Inca One Gold (IO.V) has made a lot of progress since we visited the Chala One processing facility in December. As you might remember from our site visit report, we attended the opening ceremony of the expanded Chala One plant which now has a capacity of 100 tonnes per day. We are now closing in on three months of commercial production at Chala, so this might be a good moment to review all milestones of the past four months.

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The throughput rate is increasing

Sourcing the ore is going really well and Inca One is continuously increasing the rate at which it is effectively purchasing the ore. The intake rate has increased to in excess of 400 tonnes per week and Edward Kelly expects to increase the ore-buying pace to in excess of 500 tonnes per week in the very near future as Inca One now has additional cash resources after closing its new debt issues. This additional financial flexibility was needed as on one day in March, Inca Ore saw several artisanal miners show up with their trucks for a record delivery of 131 tonnes of high-grade ore in a single day.

As we explained before, several smaller miners are willing to give Inca One’s facility a try as the Canadian standards Inca One is trying to implement are generating a lot of interest. From what we understand, the smaller miners like the better transparency offered by Inca One and this is resulting in an increasing amount of people wanting to do business with the Chala One mill.

The mill is currently operating at a rate of 60-65 tonnes per day but Inca One has ‘stress tested’ the facility to make sure the plant can effectively handle a 100 tonnes per day capacity. After testing the mill the throughput has been scaled down again until Inca One’s stockpile has reached the desired level that would allow the company to continuously operate at a rate of 100 tonnes per day.

New sources of ore

The company is also diversifying the sources of the ore it’s processing. Whereas all of the processed ore was purchased from small Peruvian mines, Inca One recently has successfully completed all the paperwork to import high grade ore from a Bolivian ore supplier. Several trucks have already discharged their ore at the Chala One plant and the Bolivian supplier is expected to send up to 1000 tonnes per month to Chala by the end of this year. As the average grade of the ore is approximately one ounce of gold per tonne of rock (and as we assume there will also be a relatively decent amount of silver in the ore) the ore definitely meets Inca One’s minimum requirements and we expect the Bolivian supplier to be a very welcome diversification.

Inca One still plans to be a 1,000 tonnes per day processor

When Inca One Gold made the switch from being just another exploration company in Peru to become a toll milling company, CEO Edward Kelly and his team were very ambitious. Even before the first plant was up and running, they made it very clear Inca One wouldn’t stop at one plant and the company would be aiming to become the leading toll processor in Peru.

Now the Chala One plant is gradually increasing the production rate towards the eyed 100 tonnes per day, Inca One has started to look for its second plant. The company obviously isn’t in a rush to complete a deal as it now can afford to wait for a ‘perfect fit’. Inca One’s management team has been looking at several plants inside Peru but hasn’t signed an agreement just yet. As said, there’s no pressure at all to do something as Inca One is still ramping up its Chala operations where it also already applied for a permit to increase the production rate to 200 tonnes per day.


Slow and steady wins the race and Inca One is gradually increasing its throughput rate and is more than halfway the planned throughput of 100 tonnes per day at Chala One. As an increasing amount of ore is being delivered to the plant, we expect Inca One to continue to increase the processing rate and we’re aiming to see Chala One hit its targeted production rate somewhere this summer.

This also means investors shouldn’t base their investment decisions on the financial results just yet, despite Inca One having achieved commercial production.

Disclosure: Inca One Gold is a sponsoring company. Please see our disclaimer for current positions.

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