Silver Elephant Mining (TSX:ELEF) - Seeking Path to Unlock Value at Main Project

Interview with John Lee, Executive chairman & CEO of Silver Elephant MiningOur previous interview: https://www.cruxinvestor.com/p....osts/silver-elephant date: 14th September 2023Silver Elephant Mining is focused on its flagship Pulacayo silver-lead-zinc project in Bolivia. The company recently announced a deal to truck and process near-surface oxides from Pulacayo at a third-party facility.In an interview, Chairman and CEO John Lee outlined plans to use the modest cash flows from this agreement to advance Pulacayo's underground sulfide potential. However, formal studies have not been conducted and risks remain in recalibrating the project to feasible smaller-scale production.Under the 5-year deal, Silver Elephant will provide around 800,000 tonnes of oxidized material grading approximately 230 g/t silver from its Paca deposit to partner Minera NDNM's processing plant. This is expected to generate $5 million in prepayments and cost reimbursements, phased over 18 months. While not linked to silver prices, NDNM will pay additional sums if silver rises above $28-32 per ounce.Silver Elephant aims to direct these limited cash flows towards preliminary engineering and feasibility work on underground sulfide mining at Pulacayo. Historic bonanza-grade production occurred from high-grade veins within the larger resource. However, formal studies have not been conducted to verify feasible parameters and economics. Required permitting also presents risks.With approximately 100 million ounces of silver in the ground, Pulacayo offers resource upside. However, advancing the project to construction amid challenging markets presents hurdles. While the deal provides non-dilutive funding through 2025, shareholders still face uncertainty regarding development timelines and ultimate economic viability.
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