Tag Archives: El Limon

Muckahi monorail-based tech removed from Torex’s Media Luna plans

Torex Gold has decided to move forward with “conventional development and mining methods” for its planned Media Luna project in Mexico, following the outcome of various risk assessments, extensive comparative financial analyses, and the results to date of the Muckahi test program at El Limón Deep (ELD), the company said.

In the company’s June quarter results – which saw “solid operational performance” of 118,054 oz of gold produced, adjusted EBITDA of $122.1 million and generation of $21.9 million of free cash flow – Torex said the monorail-based technology would no longer be used in the Media Luna feasibility study currently being worked on and expected to be published in a technical report in the March quarter of 2022.

It explained: “After an analysis of the results to date of the Muckahi test program at ELD and an assessment of business risks, the board has approved a decision to pursue the Media Luna feasibility study on a conventional mining basis. While the monorail-based technology has progressed since the beginning of the ELD test program, testing to date of the individual components operating as an integrated system demonstrates that additional process and equipment engineering is required to achieve desired advance rates, cycle times, and associated cost efficiencies, and that there is insufficient available upside in using the technology as it relates to financial or schedule considerations for Media Luna.”

The use of the Muckahi technology, invented by former President and CEO Fred Stanford, would also leave the company with “no alternative readily available once the decision is taken to drive the two steep ramps at Media Luna, since there would be no access to the ore via any other method without considerable investment and schedule disruption associated with driving conventional ramps”.

Apart from the technical risks, there are additional business risks that require time and consideration such as permitting and regulatory compliance given there is no precedent for the technology, Torex added.

The company believes the use of a conventional mining process is a more prudent approach to mitigate operational and financial risk to the business given Media Luna will be its primary source of feed at the Morelos property after mid-2024.

It did leave the door open for use of the Muckahi technology in the future, saying aspects of the monorail-based technology were currently being deployed for development of the Guajes Tunnel.

“Management will consider including a preliminary economic assessment-level study to utilise monorail-based equipment to develop the smaller EPO deposit near Media Luna as part of the overall technical report to be released in Q1 (March quarter) 2022,” it said.

Potential deployment of the technology at EPO, which hosts an inferred resource of 1.01 Moz of gold-equivalent, would allow for additional testing of the integrated system within a live production environment.

The Muckahi system was engineered by MEDATech in close collaboration with Stanford.

The monorail mining system is billed as providing a surgical way to mine narrower orebodies more efficiently. It involves three logistical paradigm shifts: steep ramps (a quarter of the length of conventional ramps), roof-mounted monorails and equipment to run on them and minimal underground infrastructure.

The technology is expected to significantly reduce capital expenditure, operating expenditure and cut time-to-revenue by as much as 80%, according to Stanford. It will also produce 95% fewer underground greenhouse gas emissions.

The Muckahi technology was included in the Media Luna preliminary economic assessment, but the company always noted that it was experimental in nature and had not yet been tested in an operating mine.

When publishing its 2020 financial results in February 2021, Torex noted: “Since the date of the technical report, the majority of the components of the Muckahi system have been tested by Torex and their functionality demonstrated. Although, the components have not yet been tested together as a system to demonstrate the rates per day in which tunnels can be excavated and material removed from long hole open stopes.

“Testing of the integrated system will continue and is expected to be completed in the second (June) quarter of 2021. Drill and blast fundamentals, standards and best practices for underground hard-rock mining are applied in the Muckahi system as described in of the technical report, where applicable. The proposed application of a monorail system for underground transportation for mine development and production mining is unique to underground mining. There are existing underground mines that use a monorail system for transportation of materials and equipment, however not in the capacity of Muckahi which is described in detail in the technical report. The mine design, equipment performance and cost estimations involving Muckahi in the technical report are conceptual in nature, and do not demonstrate technical or economic viability.”

At the same time as updating the market on its plans to use conventional development and mining methods at Media Luna, Torex said its Board had approved a pushback of the El Limón open pit, which is anticipated to add around 150,000 oz of gold production and extend open-pit mining to mid-2024. This would align with first production from Media Luna in 2024.

Para and Clark Construction partner up at Gold Road in Arizona

Para Resources has entered into a final services agreement with Clark Construction Group, whereby Clark will provide contract mining services at the company-owned Gold Road mine in Arizona, US.

The contract transitions from the original “time and materials” pact announced in November with an open book target pricing contract. This new contract establishes the basis on which mining and extraction will occur at the Gold Road mine, Para said.

Clark has already been present on the project with equipment and crews and Atkinson is currently driving an exhaust drift in preparations of installing an exhaust fan to upgrade the ventilation system, upgrading the main decline to accommodate larger trucks rehabilitating the secondary escape routes and remediating the previously announced ground control issues.

In addition, maintenance, testing, repair, and general clean-up of the mill has been completed, Para said. The mill is now in functional condition with the exception of additional ball mill liners and first fills which are expected later in January.

Mineralised rock production is on schedule and expected to commence in late January with the re-commissioning of the plant. First gold pour is anticipated in February 2019.

Geoff Hampson, Para’s CEO, said: “We are very pleased to have now transitioned our relationship with Clark Construction Group to a Target Price contract which will ensure continuity of costs and production. We have implemented several key bonus programmes to ensure that Para’s and Clarks’ interests and incentives are in sync.

“Clark is one of the most experienced and respected building and civil construction firms in the US and they bring extensive experience and knowledge to our operations and capacity. The partnership between Clark and our highly skilled and tested Para team will ensure a smooth and successful production ramp up.”

In August 2017, Para, through its 88%-owned subsidiary Gold Road Mining, acquired the 500 t/d carbon-in-leach/carbon-in-pulp Gold Road mine and mill, including patented claims and a mill and processing facility, located in the historic Oatman Mining District of north-western Arizona.

In other news, Para said the mill at the company’s El Limon mine in Colombia continues to perform as anticipated, with the ramp up of feed continuing.

“Para is now assisting several of the larger formalised artisanal miners with equipment, technology and management. The new winch and the new tailing disposal site at El Limon are expected to be completed by the end of Q1 (March quarter) 2019,” it said.

“The current ramp up at El Limon is anticipated to move the operation into positive cash flow in the coming months and commercial production is expected to be declared by the end of the March quarter.”