Americas Gold and Silver Signs Credit and Off-Take Agreement for EC120 Project
Americas Gold and Silver (TSX: USA) (NYSE American: USAS) has signed a Credit and Off-Take Agreement with Trafigura PTE for the development of the EC120 Project at its Cosalá Operations in Mexico. The agreement provides a secured credit facility of up to $15 million, with an initial draw of $10 million expected. The project aims to begin producing high-grade silver-copper concentrate in Q3-2025.
Key highlights include:
- Projected annual production of 2.5 million ounces of silver and 4.5 million pounds of copper
- Estimated cash cost of $9.61/oz and all-in sustaining cost of $10.81/oz
- Expected to increase the Company's silver-derived revenue to over 80% by end of 2025
- Commercial production estimated to start in Q3-2025
- Credit facility terms: 36-month term, SOFR plus 6-6.5% interest rate, 12-month grace period
Americas Gold and Silver (TSX: USA) (NYSE American: USAS) ha firmato un Accordo di Credito e di Off-Take con Trafigura PTE per lo sviluppo del Progetto EC120 presso le sue Operazioni di Cosalá in Messico. L'accordo prevede una linea di credito garantita fino a 15 milioni di dollari, con un prelievo iniziale previsto di 10 milioni di dollari. L'obiettivo del progetto è iniziare a produrre un concentrato ad alta legge di argento-rame nel terzo trimestre del 2025.
Le principali evidenze includono:
- Produzione annua prevista di 2,5 milioni di once d'argento e 4,5 milioni di libbre di rame
- Costo di produzione stimato di 9,61 $/oz e costo totale di mantenimento di 10,81 $/oz
- Si prevede un aumento dei ricavi derivati dall'argento della società a oltre l'80% entro la fine del 2025
- Produzione commerciale stimata per iniziare nel terzo trimestre del 2025
- Termini della linea di credito: durata di 36 mesi, tasso di interesse SOFR più 6-6,5%, periodo di grazia di 12 mesi
Americas Gold and Silver (TSX: USA) (NYSE American: USAS) ha firmado un Acuerdo de Crédito y Suministro con Trafigura PTE para el desarrollo del Proyecto EC120 en sus Operaciones de Cosalá en México. El acuerdo proporciona una línea de crédito asegurada de hasta 15 millones de dólares, con un desembolso inicial esperado de 10 millones de dólares. El objetivo del proyecto es comenzar a producir concentrado de plata-cobre de alta calidad en el tercer trimestre de 2025.
Los aspectos destacados incluyen:
- Producción anual proyectada de 2,5 millones de onzas de plata y 4,5 millones de libras de cobre
- Costo de efectivo estimado de 9,61 $/oz y costo total de sostenimiento de 10,81 $/oz
- Se espera que los ingresos derivados de la plata de la empresa aumenten a más del 80% para finales de 2025
- Se estima que la producción comercial comience en el tercer trimestre de 2025
- Términos de la línea de crédito: plazo de 36 meses, tasa de interés SOFR más 6-6,5%, periodo de gracia de 12 meses
아메리카스 골드 앤 실버 (TSX: USA) (NYSE American: USAS)는 멕시코 코살라에서 EC120 프로젝트 개발을 위해 Trafigura PTE와 신용 및 오프테이크 계약을 체결했습니다. 이 계약은 최대 1,500만 달러의 보장된 신용 한도를 제공하며, 초기 인출액으로 1,000만 달러가 예상됩니다. 이 프로젝트의 목표는 2025년 3분기에 고품질의 은-구리 농축제를 생산하는 것입니다.
주요 하이라이트는 다음과 같습니다:
- 연간 예상 생산량은 250만 온스의 은과 450만 파운드의 구리입니다.
- 추정 현금 비용은 9.61$/온스, 전체 유지 비용은 10.81$/온스입니다.
- 회사의 은에서 발생하는 수익이 2025년 말까지 80% 이상 증가할 것으로 예상됩니다.
