GREAT PANTHER SILVER LIMITED (TSX:GPR)(NYSE MKT:GPL) (the
"Company") today reports second quarter ("Q2") production at its
two wholly-owned Mexican silver mining operations, Guanajuato and
Topia.
Second Quarter 2013 Operations Highlights (Compared to Second
Quarter 2012)
-- Ore processed was up 28% to 67,569 tonnes;
-- Metal production increased 22% to a record 680,212 silver equivalent
ounces ("Ag eq oz"), at a 60:1 silver:gold ratio;
-- Silver production rose 6% to 396,730 silver ounces ("Ag oz");
-- Gold production increased 70% to a record 3,994 gold ounces ("Au oz");
and
-- Land Use Permit for San Ignacio was received.
"We are pleased to report both record total metal production and
gold production for the second quarter," stated Robert Archer,
President and CEO. "Both Guanajuato and Topia rebounded from low
grades in the first quarter of 2013 as a result of our ongoing
focus on grade control. As we continue to concentrate on improving
efficiencies at the operations, the current emphasis is on site
cost reductions and maintaining strong grade control, in light of
lower metal prices. Non-essential budget items have been cut, some
capital expenditures have been cut or deferred, and corporate
overheads have been lowered in order to conserve cash and maintain
our favorable working capital position. Directors and senior
management have participated in these cuts through voluntary salary
deferrals. Overall, these cuts will result in lower administrative,
exploration and corporate development expenditures in the second
half."
"Following the addition of a new Vice President, Operations and
Vice President, Safety, Health & Environment in the first
quarter, we welcome two new mine-site Safety Superintendents in Q2.
Our safety record has improved through the quarter, the Rayas Shaft
rehabilitation is nearing completion and we are proceeding with
improvements to the tailings dams at Guanajuato and Topia.
Preparations for the ramp development at San Ignacio are on track,
pending the approval of the Environmental Impact Assessment."
Despite an improvement in grades over the first quarter, we
caution that operating margins will remain weak for the second
quarter due primarily to the severe drop in silver and gold prices
over the quarter. In addition, the impact of improved grades will
not be substantially reflected in the margins and unit costs for
the quarter as most of the concentrate sales will reflect
production from the prior period at lower grades. This factor will
also impact reported cash costs for the period.
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Consolidated Q2
Operations Summary Q2 2013 Q2 2012 Change Q2 2013 Q1 2013 Change
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Ore processed
(tonnes milled) 67,569 52,956 28% 67,569 69,540 (3)%
Silver equivalent
ounce production
(1) 680,212 555,721 22% 680,212 607,501 12%
Silver ounce
production 396,730 374,723 6% 396,730 369,624 7%
Gold ounce
production 3,994 2,353 70% 3,994 3,144 27%
Lead production
(tonnes) 243 244 0% 243 286 (15)%
Zinc production
(tonnes) 411 351 17% 411 449 (8)%
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Total underground
development (m) 4,044 4,305 (6)% 4,044 4,123 (2)%
Underground diamond
drilling (m) 6,907 6,814 1% 6,907 7,540 (8)%
----------------------------------------------------------------------------
(1) Silver equivalent ounces for 2013 were established in
November 2012 using prices of US$28 per oz, US$1,680 per oz (60:1
ratio), US$0.85 per lb and US$0.85 per lb for silver, gold, lead
& zinc, respectively, and applied to the recovered metal
content of the concentrates that were produced by the two
operations. For consistency, these prices will be used for the
balance of 2013.
Guanajuato Mine Complex
For the second quarter, the Guanajuato operation processed
52,917 tonnes, up 29% compared to the same period in 2012, at ore
grades of 159 grams/tonne ("g/t") Ag and 2.47g/t Au. Metal
production included 236,454 Ag oz, and 3,841 Au oz, or 466,925 Ag
eq oz, which represented an increase of 30% over the same period in
2012. Plant metallurgical performance remained strong, with metal
recoveries of 87.2% for silver and 91.5% for gold.
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Guanajuato Q2
Operations Summary Q2 2013 Q2 2012 Change Q2 2013 Q1 2013 Change
----------------------------------------------------------------------------
Ore processed
(tonnes milled) 52,917 40,964 29% 52,917 52,545 1%
Silver equivalent
ounce production
(1) 466,925 359,063 30% 466,925 399,417 17%
Silver ounce
production 236,454 226,284 4% 236,454 222,906 6%
Gold ounce
production 3,841 2,213 74% 3,841 2,942 31%
Ag grade (g/t) 159 189 (16)% 159 148 8%
Au grade (g/t) 2.47 1.82 36% 2.47 1.93 28%
Ag recovery (%) 87.2% 91.1% (4)% 87.2% 89.0% (2)%
Au recovery (%) 91.5% 92.3% (1)% 91.5% 90.0% 2%
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Total underground
development (m) 1,790 1,682 6% 1,790 1,867 (4)%
Underground diamond
drilling (m) 6,426 6,223 3% 6,426 7,134 (10)%
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(1) Silver equivalent ounces for 2013 were established in
November 2012 using prices of US$28 per oz, US$1,680 per oz (60:1
ratio), US$0.85 per lb and US$0.85 per lb for silver, gold, lead
& zinc, respectively, and applied to the recovered metal
content of the concentrates that were produced by the two
operations. For consistency, these prices will be used for the
balance of 2013.
