Eloro Resources (TSX: ELO) | Next Steps in Development of Iska Iska
Summary
TLDRIn this interview, Tom Ison, President and CEO of Alluro Resources, discusses the company's progress and future plans regarding its Isa Isa project in Bolivia. Alluro Resources, publicly traded on the TSX, is focused on developing a large silver-tin polymetallic deposit. Tom shares details on recent drilling efforts, the Mineral Resource Estimate (MRE), and upcoming milestones like the Preliminary Economic Assessment (PEA) and ramping initiatives. He emphasizes the project's vast potential, ongoing metallurgical testing, and its low-cost advantages in Bolivia, positioning the company for significant growth in the coming year.
Takeaways
- 📈 Alluro Resources is a publicly traded company on the TSX under the symbol ELO, focused on the Isa Isa silver-tin polymetallic project in Bolivia.
- 🪙 The Isa Isa project is located in Bolivia’s Potosi region, near the historic Cerro Rico silver mine, which has produced over 2.5 billion ounces of silver.
- 💰 Alluro Resources completed a Mineral Resource Estimate (MRE) last year, following 120,000 meters of drilling and $50-60 million CAD in expenditures.
- 🏗 The project contains over 1.15 billion ounces of silver equivalent, with significant amounts of silver, zinc, tin, and lead.
- 📊 Despite lower-than-expected silver grades, the company is focusing on infill drilling to increase the economic viability of the deposit.
- 🔍 The company is working on a Preliminary Economic Assessment (PEA) for an open-pit bulk tonnage model, targeting a 35,000-ton-per-day operation.
- 🧪 A 7-ton bulk sample returned higher grades than initial drill results, boosting confidence in the project's potential.
- 🚧 The company plans to begin construction of a ramp for underground exploration by December, using Bolivia's lower-cost environment to its advantage.
- 🤝 Alluro has an NDA with San Cristobal mine operators to gain insights into cost inputs and best practices for its operation.
- 🔨 Alluro plans to initiate a small-scale operation for early cash flow by stockpiling ore and potentially selling pre-concentrates to a nearby zinc-lead plant.
Q & A
What is the primary focus of Alluro Resources?
-Alluro Resources primarily focuses on developing the Isa Isa silver-tin polymetallic project located in southern Bolivia, near the Potosí region.
What stock exchange is Alluro Resources listed on, and under what symbol?
-Alluro Resources is listed on the TSX under the symbol ELO and on the OTCQX under the symbol ELRRF.
What was the result of Alluro's initial mineral resource estimate (MRE) for the Isa Isa project?
-The initial MRE showed over 1.15 billion ounces of silver equivalent, including nearly 300 million ounces of silver along with significant amounts of zinc, tin, and lead.
What has been the main criticism of the initial mineral resource estimate (MRE)?
-The primary criticism was that the silver grades were lower than expected, especially compared to previous drilling results, which included other metals such as tin.
What is Alluro Resources' short-term focus for the Isa Isa project?
-The short-term focus is on infill drilling in higher-grade areas of the Isa Isa project, particularly targeting a starter pit area that shows potential for higher-grade silver and lead.
What is the significance of the 7-ton bulk sample Alluro Resources conducted?
-The 7-ton bulk sample returned significantly higher silver grades (9 grams per ton) compared to the original drilling results, indicating potential for higher economic returns from the project.
What is the purpose of the planned ramp at the Isa Isa project?
-The ramp will support further infill drilling and provide access to material for a small-scale pre-concentration operation, helping to demonstrate economic viability while preparing for larger-scale production.
What are the expected costs of the ramping initiative, and why is Bolivia a favorable location?
-The ramping costs are estimated at $1,600 to $1,800 USD per meter, significantly lower than in North American locations like British Columbia or Quebec, where costs are much higher.
What is the long-term vision for the Isa Isa project according to Alluro Resources?
-The long-term vision is to develop a 35,000-ton-per-day open-pit operation with a 12-year mine life, though the potential mine life could extend much longer.
How does Alluro Resources plan to validate the larger-scale operation?
-Alluro plans to validate the larger-scale operation by starting with small-scale production using pre-concentrate material, potentially generating cash flow to fund the project's further development.
Outlines
🎤 Introduction to Alluro Resources and the Isa Isa Project
In this section, Megan Edwards from Focus Communications introduces Tom Ison, President and CEO of Alluro Resources, to discuss the company's progress. Tom provides an overview of Alluro Resources, a publicly traded company listed on the TSX and OTCQX. The company's primary focus is on developing the Isa Isa silver-tin polymetallic project in Bolivia, near the famous Cerro Rico mine. He highlights the company's recent mineral resource estimate (MRE) after significant drilling and spending, as well as the transition to economic evaluation through a Preliminary Economic Assessment (PEA).
