Laguna (100% owned by Xtierra)
All of Minco's Mexican interests are held indirectly through its investment (40%) in Xtierra Inc., a company whose shares are listed on the TSX Venture Exchange in Toronto.
The Laguna tailings re-treatment project is located on the outskirts of the city of Zacatecas, Mexico. Micon International, of Toronto, completed a feasibility study on the 1.2 million tonne a year operation to recover silver and mercury from 7.9 million tonnes (measured and indicated resource) grading 58.8g/t silver, 0.31g/t gold and 318g/t mercury. This resource contains approximately 15 million ounces silver (30.39 million ounces silver equivalent).
Over a 7 year project life the project would produce 390,000 kilograms of silver and 2,349,000 kilograms of mercury.
The tailings accumulated as a result of historic mining during the Spanish
colonial period. Mineral treatment during this period relied on the use
of mercury to recover precious metals from their ores. The Laguna material
contains significant remnant mercury and Minco is convinced that a re-treatment
process must ensure that any leakage of this material is fully contained.
Metallurgical test work seeking alternative processing methods has been
unsuccessful to date and alternative
sites for the tailings disposal, planned
to adjoin the main highway into Zacatecas has not been resolved. Unseasonably
dry conditions in recent years also requires a re-assessment of the proposed
floating dredge method for extraction of the tailings.
In November 2009, Xtierra entered in to an option and sale agreement with Indo Gold Pty Limited of Brisbane, Australia whereby Indo Gold will, subject to completion of ongoing due diligence, have an option to purchase the Laguna property for certain cash payments and a 3% NSR production royalty.