Eloro Resources (TSX: ELO) | Next Steps in Development of Iska Iska

Summary

In 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

00:00

🎤 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).

05:03

🔍 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.

10:04

🛠 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.

15:04

📊 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.

Keywords

💡Alluro Resources

Alluro Resources is a publicly traded company focused on developing its silver, tin, lead, and zinc project known as 'Isa Isa' in Bolivia. The company is listed on the TSX exchange under the symbol ELO. It is the central subject of the video, with the discussion revolving around its projects and progress.

💡Isa Isa Project

The Isa Isa Project is a silver, tin, lead, and zinc deposit that Alluro Resources is developing. It is a significant part of the company's focus and the main topic of the discussion in the video. The project is located in Bolivia and has shown promising results from initial drilling campaigns.

💡TSX

TSX stands for the Toronto Stock Exchange, where Alluro Resources is listed under the symbol ELO. The TSX is a key platform for the company to raise capital and for investors to trade shares in Alluro Resources.

💡MRE

MRE stands for Mineral Resource Estimate, which is a study that estimates the quantity and quality of a mineral resource. In the context of the video, Alluro Resources completed an MRE for the Isa Isa Project, indicating a substantial silver equivalent resource.

💡Drilling Campaign

A drilling campaign refers to a series of drilling operations conducted to explore and evaluate mineral deposits. The video mentions that Alluro Resources spent significant time and resources on drilling over 120,000 meters to obtain an inaugural mineral resource.

💡Silver Equivalent

Silver equivalent is a term used to express the combined value of silver, lead, zinc, and tin in a deposit as an equivalent amount of silver. The video highlights that the initial MRE showed over 1.15 billion ounces of silver equivalent.

💡Infill Drilling

Infill drilling is a type of drilling conducted to increase the density of drill holes in a mineralized zone to improve the accuracy of resource estimates. The video discusses how Alluro Resources is focusing on infill drilling to enhance the grade of silver and tin in the Isa Isa deposit.

💡PEA

PEA stands for Preliminary Economic Assessment, a study that provides a preliminary analysis of the economic viability of a mineral deposit. The video mentions that Alluro Resources is moving forward on the PEA for the Isa Isa project.

💡Bulk Sample

A bulk sample is a large volume of mineralized material that is extracted to test the metallurgical characteristics of the ore. The video discusses a 7-ton bulk sample taken from the Isa Isa project, which returned a higher head grade of silver.

💡Ramp Mining

Ramp mining refers to the method of accessing a mineral deposit by excavating a ramp or decline from the surface. The video discusses Alluro Resources' plans for ramp mining at the Isa Isa project, which will be used to extract higher-grade material.

💡Metallurgical Testing

Metallurgical testing involves processing the ore to determine how it can be upgraded to a saleable product. The video mentions that metallurgical bulk testing on the bulk sample from Isa Isa returned significantly higher grades, indicating the potential economic value of the deposit.

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]