Mexico is the world’s second largest producer of silver, producing 104.2 million ounces of silver in 2008. It accounted for 15.3% of total global production.
Great Panther acquired two properties in Mexico in 2005 that were previously producing mines but which had virtually stopped production when silver prices had fallen too low (at the $ 4.50 per ounce range).
As the properties were distressed, Great Panther was able to acquire them at a very reasonable value. Shortly thereafter sliver prices began to climb, resulting in substantial value creation for Great Panther's shareholders as the mines were put back into production.
The Guanajuato mine (1,100 hectares) is in the Guanajuato District, one of the most prolific and best known silver districts in the world. Estimates of historic production in the District exceed one billion ounces of silver and 4 million ounces of gold, reportedly accounting for 1/3rd of global production during the 18th century. The property contains four silver-gold mines, including the Valenciana Mine, once regarded as the 'richest silver mine in the world'.
A non-43-101 historic resource estimate that the Company considers reliable establishes a 24 million ounces of silver equivalent resource grading 1.56g/t gold and 176 g/t silver. Guanajuato has a 400 tonnes per day operating capacity.
The Topia mine is in Durango, and the property covers 6,344 hectares. The discovery of silver here dates back to 1538. Historic production is estimated at 30 million ounces.
Topia operates at around 100 tonnes per day, with Head grades in Q2 2008 averaging 360 g/t silver, 0.85 g/t gold, 2.82% lead and 2.93% zinc.
The estimated total metal content of the resource at Topia is 3.95M oz silver, 7,718 oz gold, 25.96M lb lead, and 22.77M lb zinc.
In Q1 2009, Great Panther reported a 75% increase in earnings from mining operations (before amortization and depletion), at $ 2.6 million from $ 1.5 million in Q4 2008.
Quarterly production grew by 11% to 480,267 silver equivalent ounces over Q1 2008. Revenue grew to $ 6.3 million compared to $ 5.9 million for Q1 2008. Overall cash operating costs (net of by-products) fell to $ 6.49, from $ 9.20 in Q1 2008.
Great Panther continues to grow production and demonstrates cost control. The Company has the potential to become a mid-tier silver producer and to benefit from the continuing bull market in silver.
For more information, please visit the Company website at:
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