The renaissance of El Mochito
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ASCENDANT RESOURCES rejuvenation through Mining 101 WRITTEN BY
MARCUS LAWRENCE PRODUCED BY
RICHARD DEANE
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ASCENDANT RESOURCES
Chris Buncic, CEO and Co-Founder at Ascendant Resources, discusses the rejuvenation of the El Mochito mine in Honduras and the Mining 101 approach that has powered its success
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he El Mochito mine, located in the Las Vegas municipality of Honduras and around 88km southwest of San Pedro
Sula, has undergone a dramatic rejuvenation at the 04
hands of Ascendant Resources which acquired the site in December 2016. Under Ascendant’s management, El Mochito’s zinc production has doubled and its revenues are growing rapidly. Not only that, Ascendant has become the leading miner in Honduras, a country whose mining potential has been sorely overlooked according to CEO Chris Buncic. He earmarks both capital investment and the shift in management styles that defined the takeover as being of vital importance to the mine’s renaissance. “After we closed the acquisition, we set upon a program of optimization and rehabilitation of the asset, as well as retraining operators,” says Buncic. “It was a very peoplefocused change.” In tandem with introducing an array of new equipment – a long overdue endeavor at El Mochito – Ascendant brought the mine to free
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ASCENDANT RESOURCES
“ As we ramped up production, people have reaped the benefits through incentives” — Chris Buncic, President, CEO and Co-Founder, Ascendant Resources
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2006
Year founded
$85.6mn Revenue in 2018
1,242
Approximate number of employees
cashflow positivity within a year of closing the deal. Ascendant has approached the project with a ‘Mining 101’ mentality, zeroing in on the basics to ensure any additional developments are built upon strong and efficient foundations. “We assembled a new management team that has performed consistently over the last two and a half years, and we replaced nearly all of the underground trackless equipment,” says Buncic. “Some of the trucks and scoops had been subject to as many
CLICK TO WATCH : ‘ONE X ONE WITH CHRIS BUNCIC, ASCENDANT RESOURCES PRESIDENT AND CEO’
as four overhauls; in a typical lifecycle,
are staggered over the course of the
this would only have been done twice,
day, and changeovers at the truck
but because of their age we were
underground rather than on surface.
having availability issues. The key
This cuts out travel time, meal times
metrics of the journey have been
and so on, and has resulted in produc-
availability of the equipment and its
tivity time increasing from 15 to 22
proper and consistent utilization.”
hours per day.” Simply adding additional
It is equally essential to have both
work hours is far from the sum of
equipment at hand when it is needed,
Ascendant’s work with its staff. “In the
and trained staff who are available
five years prior to the acquisition, there
to capitalize on it. “We added a fourth
had been six general managers each
shift underground for the truck drivers,
with their own priorities and projects,”
meaning there are now four overlap-
explains Buncic, highlighting the
ping eight-hour shifts. Those shifts
general sense of uncertainty and lack w w w.a sc e nda nt re so urces . com
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of clear direction to which workers at
They were unhappy with the situation
El Mochito had become accustomed.
before we took over, so we had lots
Not only has the new and successful
of positive benefits come through
management team brought a fresh
that,” says Buncic. “As we ramped up
era of stability, but Ascendant has
production, people have reaped the
also been proactive in its approach
benefits of the higher production
to supporting staff significantly
rates through incentives. Everyone is
improving morale. “In 2017, we
happy in sharing the success of the
renegotiated our collective bargain-
mine, and it’s certainly something
ing agreement with the workers’
we’re happy to continue to foster.”
union, which had been long overdue.
This attentiveness to its employees
E XE CU T I VE PRO FI LE
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Chris Buncic, President, CEO and Co-Founder Chris Buncic is one of the founding partners in the formation of Ascendant Resources Inc. and its acquisition of the company’s f lagship operating El Mochito mine from Nyrstar NV in 2016. Prior to cofounding Ascendant, Mr. Buncic served in senior management roles at several Canadian corporations in the technology and resources sectors. His depth of experience also includes six years in Institutional Equity Research at leading Canadian independent full-service brokerage firms Cormark Securities Inc. and Mackie Research Capital Corporation. Mr. Buncic is a CFA Charterholder, has an MBA from Schulich School of Business and B.A.Sc. from the University of Toronto. Mr. Buncic is a member of the Professional Engineers of Ontario and the CFA Society.