- 상업 생산은 2025년 3분기 시작될 것으로 추정됩니다.
- 신용 한도 조건: 36개월 기간, SOFR 플러스 6-6.5% 이자율, 12개월 유예 기간
Americas Gold and Silver (TSX: USA) (NYSE American: USAS) a signé un Accord de Crédit et d'Off-Take avec Trafigura PTE pour le développement du Projet EC120 dans ses opérations de Cosalá au Mexique. L'accord prévoit une facilité de crédit sécurisée allant jusqu'à 15 millions de dollars, avec un premier tirage prévu de 10 millions de dollars. Le projet vise à commencer la production d'un concentré d'argent-cuivre de haute qualité au troisième trimestre 2025.
Les points clés incluent :
- Production annuelle projetée de 2,5 millions d'onces d'argent et 4,5 millions de livres de cuivre
- Coût de production estimé à 9,61 $/oz et coût soutenu total à 10,81 $/oz
- Prévision d'une augmentation des revenus de l'argent de l'entreprise à plus de 80 % d'ici fin 2025
- La production commerciale devrait commencer au troisième trimestre 2025
- Conditions de la ligne de crédit : durée de 36 mois, taux d'intérêt SOFR plus 6-6,5 %, période de grâce de 12 mois
Americas Gold and Silver (TSX: USA) (NYSE American: USAS) hat einen Kredit- und Abnahmevertrag mit Trafigura PTE für die Entwicklung des EC120-Projekts in seinen Cosalá-Betrieben in Mexiko unterzeichnet. Der Vertrag sieht eine gesicherte Kreditlinie von bis zu 15 Millionen US-Dollar vor, wobei eine anfängliche Abrufung von 10 Millionen US-Dollar erwartet wird. Das Ziel des Projekts ist es, im dritten Quartal 2025 mit der Produktion von hochgradigem Silber-Kupfer-Konzentrat zu beginnen.
Die wichtigsten Highlights sind:
- Projected annual production of 2,5 Millionen Unzen Silber und 4,5 Millionen Pfund Kupfer
- Geschätzte Barproduktion von 9,61 $/oz und gesamte Aufrechterhaltungskosten von 10,81 $/oz
- Es wird erwartet, dass sich die durch Silber erzielten Einnahmen des Unternehmens bis Ende 2025 auf über 80% erhöhen
- Die kommerzielle Produktion wird im 3. Quartal 2025 voraussichtlich beginnen
- Kreditlinienbedingungen: 36 Monate Laufzeit, SOFR plus 6-6,5% Zinssatz, 12-monatige Karenzzeit
- Secured $15 million credit facility for EC120 Project development
- Projected annual production of 2.5 million oz silver and 4.5 million lbs copper
- Estimated low cash cost of $9.61/oz and AISC of $10.81/oz
- Expected to increase company's silver-derived revenue to over 80% by end of 2025
- Non-dilutive financing at competitive terms
- Reduced pre-production capital requirements by $2 million due to completed development
- Potential for higher cash flow due to increased metal prices since 2019 PFS
- Additional debt burden with credit facility
- Dependency on successful development and production of EC120 Project
- Exposure to silver and copper price volatility
Insights
The signing of the Credit and Off-Take Agreement with Trafigura is a significant positive development for Americas Gold and Silver. The
The estimated cash cost of
The EC120 Project represents a strategic shift for Americas Gold and Silver. By leveraging existing infrastructure at Cosalá Operations, the company is minimizing capital requirements and accelerating the project timeline. The decision to expedite EC120 development before fully depleting the San Rafael orebody demonstrates proactive management and could lead to a smoother transition between ore sources.
The processing of 140,000 tonnes of EC120 ore, including development ore, with recoveries within PFS target range is encouraging. It validates the project's feasibility and reduces operational risk. The projected increase in silver production from less than 1 million ounces to ~2.5 million ounces annually at Cosalá is substantial and could significantly enhance the company's market position in the silver mining sector.