The lower levels of the Cata and Santa Margarita mines continued
to excel in terms of production and grades. Mining at Cata
demonstrated that the hanging wall veins merge with the main Veta
Madre at the 510 metre level, resulting in well mineralized
ore.
Gold grades increased significantly, with the most meaningful
impact coming from Santa Margarita. Silver grades recently started
to show notable improvements across all zones due to better grade
control.
Underground development at Guanajuato consisted of 1,790 metres,
up 6% compared to the same period in 2012. The development program
for the quarter was focused on preparing underground access-ways,
stopes for production, and defining new mineralized structures
indicated by exploration drilling results.
Exploration development at Cata was focused on defining the
continuity of the Veta Madre at the 525 metre level, resulting in
high grade intersections and expanding the known mineralized
resources.
The Santa Margarita main ramp reached the 510 metre level, from
which an exploration crosscut is being developed; aiming to further
define the ore structure's potential as indicated by exploration
drilling. In addition, exploratory development was completed at the
490 metre level to define the Santa Margarita vein and assist the
mining activities.
Exploration drilling was carried out using four underground
drill rigs, guiding the mining activities with more accurate
definitions of mineralized zones. For the quarter, diamond drilling
totaled 6,426 metres, up 3% compared to the same period in 2012.
Exploration drilling at deep Cata between the 525 and 540 metre
levels returned excellent results and demonstrated the potential
for the continuity of silver-gold mineralization to depth.
The development of the Guanajuatito main ramp was temporarily
suspended to put in place the development required to support an
exploration drilling program to upgrade the mineral resources
between the 245 and 390 metre levels. This program will commence
during the third quarter. The Guanajuatito Mine was connected
underground to all the other mines in the Guanajuato Mine Complex.
As a result, Guanajuatito ore production, which was previously
hauled to surface via the ramp and then by truck to the Cata plant,
is now being transported underground and up the Cata shaft, thereby
reducing haulage costs.
The Rayas shaft is undergoing a thorough rehabilitation to
improve safety and efficiency. The rehabilitation is expected to be
finalized by mid third quarter. Once completed, this investment is
expected to improve the transportation of personnel to their work
places and increase operational efficiencies by reducing
transportation times.
The Cata processing plant is being upgraded by installing a new
filter press that will maximize the rate of filtration and deliver
a dryer final concentrate. This will reduce concentrate loss and
electricity consumption. The new filter press installation is
expected to be completed by mid-third quarter. The Guanajuato
tailings dam is undergoing its 13th dyke lift to increase its
storage potential and is expected to be completed within the next
few weeks.
Topia Mine
For the second quarter, 14,652 tonnes were processed at Topia,
up 22% compared to the same period in 2012, at grades of 376g/t Ag,
0.57g/t Au, 1.79% lead ("Pb") and 3.05% zinc ("Zn"). Metal
production included 160,276 Ag oz, 153 Au oz, 243 Pb tonnes, and
411 Zn tonnes, or 213,287 Ag eq oz, which is 8% up over the same
period in 2012. Plant metallurgical performance was satisfactory
with metal recoveries of 90.6% for silver, 57.0% for gold, 92.5%
for lead, and 91.9% for zinc.
----------------------------------------------------------------------------
Topia Q2 Operations
Summary Q2 2013 Q2 2012 Change Q2 2013 Q1 2013 Change
----------------------------------------------------------------------------
Ore processed
(tonnes milled) 14,652 11,992 22% 14,652 16,995 (14)%
Silver equivalent
ounce production
(1) 213,287 196,658 8% 213,287 208,084 3%
Silver ounce
production 160,276 148,439 8% 160,276 146,718 9%
Gold ounce
production 153 140 9% 153 202 (24)%
Lead production
(tonnes) 243 244 0% 243 286 (15)%
Zinc production
(tonnes) 411 351 17% 411 449 (8)%
Ag grade (g/t) 376 424 (11)% 376 300 25%
Au grade (g/t) 0.57 0.56 2% 0.57 0.65 (12)%
Ag recovery (%) 90.6% 90.7% 0% 90.6% 89.0% 2%
Au recovery (%) 57.0% 64.3% (11)% 57.0% 57.0% 0%
----------------------------------------------------------------------------
Total underground
development (m) 2,254 2,623 (14)% 2,254 2,256 0%
Underground diamond
drilling (m) 481 591 (19)% 481 406 19%
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(1) Silver equivalent ounces for 2013 were established in
November 2012 using prices of US$28 per oz, US$1,680 per oz (60:1
ratio), US$0.85 per lb and US$0.85 per lb for silver, gold, lead
& zinc, respectively, and applied to the recovered metal
content of the concentrates that were produced by the two
operations. For consistency, these prices will be used for the
balance of 2013.
