Pan American (NASDAQ:PAAS) revealed yesterday it has finalized a preliminary feasibility study on the La Morocha deposit, which is part of the Joaquin project, located in Santa Cruz, Argentina.
The study recommends the development of the La Morocha deposit as an underground mine, with processing to occur at Pan American's Manantial Espejo mill.
Based on the results of a preliminary feasibility study, Pan American has approved a capital investment of roughly US$37.8 million to construct the La Morocha underground mine and fund activities up to the point of commercial production.
“The Joaquin royalty will be a great addition to Metalla's existing producing portfolio when it comes online. Shareholders should benefit from an annualized 17% increase in production starting in 2019, cash flow and geographical diversification, and add a top tier operator,” said Brett Heath, the president and chief executive officer of Metalla.
“The preliminary feasibility study only represents a small part of the overall potential of Joaquin. The investment by Pan American shows their commitment and confidence in the Joaquin project, and it looks to hold a significant amount of potential for future years past 2021,” Heath added.