SilverCrest Mines Inc. (CVE:SVL) (NYSE:SVLC) reported a quarter of record production at its flagship Santa Elena mine Wednesday, with the high‐grade, epithermal silver and gold producer returning an increase in silver production of almost 40 per cent year-on-year and a 45 per cent spike in the number of silver ounces sold.
The Vancouver-headquartered precious metals miner also announced that it was upping its annual silver production guidance for the 100 per cent owned Mexican mine from 625,000 ounces to 675,000 ounces and reaffirmed the annual gold production guidance of 33,000 ounces for 2013.
Silver production for the quarter came in at a record 194,022 ounces, well up on the year-ago figure of 139,850 ounces, for an increment of 39 per cent. Gold production for the quarter was recorded as 7,463 ounces, down on the 8,584 ounces recorded the year before.
When calculated using the metric of silver equivalent ounces produced, the total for the quarter, 665,684 ounces, marked an increase of 3 per cent on the year ago figure of 646,553 ounces.
The total number of silver ounces sold came to 181,398, a 45 per cent spike on the figure of 124,739 recorded for the same time the year before, while the figure for gold ounces sold of 7,375 marked a 15 per cent drop from a year earlier, when 8,679 ounces were sold.
It sold 647,504 ounces silver equivalent ounces, higher than the year ago figure of 637,050.
In the statement released with the figures, the company's senior management spoke of the results adhering to plan with the expectation of an uptick in ounces produced to come in the second part of the year.
"We are pleased with production results for the second quarter which tracked well to budget," said chairman and CEO J. Scott Drever.
"For the first six months of 2013, silver production was 347,503 ounces (11 per cent above budget) and gold production was 14,688 ounces (11 per cent below budget). We are starting to mine the planned higher ore grades from open pit so anticipate increased ounces produced in the second half of 2013."
Drever also spoke of the need to keep costs down in light of a new low-price environment and reiterated the estimated life of mine cash cost predicted for Santa Elena of around $8 per ounce of silver equivalent.
"Management has responded to the recent sharp decline in metal prices by re-enforcing ongoing disciplined cost and capital reduction measures to maintain 2013 cash cost at or below US$8.50 per silver equivalent ounce enabling the company to complete all major capital expenditures associated with the Santa Elena Expansion."
The expansion itself is well underway, with 65 per cent of the budgeted 2013 capital cost of $65 million committed as of the end of June and roughly 2,000 metres of underground development completed. The expansion remains on time and budget, with the on-site construction of the 3,000 tonne per day mill on track to meet the forecast start date of January 2014. When completed, the company said the mill facility will significantly increase metals production at the high‐grade, epithermal silver and gold mine, both open pit and underground.
In addition, all drilling required to define and expand resources and reserves has been completed, with the Santa Elena expansion pre-feasibility study to be filed this month.
Shares in SilverCrest were up 4 cents on the TSX the day before the announcement, closing at $1.72 on Tuesday.
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