Trevali Mining Corporation
(“
Trevali” or the “
Company”)
(TSX:TV) (OTCQX:TREVF) (Frankfurt:4TI) reports preliminary
consolidated second quarter 2018 (“
Q2-2018”)
production of 103.9 million payable pounds of zinc, 10.5 million
payable pounds of lead and 337,801 payable ounces of silver (Table
1). The Company remains firmly on track with its 2018 consolidated
annual production guidance of 400-427 million payable pounds of
zinc.
Q2 Highlights:
- On track with 2018 annual zinc production guidance of 400-427
million payable pounds
- Preliminary consolidated operating costs of US$58 per
tonne
- Operating costs within or below guidance at all operations; on
track with 2018 consolidated operating cost guidance of US$60-$66
per tonne
- Continued strong performance at Perkoa
- Santander back at normal capacity following mill maintenance in
the first quarter
- Caribou improved performance following winter seasonal effect
in the first quarter
- Normal concentrate shipping schedules realized at all
operations
Table 1: Preliminary Consolidated Q2-2018
Production |
|
Q1-2018 |
Q2-2018 |
YTD-2018 |
Tonnes Mined |
790,215 |
807,166 |
1,597,381 |
Tonnes Milled |
743,935 |
820,214 |
1,564,149 |
Concentrate Produced (dry metric tonnes): |
|
|
|
Zinc |
107,906 |
117,452 |
225,357 |
Lead |
14,933 |
13,308 |
28,241 |
Payable Production: |
|
|
|
Zinc (lbs)Zinc (tonnes) |
98,738,94444,800 |
103,891,60947,138 |
202,630,55291,938 |
Lead (lbs)Lead (tonnes) |
12,296,5555,579 |
10,531,4204,778 |
22,827,97410,358 |
Silver (ozs) |
336,927 |
337,801 |
669,377 |
“As per plan, we saw increased zinc production
in the second quarter and the Company remains on track to achieve
annual production and cost guidance,” stated Dr. Mark Cruise,
Trevali’s President and CEO. “The overall improvements, versus the
first quarter, reflect continued strong performance at Perkoa, a
return to normal capacity at Santander and decreasing seasonal
effects at Caribou. Unfortunately, Rosh Pinah had a challenging
quarter, however we anticipate significant improvement in the
second half of the year as we focus on optimizing operations,
specifically underground mining efficiency and productivity.”
Perkoa Mine, Burkina
FasoPreliminary Q2-2018 production was 46.2 million pounds
(20,940 tonnes) of payable zinc with an average zinc recovery of
93% (Table 2). Mine output and mill throughput for the quarter were
182,551 tonnes and 176,027 tonnes of ore, respectively. Given the
strong performance over the first half of 2018, the Company is
increasing 2018 zinc production guidance by 9 million pounds (4,080
tonnes) to 164-174 million payable pounds (74,400-78,950
tonnes).
Table 2: Perkoa Preliminary Q2-2018
Production
|
Q1-2018 |
Q2-2018 |
YTD-2018 |
Tonnes Mined |
192,158 |
182,551 |
374,709 |
Tonnes Milled |
179,940 |
176,027 |
355,967 |
Average Head Grades: |
|
|
|
Zinc (%) |
14.49% |
15.20% |
14.84% |
Average Recoveries (%): |
|
|
|
Zinc |
94.4% |
93.1% |
93.7% |
Concentrate Produced (dry metric tonnes): |
|
|
|
Zinc |
47,413 |
49,696 |
97,109 |
Payable Production: |
|
|
|
Zinc (lbs) |
45,874,974 |
46,151,647 |
92,026,621 |
Zinc (tonnes) |
20,814 |
20,940 |
41,754 |
Rosh Pinah Mine,
NamibiaPreliminary Q2-2018 production was 20.8 million
pounds (9,449 tonnes) of payable zinc, 2.1 million pounds (974
tonnes) of payable lead and 28,388 ounces of payable silver (Table
3). Mine output and mill throughput for the quarter was 159,797
tonnes and 173,082 tonnes, respectively.