The timing of this agreement aligns well with current market conditions. Silver and copper prices have risen significantly since the 2019 PFS, which assumed
The off-take agreement with Trafigura, a major commodities trader, provides a guaranteed market for the EC120 Project's output. This mitigates sales risk and could potentially lead to favorable pricing terms. However, investors should note that commodity price volatility remains a key risk factor. The project's success will depend on maintaining competitive production costs to ensure profitability across various price scenarios.
Highlights
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The Agreement provides the Company with a secured credit facility of up to
to complete the pre-production development of the EC120 Project at its Cosalá Operations to begin producing high-grade silver-copper concentrate in Q3-2025. The Company expects to draw only$15 million on the credit facility initially subject to standard closing conditions.$10 million -
The 2019 Preliminary Feasibility Study (“PFS”) for the EC120 Project projected average annual metal production of 2.5 million ounces of silver and 4.5 million pounds of copper at life of mine cash cost [1] and all-in sustaining cost [1] estimated to be
/oz and$9.61 /oz, respectively, with estimated annual average cash flow of$10.81 using$15 million per ounce silver and$17.50 per ounce copper. At the current prices, the Company expects to generate substantially greater cash flow over the life of the project with lower capital, cash cost per silver and AISC per silver ounce.$3.00 - Initial development access to the Zone 120 deposit began in Q3-2023 and is expected to be fully completed in Q3-2025. The Company has already processed close to 140,000 tonnes of EC120 ore, 30,000 tonnes of development ore from Zone 120, and 110,000 tonnes of ore from El Cajón in 2017. Recoveries from processing this ore have been within acceptable range of the PFS targets and Trafigura off-take requirements.
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The EC120 Project is expected to increase the portion of total Company revenue derived from silver to over
80% by the end of 2025, positioning the Company as one of the foremost silver-focused companies in politically stable jurisdictions.
“We are excited to partner with Trafigura to fully finance the EC120 Project development,” stated Americas Executive Vice President and CFO Warren Varga. “The Agreement provides non-dilutive financing at competitive terms to complete this brownfield project. At current market prices, the EC120 Project is expected to generate significantly greater cash flow for the Company which will be deployed to continue to derisk the Company’s balance sheet. The significant increases in both silver production and cash flow from both silver and copper are anticipated to have a positive impact on the Company’s profitability moving forward.”
EC120 Project Overview
With the current silver and copper prices, the Company decided to expedite the development of its
The PFS projected average annual metal production of 2.5 million ounces of silver and 4.5 million pounds of copper with a total of over 12 million ounces of silver and 23.0 million pounds of copper over the planned five-year life of the project. Estimated cash cost per ounce silver for the PFS were
Both silver and copper prices have increased significantly since the completion of the 2019 Preliminary Feasibility Study. At the current prices, the Company expects to generate substantially greater cash flow over the life of the project with both lower cash cost and AISC per ounce and will evaluate the processing of additional silver-copper ore that may now be economic at current prices.
The Company has mined and processed close to 30,000 tonnes of Zone 120 development ore with recoveries within acceptable range of the PFS targets. The Company estimates that the EC120 Project will reach commercial production in Q3-2025. Silver production from the Cosalá Operations is expected to increase from less than 1 million ounces per year to ~2.5 million ounces per year. Along with the forecasted increase in silver production from the Company’s Galena Complex in
Credit Facility Terms
The credit facility provides the Company with up to
About Americas Gold and Silver Corporation
Americas Gold and Silver Corporation is a high-growth precious metals mining company with multiple assets in
Technical Information and Qualified Persons
The scientific and technical information relating to the Company’s material mining properties contained herein has been reviewed and approved by Chris McCann, P.Eng., Vice President, Technical Services of the Company. The Company’s current Annual Information Form and the NI 43-101 Technical Reports for its mineral properties, all of which are available on SEDAR+ at www.sedarplus.ca, and EDGAR at www.sec.gov, contain further details regarding mineral reserve and mineral resource estimates, classification and reporting parameters, key assumptions and associated risks for each of the Company’s material mineral properties, including a breakdown by category.
