TORONTO, Oct. 22, 2014 /CNW/ - U.S. Silver & Gold Inc.
(TSX: USA, OTCQX: USGIF) ("U.S.
Silver & Gold" or the "Company") today announced third quarter
production figures for its Galena Mine Complex in Idaho.
Highlights
- Production of approximately 358,000 silver ounces and 491,500
silver equivalent ounces[1] for the third quarter of 2014 at a
silver cash cost of $16.43 per ounce
and an all-in sustaining cost of $21.06 per ounce.
- Despite processing both lower tonnage and lower silver grades,
cash costs and all-in sustaining costs declined 7% and 9%
respectively compared with Q3 2013, and 15% and 22% year-over-year
as the Company continued aggressive cost cutting and transitioning
to higher silver equivalent ore.
- Lead production increased by 251% while silver and copper
production decreased by 23% and 56% when compared to Q3, 2013.
- The transition to predominately silver-lead ore production from
silver-copper was completed this quarter as processing of the
higher tonnage silver-lead ore was moved to the Galena Mill with
the Coeur Mill now handling silver-copper ore. The Coeur Mill was
unavailable during the changeover which limited silver-copper
production in the quarter.
- As a result of the milling downtime and quicker ramp-up of
silver-lead production, 2014 production guidance is reduced to 1.65
– 1.75 million silver ounces, with silver equivalent production
between 2.1 – 2.2 million ounces. Cost targets will be maintained
at $14.50 – $15.50 per ounce in cash costs and $18.00 – $19.00 per
ounce in all-in sustaining cash-costs.
- As of September 30, 2014, the
Company's cash balance totaled approximately $6.7 million.
The Company expects to release its third quarter financial
results on Tuesday, November 11,
2014.
"During the first nine months of the year, we were transitioning
to sustainable, multi-year lower-cost delivery of predominately
silver-lead ore," said Darren
Blasutti, President and CEO of U.S Silver & Gold. "In
July, we shifted silver-lead ore processing to our higher capacity
1,000 ton per day Galena Mill and over July and August we
transitioned lower volume silver-copper ore to our 500 ton per day
Coeur Mill. While this reduced mill availability for
silver-copper ore processing during the quarter, we expect normal
tonnages to be processed in the fourth quarter. This
transition also allowed for the completion of additional shaft
maintenance and development work which will benefit the Company in
the future. We expect the fourth quarter to have higher
silver production and lower costs than we saw in the third quarter.
With almost all the necessary infrastructure in place, we will be
in a position to access additional higher volume silver-lead stopes
in 2015 and beyond."
Galena Complex Third Quarter Production Details
The Galena Complex produced 357,669 ounces of silver during the
third quarter of 2014 at an average silver grade of 9.7 ounces per
ton and a cash cost of $16.43 per ounce of silver. Production
for the quarter was reduced while silver-lead processing was
shifted from the Coeur Mill to Galena Mill to more efficiently
manage the higher volume of silver-lead production. This move
is part of the Company's long-term strategy to mine the highest
value ore per ton regardless of silver content in order to maximize
operating profit. Given the expected mill downtime,
maintenance was performed on the Galena Shaft hoist during the
quarter which prevented skipping from the high-grade 5200 level for
the second half of the quarter, resulting in lower copper
grades and production. The work was completed in early
October and the shaft is fully operational.
As indicated in Table 1 below, despite drops in tonnage and
silver grade year-over-year, silver equivalent grade was maintained
due to the increase in silver-lead ore tons milled.
Silver-lead production offers overall higher silver
equivalent grades and lower mining costs as stopes are typically
wider and allow for a greater contribution from mechanized mining.
This and the continued focus on cost reductions continued to
impact the bottom line overall with cash costs falling 7% and
all-in sustaining costs down 9% when compared to 2013 despite lower
silver and silver equivalent production.
