Silver Sand Project is a potential open pit and tank leach operation located in Potosi Department of Bolivia.

The project is 100% owned by New Pacific Metals, a Canadian exploration and development company.

A Preliminary Economic Assessment (PEA) was released by the company in January 2023. The PEA confirmed that Silver Sand Project has the potential of producing 12 million ounces of silver (Doré) per annum on average for 14 years.

The project has Base Case Pre-Tax Net Present Value (NPV) of $1.1bn.

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Location and Site details

The Silver Sand Project is located in the Colavi District of Potosí Department in southwestern Bolivia. The site is around 33km north-east of Potosí city.

The Cerro Rico silver and base metal mineral mine is around 35km from the property.

The project comprises multiple types of tenure and initially consisted of 17 Temporary Special Authorizations (ATEs). The Silver Sand deposit was discovered within the ATEs.

Subsequently, the ATEs are converted to a consolidated 30-year period Administrative Mining Contract (AMC) with an area of 3.1656km2.

Minera Alcira Sociedad Anónima Alcira, a wholly-owned subsidiary of New Pacific, owns this area.

New Pacific also acquired a 100% interest in three continuous mineral concessions called Jisas, Jardan and El Bronce encompassing a total area of 2.25km2.

This will give the company full control over an area of 5.42km2 after the consolidation and conversion procedures are complete.

Silver Sand is accessible from Potosi by a 54km long road consisting of a 27km paved Bolivia National Highway 5 and an all-season gravel road constructed for mining in the Colavi District.

Mining History of the Silver Sand Project

The Silver Sand Project is one of Bolivia’s earliest mineral discoveries identified in the mid-1500’s.

Spanish colonial settlers mined silver in the core area from the early 16th century to 19th century and tin was extracted from the adjacent Colavi and Canutillos mines during the Tin Baron period until the collapse of tin prices in 1985.

However, there had been little modern systematic exploration work at the site despite long mining history.

Ningde Jungie Mining Industry (NJ Mining) purchased Alcira, the owner of the Silver Sand Project, in 2009. It conducted comprehensive exploration work including geological mapping, surface and underground sampling, trenching, and the drilling of eight diamond drillholes at the property.

New Pacific Metals acquired Alcira from NJ Mining in July 2017.

New Pacific’s subsidiary Alcira and COMIBOL signed an updated Mining Production Contract (MPC) in January 2022 to secure access to an additional 55km2 area surrounding the original Silver Sand concessions.

Geology and Mineralisation

The Silver Sand Property is situated in the south section of the polymetallic tin belt in the Eastern Cordillera of the Central Andes.

The bedrock consists mainly of weakly deformed Cretaceous sedimentary units, siltstone, and mudstone and the strongly deformed Paleozoic marine sedimentary rocks.

The Cretaceous sedimentary sequence is segregated into the lower La Puerta Formation and the upper Tarapaya Formation.

The La Puerta Formation consists of sandstones and unconformably overlies highly folded Palaeozoic marine sedimentary rocks.

The Tarapaya Formation overlies the La Puerta sandstones in the central part of the property and features siltstones and mudstones intercalated with minor sandstone.

The Cretaceous and Palaeozoic sedimentary sequences are intruded by numerous small Miocene sub-volcanic dacitic porphyry intrusions.

Overall, 11 mineralised prospects have been identified across the property including the Silver Sand deposit.

Four mineralisation types have been recognised in the property which includes sandstone hosted sliver mineralisation, porphyritic dacitic hosted silver mineralisation, diatream breccia-hosted silver mineralisation and manto type tin and base metal mineralisation.

Silver mineralisation occurs in faults, fractures, fissures, and crackle breccia zones in the Cretaceous La Puerta brittle sandstone and porphyritic dacitic dikes, laccolith, and stocks.

The most common minerals containing silver are freibergite, miargyrite, polybasite, bournonite, andorite, and boulangerite.

Mineral Resource Estimate

The Mineral Resource estimate of the project was completed using 556 drillholes comprising 136,220m of diamond core and 92,164 assays.

According to PEA, the mineral resource estimate (Measured and Indicated) at Silver Sand is 54.26Mt at 116g/t Silver (Ag) for 201.77Moz Ag.

Mining and Ore Processing

The Silver Sand project features four open pit areas which include the main pit, two small northern satellite pits (NP1 and NP2), and one eastern satellite pit (EP1).

The open pits are proposed to be mined by conventional truck and excavator mining method using 140tonne payload trucks and 200-260tonne excavators. Mining recovery is expected to be at 92%.

A single out-of-pit will be located immediately southwest of the open pits to accommodate waste mined from the pits and disposal of filtered tailings from the plant.

The project is expected to employ a conventional, low-risk approach to extract silver. The ore will be crushed and grinded via SAG milling.

Pre-leach thickening and cyanide leaching will be done using stirred oxygen sparged tanks.

Silver will be recovered from the leach solution by a zinc precipitation process followed by drying and smelting with fluxes to deliver silver doré bars. The doré product will be exported to international markets.

Silver Sand Project Infrastructure

As Silver Sand is greenfield project, there is no significant infrastructure at the site.

For domestic usage, water can be drawn from a small lake located approximately 3.5km northwest of the property. The company plans to source water from nearby drainages for drilling activities.

A water dam is proposed to be constructed in the narrowest part of the creek to hold water in a reservoir with 2.6 million cubic metres of capacity.

The Filtered Tailings Storage Facility (filtered TSF) will be integrated within the waste rock storage area.

The associated infrastructure will include offices, warehouses, workshops, and laboratory and built close to the processing plant.

The mine will require approximately 25-35MW power per year.

New Pacific Metals has engaged with Bolivia national power supply companies, CNDC and ENDE and a preliminary power supply plan has been devised.

Contractors involved

AMC Mining Consultants (Canada) prepared the technical report titled ‘Silver Sand Deposit Preliminary Economic Assessment’, effective November 2022.

The mineral resource for the project has been estimated by Ms Dinara Nussipakynova, Principal Geologist of AMC Consultants.

The capital and operating costs estimate for process plant and plant infrastructure was prepared by Halyard, while NewFields was responsible for the estimate of the Tailings storage facility.