The majority of the metal production during the quarter was
obtained from the 1522 and Durangueno mines, followed closely by
the Argentina and El Rosario mines, which showed increased
production. Silver grades were lower than anticipated due to the
continuous narrow vein formations resulting in higher dilution.
However, a trend of increasing silver grades was noticed from month
to month during the quarter due to ongoing efforts towards
improving grade control.
Underground development at Topia consisted of 2,254 metres, down
14% compared to the same period in 2012. The development program
for the quarter was focused on deepening main ramps at the
Argentina and La Prieta mines to access new mineralized levels
indicated by exploration drilling results. In addition, development
was carried out to prepare sublevels, raises and stopes for
production. Development reached level 4 as planned at the Argentina
main ramp, whereas development of the La Prieta ramp was
temporarily suspended giving priority to preparatory work for
production.
Taking into account constantly changing metal prices, management
continues to conduct mine by mine reviews to determine the
profitability of individual mines at Topia, thereby determining
where to best concentrate the mining efforts and reduce costs. To
date, two of the fourteen mines have been temporarily shut down,
and supplemented with increased production at other more profitable
mines.
Improvements are being made to the Topia processing plant by the
installation of a cone crusher that will significantly increase the
crushing capacity at the plant and reduce maintenance and
electricity costs. In addition, a performance improvement analysis
is being undertaken in order to further optimize the mill and
flotation sections of the plant.
San Ignacio Project
The Company received approval of the Land Use permit earlier
than anticipated during the second quarter and submitted a revised
Environmental Impact Assessment which is expected to be approved by
the end of the third quarter.
A new mine plan is being compiled for San Ignacio incorporating
the latest geological resource model based on the known veins,
grade ranges and elevation for commencement of mining.
An infill and extension drilling campaign is anticipated to
begin in September at San Ignacio to better define the resource. In
addition, mine and earthwork contractors will be selected and the
installation of the water supply for the mine will be completed by
the end of the third quarter.
El Horcon
A surface drill program consisting of 24 drill holes for a total
of 2,156 metres was completed during the second quarter. The
program was laid out along 650 metres of strike length on the
Diamantillo vein and also tested various splays and nearby parallel
structures and veins.
Assay results have been received and are being compiled and
interpreted. A wireframe and 3D model are being constructed such
that the continuity of grade and vein widths can be determined. An
internal resource estimate and preliminary economic assessment will
be prepared in the third quarter.
Outlook
With first half production totaling 1,287,713 silver equivalent
ounces, the Company is on track to meet its guidance of 2.4 to 2.5
million silver equivalent ounces for fiscal 2013.
As precious metals prices dropped significantly in the second
quarter, the Company has heightened its focus on improving and
strengthening the operational efficiency of its operations. Cash
cost guidance is being reviewed and the Company will provide an
update in our second quarter earnings release, expected in early
August.
ABOUT GREAT PANTHER
Great Panther Silver Limited is a profitable, primary silver
mining and exploration company listed on the Toronto Stock Exchange
trading under the symbol GPR, and on the NYSE MKT trading under the
symbol GPL. The Company's current activities are focused on the
mining of precious metals from its two wholly-owned operating mines
in Mexico, Topia and Guanajuato. Great Panther is also in the
process of developing its San Ignacio Project and has two
exploration projects, El Horcon and Santa Rosa.
For further information, please visit the Company's website at
www.greatpanther.com.
This news release contains forward-looking statements within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 and forward-looking information within the meaning of
the Securities Act (Ontario) (together, "forward-looking
statements"). Such forward-looking statements may include but are
not limited to the Company's plans for production at its Guanajuato
and Topia Mines in Mexico, exploring its other properties in
Mexico, the overall economic potential of its properties, the
availability of adequate financing and involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements expressed or implied by such
forward-looking statements to be materially different. Such factors
include, among others, risks and uncertainties relating to
potential political risks involving the Company's operations in a
foreign jurisdiction, uncertainty of production and cost estimates
and the potential for unexpected costs and expenses, physical risks
inherent in mining operations, currency fluctuations, fluctuations
in the price of silver, gold and base metals, completion of
economic evaluations, changes in project parameters as plans
continue to be refined, the inability or failure to obtain adequate
financing on a timely basis, and other risks and uncertainties,
including those described in the Company's Annual Information Form
for the year ended December 31, 2012 and Material Change Reports
filed with the Canadian Securities Administrators available at
www.sedar.com, and reports on Form 40-F and Form 6-K filed with the
Securities and Exchange Commission and available at
www.sec.gov.
Contacts: Great Panther Silver Limited Robert Archer Chief
Executive Officer 1-888-355-1766 Great Panther Silver Limited
Rhonda Bennetto Vice President Corporate Communications
1-888-355-1766info@greatpanther.com www.greatpanther.com
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