Tara Site Visit ---------------------------------------------
Seven other Tara S H and I have just returned from the Don Ramon mine and mill site in Mexico. The mill is located approximately 25 kilometres ESE from the town of Choix, Sinaloa State, Mexico. This is about 520 miles South of Nogales, AZ.
Besides the investors, present were the CEO - Rich, Ramiro Ledezma the Mexico jaffe, his son Ramiro Jr, and the TM mining engineer. We were an hour late getting into Choix, so we missed the 2 geologists. John Brownlee was scheduled to be there, but had a delay getting out of Denver, so we missed being able to talk with him.
We all went to the mill site and then the Ramon mine site. Most of this post will be about the mill site, as there was little noteworthy about the mine site. The mine site is about 5 linear miles from the mill, on a twisty inclined road.
The following are my observations and should not be used to make ANY investment decisions:
The mill site is about 5 acres and was purchased for it's proximity to the roads and the Mexican power grid. A 33000 volt primary line runs right thru one edge of the property, so it's ideally located. The secondary voltage is 460 Volt AC 3 phase. There will be 3 secondary drops to the site, primarily for plant expansion and back-up. I've not had time to calc the 'Total Connected Load', so I'll estimate it at about 1200 H P. The property has gradient, so some gravity feed advantage will be gained.
The mill was engineered to process 300 ton/day, operating 2 X 12 hour shifts, 25 days/month. Total throughput approx 7500 ton/month. The major equipment is all in place. Remaining tasks are electrical and plumbing hook-ups, some of the conveyor systems and a plant laboratory..
Work process flow, as follows:
Contractors deliver the head ore to mill site and unload. The ore is to be delivered no larger than 16" rock. Front end loaders dump the ore into a large steel bin. It exits the bin onto a conveyor and moves into a 36" jaw crusher. Exits the jaw crusher (50 HP) by conveyor to a large Nordberg vibrating screen deck sized for 3/8" minus. Conveyor belt to the cone crusher (100 HP). Conveyor moves the 3/8 minus to one of 3 different circuits, leading to one of 3 ball mills. One is 6 X 6 and the other 2 are 4 1/2 X 6, probably about 100 HP each. Exiting the ball mills, the ore is about 120 mesh. Gravity feed to 3 concentrating wave tables. Next step is to one of 3 flotation cells, where it is concentrated further, using different chemicals for Pb, Zn, and Ag. After concentration is finished, the cons will be delivered to the buyer, using 40 ton low-boys pulled by large diesel rigs.
To increase the mill throughput, they can easily go larger on the ball mills, as that will be the bottle-neck. The entire mill layout was done so that larger equipment or more of it can be added.
They started mill construction on Jan 2nd and I think they have done a great job, getting it this close to operation in less than 5 months. I'm very impressed with the people and what they have accomplished, especially in what amounts to a fairly remote location.
I observed the following equipment on the site:
Large backhoe with 1 yard front bucket
One yard front end loader
A Robex 160 LCD-7 tracked hoe
12 yard, 20 ton dumptruck
2 ea. motorized welders
Asst. construction equipt.
After observing the 2 sites, we returned to the Tara office in Choix and watched a slide show of expected grades and some projected #'s for gross proceeds, costs, and bottom line projections. They have done a lot of drill analysis and are satisfied that they have a very high tonnage deposit to work from.
The following #'s are from the Nov '06 news release and I think are probably representative of their present projections:
Sample # Ag (grams) Pb (%) Zn (%)
R31-1 772.0 5.50
R31-2 426.0 10.65 23.45
R36-3 1,426.0 20.16 27.34
R46-4 484.0 28.0
R46-6 0.436 2.34 13.98
R49-7 238.0 1.25 7.22
R56-9 340.0 2.20 11.20
R56-10 629.0 7.80 23.80
R56-11 244.0 1.92 8.60
R62-12 435.0 4.75 8.66
R62-13 408.0 2.77 10.34
R62-14 403.0 7.70 48.10
R70-15 66.0 2.23 4.55
R87-16 667.0 10.70 16.11
R87-17 356.0 3.0 6.78
R87-18 388.0 4.30 9.15
R87-19 683.0 4.73 11.90
R125-25 493.0 3.40 14.33
R125-26 942.0 8.80 36.94
R125-27 247.0 1.77 7.18
R125-28 599.0 2.79 10.20
R125-29 714.0 9.29 39.84
R125-30 256.0 1.69 7.17
R125-31 292.0 1.62 8.64
R125-32 357.0 3.61 10.82
R125-33 493.0 5.95 24.41
I heard some very large #'s being contemplated, but I'll leave it with what they have publicly released. I've crunched some #'s myself, and I think putting a million$/month to the bottom line will be easily doable. Using that figure - that's about 30 cents/share/year net profit. If we were to get a 10 P/E, makes for a $3 share price.
The following is my opinion only - I think the mill will be operational in about 6 weeks. I have a fairly large position in T M, and couldn't be more pleased with the way things are developing with this project.
I have some pictures with no way to put them up in public. If you want to email me, I'll send some of them to you:
CL99CL@yahoo.com
Might take a few days, if the demand is heavy. Rich plans some news releases and some of these pics will be put up on the TM web-site, as his time allows.
C L
