Endeavour Silver acquired El Cubo mine in July 2012 as part of its strategy of buying and rejuvenating struggling old mines in historic mining districts. Unlike Guanaceví and Bolañitos, the other two producing mines in Endeavour Silver’s portfolio, that had low throughputs and no reserves when acquired, El Cubo offered the potential to quickly begin producing at a rete of 1,000 t/d. El Cubo has many mine adits, ramps, and shafts, as well as a 400 t/d leaching plant to produce doré bars. The processing plant at El Cubo goes back at least 150 years, and was the first mill site permitted to use cyanide in Mexico. Recognizing that this is an old facility, ripe with risks and challenges that date back to a time before sustainable mining standards and practices were in place, Endeavour Silver launched a rebuilding program to address any of the facilities’ shortcomings and to modernize the operations.
In the third quarter of 2012 Endeavour Silver launched a US$67 million, 18 month capital investment program at El Cubo, to explore and develop the mine and to rebuild and expand the plant, tailings facility, water supply, electrical supply, surface buildings, and surface infrastructure. Located only 6km southeast of the city of Guanajuato, in the southeastern part of the second largest historic silver mining district in Mexico, El Cubo is only 15km from the Bolañitos project, which creates significant operational synergies between El Cubo and Bolañitos. Although El Cubo has until recently been a low grade, high cost mining operation, it is already showing improved throughput, grades, and mineral recoveries as a result of Endeavour Silver’s operational initiatives.
The El Cubo property consists of 61 mineral concessions covering 8,146 hectares. Some 38 individual veins have been historically mined, and 16 additional exploration targets outside of the existing mines at El Cubo offer potential for new silver and gold vein discoveries. Endeavour Silver’s exploration review identified 28 prospective target areas in and around the existing mines at El Cubo, that have the near-term potential to delineate new reserves and resources. Since acquiring the property the company has undertaken mapping, sampling, permitting, and drilling to start testing the high priority targets. More than 50,000m of core drilling is planned over the next two years.
After producing 300,000oz of silver, 600,000oz of silver equivalent, and 4,893oz of gold in 2013, Endeavour Silver is expecting to produce 900,000oz of silver, 1.7 million ounces of silver equivalent, and 13,000oz of gold in 2013 at cash costs per ounce that are significantly lower than the company achieved in 2012.