SilverCrest Mines (TSE:SVL) (NYSE MKT:SVLC) has posted record production of 2.81 million silver equivalent ounces for 2014 and is predicting sharply higher output this year on the back of the new 3,000 tonne per day mill at its Santa Elena mine in Mexico.
The company said 2014 production of 2.81 million ounces is six percent higher compared to 2013, with pure silver production jumping 49 percent to 1.16 millon ounces. Gold output, meanwhile, declined 11 percent to 27,609 ounces last year.
In the fourth quarter, total metal production climbed 18 percent to a record 936,472 ounces as silver output soared 74 percent.
The precious metals miner last year transitioned its Santa Elena mine from an open pit heap leach operation to an underground mine and mill, but encountered some hiccups along the way. The new 3,000 tpd mill was commissioned last August, generating 526,525 tonnes during 7 months of production.
The company said the expectation this year is that higher grade underground and open pit ore will be about 60 to 70 percent of the mill feed versus the lower grade leach pad ore. Mill recovery rates are still being optimized, it added, targeting 70 percent for silver and 92 for gold in 2015.
SilverCrest is projecting production of 4 to 4.4 million ounces of silver equivalent this year, with pure silver output alone expected to range between 1.6 to 1.8 million ounces. Cash operating costs are estimated in the range of $10 to $11 per ounce sold, while all-in costs are expected between $14 to $15 an ounce.
"SilverCrest achieved 93% of its 2014 metal production guidance in spite of the early closure of the open pit and short-term delays relating to the first underground stope," said president and COO N. Eric Fier.
"As of today, we have temporarily reopened the pit to provide approximately 6 months of low cost production. Our current operational focus is to improve underground stope production and continue to optimize the mill to ensure throughput tonnages at or above the nameplate capacity of 3,000 tonnes per day and increase metallurgical recoveries to our budget rates."
Fier also said the company is continuing to implement stringent cost controls to ensure positive operating and all-in sustaining cash flow is generated at current metal prices.
SilverCrest is planning to release its annual financials after market close on March 11.