Better-than-expected output in the first quarter has prompted
During the first three months of the year, San Sebastian poured more than 765,000 oz. silver and 9,000 oz. gold. The mine is now expected to pump out 2.8 million oz. silver in 2002, a 40% increase over the previously estimated 2 million oz., while gold production is expected to climb 28% to 32,000 oz. Total cash costs at San Sebastian during 2002 are estimated at US$2 per oz. silver.
San Sebastian began producing last May, and by the end of 2001 the mine had poured 1 million oz. silver and 15,000 oz. gold.
“The mine has gone from being a startup operation to a significant cash-flow generator in less than a year,” says Hecla President Phillips Baker. “With little capital investment, Hecla has been able to develop a production plan that is expected to take this mine to the middle of 2005.”
At the end of 2001, reserves were estimated at 276,000 tonnes grading 967 grams silver and 10.3 grams gold per tonne.
Delineation drilling on the Francine vein has increased minable tonnes by about 50% and boosted silver and gold resource estimates by 21%. The company has also pinned down 14 additional veins on the surrounding Saladillo concession. About 6.4 km south of current operations, 33 shallow holes will be drilled.
Meanwhile, at the La Camorra underground mine in Venezuela, Hecla produced 40,000 oz. gold in 2001.
Underground drilling on the Main vein returned 2 metres grading 32.1 grams gold per tonne at a depth of about 560 metres, nearly 230 metres below current mining levels. A confirmation assay from an offset hole averaged 45.7 grams over 2 metres.
Earlier this year, a deep drill hole and a hole wedged off from it both cut the Betzy vein, the other near-vertical ore structure at La Camorra. The first hole ran 54 grams over 2 metres. The wedge from the first hole ran 115 grams gold over an identical width.
Mid-to-deep-level drilling on both the Main and Betzy veins will continue through to November.
Year-end reserves at La Camorra were 438,000 tonnes grading 29.7 grams gold per tonne. Additional resources on the Main and Betzy veins amounted to 126,000 tonnes averaging 27.1 grams per tonne.
Closer to home, the Lucky Friday mine in Idaho and the Greens Creek mine in Alaska are expected to contribute a combined 4.5 million oz. silver to Hecla’s account in 2002.
On an operations-wide basis, Hecla expects silver production to climb by 1 million oz., to about 7.5 million oz. during 2002. Cash costs are expected to ring in at US$3 per oz., more than US50 per oz. lower than in 2001.
After suffering a US$83.9-million loss on revenue of US$75.9 million (after US$40.2 million in writedowns) in 2000, Hecla managed to turn things around and post a 2001 profit of US$2.3 million on revenue of US$85.2 million.
Be the first to comment on "Hecla eyes higher San Sebastian production"