SilverCrest Mines (CVE:SVL) (OTCQX:STVZF) Friday said its Santa Elena mine expansion remains on schedule, targeting a 100 per cent increase in metal production beginning in 2014.
The silver miner also said that it anticipates a resource update for
its La Joya exploration-stage property in Durango, Mexico by the fourth
quarter of 2012.
"We are certainly pleased as to how the various components of the
Santa Elena Expansion Plan to double our production and the exploration
of the La Joya project are progressing,” said president J. Scott Drever.
"Most importantly, as we anticipated, the work is being funded
largely from operational cash flow of approximately $2.5 million per
month leaving our treasury of $35 million intact for the larger capital
items associated with the mill facilities.
"This planned strategy insulates the company from the need to finance during the current market conditions."
In a project update, the company said that expansion activities for
its flagship Santa Elena mine in Mexico continue, with construction of a
proposed 3,000 tonne per day CCD processing plant scheduled to start in
the fourth quarter.
SilverCrest noted that detailed engineering for the entire facility
should be completed by the first quarter of 2013, with a target to begin
milling ore from the open pit by January 2014.
Underground decline work continues, and SilverCrest said it
anticipates an initial production rate of 1,000 tonnes per day starting
The company expects to finish leach pad expansion this month, but
said once the new processing plant is operational, use of the leach pads
will be discontinued.
SilverCrest anticipates that around 4 million tonnes of heap leached
material may be available for reprocessing once the processing plant is
constructed, and will address inventory and expansion in its upcoming
pre-feasibility study (PFS).
A shallow, 13-hole in-pit drill program to better define tonnages and
grade of the lower part of the planned open pit was completed in June,
yielding mineralization that showed up to 6.2 grams per tonne (g/t) gold
and 102.7 g/t silver over 16 metres.
SilverCrest said that at the Cruz de Mayo project, a component of the
Santa Elena expansion plan, work is ongoing to complete a PFS in the
third quarter. An additional six holes are to be drilled in July to
further delineate resources for conversion to reserves.
The 100-per-cent owned producing Santa Elena mine is located 150
kilometres northeast of Hermosillo, near Banamichi in the State of
Meanwhile at the company’s La Joya site, located in the Durango State
in Mexico, phase two core drilling with two rigs continues to expand
the known mineralized zones.
SilverCrest said that initial holes in this program have expanded
mineralization to the north and east, while more recent drilling has
tested favorable areas to the south and west.
To date, 40 of the 60 core holes planned for the phase two program
have been completed with an additional 20 reverse circulation holes to
be completed upon rig availability.
The company noted that assay results for the next 10 to 15 holes are expected to be released later this month.
A new resource estimate for the property is anticipated in the fourth
quarter, with a target to increase the current resource of over 100
million ounces of silver by 50 to 100 per cent, the company said.
Results to date from drilling at La Joya suggest that there is
significant mineralization containing tungsten, molybdenum, tin, lead
and zinc that may be by-products to the dominant silver-copper-gold
mineralization, SilverCrest said.
It plans to drill a number of the highest priority targets later this
year. To accommodate this, the company has expanded its land package at
La Joya to a total of 10,656 hectares.
SilverCrest Mines is a Mexican precious metals producer with headquarters based in Vancouver, BC.
In May, the miner reported a jump in the amount of silver and gold it
sold from its producing Santa Elena mine in Mexico. For the three
months that ended March 31, SilverCrest said cash flow from operations
reached $12.2 million, or $0.14 per share, on revenue of $19.6 million.
Net profit amounted to $6.3 million, up from a loss of $2.8 million a
year earlier, or a profit of 7 cents per share from a loss of 4 cents
in the first quarter of 2011.