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Silver Standard Resources Inc. (NASDAQ: SSRI) (TSX: SSO) ("Silver Standard") provides its second quarter 2016 operational results.
Operating Highlights:
-- Expanded gold production profile demonstrates scale: Produced 97,790 gold equivalent ounces during the second quarter (1). This includes gold production at the Seabee Gold Operation prior to our acquisition.
-- Gold production on track to meet guidance at Marigold: Produced 47,195 ounces of gold during the second quarter of 2016.
-- Increased ore tonnes to leach pads at Marigold: Stacked ore increased to 6.7 million tonnes containing approximately 67,000 recoverable ounces loaded to the leach pads as mining benefited from three additional haul trucks that commenced operating early in the second quarter.
-- Gold production on track at the Seabee Gold Operation: Produced 17,524 ounces of gold in the second quarter, with 6,721 ounces produced from date of acquisition on May 31 to June 30, 2016, well positioned to meet the upper end of previously reported production guidance.
-- Continued strong production at Pirquitas: Produced 2.5 million ounces of silver, well on track to meet production guidance
-- Enhanced mine fundamentals at Pirquitas: Achieved record quarterly milling rate of 4,668 tonnes per day in the second quarter as a result of our ongoing Operational Excellence program.
Paul Benson, President and CEO said, "In the second quarter we completed the acquisition of Claude Resources, adding the Seabee Gold Operation to our portfolio in a robust precious metals environment and establishing Silver Standard as a high-quality intermediate precious metals producer. At Seabee, we are focused on successful integration and working with the team to identify operational excellence and growth opportunities at the mine."
"During the quarter all three operations delivered consistent production results and remain well-positioned to achieve full year production guidance. With three cash-flowing mines, a strong balance sheet and an experienced operating team, we continue to pursue our goal of creating value for shareholders through operational excellence and disciplined growth."
Marigold mine, U.S.
Q2 2016 Q1 2016 % Change 1
Total material mined kt 18,685 17,291 8.1%
Waste removed kt 12,005 11,611 3.4%
Ore to leach pad kt 6,680 5,680 17.6%
Strip ratio w/o 1.8 2.0 (10.0%)
Gold grade to leach pad g/t 0.44 0.47 (6.4%)
Gold recovery % 71% 70% 1.4%
Gold produced oz 47,195 50,520 (6.6%)
Gold sold oz 47,124 48,605 (3.0%)
1. Percent changes are calculated using rounded numbers presented in the table.
The Marigold mine produced 47,195 ounces of gold in the second quarter of 2016, on target to meet previously increased guidance. Second quarter production was lower than in the first quarter due to planned ore stacking at higher elevations on the leach pads with irrigation of these areas starting later in the quarter. We expect third and fourth quarter production to increase, relative to the first half of 2016, as the new leach pad is commissioned and the full impact of the additional trucks is realized. We recognized sales of 47,124 ounces of gold in the second quarter of 2016.
Three additional 300-tonne class haul trucks commenced operating ahead of schedule early in the second quarter. A total of 18.7 million tonnes was mined during the quarter, higher than the first quarter of 2016 due to the additional hauling capacity and the start of stripping the next phase of the Mackay pit. Approximately 6.7 million tonnes of ore were delivered to the leach pads at a gold grade of 0.44 g/t, containing approximately 67,000 recoverable ounces of gold stacked during the quarter. The strip ratio declined to 1.8:1 in the second quarter, a 10% reduction compared to the previous quarter, and ore tonnes reconciliation continued to be positive. Gold recovery was 71% in the second quarter, slightly higher than the first quarter of 2016. In the second quarter a premature failure of the swing bearing on one of our two hydraulic shovels occurred, which impacted total material mined. By quarter-end this repair work was completed and the shovel was operating normally. Total material mined is expected to further increase in the third quarter as the additional haul trucks ramp up to full capacity.
The construction of the new leach pad, budgeted for 2016, is on schedule to be completed by the end of the third quarter and is anticipated to benefit production later in the year.
Seabee Gold Operation, Canada
Period from Acquisition Q2 2016 2 Q1 2016 3 % Change 4
to June 30, 2016 1
Total ore milled t 18,856 71,218 74,179 (4.0%)
Ore milled per day t/day 629 783 815 (3.9%)
Gold mill feed grade g/t 7.79 7.97 8.99 (11.3%)
Gold recovery % 96.6% 96.8% 96.5% 0.3%
Gold produced 5 oz 6,721 17,524 20,264 (13.5%)
Gold sold oz 11,306 16,305 21,030 (22.5%)
1. The data presented in this column is for the period from and after May 31, 2016, the effective date of our acquisition of Claude Resources Inc. ("Claude Resources"), to and including June 30, 2016.
2. The data presented in this column is for the period from April 1, 2016 to June 30, 2016 and includes operating results for the Seabee Gold Operation for the period from April 1 to May 30, 2016 prior to our acquisition.
3. First quarter 2016 data is presented as reported by Claude Resources in its Q1 2016 Management's Discussion and Analysis for the three months ended March 31, 2016.