Performance for the quarter was below
expectation; specifically, mine production did not achieve targeted
levels due to non-optimal operational practices. Consequently, 2018
production guidance has been reduced by 10 million pounds (4,540
tonnes) to 95-105 million payable pounds (43,100-47,640 tonnes) of
zinc. The Company is actively addressing this issue and continues
to onboard key skills, advance workforce training, provide
operational support and implement compliance tracking.
Table 3: Rosh Pinah Preliminary Q2-2018
Production
|
Q1-2018 |
Q2-2018 |
YTD-2018 |
Tonnes Mined |
172,334 |
159,797 |
332,131 |
Tonnes Milled |
177,837 |
173,082 |
350,919 |
Average Head Grades: |
|
|
|
Zinc (%) |
7.92% |
7.69% |
7.81% |
Lead (%) |
1.40% |
1.07% |
1.24% |
Silver (ozs/ton) |
0.58% |
0.29% |
0.41% |
Average Recoveries (%): |
|
|
|
Zinc |
88% |
86% |
87% |
Lead |
77% |
58% |
67% |
Silver |
51% |
60% |
56% |
Concentrate Produced (dry metric tonnes): |
|
|
|
Zinc |
25,175 |
25,540 |
50,715 |
Lead |
4,268 |
3,017 |
7,285 |
Payable Production: |
|
|
|
Zinc (lbs)Zinc (tonnes) |
22,831,57510,359 |
20,825,3329,449 |
43,656,90719,808 |
Lead (lbs)Lead (tonnes) |
3,925,0121,781 |
2,146,675974 |
6,071,6872,755 |
Silver (ozs) |
50,794 |
28,388 |
73,831 |
Caribou Mine, CanadaPreliminary
Q2-2018 production was 20.5 million pounds (9,315 tonnes) of
payable zinc, 6.5 million pounds (2,937 tonnes) of payable lead and
178,753 ounces of payable silver (Table 4). Mine production for the
quarter was 266,500 tonnes, an operational record, and mill
throughput was 247,222 tonnes. As expected, the winter impacts
experienced in the first quarter decreased in the second quarter,
which positively impacted zinc recoveries.
Table 4: Caribou Preliminary Q2-2018
Production
|
Q1-2018 |
Q2-2018 |
YTD-2018 |
Tonnes Mined |
238,650 |
266,500 |
505,150 |
Tonnes Milled |
235,531 |
247,222 |
482,753 |
Average Head Grades: |
|
|
|
Zinc (%) |
5.94% |
5.92% |
5.93% |
Lead (%) |
2.43% |
2.16% |
2.29% |
Silver (ozs/ton) |
2.14 |
1.96 |
2.04 |
Average Recoveries (%): |
|
|
|
Zinc |
75% |
76% |
76% |
Lead |
62% |
60% |
61% |
Silver |
41% |
35% |
38% |
Concentrate Produced (dry metric tonnes): |
|
|
|
Zinc |
22,769 |
23,394 |
46,163 |
Lead |
9,556 |
8,400 |
17,956 |
Payable Production: |
|
|
|
Zinc (lbs)Zinc (tonnes) |
19,079,1238,657 |
20,530,3959,315 |
39,609,51717,972 |
Lead (lbs)Lead (tonnes) |
7,200,9553,267 |
6,473,1362,937 |
13,674,0906,204 |
Silver (ozs) |
216,087 |
178,753 |
394,840 |
Santander Mine, PeruPreliminary
Q2-2018 production was 16.4 million pounds (7,434 tonnes) of
payable zinc, 1.9 million pounds (867 tonnes) of payable lead and
130,659 ounces of payable silver (Table 5). Recoveries averaged 89%
for zinc, 79% for lead and 61% for silver.
The mill maintenance was completed prior to the
beginning of the second quarter, resulting in mill throughput of
223,884 tonnes (an operational record) and mine output of 198,318
tonnes for the quarter.
The Santander mill is now operating at
approximately 2,500 tonnes-per-day, which is above design capacity,
and as such the Company is increasing 2018 zinc production guidance
by 1 million pounds (500 tonnes) to 55-58 million payable pounds
(24,950-26,320 tonnes).
