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.
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%
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 $17.67 per ounce. Overall tonnage and production for the quarter decreased by
28% and 15% respectively; however, this was expected due to staffing
reductions following implementation of a Small Mine Plan ("SMP"), which
aimed to reduce production and costs and increase grade to be
profitable at current silver prices. The decrease in tonnage was
partially offset by an 18% increase in average grade mined for the
quarter. Cash costs for Q3 2013 were significantly below costs during
the third quarter and the first nine months of 2012.
Galena Production Highlights
Processed Ore (tons milled)
Grade (ounces per ton)*
Cash Costs ($ per ounce silver)**
* 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
** 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
Small Mine Plan Update
A SMP was implemented during Q3 2013, reducing fixed and variable costs
The number of operating stopes was reduced from over twenty to
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.
For further information:
President and CEO