QualityStocks would like to highlight Lone Star Gold, Inc. (OTCBB: LSTG), a gold exploration and development company based in Albuquerque, New Mexico. The company's aggressive acquisition and exploration approach is strategically focused on proven, stable precious metal regions in America and Mexico. Currently, Lone Star has a 70% Working Interest in concessions covering 800 hectares in the La Candelaria project in Chihuahua, Mexico, which the company is evaluating to determine the potential sites that represent the best potential for silver and gold deposits.
In the company’s news yesterday,
Lone Star Gold provided markets with an update on the company’s San Antonio del Potrero Tailings Project (some 1.2M tons of mine tailings, company holds an undivided 65% interest) outside Hidalgo Del Parral, Chihuahua state.
The company has made significant progress making the Tailings Project more efficient, with the recent completion of the 2nd of 3 jigs, used by LSTG to increase assay results (by more than a factor of two) via separation of the heavier, mineral-rich material, from the lighter, mineral deficient tailings. This pre-washing has been taking place for roughly two months now and has yielded maximized gold/silver returns, which are then sent to the nearby town of Parral, for processing at the flotation/leaching facilities located there.
Given the unanticipated shut down of the first processing plant in Parral over the last several months, which has subsequently seen the state government step in, bringing a new management team to the key infrastructure around the first of the month, LSTG looks forward to the mid-July restart date projected and eagerly anticipates improved output from upgrades implemented by the new team. Retrofitting of crushing stages at the processing plant, as well as automation of certain conveyor lines should help speed up production significantly and plant managers have already agreed to handle some 200 ton/day of tailings material moving forward.
With the second Parral processing plant still handling a relatively small throughput of washed tailings material produced by LSTG, and simultaneously moving to improve the overall processing route of material through the facility as well, the company is confident that progress towards greater overall efficiency has been made. In fact, while the processing has indeed taken more time than expected, considerable throughput upgrading continues apace of expectations and should really accelerate future processing volumes.
In addition the company reported that preliminary studies have been completed for a proposed benign nitrogen leaching pile process plant to be located on the Tailings Project site that would handle as much as 1k tons/day. This leaching process brings the added benefit of a squeaky clean
environmental footprint, with the elimination of cyanide processing, and the promise of increased on-site processing capacity. Needless to say LSTG is hard at work executing on the facility and has already put together an exemplary metallurgical, engineering, and construction team to hammer the plant through as soon as the requisite permitting has been obtained.
In addition to the 70% Working Interest in concessions covering some 1977 acres in the in the La Candelaria silver and gold project, also in Chihuahua, this Tailings Project provides the company with a very strong position in the Mexican mineral sector, which is drawing increased focus as the slowdown in emerging markets like China becomes more apparent. A great deal of unexplored and underexplored/exploited mineral potential lies just south of the U.S. border in Mexico and savvy investors are getting ahead of the curve by increasing their holdings of Mexico-focused mineral developers like LSTG.
President of LSTG, Daniel Ferris, commended the company’s team in Mexico for so circuitously handling the unannounced management change up at the one plant, noting in particular how quickly the team resolved this problem, even managing to negotiate a better processing deal at the same time which should enabled the company to exceed the first year’s production targets. Ferris also pointed out negotiations with a new concentrate purchaser that should not only improve returns by over 5% but accelerate the entire concentrate sales payment process handedly.
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