🔍 Recap of Progress on the Isa Isa Project
Tom recaps Alluro's progress over the past few months. The company has been focused on defining the large mineralized system through infill drilling. The initial MRE reported over 1.15 billion ounces of silver equivalent, but some criticism emerged due to lower-than-expected silver grades. Tom discusses the company's efforts to improve the silver grades and focus on areas with higher-grade silver and lead for a starter pit, highlighting that Isa Isa is a massive system still open in multiple directions.
🛠 Bulk Sampling and Metallurgical Results
Tom discusses the results of a bulk sample test, which showed significantly higher silver grades compared to previous drill hole assays. The bulk sample returned 9 grams of silver per ton compared to 31 grams from the drill holes, indicating the potential for higher reported grades. He draws parallels to the San Cristobal mine, a nearby profitable operation with similar grades, and mentions ongoing partnerships and information sharing with the new owners of San Cristobal to improve cost inputs for the PEA.
📊 Ramping and Infill Drilling Plans
Tom describes Alluro’s next steps, which include ramping initiatives and more infill drilling at the Santa Barbara area, known for high-grade silver and lead. The company is aiming to enhance the silver and tin grades for the PEA, with a 5,000-meter drilling program starting soon. He highlights the benefits of operating in Bolivia, where costs are lower compared to other regions, and explains plans for the ramp construction to facilitate further development and exploration.
🚀 Small-Scale Operations and Future Plans
Tom elaborates on the company's plans to move forward with a small-scale operation by using material from the ramp development. This material could be processed at a nearby plant owned by Mr. Edwin Vias, the owner of the Isa Isa project, to demonstrate the economic viability of the larger 35,000-ton-per-day open-pit operation. He emphasizes the company's confidence in the metallurgical data and their low-cost approach, which will help generate small-scale cash flow while preparing for larger operations in the future.
👋 Conclusion and Outlook
Megan Edwards thanks Tom Ison for his time and insights, summarizing that Alluro Resources has an exciting and busy year ahead. The discussion closes with the anticipation of more updates from the company as they continue to advance the Isa Isa project toward full-scale development.
Mindmap
Keywords
💡Alluro Resources
💡Isa Isa Project
💡TSX
💡MRE
💡Drilling Campaign
💡Silver Equivalent
💡Infill Drilling
💡PEA
💡Bulk Sample
💡Ramp Mining
💡Metallurgical Testing
Highlights
Alluro Resources is publicly traded on the TSX (ELO) and OTCQX (ELR RF), primarily focused on developing the Isa Isa silver-tin polymetallic project in Bolivia.
The Isa Isa project is located near the famous Cerro Rico mine, a historic 2.5 billion-ounce silver producer over the past four centuries.
Alluro has drilled over 120,000 meters and invested $50-60 million CAD to produce an inaugural mineral resource estimate (MRE) for Isa Isa.
The initial MRE revealed over 1.15 billion ounces of silver equivalent, including nearly 300 million ounces of silver, along with significant amounts of zinc, tin, and lead.
Alluro is focusing on infill drilling in the higher-grade silver zones to enhance the project's economic potential and refine their preliminary economic assessment (PEA).
The company aims to develop a 35,000 ton-per-day open pit operation with a 12-year mine life, potentially extending up to 50 years.
Recent infill drilling and bulk sampling have confirmed higher silver and tin grades, providing stronger economic value for the project.
Alluro plans to commence a 5,000-meter infill drilling campaign to further delineate high-grade silver and tin zones for the PEA.
The company is considering constructing a 1,000-meter ramp to access the higher-grade areas, with construction potentially starting by the end of December.
Bolivia's low-cost mining environment is a key advantage, with ramping costs between $1,600 to $1,800 USD per meter, significantly lower than in North America.
A 7-ton bulk sample returned much higher silver grades of 9 grams per ton compared to the initial 31 grams per ton, proving the value of bulk tonnage modeling.
Alluro has signed a non-disclosure agreement with San Cristóbal mine, a nearby operation, to exchange insights and cost data for the Isa Isa project.
The company is exploring the potential to use ore sorting and preconcentration methods to further improve the economics of the Isa Isa project.
The ramping initiative and bulk sampling will help validate a small-scale operation that could generate early cash flow, aiding the larger open-pit project.
Alluro aims to finalize the PEA by next year, with a focus on improving silver and tin grades to attract larger capital investments.
