Antilles Gold Ltd (ASX:AAU, OTCQB:ANTMF) continues to progress offtake negotiations with an international trading company as it seeks economic opportunities for concentrate from the La Demajagua gold and silver open pit mine in Cuba.
So far, the company has indicated that payables for the value of contained gold in concentrates should be in the order of 75% — higher than the metrics incorporated in the February scoping study.
On the other hand, payables for contained silver in the concentrate could be lower, as not many smelters recover this metal, and pricing has not yet been established.
As a result, Antilles intends to continue metallurgical test-work, which indicated a second concentrate could be produced from the La Demajagua ore hosting the majority of its silver content and be marketed to specialist refiners.
Importantly, this concentrate would also contain high levels of antimony, which associates with silver metals, whereas gold associates with pyrite and arsenopyrite.
What does test-work tell us?
Initial test-work indicated grades of the second concentrate would come in at roughly 33% antimony, 28 g/t gold, 1,540 g/t silver and 8.8% arsenic.
Interestingly, antimony is a high-value critical metal used in the manufacture of semi-conductors and in alloys for batteries.
Antilles has also been advised that with minor changes to the planned flotation circuit, antimony content may be increased.
The primary concentrate is expected to hold around 38.5 g/t gold, 114 g/t silver, 6.6% antimony and 29% arsenic, and the trading company’s sample testing indicates acceptable levels of metal recovery by smelters.
Next steps at La Demajagua
Antilles Gold executive chair Brian Johnson said it was encouraging that the gold-rich arsenopyrite concentrate would be saleable at a reasonable level of payables.
He also considers it worth delaying the proposed offtake agreement and definitive feasibility study (DFS) for the proposed La Demajagua mine for two to three months so that further metallurgical test-work can be undertaken, aimed at producing a concentrate with a high antimony content and containing most of the silver from the ore.
Optimisation of potential project income and product saleability remain Antilles primary objectives, and the prospect of increasing revenue through the antimony content is of special interest.
An updated scoping study for the proposed La Demajagua mine is expected next month, incorporating the above information, pricing of the high antimony concentrate, recently increased JORC resources, current concentrate shipping costs and updated capital costs.
If the revised study demonstrates that producing two concentrate products is the optimum commercial outcome for the La Demajagua project, then finalising the offtake agreements and the DFS will be delayed until February/March 2023 to permit additional confirmatory metallurgical test-work.