Gold mid-tiers’ Q3 2024 fundamentals
All-time-high gold prices combined with relatively-contained costs catapulted unit earnings to another epic record.
Golden Minerals (NYSE-A: AUMN TSX: AUMN) announced this week it has agreed to sell its El Quevar silver project in Argentina for $3.5 million to address its immediate cash needs.
Golden Minerals’ shares were down 2.2% by 1 p.m. ET on the latest asset sale, dropping its market capitalization to just $4.6 million.
In May, the Colorado-based miner sold its Velardeña mine in Mexico, which had been underperforming during a brief period of restart, for a $5.5 million cash injection to help it develop its other assets, namely El Quevar.
The company also recently sold its Mexican subsidiary that owned the Velardeña Plant 1 to an entity separate from the mine’s buyer for $445,500.
However, Golden Minerals continues to face liquidity problems, as it noted in a press release on Sept. 3, leading to the sale of another key asset. As of the end of August, it had cash and cash equivalents of approximately $900,000, the company said.
According to Golden, approximately $2.8 million is still owed to the company from the Velardeña sale. It had initially planned to conduct additional drilling and complete a new technical report at El Quevar, but now believes the sale would help alleviate its short-term financial pressures.
The El Quevar project is an advanced exploration-stage asset in Argentina’s Salta province holding nearly 50 million oz. in silver resources, of which 45 million oz. are in the indicated category. The project has a preliminary economic assessment that gave it a net present value of $45 million (at 5% discount) with an internal rate of return of 17%.
Following the sale, Golden Minerals’ portfolio is left with early-stage exploration assets that include the Yoquivo gold-silver project in Chihuahua, Mexico, and the Sarita Este gold-silver-copper project in Salta, Argentina.
