In 2014, Santacruz Silver Mining reached a record of 755,000 silver equivalent ounces. What factors have led to this success?
We started work on the Rosario mine in 3Q2012 and began production in early 2013. Full credit goes to the people in the field, as they are seasoned engineers and profesionals deeply committed to their work and. That has been the main reason why we have been able to achieve production on time and within budget. We produced on average around 280 tons per day, and in 2014 we are hoping to reach about 450 tons by the end of the third quarter. This would mean hitting maximum capacity at Rosario, giving us an average of 1.3 million ounces of silver equivalent production on an annual basis. Rosario mine has a lifespan of about seven years remaining. Nowadays, as you are aware, silver prices are not as good as they were in previous years. For us it is important to keep our ramping-up process in the sense of meeting cost efficiencies so that every ounce we produce is profitable, as opposed to merely reaching goals or targets only measured by produced ounces, in other words, we want profitable produced ounces. Perhaps this approach will prove slower in terms of tonnage, but it remains profitable. Our next producing mine will be San Felipe. A NI-43101 Technical Report was completed last year indicating strong economic potential for the mine, and with today's metal prices it is encouraging for us and also a good reason to keep further de-risking the property. Hopefully, by year-end it will have led to a construction decision. The mine will be in line to produce around 3.3 million ounces of silver equivalent once it reaches full capacity within one year after construction starts. We expect to be producing at a 1,250 tons per day on San Felipe.
What are your plans for the Gavilanes and El Gachi mines?
Gavilanes is a property that is undergoing the exploration process at present, but we have halted activities for the moment. The Gavilanes project has a budget for the second and third drilling phases. The property has about 36 million ounces of silver equivalent. We just need to continue with the exploration activities including drilling campaigns, so hopefully we might revisit and begin those drilling campaigns by 2016. As for El Gachi, we have finished some surface exploration works and obtained good results. We have not done much yet, but it is definitely a strategic property for the San Felipe project, being located 36km from San Felipe. It is likely that the mill from San Felipe will allow us to run ore from El Gachi, making it a more profitable project.
Is it still a challenge for mining companies to raise capital in Mexico?
It is definitely still difficult, as we lack a financial vehicle such as the TSX Venture Exchange in Canada. Knowledge on the part of investors is rather limited compared to countries like Canada and Chile. In the past we have only had a few listed companies on the Mexican Stock Exchange, which also curbs the investor community. I assume that the community in Mexico is gradually becoming more aware of this industry, but it will take a few more years to become clear. The investment community is maturing in this industry in Mexico, but we need our stock exchange to have more appropriate vehicles.
Where do you see the company in five years' time?
Over the next five years I see the company becoming a much stronger entity. By then we should have at least three of our mines in production, achieving results of somewhere in the range of 8-10 million ounces of silver equivalent annually. We are eager to sustain our local growth, and feel this is where we have the leverage and knowledge required for expansion.