What's Happening?
Silver Tiger Metals has received a construction permit for its El Tigre project in Sonora, Mexico, marking the first such permit issued to a foreign company in Mexico since 2019. The company is building a heap leach silver/gold mine, with the first doré
pour expected in December 2027. The project has an after-tax NPV of approximately $800 million USD and a 92% IRR, generating about $100 million USD in annual after-tax cash flow over a 10-year mine life. The underground mine, with a separate PEA, shows a 15-year mine life and an NPV of $830 million. Both projects combined could represent a $1.7–1.8 billion NPV.
Why It's Important?
The issuance of the construction permit is a significant milestone for Silver Tiger Metals, highlighting the company's ability to navigate Mexico's challenging permitting environment. The project's robust economics, with high IRR and NPV, position it as a potentially lucrative investment. The ability to operate both the surface and underground mines concurrently, without sterilization risks, offers a unique advantage in the Mexican mining sector. This development could attract investor interest and enhance the company's market position, especially given the favorable silver and gold price environment.
What's Next?
Silver Tiger Metals plans to advance the underground project to a Prefeasibility Study (PFS) and continue exploration drilling to expand resources. The company is evaluating debt financing options for the underground project, with favorable terms expected due to the project's de-risking. The construction of the heap leach mine is progressing, with key milestones scheduled for completion by December 2027. The company's strategic focus on concurrent operations and exploration could further enhance its resource base and financial performance.
