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About Project Fenix

Located in Mexico

Project Fenix is a proposed redevelopment plan for McEwen Mining’s El Gallo Complex in Mexico. A Preliminary Economic Assessment (PEA) published in 2018 was further updated by a Feasibility Study (FS) that was filed in February, 2021. Project Fenix evaluates the potential extension of production in the complex, based on a 2-phased transformation of the processing from the El Gallo mine, innovative in-pit tailings disposal, and sourcing from further deposits.

The project envisions constructing a mill at the existing mine site that will initially reprocess the existing heap leach material, and further will transition to open pit mining and processing ore from the El Gallo Silver deposit.

At a base case using gold and silver prices of $1,500 and respectively $17 per ounce, key outcomes of the feasibility study for Project Fenix include a 9.5-year Life‑of‑Mine (LOM), average annual production rate of 26 thousand gold equivalent ounces (Au Eq) until Year 7 and further of 4.5 million silver equivalent ounces (Ag Eq) for a 28% After-Tax internal rate of return (IRR) and a $32 million After-Tax net present value (NPV) using an 8% discount rate.

At an upside case using gold and silver prices of $1,900 and respectively $25 per ounce, project Fenix has a 56% After-Tax IRR and a $98 million After-Tax NPV using an 8% discount rate. The Fenix feasibility report can be accessed here.

About Diagram About Diagram


Silver pille



19.5 M Oz


.3 M Oz


19.2 M Oz
For more details click here.

Highlights of the Feasibility Study

  • Estimated capex: $42 million initial capex (for Phase 1), $24 million incremental capex in Year 6 (for Phase 2);

  • 3.6 years payback period;

  • After-Tax 28% IRR and $32 million NPV @ 8% discount rate;

  • Average annual production: 26,000 oz Au in Phase 1 (Years 1-6), 4,500,000 oz Ag Eq in Phase 2 (Years 7-9.5);

  • Cash Cost: $1,037/ oz Au in Phase 1, $14.22/ oz Ag Eq in Phase 2;

  • AISC: $1,045/ oz Au in Phase 1, $14.30/ oz Ag Eq in Phase 2;

  • 9.5-Year LoM;

  • $12 million average After-Tax cash flow per year of full production;

  • Updated Measured and Indicated resource estimate of 14.5 million tonnes at average grades 0.45 g/t gold & 42 g/t silver, containing 208,000 ounces gold & 19,536,000 ounces silver;

  • Updated Proven and Probable reserve estimate of 14.5 million tonnes at average grades 0.39 g/t gold & 41 g/t silver, containing 187,000 ounces gold & 19,243,000 ounces silver.

Capital Costs and Processing

The Fenix Project involves a two-phase development process. The process plant would use conventional and proven mineral processing and precious metals recovery technologies. Tailings produced during the operation would be stored in an existing mined-out open pit at the El Gallo Gold Mine. As part of this process, tailings deposition would include a delivery system designed to maximize tailings consolidation and water recovery.

Phase 1 includes reprocessing the gold from the heap leach pad material at our existing El Gallo Gold Mine, at an estimated capital expenditure of $42 million. The heap leach material would be processed at a rate of 5,000 tonnes per day (tpd), using conventional ball mill grinding and a hybrid carbon-in-leach (CIL) circuit. Industry standard elution, electrowinning and smelting circuits would be used to produce a doré product.

Phase 2 includes the mining by open pit methods of the in-situ silver ores at El Gallo Silver and has additional expansion capex of $24 million. In Phase 2 the process facility would be modified to enable treatment of the mineralized material from this deposit, at a rate of 3,250 tpd. Ore delivered to the grinding circuit would be prepared using the existing El Gallo Gold three-stage crushing circuit. Processing in this phase would utilize conventional flotation followed by leaching of concentrates and the Merrill-Crowe process would produce the gold and silver precipitate. Flotation tailings transferred to the CIL plant built in Phase 1 would maximize overall silver recoveries.

The project offers low upfront capital requirements by:

  • Utilizing existing infrastructure at the El Gallo Gold Mine;
  • Commissioning an in-pit tailings storage facility; and
  • A significant reduction in required leach tank volumes for El Gallo Silver processing in comparison with previous studies.


The current operation at El Gallo Gold is a fully permitted site; permit for the Phase 1 was granted by the Federal Environmental Authority (SEMARNAT) in September 2019, for the addition of a mill and leach circuit in the location of the existing facilities for the reprocessing of the heap leach pad material. The permit amendment also includes the backfilling of a previously mined pit with mill tailings, as part of an integrated concurrent closure plan for the El Gallo Gold Mine.

In-pit tailings storage provides a number of key benefits to the project, including:

  • Lower construction and operating cost compared to a conventional tailings dam or dry-stack facility;
  • Much improved safety and long-term tailings and pit stability;
  • Reduced footprint that minimizes surface disturbance and maximizes reclamation results;
  • Promotes the re-use of process water, reducing groundwater demand;
  • Reduces reclamation and management costs.

Further project advancement to Phase 2 is subject to permit approvals and will require authorization to expand the process plant footprint at El Gallo Gold and the haul road, and to augment the tailings volume to be deposited at the depleted pit.

Fenix has CONAGUA approval for the extraction of groundwater and land-use permits for the construction of wells required for the life of the project.

Exploration Potential
at El Gallo Complex

In recent years, exploration efforts at the El Gallo Complex have focused on both near-mine and property-wide targets. A property-wide soil geochemical survey completed in 2018 identified multiple additional targets and indicated the potential for extensions of known zones of sulfide mineralization.

Near-mine drilling efforts have been successful in delineating and extending mineralization near the Samaniego and Sagrado Corazon pits. The new gold mineralization generally contains sulfides that could be processed in the Phase 2 process plant.

At the property scale significant mineralization has been confirmed at Encuentro South, located 7 miles (11 km) southwest of the El Gallo Mine. The project area lies on an important 4 mile (7 km) long, regional NW-SE mineral trend that also hosts two other exploration targets, Las Milpas and Twin Domes. Extensive exploration along this trend has identified favorable alteration signatures and abundant anomalous gold and silver mineralization in surface rock and soil samples.

The 42 core holes (7,522 meters) drilled at the Encuentro South prospect indicate that the favourable gold assays occur in at least three distinct zones that are either shallow dipping NW, or sub-vertical NS structures and are still open along strike and at depth. The mineralization zone has a strike length of approximately 230 meters and was identified from surface to a depth of 130 meters.

Mineralization at Encuentro South is characterized primarily by structurally controlled, multi-event quartz breccias and stockwork zones hosted by propolytically altered meta-andesites. Minor silicification and hematisation alteration is also seen locally. The mineralization is considered of the low-sulphidation, epithermal style as seen elsewhere on the property.

Highlights of drill results from Encuentro South are presented below.


Latest exploration drilling at the El Gallo Complex has been concentrated primarily on three prospective areas; one area called Encuentro South has returned particularly encouraging results at shallow depths.

Highlights are summarized on the right. For all drill results click here.

Hole ID Gold
Grade (gpt)
Width (m)
ENX-032 9.59 9.1
including 126.50 0.5
and 2.94 38.2
including 27.30 1.2
ENX-043 7.82 5.4
including 28.70 1.1
ENX-009 16.09 2.1
ENX-041 16.27 1.9
ENX-051 1.30 19.5
and 6.13 4.8
ENX-019 1.85 15.2
including 3.99 5.0
ENX-021 1.66 12.7