All mining terms used herein have the meanings set forth in National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”), as required by Canadian securities regulatory authorities. These standards differ from the requirements of the SEC that are applicable to domestic
Cautionary Statement on Forward-Looking Information:
This news release contains “forward-looking information” within the meaning of applicable securities laws. Forward-looking information includes, but is not limited to, Americas’ expectations, intentions, plans, assumptions and beliefs with respect to, among other things, estimated and targeted production rates and results for gold, silver, copper and other metals, the expected prices of gold, silver, copper and other metals, as well as the related costs, expenses and capital expenditures; production from the Galena Complex and Cosalá Operations, including the expected number of producing stopes and production levels; the expected timing and completion of required development and the expected operational and production results therefrom, including the anticipated improvements to production rates and cash costs per silver ounce and all-in sustaining costs per silver ounce; and statements relating to Americas’ EC120 Project, including expected approvals, prepayment financing availability, execution and timing and capital expenditures required to develop such project and reach production thereat, and expectations regarding its ability to rely in existing infrastructure, facilities, and equipment. Guidance and outlook references contained in this press release were prepared based on current mine plan assumptions with respect to production, development, costs and capital expenditures, the metal price assumptions disclosed herein, and assumes no further adverse impacts to the Cosalá Operations from blockades or work stoppages, and completion of the shaft repair and shaft rehab work at the Galena Complex on its expected schedule and budget, the realization of the anticipated benefits therefrom, and is subject to the risks and uncertainties outlined below. The ability to maintain cash flow positive production at the Cosalá Operations, which includes the EC120 Project, through meeting production targets and at the Galena Complex through implementing the Galena Recapitalization Plan, including the completion of the Galena shaft repair and shaft rehab work on its expected schedule and budget, allowing the Company to generate sufficient operating cash flows while facing market fluctuations in commodity prices and inflationary pressures, are significant judgments in the consolidated financial statements with respect to the Company’s liquidity. Should the Company experience negative operating cash flows in future periods, the Company may need to raise additional funds through the issuance of equity or debt securities. Often, but not always, forward-looking information can be identified by forward-looking words such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “potential’, “estimate”, “may”, “assume” and “will” or similar words suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions, or statements about future events or performance. Forward-looking information is based on the opinions and estimates of
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1 This metric is a non-GAAP financial measure or ratio. The Company uses the financial measures “Cash Cost”, “Cash Cost/Ag Oz Produced”, “All-In Sustaining Cost”, and “All-In Sustaining Cost/Ag Oz Produced” in accordance with measures widely reported in the silver mining industry as a benchmark for performance measurement and because it understands that, in addition to conventional measures prepared in accordance with IFRS, certain investors and analysts use this information to evaluate the Company’s underlying cash costs and total costs of operations. Cash costs are determined on a mine-by-mine basis and include mine site operating costs such as mining, processing, administration, production taxes and royalties which are not based on sales or taxable income calculations, while all-in sustaining costs is the cash costs plus all development, capital expenditures, and exploration spending. A full reconciliation of these non-GAAP financial measures can be found in the Technical Report on the San Rafael Mine and the EC120 Preliminary Feasibility Study,
View source version on businesswire.com: https://www.businesswire.com/news/home/20240814616373/en/
For more information:
Stefan Axell
VP, Corporate Development & Communications
Americas Gold and Silver Corporation
416-874-1708
Darren Blasutti
President and CEO
Americas Gold and Silver Corporation
416‐848‐9503
Source: Americas Gold and Silver Corporation
FAQ
What is the EC120 Project's expected annual silver production for Americas Gold and Silver (USAS)?
When is the EC120 Project expected to begin commercial production for USAS?
What is the size of the credit facility secured by Americas Gold and Silver (USAS) for the EC120 Project?
How will the EC120 Project affect Americas Gold and Silver's (USAS) silver revenue percentage?