Table 5: Santander Preliminary Q2-2018
Production
|
Q1-2018 |
Q2-2018 |
YTD-2018 |
Tonnes Mined |
187,073 |
198,318 |
385,391 |
Tonnes Milled |
150,627 |
223,884 |
374,511 |
Average Head Grades: |
|
|
|
Zinc (%) |
4.46% |
4.47% |
4.46% |
Lead (%) |
0.48% |
0.52% |
0.50% |
Silver (ozs/ton) |
0.77 |
0.91 |
0.85 |
Average Recoveries (%): |
|
|
|
Zinc |
89% |
89% |
89% |
Lead |
79% |
79% |
78% |
Silver |
58% |
61% |
60% |
Concentrate Produced (dry metric tonnes): |
|
|
|
Zinc |
12,549 |
18,822 |
31,371 |
Lead |
1,109 |
1,891 |
3,000 |
Payable Production: |
|
|
|
Zinc (lbs)Zinc (tonnes) |
10,953,2724,970 |
16,384,2357,434 |
27,337,50712,404 |
Lead (lbs)Lead (tonnes) |
1,170,588531 |
1,911,609867 |
3,082,1971,398 |
Silver (ozs) |
70,046 |
130,659 |
200,706 |
Q2-2018 PRELIMINARY OPERATING COSTS AND ANNUAL COST
GUIDANCE (1, 2, 3)
Table 6: Q2-2018 Preliminary Operating
Costs and Annual Cost Guidance (US$ per tonne)
Mine |
2018 AnnualOperating Cost Guidance |
Q1-2018Operating Costs |
Q2-2018PreliminaryOperating Costs |
YTD-2018PreliminaryOperating Costs |
Perkoa (100%) |
$103-$113 |
$112 |
$87 |
$100 |
Rosh Pinah (100%) |
$49-$54 |
$54 |
$47 |
$51 |
Caribou |
$55-$61 |
$64 |
$60 |
$62 |
Santander |
$38-$42 |
$65 |
$40 |
$50 |
Total |
$60-$66 |
$73 |
$58 |
$65 |
(1) Constitutes forward-looking information; see “Cautionary
Note Regarding Forward-Looking Statements”.(2) Trevali’s ownership
interest is 90% of Perkoa and 90% of Rosh Pinah.(3) Costs are
preliminary and subject to adjustment.
2018 CONSOLIDATED PRODUCTION
GUIDANCEProduction guidance for the year remains unchanged
at between 400 and 427 million pounds (181,500-193,700 tonnes) of
payable zinc, 43.8 and 46.0 million pounds (19,900-20,900 tonnes)
of payable lead and 1.40 and 1.47 million ounces of payable silver
(Table 7).
The Company is increasing its zinc production
guidance at Perkoa and Santander by an aggregate of 10 million
pounds (4,540 tonnes) of payable zinc, which offsets the lower zinc
production guidance at Rosh Pinah of 10 million pounds (4,540
tonnes). There will be moderate fluctuations on a
quarter-to-quarter basis due to normal-course mine scheduling
(Figure 1).
Table 7: 2018 Consolidated Production
Guidance (1&2)
Mine |
2018 Zinc Production |
2018 Lead Production |
2018 Silver Production |
Perkoa (100%) |
164-174 million lbs74,400-78,950 tonnes |
N/A |
N/A |
Rosh Pinah (100%) |
95-105 million lbs43,100-47,650 tonnes |
5.7-6.0 million lbs2,600-2,700 tonnes |
123-129 k ozs |
Caribou |
86-90 million lbs39,000-40,850 tonnes |
27.1-28.4 million lbs12,300-12,900 tonnes |
627-658 k ozs |
Santander |
55-58 million lbs24,950-26,300 tonnes |
11.0-11.6 million lbs5,000-5,300 tonnes |
654-687 k ozs |
Total |
400-427 million lbs181,500-193,700
tonnes |
43.8-46.0 million lbs19,900-20,900
tonnes |
1,400-1,474 k ozs |
(1) Constitutes forward-looking information; see
“Cautionary Note Regarding Forward-Looking Statements”. (2)
Trevali’s ownership interest is 90% of Perkoa and 90% of Rosh
Pinah.