Transcripts
[Music]
good morning my name is Megan Edwards of
focus Communications and today we're
getting another update from alluro
resources which trades on the TSX
exchange under the symbol ELO joining me
today is lauro's president and CEO Tom
lson Tom thank you for joining us today
yeah good morning Megan so Tom for those
new to the alluro resources story could
you please give us a brief introduction
to the company and your Isa Isa project
in
Bolivia yeah allur resources that were
publicly traded company uh listed on the
uh
TSX and also on the otcqx under the
symbol ELR RF symbol on the TSX is
Elo um our primary focus is to develop
our recently discovered Isa Isa uh
silver 10 poly metallic project you see
that in the background uh from that
first
slide um this is located in the southern
area of uh region of Bolivia in a
department of
potasi uh close by to the famous Saro
Rico uh 2.5 billion ounce producer of
silver over the last four centuries four
or five centuries um
we completed uh a an
MRE uh which is basically a mineral
resource estimate uh last year after
spending close to three and a half years
uh drilling over
120,000
meters uh spending close to 5060 million
Canadian uh to obtain that initial
inaugural mineral resource uh we are now
today moving forward on this multimetal
silver tin Le zinc deposit and that
again is uh the focus without getting
into you know the last three years which
were very uh exciting initially on a on
a discovery basis and usually always is
but practically bringing this into
proper economic Focus uh sometimes that
can be a a little less exciting but we
expect to see a lot more upside on the
deposit uh more sort of enhanced
valuation that you will see coming up in
our pea model which is next step usually
after an inaugural Mr economic
M right and today I wanted to discuss
the latest set of news from alluro where
the company has planned out the next
phases of the development for Isa Isa uh
for the investment Community can you
quickly recap the progress of the
company that's it's made over the last
several months in advancing the ISA Isa
pea well we we've come up with a couple
of press releases in the last uh two
months uh one recently on Wednesday
which is basically giving uh the reader
uh an idea as to where our short-term
focus is going to take us in the
inaugural M that we came out with last
September um we felt that the the whole
point point of the initial drilling
campaign was to try and outline this
system it's a big big massive
mineralized system uh in fact the
initial MRE that we came out with uh
showed uh over 1.15 billion ounces of
silver equivalent uh and if you break
that down you can break it down to
almost 300 uh million ounces of uh
silver uh a massive amount of zinc
tin and lead so from from a from a an
insitu uh 100 meter spacing perspective
I thought it was very very solid the
criticism that we received was that the
grades uh especially in the silver
seemed lower than what the expectation
was from the drilling results that we
always quoted in silver equivalent uh
which included All Metals that we were
coming up with from those 100,000 meters
plus of drilling that also included tin
uh in uh in quite a few of those
intersections that we reported on over
the last two three years uh since then
we've really sort of focused in on okay
short term how do we show we want to
show economic model um so let's focus in
on more infill Drilling in the higher
areas zones of the isisa M area um go in
you know look after go after that sort
of starter pit area where we were coming
up with some higher grade silver and
that's where we started we showed in the
M that there was this uh open pit
zonation potential
of uh you know higher grade silver and
Lead primarily so that's what sort of
made us focus in more just on that pre
precise area which uh came out at around
132 million tons 132 million tons even
that number is large so people have to
realize this is a massive system I'm not
a doctorate of geoscience like my uh
contemporaries here working with me Dr
Bill Pearson or you know Dr Oswaldo AR
who is recently become the uh Executive
Vice President of the lauro Latin
American
operations uh he is the guy when it
comes to Bolivian poly metallic Bonanza
style type systems and there are a few
of them in Bolivia and he classifies
this Isa Isa project
as definitely or the system at least as
definitely being a front runner uh in
over the last hundred or so years of
Discovery uh in B in Bolivia so it's a
massive system uh we proved that with
the the infield with the first pass uh
100 meter spacing drilling that came in
with our M last year still wide open in
three directions to the West to the east
to the South the strike length of the
open pit model in that MRE was over 15
14500 meters um you know we gave used a
stripping ratio of one: one these are
fabulous numbers especially when it
comes to uh the economics the lowcost
environment that you have in Bolivia
unlike most other jurisdictions here in
North America so you know there's a lot
of of hidden benefits that we felt we've
really got a sort of micro wise go into
to show the market uh focus in on
drilling don't on infill drilling to up
the grades not only of the silver the
zinc's somewhat consistent the lead's
somewhat consistent but more on the
silver and also on the tin I believe tin
it could be the main next to Silver you
know the main hook to eventually
attracting bigger Capital into this
system into our project so our Focus has
been um you
know basically moving on the Pea moving
on the starter pit that'll be will form
the Pea the preliminary economic
assessment
study um so we've completed logistical
studies independently over the last 6
eight months uh we did some more infill
Drilling in last September to December
we what the most significant thing in my
mind that that resulted from that work
was the 7 ton bulk sample that we took
