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 in mid-2014.
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 (NYSE: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 Sonora, Mexico.
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.