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Silver Junior Banking on San Acacio Project

Bruce Winfield - Defiance Silver
President & CEO

STORY INLINE POST

Wed, 10/19/2016 - 00:04

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Q: What have been the key milestones and achievements for Defiance Silver during 2015, and what new opportunities have you spotted in the San Acacio project?

A: We were able to use the funds that were invested into the company in early 2014 in order to complete the acquisition of surface rights, obtain environmental drilling permits, and carry out three different drilling campaigns on the project, which total approximately 3,000m. We are still assessing the results from the aforementioned drilling but overall it was extremely positive, with wide, high grade intersections. We marketed ourselves on the promise that we could drill below the old workings and increase the number of ounces of our resource, offering the least risk and highest reward.

Q: Bearing in mind the positive results, how will this affect your exploration efforts looking ahead?

A: We are still in the early stages, with a total of 25,000m of drilling to complete. Our first phase is expected to stretch 5,000m, the second phase 10,000m, and the third phase 10,000m. We are still in the midst of Phase One but we are encouraged by our early successes and this will drive us into Phases Two and Three. The property has produced 100 million ounces of silver over the last 500 years and we have always maintained that there is potential for 50-100 million ounces remaining in the mine to be produced. Our aim is to prove this potential, and this is what we have started to do with the first 3,000m. Now, it is a matter of increasing our efforts.

Q: What characteristics does the San Acacio project have that makes it a viable and interesting development?

A: San Acacio is one of the last major mines with substantial production that has experienced little modern exploration. Now we need to increase our success levels in order to be able to acquire the property for the US$5.5 million full purchase price within the next three years. Another thing that makes San Acacio so exciting is that it is a previously producing mine with tremendous future potential. Moreover, it is only located 6km north of Zacatecas, which is a fully developed city, so we are able to benefit from paved roads and power lines throughout the property. There is a well- developed history of mining in the town, and we have not experienced a great deal of resistance from the locals. For instance, we obtained drilling permits within six weeks, which is unheard of in Mexico.

Q: What has enabled you to thrive and survive?

A: The San Acacio mine is a solid project that has allowed us to attract enough capital even though this has admittedly been difficult over the last four years. Moreover, investment in high-risk projects is not forthcoming at the moment, so it has helped that ours is at a more advanced stage. In 2014, we were fortunate to find an investor in Windermere Capital that could see the potential of the project and was willing to invest US$1 million in order to support it. We have applied for another set of concessions with the Minerva Group in northern Mexico. This is another old mine in which we see great potential for modern exploration, and although it is still only in the application process, we think it is a solid opportunity. However, we are currently concentrating our efforts on San Acacio simply because funds are limited and we need to dedicate them to the most important project.

Q: What are the key goals you have for 2016, and where do you see the company in the coming five years?

A: In 2016, we want to continue drilling and developing the project. Within five years, we hope to have advanced the project to the point where we can start conducting pre-feasibility studies in order to justify building a mine. In my view, San Acacio certainly has the potential to be a substantial modern mine like Capstone Gold’s Cozamin mine, which is located just 2.5km south of San Acacio. Despite the fact that our concession lies on the northern structure, the two are very similar, so we believe that our project can be just as productive.

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