Telson Mining Corporation arranges $25m gold mine financing
Canada-based Telson Mining Corporation has arranged $25 million financing to restart the construction and ramp up of its fully owned Tahuehueto Gold mine project with pre-production targeted within 10-12 months and full scale production within 12-14 months.
A LoI was signed with Accendo Banco S.A. de C.V ($12 million loan), Empress Royalty Corp. ($5 million) and Endeavour Financial ($8 million equity private placement, due to close first week of March).
Telson, Accendo Syndicate and Trafigura Mexico S.A. de C.V. have also executed an MoU that provides a non-binding framework with terms to be used by the parties to negotiate the potential entry into the Definitive Agreements of the proposed transactions.
Capex required to complete mine construction and commissioning is estimated at $15.4 million which includes $12.6 million for equipment and construction, including a 15% contingency, plus $2.8 million of working capital to support operations until the mine achieves positive cashflow, following a proposed three-year payback period.
Tahuehueto, located in Mexico's north-western Durango State, will produce gold, silver, lead, and zinc in concentrates within its own on-site mineral processing facility, and has a designed capacity of at least 1,000 tonnes per day. It consists of 28 mining concessions grouped into five non-contiguous blocks that total approximately 7,492 hectares.
In addition, Telson Mining has announced the retention of Peak Investor Marketing Corp., a boutique firm which provides full-service marketing and consulting services focused on the junior mining sector. The contract is for one year, with a fee of $12,000 per month.
Peak will also receive 300,000 stock options vested over 12 months (as to one-quarter every 3 months), in accordance with the terms of the Company’s stock option plan, at the time of the Company’s next option grants, at a price to be determined.
Operations at Campo Morado - a polymetallic base metal mine - during Q4 2020 showed a steady increase in production with December throughput production increasing to 57,081 tonnes of mineralized material processed, resulting in 3,756 tonnes of zinc concentrate and 740 tonnes of lead concentrate for the month. Estimated revenues for the quarter, net of all concentrate sale deductions such as treatment charges and penalties, were approximately US$8,766,889.
All transactions are subject to TSX Venture Exchange approval.
Copper production from top ten companies to increase by 3.8%
Copper production from the world’s top companies is set to increase by up to 3.8% this year, following a fall of 0.2% in 2020, GlobalData analysis reveals. Last year’s marginal slump saw production drop to 11.76 million tonnes (Mt).
The initial impact of the COVID-19 pandemic on mining operations was immense, however, six of the ten largest copper producers succeeded in increasing output last year. In 2021, copper production from the top ten copper companies is expected to bounce back, rising by up to 3.8%, to reach 12.2Mt, according to GlobalData, a leading data and analytics company.
The highest increase in copper production was by Canada’s First Quantum, which, despite all the challenges, reported 10.4% growth in 2020. The company’s Sentinel mine in Zambia and Cobre Panama were key contributors to this growth. While the latter remained under care and maintenance between April and August 2020, it delivered record production levels during the subsequent months.
Codelco, the world’s largest producer of the red metal used in electric vehicles, also bucked the trend.
Vinneth Bajaj, Associate Project Manager at GlobalData, commented: “Despite Codelco reporting over 3,400 active cases during July 2020, the company achieved 1.2% growth in its production in 2020. The company implemented a four-phase plan, as part of the COVID-19 measures, to ensure the health and safety of its employees, while also avoiding any significant impact to its copper output.”
Although the overall impact was minimal, declines in production were observed from Glencore (8.2%), Antofagasta (4.7%), BHP (3.9%) and Freeport McMoRan (1.3%). Reduced operational workforces due to COVID-19 measures, lower ore grades and production halts due to maintenance were the key disruptors to output during 2020.
The move towards electric vehicles and clean energy from renewables sources such as solar panels and wind turbines has driven the copper price to all-time highs. Copper has been among the best performers over the last month where metals ranging from aluminum to iron ore have surged to their highest prices in years. The rally is being fueled by stimulus measures, near-zero interest rates and signs that economies are recovering from the global pandemic.