Takeaways from MAG Silver’s Annual Occasion at PDAC

A Macquarie report touched on a few of the highlights of the administration presentation.

In a analysis notice dated March 6, Michael Grey, an analyst at Macquarie, outlined the important thing factors of the technical lunch of MAG Silver Corp. (MAG: TSX; MAG: NYSE.MKT) on the PDAC convention.

MAG President and CEO, George Paspalas, and Chief of Exploration, Peter Megaw, made this presentation, which befell "simply days after Fresnillo had introduced imminently the optimistic approval of the Fresnillo Board of Administrators for Juanicipio, "mentioned Grey.

One of many essential messages from lunch was that the Juanicipio operation might begin earlier and last more, Grey identified. The infrastructure beneath development has a mine life nicely above the state of affairs described within the Preliminary Financial Evaluation and an operation of four,000 tonnes per day (four kt / d). Whereas Macquarie had modeled its first manufacturing for the primary quarter of 2001, MAG famous that this might occur even earlier than the second half of the yr.

One other necessary level is that the design of the higher mine would doubtlessly produce 5,000 t / d of Bonanza Zone manufacturing, which Macquarie considers more likely to be achievable, Grey mentioned. Such a state of affairs needs to be evaluated when it comes to potential danger and extra prices.

Third, current infill and enlargement drilling at Juanicipio yielded "stable outcomes," Grey wrote, in addition to "a brand new pre-Anticipada suspended wall vein – it is a bonus ". Pre-Anticipada, which measures between zero.6 and three.2 meters in thickness and has "excellent silver grades", is interpreted as a "second deeper" vein wealthy in silver on the skin from Valdecanas. "The Anticipada returned three.eight meters to 227 grams of gold and a pair of.1 grams per tonne of gold, for instance.

The fourth spotlight was the invention of one other vein, Venadas, the latter oriented north-northeast, which is the primary of its variety within the Fresnillo district to be recorded. The vein "often has a excessive silver and gold content material over precise thicknesses of about 40 centimeters to about 2 meters," Grey defined. "It's nonetheless early, however we expect Venadas has the prospect to turn out to be an extra useful resource that may very well be an simple benefit."

Lastly, the success of Fresnillo to discover east of the Juanicipio three way partnership space, in addition to, maybe, the brand new interpretation of the geological construction, suggests an extra perspective and subsequently a price. Grey commented: "The brand new development of the Huizache mine (at the moment in manufacturing) and different vein vein developments have a excessive potential to hit the three way partnership lands."

Macquarie made a suggestion on outperformance and a goal worth of C $ 22 per share on MAG, whose shares are at the moment buying and selling at roughly C $ 14.40 per share.


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Disclosures by Macquarie, MAG Silver Corp., March 6, 2019

Analyst Certification: The opinions expressed on this examine precisely replicate the non-public opinions of the analyst (s) on the securities or issuers in query, and no a part of the analyst's compensation was, nor was it, the analyst's opinion. is or shall be immediately or not directly associated to the inclusion of particular suggestions or opinions on this analysis. The analyst primarily accountable for the preparation of this examine receives remuneration primarily based on the general revenues of Macquarie Group Ltd ABN 94 122 169 279 (AFSL No. 318062) (MGL) and its associated entities (the Macquarie Group) and has taken affordable steps to take care of and keep independence and objectivity in making suggestions.

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