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Golden Minerals Company (NYSE American / TSX: AUMN) – Initiating Coverage – Junior with Advanced Stage Assets and Toll Milling Revenues
Golden Minerals Company (NYSE American / TSX: AUMN) – Initiating Coverage – Junior with Advanced Stage Assets and Toll Milling Revenues
Golden Minerals Company (“company”, “Golden”, “AUMN”) holds a portfolio of precious metals projects in the Americas; including the advanced stage El Quevar silver project in Argentina, the Velardeña properties in Mexico, and early stage projects in Mexico and Nevada.
The company also generates revenues by leasing its oxide mill at Velardeña to Hecla Mining (NYSE: HL). In the first nine months of 2019, this lease generated an operating profit of $4 million to AUMN.
A 2018 Preliminary Economic Assessment (“PEA”) on the El Quevar silver project, based on $16.7 per oz silver, returned an After Tax – Net Present Value (AT-NPV) at 5% of $45 million, and an After Tax – Internal Rate of Return (“AT-IRR”) of 17%.
Excluding a project recently signed up for sale, the company has a total measured and indicated resource of 76 million ounce (“Moz”) silver equivalent, and an inferred resource of 37 Moz silver equivalent across three projects.
Management and board members combined hold approximately 5% of the total outstanding shares. Sentient Equity Partners is the largest investor, and holds 39% of the outstanding shares.
We are expecting multiple catalysts for the share price in 2020, including an updated PEA on its Velardeña properties, a potential joint venture partner for El Quevar, and drill results from a recently optioned gold-silver project in Nevada.
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