Excellon Resources receives US$4.4M from Mallay concentrate shipments
The Peru mine remains in pre-commissioning, with full mill capacity targeted for mid-2027 and a revised mine plan due at year-end.
Mara Quinlan
Excellon Resources Inc. CVEEXN OTCMKTSEXNRF FRAE4X2 said on Thursday it has collected US$4.4 million from initial concentrate shipments during pre-commissioning at its wholly owned Mallay silver-lead-zinc mine in central Peru. The receipts provide cash during a restart targeting the mill's rated capacity of 600 tonnes per day by mid-2027, with the schedule still subject to an updated mine plan.
Shares closed lower at C$0.26 on the TSX Venture Exchange at 4:00 p.m. EDT on Oct. 28 CVEEXN. That close predates Thursday's announcement.
The mill has processed 19,884 tonnes across three test campaigns, recovering 52,860 ounces of silver in concentrate since restarting in July. Excellon reported recoveries reaching 84 per cent for silver and lead, and 81 per cent for zinc.
Excellon reported US$5 million in cash in its Oct. 29 update. It expects that cash, mobilization of a US$5 million credit facility and receipts from further milling campaigns to support the ramp-up and exploration.
"We are now focused on expanding underground mining activities to achieve the mill's rated capacity of 600 tonnes-per-day by mid-2027," chief executive Shawn Howarth said in the release.
Feed for the test campaigns came principally from surface stockpiles and narrow-vein stopes above the 4090 level. Excellon cautioned that their grades do not represent the mineralization expected to support steady-state operations below that level.
Three narrow-vein stopes above the 4090 level are expected to keep supplying mill feed through the first quarter of 2027.
The company has selected a new mining contractor and expects to finalize the production contract in the fourth quarter of 2026. Rehabilitation of the dewatered 400 Ramp is underway, with completion targeted for the first quarter of 2027. The contractor transition, including full crew mobilization, is expected to finish in the same quarter.
Initial longhole stoping at Clavo 3 and cut-and-fill mining of the Daria vein are scheduled to start in December 2026. Clavo 6 production is expected in the second quarter of 2027, but production planning and sequencing depend on the updated resource estimate and mine plan.
Excellon also said in the Oct. 29 release that it had pre-purchased 4 million pounds each of lead and zinc under its base metals stream. Consideration totals US$5.675 million in common shares, cash and offsets, while remaining stream deliveries are deferred until Jan. 1, 2031 to free cash flow during the ramp-up.
The resource update will incorporate previously unmodelled mineralized zones, up to 27 new drill holes and additional underground channel sampling. The mine plan will set out targeted production for the next two years.
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Excellon targets completion of the updated resource estimate and mine plan by the end of 2026, ahead of further ramp-up guidance in early 2027.