CONCENTRATE SHIPPING AND
SALESNormal shipping schedules were realized at all
operations in the second quarter and there were no material
inventory backlogs that affected concentrate sales.
STRENGTHENED MANAGEMENT
TEAMTrevali has added two new key management
positions:
Vice President, General Counsel and
Corporate SecretarySteven Molnar has joined Trevali as
Vice President, General Counsel and Corporate Secretary. He joins
the Company from McCarthy Tétrault LLP, where he practiced
corporate and securities law with a focus on the mining industry.
He brings extensive experience in corporate governance and
continuous disclosure requirements, public and private mergers and
acquisitions and capital markets transactions, and joint ventures
and other commercial arrangements in the mining industry. Steve
will be overseeing all legal aspects at Trevali, providing advice
on strategic direction, planned initiatives, operations and
corporate governance and regulatory compliance.
Vice President, Mineral Resource
ManagementYan Bourassa has joined Trevali as Vice
President, Mineral Resource Management. He joins the Company with
extensive experience in resource estimation / disclosure and has a
solid background in operations and exploration. Yan will be
overseeing the development and maintenance of the individual
resource and reserve models for all Trevali mining assets combined
with the management of all in-mine conversion drilling, drill data
management, and sampling QA/QC. He will also be developing
frameworks for mineral resource management, supervising and
training geologists and providing technical guidance to Senior
Management team as part of due diligence processes.
Additionally, Trevali has implemented
operation-level changes to reinforce ongoing improvement and
optimization initiatives at all operations.
Qualified Person and Quality
Control/Quality AssuranceEurGeol Dr. Mark D. Cruise,
Trevali's President and CEO, is a qualified person as defined by NI
43-101, has supervised the preparation of, and has verified the
scientific and technical information that forms the basis for this
news release. Dr. Cruise is not independent of the Company as he is
an officer, director and shareholder.
ABOUT TREVALI MINING
CORPORATIONTrevali is a zinc-focused, base metals company
with four mines: the wholly-owned Santander mine in Peru, the
wholly-owned Caribou mine in the Bathurst Mining Camp of northern
New Brunswick, its 90% owned Rosh Pinah mine in Namibia and its 90%
owned Perkoa mine in Burkina Faso.
The shares of Trevali are listed on the TSX
(symbol TV), the OTCQX (symbol TREVF), the Lima Stock Exchange
(symbol TV), and the Frankfurt Exchange (symbol 4TI). For further
details on Trevali, readers are referred to the Company’s website
(www.trevali.com) and to Canadian regulatory filings on SEDAR at
www.sedar.com.
On Behalf of the Board of Directors ofTREVALI MINING
CORPORATION“Mark D. Cruise” (signed)Mark D. Cruise,
President
Contact Information:Steve Stakiw, Vice
President - Investor Relations and Corporate CommunicationsEmail:
sstakiw@trevali.com Phone: (604) 488-1661 / Direct: (604)
638-5623
Cautionary Note Regarding
Forward-Looking StatementsThis news release contains
“forward-looking information” within the meaning of the Canadian
securities legislation and “forward-looking statements” within the
meaning of Section 27A of the United States Securities Act of 1933,
as amended, Section 21E of the United States Exchange Act of 1934,
as amended, the United States Private Securities Litigation Reform
Act of 1995, or in releases made by the United States Securities
and Exchange Commission, all as may be amended from time.
Statements containing forward-looking information express, as at
the date of this news release, the Company’s plans, estimates,
forecasts, projections, expectations, or beliefs as to future
events or results. Such forward-looking statements and information
include, but are not limited to statements as to: the timing and
amount of estimated future production; the estimation of mineral
resources and mineral reserves; costs and timing of development;
operating efficiencies, including the ability to manage water while
reducing power consumption, costs and expenditures; expectations
regarding milling operations and metal production shortfalls; metal
output and throughput rates; cost guidance and anticipated annual
results; anticipated results of future exploration; and forecast
future metal prices.
