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Friday, December 16, 2016

Orex - Sandra Silver recoveries

Today we received the long awaited metallurgical results from Sandra Escobar and it a nutshell, they are worse than crap they are abysmal.

What does Orex's president, Gary Cope, have to say "While the preliminary metallurgical results are not idea for the Boleras Main Zone, the comparisons between Sandra Escobar geology and that of the neighboring La Pitarrilla project are encouraging"

So how bad is it?

Single word - Extremely, but let us be a bit more scientific. Here are the preliminary results:

The deposit has an average grade of 106 g/t Ag
They've given us some nice charts to show us visually how crap the recovery is. I've added a couple of notes to show you the recovery for average grade ore.

wow, that is pathetic
So at the average grade of the deposit less than 20% of the silver can be recovered.

Basically it means for every tonne they mine only 19 grams gets recovered and just 87 grams goes to make the richest silver tailings in Mexico.

Or, they can only recover 6.7Moz of the 33.3Moz Ag resource they've defined.

Hahahahahahahahahahahahahhaahahahhahahahahaaaaaaaaaaaaaaaaaaaa

But, I hear you telling me, they get some decent recoveries for the high grade ore!!!


But they have no high grade ore..

What a heap of crap, but it was nice to know that Orex waited for the results from the metallurgical studies before commiting more money to the project (link and link.

Ohh, they drilled an additional 3,000 meters and committed to drill another 4,000 more. Well I'm sure that Orex's shareholders will be very happy that you've spent another couple of million bucks on an uneconomic silver project.

The frustrating thing is - poor metallurgical recoveries are a common feature for many disseminated silver deposits.

Congratulations, I hope you have a plan B, especially as you didn't take an opportunity to raise money back when your share price was touching $1.40.

just a quick update, this is how Proactive Investors UK reported the data from Sandra
I guess it is how you phrase it...






19 comments:

  1. "worse than crap they are abysmal." - But why don't you tell us how you REALLY feel AG?

    Butt seriously (_*_) REX.v has semi-plummeted from around the $ .45 levels to $ .31. Based upon the carefully disguised oblique hints from AG perhaps there's a good reason for that eh?

    http://pennystockjournal.blogspot.ca/2016/05/orex-minerals-inc-rexv.html

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  2. The silly think is I spoke with Ben back in april about possible recovery issues, but I was politely told that the silver minerals were easy to leach......

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  3. What do you make of the fact that grind size was not even mentioned?

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    1. I think they did a standard metallurgical test, so probably a coarse grind (2-5cm) for heap leach. With the average grade of the deposit it is uneconomic to grind any finer.

      The good news is that they didn't just send the highest grade material for testing, which is a common trick used by Junior companies to maximize recoveries.

      It will be interesting if they spend money on more test work, for finer grinds or more aggressive techniques. If they do, they will just be throwing good money after bad

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    2. I had a long look at other options in the literature for single stage reductive leaching using various lixiviants such as acidified thiourea, ammoniacal thiosulfate and others.

      I also had a long look at the current state of ultra-fine grinding ()"UFG"), before concluding from the REX PR's that the problem was likely oxides of manganese, as was subsequently confirmed by later REX PR's.

      Now, the latest REX PR is again suggesting that a portion of the ore is refractory due to silica encapsulation. This problem can only be beneficiated by finer grinding, so while your course grind theory of (2-5cm) fits the recovery data presentent, it does not fit the circumstances of this case.

      I would also like to point out that the near surface oxide zones at La Pitarrilla have the same problems of variable manganese oxides and silica encapsulation. And Silver Standard similarly fiddle around with metallurgy, before they hit enough deeper sulfide ore that the problem apparently became immaterial.

      From an early report:
      "In preliminary test work, 17 composite samples were prepared as part of a metallurgical investigation of La Pitarrilla mineralization. The composites represented high, medium and low grade material collected from drill cuttings from the Cordon Colorado and Pena Dyke zones. While each grade responded to direct cyanidation, conventional milling pretreated with sulphur dioxide increased recoveries for medium and high grade mineralization ranging from 68% to 89%. Additional test work will be part of the ongoing evaluation of La Pitarrilla."

