan was five million SilverCrest warrants redeemable for a common share at 90c over three years. Macquarie agreed to cancel 3.2 million shares worth of warrants it already held.
Further to the US$12.5million loan, Macquarie will extend SilverCrest a $3 million bridge finance so that SilverCrest can complete acquisition of Santa Elena. In 2005 SilverCrest entered into a 100% option agreement with the owners of the Santa Elena property for US$4 million payable in stages over five years. The final payment of the agreement is US$1 million.
On news of the US$12.5 million loan SilverCrest's share price lost 5c to close at 55c. SilverCrest has 45.5 million shares outstanding.