LONDON (Alliance News) - Patagonia Gold PLC shares fell early Thursday after the company said the pre-feasibility study conducted on the Cap-Oeste heap leach project in Argentina indicate the project is not currently economically viable.
Patagonia said the initial results from the studies being carried out at the site using the heap-leach process indicate that additional oxide resources will be required to make the project economically robust at current gold and silver prices.
The company said it is working to establish these further resources through its exploration programme.
"The company continues to see a promising long term future for the Cap-Oeste project once conditions in mining markets have normalised. Meanwhile, we will continue to maximise free cash flow from our Lomada operations. We will also concentrate our exploration efforts on replacing reserves at Lomada and continue to grow our global resource," said Patagonia Chief Executive Bill Humphries.
Patagonia shares were down 25% to 2.26 pence in early trade on Thursday, the worst performer in the AIM All-Share index.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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