TORONTO,
Oct. 22, 2013 /CNW/ - U.S. Silver
& Gold Inc. (TSX: USA, OTCQX:
USGIF) ("U.S. Silver & Gold" or the "Company") today announced
production figures for its Galena Mine Complex in Idaho.
Highlights
- Production for the quarter of 529,860 silver equivalent
ounces1 including 464,850 silver ounces which represents
a 15% decrease in silver production compared with Q3, 2012, and
production of 1.67 million ounces for the first 9 months of 2013,
an increase of 3% year-to-date.
- Cash costs of $17.67 per ounce
silver for the quarter and $18.16
year-to-date, which represent reductions of 13% over Q3, 2012 and
5% year-over-year.
- Average mill feed grade for the quarter rose 18% to 11.84
ounces per ton silver, comprising 36,359 tons grading 12.83 ounces
per ton silver from production areas and 7,676 tons of incremental
development muck grading 1.75 ounces per ton silver.
- Production from silver/copper areas adjacent to the Caladay
Zone commenced in the third quarter. Although installation
and commissioning of additional cooling capacity has impacted
mining activities in the area, consistent production rates are
expected to be achieved before year-end and the Company continues
to target a production rate of 100 tons per day.
- The previously announced Small Mine Plan2 was
implemented, reducing production, eliminating more than 100
positions and adding one-time severance costs. It will result in
lower cash and overall costs going forward and increase grade mined
to be profitable at current silver prices.
- Silver guidance for 2013 remains at 2.1 - 2.2 million ounces
with production at the Galena Complex during the second half of the
year on track to deliver 850,000 - 1,000,000 ounces at a cash cost
of $15.50 - $17.50 per ounce.
The Company expects to release its third quarter financial
results on Wednesday November 13,
2013.
"We made a strategic decision to implement the
Small Mine Plan early in the quarter knowing the elimination of
more than 100 positions would reduce production, create some
disruption and temporarily increase costs due to severance
payments," remarked Darren Blasutti,
President and CEO of U.S. Silver and Gold. "In light of this, I am
pleased with the quarterly results we achieved and would like to
thank Management and our employees for their effort and
commitment. We expect the fourth quarter to have lower cash
costs and expect to meet our full year production guidance. In
addition, we remain focused on doing what is necessary to keep
costs low and production profitable in order to protect our balance
sheet and position the Company well for an increase in silver
prices."
________________________________
1 Silver equivalent calculation is based on prices of
$22 per ounce gold, $0.90 per pound lead and $3.25 per pound copper.
2 Please see press release dated July 16, 2013.
Galena Complex Third Quarter Production Details
The Galena Complex produced 464,850 ounces of
silver during the third quarter of 2013 at a grade of 11.84 ounces
per ton and a silver cash cost of $17.67 per ounce. Overall tonnage and
production for the quarter decreased by 28% and 15% respectively;
however, this was expected due to staffing reductions following
implementation of a Small Mine Plan ("SMP"), which aimed to reduce
production and costs and increase grade to be profitable at current
silver prices. The decrease in tonnage was partially offset
by an 18% increase in average grade mined for the quarter. Cash
costs for Q3 2013 were significantly below costs during the third
quarter and the first nine months of 2012.
Table 1
Galena Production Highlights |
|
Q3 2013 |
Q3 2012 |
Change |
YTD 2013 |
YTD 2012 |
Change |
Processed Ore (tons milled) |
40,746 |
56,488 |
-28% |
162,157 |
170,999 |
-5% |
Production (ounces) |
464,850 |
544,104 |
-15% |
1,671,172 |
1,623,231 |
+3% |
Grade (ounces per ton)* |
11.84 |
10.03 |
+18% |
10.71 |
9.91 |
+8% |
Cash Costs ($ per ounce silver)** |
$ 17.67 |
$ 20.29 |
-13% |
$ 18.16 |
$ 19.17 |
-5% |
Lead (pounds) |
705,665 |
1,429,449 |
-51% |
5,114,010 |
3,860,542 |
+32% |
Copper (pounds) |
244,653 |
259,445 |
-6% |
774,663 |
729,750 |
+ 6% |
* Comprises 36,359 tons of production ore grading
13.06 ounces per ton silver and 7,676 tons of development material
grading 1.75 ounces per ton silver.
** During 2012, the Company changed its
presentation of cash costs to report under a payable ounces basis
to conform to presentation used by other comparable entities within
the silver mining industry. Previous disclosures have been
restated to conform with the amended presentation.
Small Mine Plan Update
A SMP was implemented during Q3 2013, reducing
fixed and variable costs as follows:
- The number of operating stopes was reduced from over twenty to
approximately fifteen;
- Staffing at the Galena Mine Complex was reduced from 351 to 240
and appropriate severance costs paid;
- The Coeur Shaft was put on care and maintenance;
- Levels 2800, 3000, 3200, 4300 and 5500 were put on care and
maintenance;
- Capital expenditures are limited to mine development activities
that directly support the SMP;
- Exploration is focused on increasing confidence of high-grade
resources adjacent to current mine infrastructure.
The Company's outlook for silver/lead ore
production was recently reviewed and based on anticipated operating
activity, a decision was made to periodically use the Coeur Mill to
process any high grade silver/lead ore on a campaign basis with
staff temporarily relocated from the Galena Mill.
Quality Assurance / Quality Control
("QA/QC")
U.S. Silver & Gold maintains a QA/QC Program
for all assays, whether completed at the Drumlummon laboratory or
at a contract laboratory including the use of standards, blanks and
duplicates. All QA/QC results are evaluated using a program of
QA/QC monitoring. Both the contract laboratory and the
Drumlummon laboratory maintain programs of QA/QC as well.
Assays for the Caladay Zone were prepared by a commercial
laboratory located in Osburn,
Idaho.
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 for the NI 43-101 compliant Technical Report on
the Galena Project dated March 22,
2013.
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 and 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.
SOURCE U.S. Silver & Gold Inc.