Aftermath Silver Corp – Silver Development Junior

Jun 20, 2019

Silver Development Junior in the process of announcing the new financing, it looks like we will be pricing the Unit at C$0.08cents with a ½ warrant with an exercise price of C$0.12.

Highlights

We picked up Challacollo from Mandalay Resources after they have spent $33 million on acquisition and development. There is currently a 30 million ounces resources @ 200 g/t Ag but we think there is 80-100 million oz potential. We expect to open pit the majority at a grade of 130-140 g/t Ag (see below). This Company will comp as one of the largest silver development companies on the TSX.

Aftermath will be one of the largest silver companies on the TSX. Coupled with our ability to get to the 100,000 ounce gold equivalent production level, the goal is to build the Company into one of the premier silver companies. This is in part due to Aftermath having two projects of significant scope that could be economic at the current silver prices and a dearth of quality publicly traded silver vehicles that can demonstrate size and grade.

A few key points on Aftermath.

The programs at the Challacollo and Cachinal Projects will be focused on development drilling as we intend to expand the current resources to where we can demonstrate the Project economics in 24- 36 months.
At Challacollo we currently have 30 million oz’s of silver at 200 g/t – please note there are an additional 20 million oz’s identified by underground sampling that were not included in the most recent Resource.
We see an opportunity to open pit Challacollo with the goal of bringing the Resource to between 80,000,000 to 100,000,000 million ounces of silver that would be economic at current prices
Teck is building a 1300 L/S de-salination pipeline that will cross through the Challacollo Property.
The Cachinal Project is currently 20 million ounces of silver at 100 g/t open pit with the goal of expanding the Deposit to $40-50 million ounces which would be economic at the current metal price if the ore can be processed at local mill which is under capacity and has a camp with water rights.

The Cachinal and Challacollo Projects currently represent 67,000,000 ounces of Silver at an average grade of 142 g/t (70% in Indicated Category).

Both Projects are open for expansion with potential for open pits.

Both are proximal to infrastructure and are accessed via roads and are at lower elevations.

Chile (4th largest silver producer) is ranked #1 in Latin America for Political Stability , Secure and Skilled Labour.

The technical person is Mining Engineer Peter Voulgaris. Peter is a mining engineer/geologist who worked for seven years with Robert Friedland at Ivanhoe Mining and was responsible for the Pre-production development at Oyu Tolgoi in Mongolia. Peter also worked at senior levels with MMG, Newmont and Placer Dome. He also provides peer to peer analysis for Lundin Mining, consulted to Goldcorp on the recent Newmont merger and is a consultant to Dundee Precious Metals.

These are our internal prognostications surrounding the economics at Challacollo. Currently the underground is uneconomic at the spot price. There is a study by Mandalay that confirms this and we feel silver need to be at the $25 oz level for the current underground resource to work however, we should be able to turn Challacollo into a 200m deep oxide open pit.

Target grade in the hanging-wall and the Lolon Vein which will be approximately 120 -140 grams + hold credits – this equates to $70 gross dirt at today’s prices. We are conservatively assuming that the Strip Ratio will be less than 6:1 on the hill. The unknown is over what strike length will we will continue to see the hanging wall grades as identified by previous drilling.

That is the opportunity and the risk. We are not factoring in the foot wall mineralization, but will pick up some grade there. Assuming a $4/t ore mining, $3/t waste mining, $5/t G&A, $25/t milling & tails = total $51/t, so we think on a cash cost basis it works. Size / throughput rates and hence the economics will be determined largely by the success or otherwise of the hanging-wall drilling. Geologically we view the risk as relatively low based on the available drill data.

https://aftermathsilver.com/