Junior Gold Firm Goes from “Explorer” to “Producer”

by Mike Fagan

Mike Fagan

Magna Gold Corp. (TSX-V: MGR)(OTC: MGLQF) — currently trading just below C$1 per share — is steadily ramping up gold production at its flagship San Francisco Mine located in Sonora, Mexico, while eyeing a return to full-scale commercial production by June of this year.
The past-producing San Francisco Mine — which Magna acquired in May of last year — produced 4,030 ounces of gold in March, which the company expects to increase to over 6,000 oz/mo starting in June, and exit the year at a production rate north of 7,500 oz/mo.

                                    san francisco location

In all, management expects the mine to meet its 2021 production guidance of 55,000 to 65,000 gold ounces — resulting in sustained free cash flow generation for the company throughout a projected 8-year mine life.

Magna Gold president & CEO, Arturo Bonillas, commented via press release.

"We are extremely proud of our progress at San Francisco — our team has made considerable progress during ramp-up and we are well on our way to establishing San Francisco as a stable free cash flow generator.  The evident turnaround of the San Francisco Mine, considered by many as an impossible task one year ago, shows our team's resourcefulness and commitment to executing our mission to become a profitable precious metal producer. In addition to achieving commercial production at San Francisco in the coming months, we will remain focused on realizing further operational efficiencies, expanding mineral reserves and resources and seeking growth opportunities externally and within our significant pipeline of projects."

The San Francisco Mine is open for resource expansion through drilling in the current operating pits plus ongoing development of an underground mine situated within one of the open pits. In addition, the company has identified at least three satellite open-pit opportunities near the mine site with historical drilling and positive results.

San Francisco Mine — Ramp Up
Sonora, Mexico

                                 Magna Gold pit

San Francisco open pit

                                Magna Gold pit

Process facilities (22,000 tpd)

Additionally, in the states of Sonora and Chihuahua, Magna is advancing a robust portfolio of 100%-owned, early-stage exploration projects (see below) which include the Mercedes and San Judas gold projects and the Margarita, La Pima, Mina Fortuna, and Los Muertos silver projects.

                                Exploration pipelines

The current focus is on the Margarita project where only about 1.5 km of 7 km of outcroppings have seen historical drilling to-date. The company plans to commence a field mapping program along with the relogging of historical drill core — culminating in a phase-one drill program in Q3 2021.

Mr. Arturo Bonillas, CEO, added:

"Magna has a promising portfolio of silver projects in Mexico and an ambitious exploration program planned for the year. We expect good results from Margarita, as well as our other properties, and we look forward to reporting the results over the course of 2021. In addition to a continued successful ramp-up at San Francisco and establishing a stable base on gold production, we believe there is a significant amount of value that can be surfaced across our silver portfolio."

For speculators in the junior space, Magna Gold offers exposure to gold-silver via the producing San Francisco mine plus several highly-prospective precious metals exploration properties located in the prolific mining states of Sonora and Chihuahua, Mexico.

The company is well-structured with approximately 90 million shares outstanding for a current market capitalization of around C$85 million and had US$7.2 million in the treasury as of 31 December 2020.

Learn more about Magna Gold at the company’s corporate website.

And be sure to click here for our in-house report on Magna Gold.

Yours in profits,

Mike Fagan

Mike Fagan
Editor, Resource Stock Digest

Mike Fagan has mining in his blood. As a teenager he staked countless gold and silver properties in Nevada alongside his dad, Brian Fagan, who created the Prospect Generator model that’s still widely used today in the resource space. One of those staking projects was put into production by a major Canadian mining company — a truly rare and profitable experience. That background uniquely qualifies him as a mining stock speculator. One of the most well-known names in the business, Mike is now putting that experience to use for the benefit of Resource Stock Digest and Hard Asset Digest readers.