4. Percent changes are calculated using rounded numbers presented for Q1 2016 and Q2 2016 in the table.
5. Gold produced is defined as gold poured in each period. Gold produced in the first quarter of 2016 is gold ounces poured during this period, compared to gold ounces produced as reported by Claude Resources.
The Seabee Gold Operation consists of the Seabee and Santoy underground mines, both of which feed a single processing facility. The operation produced 6,721 ounces of gold from May 31, 2016, the date of our acquisition, to the end of the second quarter of 2016 (the "Period"). We recognized sales of 11,306 ounces of gold for the Period.
A total of 18,856 tonnes of ore were milled at a gold grade of 7.79 g/t during the Period. Mill throughput per day for the Period was 629 tonnes per day, while mill throughput per operating day during the Period averaged 820 tonnes per day. The total tonnes milled for the Period were impacted by an unplanned power outage which lasted a total of ten days. Seven days impacted tonnes milled in the second quarter and three days impacted tonnage in the third quarter of 2016. Seabee is on track to meet the upper end of annual production guidance as disclosed by Claude Resources in its news release dated May 5, 2016. The ore tonnes reconciliation in the Period was positive and gold recovery was 96.6%.
Pirquitas mine, Argentina
Q2 2016 Q1 2016 % Change 1
Total material mined kt 2,543 2,520 0.9%
Waste removed kt 1,814 1,726 5.1%
Ore mined kt 729 794 (8.2%)
Strip ratio w/o 2.5 2.2 13.6%
Silver mined grade g/t 189 181 4.4%
Zinc mined grade % 0.19% 0.37% (48.6%)
Ore milled kt 425 418 1.7%
Silver mill feed grade g/t 238 247 (3.6%)
Zinc mill feed grade % 0.21% 0.44% (52.3%)
Silver recovery % 77.6% 79.7% (2.6%)
Zinc recovery 2 % - 24.1% (100.0%)
Silver produced '000 oz 2,526 2,639 (4.3%)
Zinc produced 2 '000 lb - 381 (100.0%)
Silver sold '000 oz 2,594 3,223 (19.5%)
Zinc sold 2 '000 lb 798 - 100%
1. Percent changes are calculated using rounded numbers presented in the table.
2. Data for zinc production and sales relate only to zinc in zinc concentrate as any zinc metal within our silver concentrate does not generate revenue.
The Pirquitas mine produced 2.5 million ounces of silver during the second quarter of 2016, lower than production in the first quarter of 2016, due to slightly lower silver mill feed grade and silver recovery. We recognized sales of 2.6 million ounces of silver, lower than the first quarter as concentrate shipments that were delayed in December 2015 were recognized in the first quarter of 2016. There was no zinc production in the second quarter of 2016, as planned, due to lower zinc grade mined. Starting in the third quarter of 2016 we will discontinue disclosing zinc data.
Ore was milled at an average rate of 4,668 tonnes per day in the second quarter of 2016, a quarterly record for the mine since it began operating due to our ongoing Operational Excellence program. Ore milled contained an average silver grade of 238 g/t, 4% lower than the 247 g/t reported in the first quarter. We continue to encounter additional tonnes of ore in the bottom benches of the San Miguel open pit. The lower and medium grade material was stockpiled and will be processed after mining ceases at the end of 2016.
Qualified Persons
The scientific and technical data contained in this news release relating to the Marigold mine has been reviewed and approved by Thomas Rice, SME Registered Member, a Qualified Person under National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") and our Technical Services Manager at the Marigold mine. The scientific and technical data contained in this news release relating to the Seabee Gold Operation has been reviewed and approved by Gordon Reed, P.Eng., a Qualified Person under NI 43-101 and General Manager at the Seabee Gold Operation. The scientific and technical data contained in this news release relating to the Pirquitas mine has been reviewed and approved by Bruce Butcher, P.Eng., a Qualified Person under NI 43-101 and our Director, Mine Planning.
About Silver Standard
Silver Standard is a Canadian-based precious metals producer with three wholly-owned and operated mines, including the Marigold gold mine in Nevada, U.S., the Seabee Gold Operation in Saskatchewan, Canada and the Pirquitas silver mine in Jujuy Province, Argentina. We also have two feasibility stage projects and an extensive portfolio of exploration properties throughout North and South America. We are committed to delivering safe production through relentless emphasis on Operational Excellence. We are also focused on growing production and Mineral Reserves through the exploration and acquisition of assets for accretive growth, while maintaining financial strength.
For further information contact: W. John DeCooman, Jr. Vice President, Business Development and Strategy Silver Standard Resources Inc. Vancouver, BC N.A. toll-free: +1 (888) 338-0046 All others: +1 (604) 689-3846 E-Mail:[email protected]
To receive Silver Standard's news releases by e-mail, please register using the Silver Standard website atwww.silverstandard.com.
Footnotes:
(1) Gold equivalent production for the second quarter of 2016 is calculated using weighted average realized gold price at the Marigold mine and the Seabee Gold Operation and realized silver price at the Pirquitas mine.
Cautionary Note Regarding Forward-Looking Statements:
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