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El Compas //

El Compas is located in Zacatecas state, Mexico, about one kilometre south of the city of Zacatecas in the historic silver mining district of the same name. Our property covers approximately 3,990 hectares, and is well served by local infrastructure, including a paved highway, state electrical power, local labour, supplies and services. El Compas is characterized by two high-grade, low-sulphidation epithermal veins up to several hundred metres long by 200 metres deep and up to 10 metres thick, and multiple vein targets that have never been drilled.

El Compas is an example of a strategic acquisition made by Endeavour in 2016 for a purchase price of $6.7 million. When we acquired the asset, the mine was already permitted and a nearby 500 tonne-per-day government plant was leased for up to 10 years. We started development in 2017, and are on schedule to attain commercial production by July of 2018. The new mine will be accretive to our consolidated cash flow, with all in sustaining costs below $10 per ounce .

In March 2017, Endeavour published a preliminary economic analysis for El Compas, which delivered robust economic returns, supporting the basis to initiate development. In early 2018, Endeavour announced improved operating metrics to boost production by 25% to 1.175 million oz Ag Eq in the following year. The improved mine plan calls for production of 250 tpd using a mechanized cut and fill method and the plant will have a capacity of 325 tpd. Additionally, there is an implied expansion opportunity, if we discover or purchase additional mineral resources in the area and refurbish the second ball mill to nearly double the plant capacity to 500 tpd.

Low Costs

Capital expenditures are estimated to be $11.3 million, funded by cash flow from existing operations. Operating costs are estimated to be $110 per tonne and cash costs, including royalties and mining duties, are estimated to be $9.09 per silver equivalent ounce, net of by product credits. All-in-sustaining costs are estimated to be $9.64 per silver equivalent ounce, net of by product credits. Management will seek opportunities to expand production and reduce costs going forward.

PEA Economics

Ag Price Au Price IRR NPV Payback Period
$16/oz US$1,120/oz 29% $8.0m 2.6 years
$18/oz Base Case US$1,260/oz 42% $12.6m 2.1 years
$20/oz US$1,400/oz 54% $17.0m 1.8 years

*Based on the PEA published by Endeavour Silver in May 2017

Resources: Silver

  • 495,000M oz
    Indicated Silver Resources
  • 530,000M oz
    Inferred Silver Resources

Resources: Gold

  • 34,900 oz
    Indicated Gold Resources
  • 37,500 oz
    Inferred Gold Resources
*for full details, refer to the complete Reserves and Resources table found here

El Compas will be our fourth operating mine, with initial production in Q2 of 2018.

El Compas