Gainey Capital Corp. (TSXV: GNC) (OTCQX: GNYPF) (“Gainey” or the “Company”) is pleased to provide an update on ore processing negotiations and exploration plans. In addition, the company has finalized an agreement with the Municipality of Huajicori, which will enable Gainey to use the Municipality’s heavy equipment, such as backhoes and front end loaders, at attractive rates.
Cash Position: As at September 30, 2014, the Company had a total of approximately CDN$2.8 million in cash reserves. This, along with the positive operating margin and cash flow from ore processing, will be used to fund the Company’s exploration strategy.
Ore Processing: Gainey has now completed the ore sampling process with multiple local mining companies and is in negotiations regarding long-term processing contracts. The Company has received cash deposits from processing customers and has ore stockpiled at the mill. The Company’s mill and processing centre, which benefits from competitive operating costs, has consistently delivered recovery rates in excess of 90%. The Company expects to generate a positive operating margin and cash flow from its processing operations, which will be used to further fund exploration initiatives. Gainey plans to begin sampling its own ore in early 2015.
Exploration: Gainey is finalizing its exploration strategy and plans to announce details, in January 2015, of the upcoming program. The Company’s advanced gold/silver project at El Colomo is located in the gold/silver-rich Sierra Madre Occidental Trend in western Mexico. The project has a number of high-priority drill targets already established and exploration will be headed up by renowned geologist, Peter Megaw.
David Coburn, CEO of Gainey, commented, “It has been a busy period for Gainey since the acquisition of our assets in Mexico closed in Oct 2013. Our ore sampling program has enabled us to build relationships with the many independent mining operations in the region and we can now move towards arranging long term tolling contracts. The mill’s high efficiency and low operating costs are a particular advantage for the toll processing part of our business model. We are well-funded and are looking forward to the upcoming exploration and toll processing opportunities as 2015 approaches.”