from the starter pit area the uh upper
upper area that we're working the Pea
towards uh and and send it over to to
Armstrong a
laboratory uh in in Cornwall England
under the supervision of Michael uh Mike
hollywell who's our senior VP project
risk
metallurgical uh is doing a lot of uh
fantastic work for us uh now and moving
forward he has one other file and that's
with sir MC Davis of Cornish medals runs
a private Equity Fund called Vision blue
they're rehabbing the big tin old tin
Underground deposit in Cornwall so he
knows his stuff he was the guy that
brought in xrt or sorting into our model
um so we're really really staying
focused on upgrading and with this bulk
sample that I I mentioned the seven ton
bulk sample what it proved it was a
seven ton bulk sample um used for
metallurgical bulk testing which returns
significantly higher head grade of 9
gram silver per ton like three ounces
close to three over three ounces of
silver per ton compared with 31 gram
silver uh average grade from two
original twin Diamond drill holes in the
exact same
area uh in this poly metallic open pit
domain that speaks a a thousand words
because I'll tell you San Cristal the
operat a that was owned by sumomo 180
kilm away was an
extremely profitable mine although it
was in private hands being
sumomo uh but it ran from 2006 and still
is running uh with grades similar to
ours at this stage that's that we have
an NDA signed with with San christable
the new San chrisal company that owns
the that owns the San Crystal B mine so
you know we're getting a lot of guide
lines as to cost inputs that have been
very helpful as we move into this pea so
that bulk tonnage what that did was it
made us start thinking doing all this
drilling I mean if we're get under Under
reporting our grades I mean it's great
from the standpoint of okay we're
showing a bigger resource but what we
need to show what the real value per
especially in the silver uh by using
bulk sampling by using bulk tonnage type
modeling uh for assaying uh you know
what that can really do for our paa and
so this brings me up to the next qu the
next point that in our press release
that we came out with a couple of days
ago we are now moving forward on the a
ramping initiative this ramp we're
looking at around 3 meter to three and a
half meter Dimension it's going to be
located uh very close
or perhaps even within the Santa Barbara
the old Santa Barbara adct that if you
go to that press release two days ago
came up with continual Channel samples
within that old adct of well over 150
gram silver and high grades of tin and
lead it's more of a a silver lead tin
type of environment less zinc which is
more to the east of this
um major deposit here at ISA Isa uh so
you know this ramp what we're looking to
do is with the 5,000 meters of infill
drilling that we also mentioned in the
press release that will start up at the
end of September that 5,000 meters will
be um in that Santa Barbara added area
to which is the higher grade area that
that
that that tonnage will give us U
basically uh it'll help in two ways
it'll help from the standpoint of
enhancing more silver and Tin that will
now be added to the
Pea um the Pea model itself will be a
35,000 ton a day operation open pit bulk
tonnage uh we're hoping to bring the tin
in Midway through that 12year min life
even though there could be a eventually
a 30 40 50y year mine life but we're
talking 12E for the Pea model so this
infill drilling should allow us to bring
more tin resource into that model but we
have to firm that up but not only will
that be of of obvious significance for
the
Pea uh and that's slated for next year
but it'll also determine finally exactly
the entrance way for the startup of the
ramp and we want to hopefully get moving
on the ramping near the end of December
one of the great things about working in
Bolivia is the fact that the costs are
so much lower the ramping study the
independent study that we've done to
date comes in between $1600 to $1,800 us
a meter try doing a ramp in BC or in
Quebec uh for that type of uh cost good
luck three four times higher so those
are the advantages and this ramp you
know we the initial uh thought is a
th000 meters we will take from that
ramp uh the material that we're we're
opening the you know the ramp up with
and stockpile it and that'll be the next
step moving forward with that stockpile
on the basis of potentially adding
crushing adding an orse order uh and
potentially moving that
material as a preconcentrate form by
truck 15 kilometers down to the owner of
the ISA Isa project Mr Edwin Vias to his
zinc Le differentiation plant uh where
we can start showing the smallscale type
of
operation with the returns that we
expect to
see which is will be very very sort of
helpful for the much bigger and validate
the much larger 35,000 ton a day
operation uh for down the road so we're
really really excited about the
direction we're taking and and this this
basically proves that this material we
have this isn't Pie in the Sky we've
done so much work on the metallurgical
on the or sorting on the grades we know
what s s San Cristal all about this is
going to be a very cheap capex to to to
bring in a couple of Crushers at you
know hopefully within the next uh you
know few months and move forward on this
small scale operation and derive some
small cash flow to probably from a
sustainability standpoint to even pay
off this type of of operation it has
nothing to do with the big picture
though being the open pit 35,000 ton a
day pea operation
from that you'll see uh coming out next
year all right well thank you so much
for your time today Tom it sounds like
it's going to be a busy remainder of the
year for the company and we look forward
to having you back soon for the next
aora update great Megan thank you very
much
[Music]
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