What is the expected timeline and capital requirement to advance the Cerro Caliche project to production now that full control is secured?

Timeline & Capital Outlook

With the surface‑rights lease now fully approved, Sonoro moves from the “control‑acquisition” phase to the “development‑to‑production” stage. In comparable gold projects in Mexico (e.g., Cerro del Aguila, La Herradura), the interval from 100 % rights to first‑metal is typically 2 – 3 years: a 12‑month feasibility‑study and permitting window followed by a 12‑ to 18‑month engineering‑construction window. Assuming Sonoro follows the same cadence, we can expect initial production to be targeted for late 2027 or early 2028.

The capital envelope required to bring Cerro Caliche to operating status is not disclosed in the release, but industry benchmarks for a mid‑size, open‑pit gold mine in Sonora range from US$200 – 300 million (including pre‑FEED studies, mine‑design, infrastructure, and initial working‑capital). Given Sonoro’s need to fund a detailed‑feasibility study, environmental permits, and a modest‑scale processing plant, a ≈ US$250 million spend over the next 24‑30 months is a realistic estimate. The company will likely tap a mix of equity placements, senior debt, and possibly a strategic partner to meet this requirement.

Trading Implications

The full‑control milestone removes a major execution risk and positions Sonoro for a clear, fund‑driven development path—an upside catalyst for the stock. Until a formal capital‑raising or FEED update is released, the market may still price in a “development‑risk premium,” creating a short‑to‑mid‑term buying opportunity on any pull‑back. Key watch‑points are:

• Upcoming FEED or PFS announcements (mid‑2025 – early 2026) – will outline the definitive capex and confirm the 2027‑2028 production target.
  
• Financing disclosures (e.g., a $150 M private placement or senior loan) – provide insight into dilution or leverage risk.
  
• Permitting progress in Sonora – any delay could push the production timeline beyond 2028 and compress the upside.

From a risk‑reward perspective, a long‑position with a modest stop‑loss around 10 % below current levels captures the upside from the newly secured rights while protecting against potential financing or permitting setbacks. Keep the position size flexible to accommodate any forthcoming capital‑raising news, which could either sharpen the upside (if terms are favorable) or trigger a short‑cover rally if the market perceives a dilution risk.