Santacruz Silver– Acquisition Of 500 TPD Mill To Unlock Production Growth At San Lucas & Other Mines
Summary
Santacruz bought a 500 tpd (tonnes per day) mill for about US$14 million, giving San Lucas dedicated capacity and freeing three Bolivian mills.
Freed milling capacity at Bolivar, Porco, and Caballo Blanco should lift company-owned production gradually, with a revised mine plan expected by late November.
Zimapan drilling keeps extending veins, and a mill upgrade is lifting recoveries and grades, supporting higher output and better costs next year.
Soracaya, a silver-dominant development project, targets first production in December 2026 and 2.5-3 million silver-equivalent ounces (all metals counted as silver) at full run-rate.
The guest argues Santacruz is undervalued at about a $1.1 billion market cap, with roughly $140 million in treasury and no royalties or streaming.
Key points on Santacruz Silver Mining Ltd
- The guest says the newly acquired 500-tonne-per-day mill, dedicated to the San Lucas ore-sourcing business, frees milling capacity at Bolivar, Porco and Caballo Blanco, so milling will no longer constrain production growth from the company's own mines.
- San Lucas is expected to grow from about 4 million to roughly 4.5 million ounces per year (around 8-10%), and Porco — which dedicates about 50% of its mill to San Lucas — gains the most released capacity.
- Soracaya needs only its final permit to start: initial production of 200-300 tonnes per day is planned for December 2026, ramping to a budgeted 700-800 tonnes per day and about 2.5-3 million ounces silver equivalent per year, mostly silver.
- The company guides to slightly over 10 million ounces silver equivalent for 2026, with Bolivar back on track by Q4 and two new high-grade silver areas adding production from 2027, and Zimapan set to grow next year on drilling success, higher head grades and better recoveries.
- The guest reports closing Q3 2026 with close to $140 million in treasury (about double Q2), no royalties or streams, and points to the September 21 TSX uplisting as a step toward better liquidity and a potential rerating.
Arturo Préstamo Elizondo's takeaways
- Top takeaway He argues Santacruz is undervalued against mid-tier silver peers and expects its fundamentals — strong cash flow, no royalties or streams, and a treasury near $140 million — to eventually drive a rerating.
- He frames the 500 tpd mill purchase as a long-pursued strategic move that gives San Lucas dedicated milling capacity while removing milling as a constraint on growth at the company's three Bolivian mines.
- He guides to slightly over 10 million ounces silver equivalent in 2026 and expects growth at every operation next year through efficiencies at Bolivar and Zimapan plus the Soracaya ramp-up.
- He expects Soracaya to start producing in December 2026 and reach about 2.5-3 million ounces of silver equivalent a year, mostly silver, lifting the company's silver revenue share toward 60%.
- He says the growing treasury and clean balance sheet position the company to pursue accretive acquisitions as a third growth front alongside mine efficiencies and organic growth.
Shad Markwitz's takeaways
- Top takeaway The host makes the case that Santacruz is undervalued, contrasting its roughly $1.1 billion market cap and 10-plus million ounces of silver equivalent production with peers' valuations and the SilverCrest ($1.7 billion) and MAG Silver (over $2 billion) takeover prices.
- He explains San Lucas as a margin business that buys ore from small and artisanal miners on fair terms, noting its costs move with the silver price rather than a traditional mine cost structure.