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    3. Hello Layman,

      It was obvious from the early photos of the native silver grains that even if the silver wasn't encapsulated the silver mines were very fine grained and would require UFG, which uses a lot of energy and costs a lot of money (look at the Isa-mill as an example)

      For this case, I think the costs of doing a fine grind on low grade ore will be cost prohibitive. There aren't enough resources at Sandra to warrant the increase in Capex for a UFG mill.
      We also have to remember that Pitarilla isn't in production at the moment (Silver Standard have decided to buy gold mines instead of building the Pitarilla mine). So their solution for Pitarilla was to fine enough ore where the silver can be recovered and ignore the manganese oxide ore zone!

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    4. The latest 43-101 I read from La Pitarrilla makes no effort at any special treatment for the oxide ores. Seems like they just plan on running it through the same circuit they designed for the sulfide ores (probably without flotation) and just taking what they can get out of it.

      Still, I would like to see the metallurgy numbers from Sandra, at a the same grind size used in the La Pitarrilla flow-sheet. I bet you it is more that 18%

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    5. So at Pitarilla it is the case of shoving it through the mill and see what you get (they may focus on the highest grade areas).

      I am also intrigued to see the final met report for Sandra, but is it worth Orex spending more money on the project? It only has 33Moz Ag (Pitarilla has >500Moz)?
      My opinion is that they should start to look at exploring some of the other targets around Sandra, they have a few veins that look interesting and go from there.

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    6. I had a long chat with Ben, after he returned from Mexico earlier this month. I wanted answers on 2 topics.

      1.) The change in the boiler-plate language, to say that the Sandra play is contained within a large caldera setting. I looked carefully on Google Earth and convinced myself that this "caldera" is about 15 km across, centered on Cienega de Escobar and that the Sandra property is located in the collapse-ring in the NE quadrant. Caldera ring slump is visible everywhere in the topography, always in the direction of Cienega de Escobar.

      2.) The basal conglomerate, also referred to as the "Manto Rico", heavily mineralized at La Pitarilla, and mentioned by Ben in his earlier writing on Coneto. Ben said that the basal conglomerate was also important at La Preciosa.

      Basically, I see the permeable basal conglomerate as a diffusion layer in the pathway for mineralizing fluid migration, particularly where it is transected by regional faulting.

      Stratigraphically, the basal conglomerate appears deeper to the west, with the bottom depth apparently unknown to the NW at Guanacevi.

      Ben said it might be as deep as 1000 meters at Sandra and that her was planning to drill to between 700-900 meters during the current program.

      I really think it is a bit too early to write off Sandra-Escobar. Not sure why, but REX seems to be playing their cards pretty close. If I was to speculate, I suspect they might be in negotiation with Steinmann over at Pan American. Pan American has a 60% interest in the land between Boleras an the likely intrusive outlined on the Canasil airborne surveys.

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  5. Did they not have any idea of this recovery data, as late as November 7, when they added a rig at Sandra and doubled down on their drilling efforts there.

    Was Cope outright lying when he said on October 19, "Initial testing shows that the native silver and silver halides are amenable to cyanidation, whereas the argentiferous manganese oxides will require a reductive leach process stage. These manganese oxides have responded well for the liberation of silver in reductive leaching during the preliminary testing phases. The metallurgical program is currently underway."

    Frankly, the evidence we have before us does not add up. We must be missing some relevant facts.

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    1. I think they were in "ostrich" mode - burying their heads in the sand and hoping that the results from the metallurgical studies would be positive.

      However, I know of several disseminated silver deposits that contained similar silver mineralization.
      Chemically silver halides and Native silver are very easy to leach. However, at Sandra you have 2 issues:
      1. the silver minerals are very fine grained - with a standard crush you don't expose enough grains, so the cyanide can't get in contact with the silver minerals to dissolve them
      2. Manganese - (I'm not a metallurgist) so I think the issue is that manganese will be dissolved in preference to silver as the reaction liberates more entropy than dissolving silver, and so Manganese (as it will be in much greater amounts as silver) will essentially react with all the cyanide before the silver can.

      I know of several geologists that tried to speak with Ben about potential metallurgical issues but he was very consistent in replying that native silver and silver halides are readily dissolved and chose to ignore them (arrogance or hubris - you choice).

