Gold Co. in Mexico Looks to Review Tailings Storage Options

Sierra Madre Gold and Silver Ltd. (SM:TSX.V; SMDRF:OTCQX) put out a press release announcing its partnership with Stantec Consulting International LLC to perform analysis on its tailings depositions options related to its La Guitarra project, located in Mexico.

The company has experience working with Santec Consulting International, and finalized this partnership on September 12, 2023, and expects the results of this partnership to come out at the end of the year.

The press release outlined several steps that Stantec is undertaking as part of this process, including a global stability evaluation of the company's storage facilities, and a scoping-level study where the company will evaluate the infrastructure possibility and potential environmental impact of adding a new storage facility. A new storage facility is approved for an ultimate capacity of 5.8 million tonnes of dry stack tailings.

Gold Breaking Out on the Upside

Technical Analyst Clive Maund released an analysis of the gold market on October 19 of this year, where he concluded that, although some of the recent surge in gold prices can be attributed to amateur investors motivated by uncertainty caused by the Israel-Hamas war, gold's long-term trends show that it is likely to increase in the near future.

Technical Analyst Clive Maund also reviewed Sierra Madre on July 25, 2023, where he rated the company as a "Strong Speculative Buy."

Maund stated, "It is hardly likely that gold's nominal price in dollars will drop significantly — on the contrary, it can be expected to break out on the upside and ascend to unimaginable heights."

Rick Mills of Ahead of the Herd is also optimistic about the gold market, as it detailed in a report dated October 18, 2023. Mills identifies a lack of control from central banks as a driving factor in the increase in gold prices.

Moving Up With "The Wind at Its Back"

On October 4, 2023, Ceasar's Report reviewed Sierra Madre following the acquisition of the La Guitarra property from First Majestic Silver Corp. (FR:TSX; AG:NYSE; FMV:FSE), where it stated that "acquiring a fully permitted and past-producing silver mine with a substantial gold credit was a good move but we are entering the phase where the company will have to prove to the investment community it can run the mine at a profit."

Technical Analyst Clive Maund also reviewed Sierra Madre on July 25, 2023, where he rated the company as a "Strong Speculative Buy" for potential investors. According to Maund, the company's stock looks promising: "downside looks done, and it has a lot of upside from here, especially as it should have ‘the wind at its back' soon with the sector taking off higher."

Sierra Madre has a number of catalysts it is working on, according to its investor portfolio, including a mine restart study and mine plan that it expects to complete by quarter two (Q2) of 2024, equipment procurement and repair that it expects to finish by Q4 of 2024, mill upgrades that it expects to complete within the same timeframe, and commercial production that it anticipates beginning in Q1 of 2025. 

Ownership and Share Structure

Reuters provided a breakdown of the company's share and ownership record, where management and insiders own 5.17% of the company.

According to Reuters, President and CEO Alexander Langer owns 2.04% of the company with 2.94 million shares, Lead Director Jorge Ramiro Monroy owns 1.41% of the company with 2.02 million shares, Director and Country Manager Alejandro Caraveo owns 1.23% of the company with 1.77 million shares, Controller and Corporate Secretary Kerry Melbourne Spong owns 0.32% of the company with 0.46 million shares, and Director Gregory F. Smith owns 0.17% of the company with 0.25 million shares.

Reuters reports that institutional investors own approximately 1.35% of the company, with 1.95 million shares in the form of Commodity Capital AG.

First Majestic Silver Corp., a strategic investor, owns 47.96% of the company with 69.06 million shares.

There are 144 million shares outstanding, with 67.49 million free float traded shares, Reuters stated, and it has a market cap of CA$53.28 million and trades in the 52-week period between CA$0.34 and CA$0.74.

Important Disclosures:

1. Sierra Madre Gold and Silver Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000. 
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Sierra Madre Gold and Silver Corp.
3. Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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