Table
1
Galena Complex
Production Highlights
|
|
Q3
2014
|
Q3
2013
|
Change
|
Q2
2014
|
Change
|
Total Processed
Ore (tons milled)
|
38,911
|
40,746
|
-5%
|
40,166
|
-3%
|
Silver-Lead
Ore (tons milled)
|
23,487
|
8,507
|
176%
|
18,469
|
27%
|
Silver-Copper
Ore (tons milled)
|
15,424
|
32,239
|
-52%
|
21,697
|
-29%
|
Silver
Production (ounces)
|
357,669
|
464,850
|
-23%
|
520,723
|
-31%
|
Silver Equivalent
Production (ounces)
|
491,490
|
529,860
|
-7%
|
649,928
|
-24%
|
Silver Grade
(ounces per ton)
|
9.72
|
11.84
|
-18%
|
13.49
|
-28%
|
Silver Equivalent
Grade (ounces per ton)
|
13.50
|
13.53
|
-1%
|
16.93
|
-20%
|
Lead
Production (pounds)
|
2,479,039
|
795,665
|
251%
|
2,040,198
|
22%
|
Copper
Production (pounds)
|
107,112
|
244,653
|
-56%
|
215,302
|
-50%
|
Cash Costs ($
per ounce silver)
|
$16.43
|
$17.67
|
-7%
|
$12.31
|
33%
|
All-in Sustaining
Costs ($ per ounce silver)
|
$21.06
|
$23.11
|
-9%
|
$15.36
|
37%
|
Quality Assurance / Quality Control ("QA/QC")
U.S.
Silver & Gold maintains a QA/QC Program for all assays,
including the use of standards, blanks and duplicates. All
QA/QC results are routinely evaluated using a program of QA/QC
monitoring. Details of the program are provided in the
Company's NI 43-101 compliant Technical Report on the Galena
Project dated March 22, 2013.
About U.S. Silver & Gold Inc.
U.S. Silver &
Gold is a silver and gold mining company focused on growth from its
existing asset base and execution of targeted accretive
acquisitions. It owns and operates the Galena Mine Complex in
the heart of the Silver
Valley/Coeur d'Alene Mining District, Shoshone County, Idaho which produces
high-grade silver and is the second most prolific silver mine in
U.S. history, delivering over 200 million ounces to date. The
Caladay Zone is being evaluated for bulk mining development.
U.S. Silver & Gold also owns the Drumlummon Mine Complex
in Lewis and Clark County,
Montana.
Mr. Daren Dell, Vice President,
Technical Services and a Qualified Person under Canadian Securities
Administrators guidelines, has approved the applicable contents of
this news release.
For further information please see SEDAR or
www.us-silver.com.
Cautionary Statement Regarding Forward Looking
Information:
This news release contains "forward‐looking information" within
the meaning of applicable securities laws. Forward‐looking
information includes, but is not limited to, the Company's
expectations intentions, plans, and beliefs with respect to, among
other things, the Galena Complex and the Drumlummon Mine. Often,
but not always, forward‐looking information can be identified by
forward‐looking words such as "anticipate", "believe", "expect",
"goal", "plan", "intend", "estimate", "may", and "will" or similar
words suggesting future outcomes, or other expectations, beliefs,
plans, objectives, assumptions, intentions, or statements about
future events or performance. Forward‐looking information is based
on the opinions and estimates of the Company as of the date such
information is provided and is subject to known and unknown risks,
uncertainties, and other factors that may cause the actual results,
level of activity, performance, or achievements of the Company to
be materially different from those expressed or implied by such
forward looking information. This includes the ability to develop
and operate the Galena and Drumlummon properties, risks associated
with the mining industry such as economic factors (including future
commodity prices, currency fluctuations and energy prices), failure
of plant, equipment, processes and transportation services to
operate as anticipated, environmental risks, government regulation,
actual results of current exploration activities, possible
variations in ore grade or recovery rates, permitting timelines,
capital expenditures, reclamation activities, social and political
developments and other risks of the mining industry. Although U.S.
Silver & Gold has attempted to identify important factors that
could cause actual results to differ materially from those
contained in forward‐looking information, there may be other
factors that cause results not to be as anticipated, estimated, or
intended. Readers are cautioned not to place undue reliance on such
information. By its nature, forward‐looking information involves
numerous assumptions, inherent risks and uncertainties, both
general and specific those contribute to the possibility that the
predictions, forecasts, and projections of various future events
will not occur. The Company undertakes no obligation to update
publicly or otherwise revise any forward‐looking information
whether as a result of new information, future events or other such
factors which affect this information, except as required by
law.
_________________________
1 Silver equivalent calculation is based on prices of
$20 per ounce silver, $0.95 per pound lead and $3.00 per pound copper.
SOURCE U.S. Silver & Gold Inc.