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    2. 2.) The problem of oxides of manganese is well explained at the bottom of the page, here:
      https://www.911metallurgist.com/blog/effect-of-manganese-on-silver-ore-leaching

      Note that the chemistry of the problem is not completely understood

      Here is another interesting link. Hydrogen peroxide is widely available:

      https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0ahUKEwijr9iL5vvQAhUP0GMKHW9GCQ4QFgghMAA&url=http%3A%2F%2Fwww.paper.edu.cn%2Fscholar%2Fdownpaper%2Fjiangtao459036-200904-3&usg=AFQjCNHDmYM0L_fFK1k2GGqLfUqSnjyHfg&sig2=0_-z9FXrdZwb_dpCaDqflA&cad=rja

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    3. I just want to state that I really am shocked at how little information was included in the recent REX PR on metallurgy.

      If you take a look at the link above (long but it works to provide a full PDF of the study) we see that there are many relevant parameters that can be included:

      Grade;
      Ore composition;
      Grind size;
      Leach time;
      Temperature;
      PH for reductive processes;
      Lixiviant concentration.

      All we got was Grade Vs H2SO4 and CO2. Frankly, I find this to be outrageously suspicious after 6 months of laboratory work. I see one of two possibilities here, both of which would represent end-points on the continuum: Either this was the absolute best recovery they could achieve (unlikely because it is by far the worst I have ever seen) or they are setting an absolute basement for expectations, based on coarse crushed heap-leaching, as you suggested earlier.

      Will we see a Recovery Vs Grind Size chart at a later date?

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    4. I hope that info does get released. I'm not confident that it will, as I doubt that a PEA will be done on Sandra and that is where normally you find a summary of that info in the metallurgical studies section.

      I was surprised at how long the it took between press releases announcing the metallurgical studies were being conducted and the release of the results. I found that it ranged (for the 1st met study on a project) from 4-11 months, so 6 months for Sandra is 'relatively' quick.

      Some of that info was submitted in the original PR in June where they told us the grades of the various samples being submitted for test-work. I actually applaud the fact that Orex sent a range of samples to determine the recoveries for average, low and high grade material. Typically (i.e. all) junior companies send the best and highest grade materiel for testing.

      I'm guessing that they started with a standard CN leach, that didn't work very well so they then did the SO2 pre-treatment (due to the Mn - it would be interesting to see if Mn is an issues throughout the depoist or just in selected areas - they should model the Mn from the XRF and/or assay data).

      send me an e-mail at theangrygeologist@gmail.com so we can continue this conversation properly

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  6. Pretty hard to optimize something with great variability:

    15.0 MINERAL PROCESSING AND METALLURGICAL TESTING

    Metallurgical studies are continuing at La Pitarrilla. Preliminary studies have shown that the metallurgy varies between the five known zones of oxide mineralization because the silver occurs in both oxides and silicates. Consequently, processes that are effective for silver recovery in one section of a zone are not as effective in another section of the same zone. Accordingly, a detailed evaluation of the mineralogy of the oxidized ore is ongoing. The sulphide ore has to date only been encountered at Breccia Ridge and early work suggests that it responds well to conventional flotation and cyanidation treatment (McCrea 2007 - Silver Standard, 2006, pers.
    comm.). Advanced metallurgical studies of the sulphide mineralization are ongoing at G&T Metallurgical Laboratories in Kamloops, B.C. This program includes process optimization, a pilot plant study as well as extensive deposit variability test work.

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    1. This is why lots of companies are getting into Geomet, so they can characterize a deposits by a range of different factors to optimise recovery and/or lower costs.

      However, the fact that Pitarilla is fairly dead at the moment seems to indicate that they need higher silver prices to economically recover the silver (and payback the capex).

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    2. La Pitarrilla might be half dead right now, but only partially due to metal prices and the fact that current development plans call for a pit where there is now a volcanic dome.

      PITARRILLA PERMIT DENIED

      The company also announced Mexico's environment ministry rejected an environmental impact assessment (EIA) for its Pitarrilla open pit silver project, primarily because sufficient water rights could not be secured.

      Silver Standard is currently reviewing the project in light of new taxes in Mexico, including a 7.5% mining tax on sales minus certain deductions, and a 0.5% gross revenue charge on silver, gold and platinum mines.

      The company is currently considering changing to a 3,000-4,000t/d underground operation, which would require no external water sourcing.

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  7. Sandra no longer has a mineral resource. Should be retracted immediately.

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