Torex Gold Resources Inc. (TSX:TXG) is pleased to announce that the resettlement of all 102 families of the village of La Fundicion has been completed at its 100% owned Morelos Gold Property in Mexico. The Company also announced that a draw of $25 million on its debt facility was received at the end of August and provided a construction update.
Construction: On Budget and On Schedule for First Gold Pour in Q4/15 and Commercial Production in Q2/16
Construction for first gold is 88% complete, with water and grid power now available at the processing plant. With these two services in place, the focus of construction is on finishing up the piping, electrical, and instrumentation work in preparation for initial commissioning of the processing plant circuits with water. The operations and maintenance teams have been hired and are working with commissioning specialists to bring the processing plant into production. There are still approximately 3,000 workers on site. This number will start to decrease given that road construction is drawing to a close as is ancillary construction such as the permanent camp.
Construction: On Budget and Ahead of Schedule for Full Production (14,000 t/d) By Year End 2016
Achieving full production of 14,000 tonnes per day requires the second pit, El Limon, to be in production. The access road to El Limon has been in place for some time now and has been used for the construction of the El Limon Crusher and the RopeCon, both of which are tracking ahead of schedule. For the RopeCon, the towers have been installed and the three pairs of cables have been mounted on the towers and tensioned. Current activity includes installing the frames that keep the three pairs of cables in consistent alignment. The final piece of the puzzle was the recently completed resettlement of the La Fundicion Village. The relocation of this village has made it safe to begin working above the former village, which allows for the start of waste stripping for El Limon.
Mining: Ahead of Schedule
Mining continues ahead of schedule with over 1.2 million tonnes in stock pile. The stock pile is of sufficient size to take mining off the critical path for commercial production in Q2/16, which is consistent with the commercial production schedule when construction started. With an adequate stockpile available, the focus of the mining team has shifted to waste stripping to avoid future re-handling costs.
Financing: The Project Remains Fully Funded
At the end of August, the Company received a drawdown on its Project Finance Facility in the amount of $25 million for a total of $300 million drawn to date. The cost to complete estimate remains at $800 million. This cost to complete estimate anticipates the spending of the full contingency.
Security: Quiet and Well Supported By State and Federal Forces
From a security perspective the site remains quiet, and negotiations for a permanent official presence are ongoing. From a social perspective there has been some recent blockade activity on one of two access roads to the plant site. The blockade was initiated by a group of fishermen that believe that our activities have resulted in lower fish catches in the Caracol Reservoir. We will be hiring an independent third party to prepare a study and determine whether there is legitimacy to their claim. The blockade has been lifted and there is no anticipated impact to the schedule of first gold in Q4/15.
Torex is a growth-oriented, Canadian-based resource company engaged in the exploration and development of its 100% owned Morelos Gold Property, an area of 29,000 hectares in the highly prospective Guerrero Gold Belt located 180 kilometers southwest of Mexico City. Within this property, Torex has two projects: the El Limon-Guajes (ELG) Mine, currently under development, and the Media Luna Project, at an advanced stage of exploration. Torex intends to identify a pipeline of future economic deposits within its property, which remains 75% unexplored.
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