These statements reflect the Company’s current
views with respect to future events and are necessarily based upon
a number of assumptions and estimates that, while considered
reasonable by the Company, are inherently subject to significant
business, economic, competitive, political and social uncertainties
and contingencies. If any assumptions are untrue, it could cause
actual results, performance or achievements to be materially
different from future results, performance or achievements
expressed or implied by such statements. Assumptions have been made
regarding, among other things, present and future business
strategies and the environment in which the Company will operate in
the future, including commodity prices, anticipated costs and
ability to achieve goals.
Forward-looking statements are subject to known
and unknown risks, uncertainties and other important factors that
may cause the Company’s actual results, level of activity,
performance or achievements to be materially different from those
expressed or implied by such forward-looking statements, including
but not limited to: risks related to joint venture operations;
fluctuations in spot and forward markets for silver, zinc, base
metals and certain other commodities (such as natural gas, fuel oil
and electricity); fluctuations in currency markets; risks related
to the technological and operational nature of the Company’s
business; changes in national and local government, legislation,
taxation, controls or regulations and political or economic
developments in Canada, the United States, Peru, Namibia, Burkina
Faso, or other countries where the Company may carry on business in
the future; risks and hazards associated with the business of
mineral exploration, development and mining (including
environmental hazards, industrial accidents, unusual or unexpected
geological or structural formations, pressures, cave-ins and
flooding); risks relating to the credit worthiness or financial
condition of suppliers, refiners and other parties with whom the
Company does business; inadequate insurance, or inability to obtain
insurance, to cover these risks and hazards; employee relations;
relationships with and claims by local communities and indigenous
populations; availability and increasing costs associated with
mining inputs and labour; the speculative nature of mineral
exploration and development, including the risks of obtaining
necessary licenses and permits and the presence of laws and
regulations that may impose restrictions on mining; diminishing
quantities or grades of Mineral Resources as properties are mined;
global financial conditions; business opportunities that may be
presented to, or pursued by, the Company; the Company’s ability to
complete and successfully integrate acquisitions and to mitigate
other business combination risks; challenges to, or difficulty in
maintaining, the Company’s title to properties and continued
ownership thereof; the actual results of current exploration
activities, conclusions of economic evaluations, and changes in
project parameters to deal with unanticipated economic or other
factors; increased competition in the mining industry for
properties, equipment, qualified personnel, and their costs, as
well as other risks as more fully described in the Company’s annual
information form for the year ended December 31, 2017, which is
available on the Company’s website (www.trevali.com) and filed
under our profile on SEDAR (www.sedar.com). Investors are cautioned
against attributing undue certainty or reliance on forward-looking
statements. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially, there may be other factors that cause results not to be
as anticipated, estimated, described or intended. The Company does
not intend, and does not assume any obligation, to update these
forward-looking statements or information to reflect changes in
assumptions or changes in circumstances or any other events
affecting such statements or information, other than as required by
applicable law.
Note to United States
Investors
In accordance with applicable Canadian
securities regulatory requirements, all mineral resource estimates
of the Company disclosed or incorporated by reference in this news
release have been prepared in accordance with Canadian National
Instrument 43-101 - Standards of Disclosure for Mineral Projects,
classified in accordance with Canadian Institute of Mining
Metallurgy and Petroleum's “CIM Standards on Mineral Resources and
Reserves Definitions and Guidelines”.
The Company uses the terms "measured mineral
resources", "indicated mineral resources" and "inferred mineral
resources". While these terms are recognized by Canadian securities
regulatory authorities, they are not recognized by the United
States Securities and Exchange Commission. US investors are
cautioned not to assume that any part or all of the material in
these categories will ever be converted into reserves.
A photo accompanying this announcement is available at
http://www.globenewswire.com/NewsRoom/AttachmentNg/9055296f-a55b-49c2-bd7d-610806906aab
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