San Francisco Mine of Magna Gold Into Serious Production
I have been pounding the table for the best part of three weeks about us having hit at least a tradeable low in gold and silver at the end of September. Relative to the S&P or the commodities index the price of gold or gold shares is at the lowest it has been in many years. You are at the point where risk is the least. So while this article is about one specific company, there are hundreds of companies selling for a fraction of what they should be selling for. Across the board there are exceptional bargains.
I wrote about Magna Gold (MGR-V) over a year ago. The president of the company, Arturo Bonillas, was predicting production of somewhere about 70,000 ounces of gold the first year. Arturo intends to expand production to 200,000 ounces of gold a year by 2023 via an increase in gold being mined and adding additional deposits.
In August the company put out a press release saying they had just signed a deal to raise $10 million in a convertible debenture paying a tiny 6.5% a year for two years. The debentures can be converted into shares at $1.25 apiece so they are non dilutional.
The company is cashed up. The latest monthly production was about 7,000 ounces in August. On October 14th the company announced quarterly production of 19,102 ounces, up an amazing 63% in a year. So production of 100,000 ounces a year, which is the magic number for juniors to gain credibility, seems quite possible for 2022. The San Francisco mine has reserves of just over 854,000 ounces of gold.
Obviously the company will want to expand the resources and reserves. Drilling will accomplish that and doing additional deals will add the potential for more production from those deposits. Magna management has been meeting and exceeding their targets. When they add additional ounces they are going to be one of the lowest priced actual gold producers in the market.
Magna is an advertiser and I have participated in a prior private placement. Naturally I am biased so you need to do your own due diligence.
Magna Gold Corp