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ASCENDANT RESOURCES
“ We brought in a new management team that has performed consistently over the last three years, and we replaced nearly all of the underground trackless equipment” 10
— Chris Buncic, President, CEO and Co-Founder, Ascendant Resources
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extends to the local municipality
school lunches and environmental
through a range of highly successful
efforts. We have 11,000 hectares of
corporate social responsibility (CSR)
forestland on our property, and we
initiatives. In each of the past 10 years,
do a lot of reforestation and environ-
El Mochito mine has won the prestig-
mental preservation on that land.”
ious Empresa Socialmente Respon-
As for the mine itself, incremental
sible (‘Socially Responsible Busi-
infrastructural upgrades have been
ness’) award from the Foundation for
vital to the leap in production, the sharp
Corporate Responsibility in Hondu-
rise in the quality of the ore produced,
ras (FUNDAHRSE). “We give back
and the efficiency with which that
to communities to a very large deg-
produce is brought to the surface.
ree,” enthuses Buncic. “We operate
“We have been able to access some
a hospital and two schools, and we
new high-grade areas of the mine that
run smaller programs with respect to
were not previously available, and our w w w.a sc e nda nt re so urces . com
ASCENDANT RESOURCES
grade has improved materially from 5.3% when we took over the mine to as high at 7% in Q4 2018,” says Buncic. Part of this success can be traced to Ascendant’s Lagoa Salgada mining project in Portugal, itself located within the famed Iberian Pyrite Belt. “At Lagoa Salgada, we conducted gravity and induced polarization (IP) work which we found to be very effective in finding additional anomalies and targets to follow up. We brought the same group that 14
conducted that study over to El Mochito, and their underground, gravity and IP studies have opened up the potential of the western part of the mine.” In February of this year, the company completed a 700-meter tunnel from the Esperanza ore body in the northwest of the mine to the crusher. The tunnel provides a more direct route between the sites, circumventing the original winding route comprised of rough terrain. Not only has this opened up a previously unexplored part of the mine and minimized the wear and tear of the associated machinery, but it is emblematic of the
“One of the things our team has been good at is identifying new opportunities” — Chris Buncic, President, CEO and Co-Founder, Ascendant Resources
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17 infrastructural upgrades that have been pivotal in the mine’s rejuvenation. “It’s a good example of the ways that our team is strategizing as it looks to find high-grade material to bring into the mine plan as soon as possible,” says Buncic. In the long term, Buncic stresses that Ascendant’s commitment to maximizing the value of El Mochito is far from over. Whilst maintaining the production rates it has achieved, continuing to seek out high-grade ore bodies and evaluating areas where costs can be saved, Ascendant is
“In 2017, we renegotiated our collective bargaining agreement with the workers’ union, which had been long overdue” — Chris Buncic, President, CEO and Co-Founder, Ascendant Resources
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ASCENDANT RESOURCES
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“ It was a very peoplefocused change” — Chris Buncic, President, CEO and Co-Founder, Ascendant Resources
working hard to boost its profitability per ton. With respect to this, Buncic highlights the expansion plan posited in a Preliminary Economic Assessment (PEA) released in October 2018 that seeks to cut costs to below $1 per zinc equivalent pound. The plan is split into three components: opening a more direct mine shaft in the east of the mine; installing a large and efficient water pumping system with
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clarification capabilities; and expand-
a lot of great opportunities, and we
ing the plant to bring its capacity up
have an excellent network of partners
to an average of 2,800 tons per day,
who want to work with us across the
boosting the mill’s production by 27%
financial gamut as we look to grow
while simultaneously cutting costs by
the company.”
the same margin. “One of the things our team has been good at is identifying new opportunities,” says Buncic. “We’ve done that with El Mochito, we’ve done it with Lagoa Salgada. In the mining space today, there are w w w.a sc e nda nt re so urces . com
501-110 Yonge Street Toronto, Ontario M5C 1T4, Canada T +1 647 796 0066 www.ascendantresources.com