Coeur Reports Second Quarter 2019 Production and Sales Results

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CHICAGO–(BUSINESS WIRE)–Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE: CDE) today announced second quarter 2019 production of 86,584 ounces of gold, 3.1 million ounces of silver, 5.3 million pounds of zinc and 5.0 million pounds of lead. Metal sales for the quarter were 86,385 ounces of gold, 3.0 million ounces of silver, 5.3 million pounds of zinc and 5.2 million pounds of lead.

As disclosed on May 1, 2019, the Company expects to produce 334,000 – 372,000 ounces of gold, 12.2 – 14.7 million ounces of silver, 25 – 40 million pounds of zinc and 20 – 35 million pounds of lead in 2019.

Quarterly Production Results

“Our second quarter operational results were in-line with our expectations and reflect solid, double-digit production increases across all four metals we produce,” said Mitchell J. Krebs, Coeur’s President and Chief Executive Officer. “We continue to deliver quarter-over-quarter improvements at Silvertip, which is a top initiative for the Company this year. Production increased at Palmarejo due to higher throughput and recovery rates, while Kensington continued to benefit from higher grades from the Jualin deposit. Wharf is expected to benefit from a combination of higher grades and the placement of additional ore during the second half to achieve its full-year plan.”

“At Rochester, commissioning of the high-pressure grinding roll (“HPGR”) unit continues. We expect the new crushing configuration to begin crushing ore in early August, which is approximately four weeks later than originally scheduled due to a new secondary crusher unit that required replacement,” continued Mr. Krebs. “Overall, we remain confident in our ability to achieve our full-year production guidance at each of our operations.”

Operations

Second quarter production and sales highlights for each of Coeur's operations are provided below.

Palmarejo, Mexico

 

2Q 2019

 

1Q 2019

 

4Q 2018

 

3Q 2018

 

2Q 2018

Tons milled

447,727

 

378,987

 

378,389

 

300,116

 

344,073

Average gold grade (oz/t)

0.07

 

0.07

 

0.08

 

0.10

 

0.11

Average silver grade (oz/t)

4.74

 

4.64

 

5.96

 

6.26

 

6.86

Average recovery rate – Au

87.7%

 

83.4%

 

97.6%

 

88.8%

 

89.9%

Average recovery rate – Ag

81.8%

 

72.8%

 

84.0%

 

82.2%

 

87.5%

Ounces Produced

 

 

 

 

 

 

 

 

 

Gold

28,246

 

23,205

 

31,239

 

27,885

 

33,702

Silver (000's)

1,735

 

1,278

 

1,893

 

1,544

 

2,066

Ounces Sold

 

 

 

 

 

 

 

 

 

Gold

28,027

 

27,394

 

23,667

 

29,830

 

31,207

Silver (000's)

1,709

 

1,405

 

1,534

 

1,572

 

2,092

Average realized price per gold ounce

$1,210

 

$1,154

 

$1,148

 

$1,082

 

$1,162

Average realized price per silver ounce

$14.86

 

$15.39

 

$14.57

 

$14.75

 

$16.49

  • Second quarter gold and silver production increased 22% and 36%, respectively, to 28,246 and 1.7 million ounces compared to the prior quarter. Year-over-year, gold and silver production decreased approximately 16%
  • Higher production during the quarter was primarily driven by an 18% increase in mill throughput as well as improved access to higher-grade secondary stopes with better recoveries due to the maintenance and expansion of the cemented rockfill plant, which was completed in the prior quarter
  • Production began at the La Nación deposit, located between the Independencia and Guadalupe underground mines, shortly after the end of the second quarter. Production at La Nación is anticipated to continue ramping up during the third quarter as infrastructure projects are completed, adding approximately 400 tons per day of additional mill feed
  • Installation of a new thickener remains on budget and on schedule with commissioning anticipated to begin at the end of July. The project is expected to increase metallurgical recoveries for both gold and silver by approximately 2% and has an estimated one-year payback
  • Approximately 22% of gold sales in the second quarter, or 6,190 ounces, were sold under Palmarejo's gold stream agreement at a price of $800 per ounce
  • Full-year 2019 production guidance remains unchanged at 95,000 – 105,000 ounces of gold and 6.5 – 7.2 million ounces of silver

Rochester, Nevada

 

2Q 2019

 

1Q 2019

 

4Q 2018

 

3Q 2018

 

2Q 2018

Tons placed

2,786,287

 

2,667,559

 

3,674,566

 

4,061,082

 

4,083,028

Average silver grade (oz/t)

0.45

 

0.46

 

0.46

 

0.52

 

0.53

Average gold grade (oz/t)

0.003

 

0.003

 

0.004

 

0.004

 

0.004

Ounces Produced

 

 

 

 

 

 

 

 

 

Silver (000's)

971

 

960

 

1,466

 

1,290

 

1,125

Gold

8,609

 

8,256

 

15,926

 

14,702

 

12,273

Ounces Sold

 

 

 

 

 

 

 

 

 

Silver (000's)

962

 

1,000

 

1,391

 

1,248

 

1,097

Gold

8,642

 

8,511

 

15,339

 

14,257

 

12,030

Average realized price per silver ounce

$14.83

 

$15.31

 

$14.53

 

$14.70

 

$16.47

Average realized price per gold ounce

$1,295

 

$1,299

 

$1,234

 

$1,204

 

$1,297

  • Silver production remained relatively flat quarter-over-quarter at approximately 1.0 million ounces, while gold production increased 4% to 8,609 ounces. Year-over-year, silver and gold production decreased 14% and 30%, respectively
  • Higher gold production was driven by the timing of leach pad recoveries as well as improved weather conditions. Tons placed also increased in the second quarter due to the stacking of additional run-of-mine material, despite the idling of the X-Pit crusher during May and June for commissioning of the new crusher configuration
  • Commissioning of the new crusher configuration, including the HPGR unit, continued through the end of the quarter. A new secondary crusher unit failed late in the second quarter, and is in the process of being replaced by an idle tertiary crushing unit located on-site
  • The replacement of the secondary crusher unit is expected to delay the commissioning of the crushing circuit, including the HPGR unit, by approximately four weeks. Overall crushing rates, silver recovery expectations and capital requirements remain in-line with prior estimates
  • The Company is maintaining full-year 2019 production guidance of 4.2 – 5.0 million ounces of silver and 40,000 – 50,000 ounces of gold

Kensington, Alaska

 

2Q 2019

 

1Q 2019

 

4Q 2018

 

3Q 2018

 

2Q 2018

Tons milled

160,510

 

164,332

 

166,310

 

167,964

 

168,751

Average gold grade (oz/t)

0.23

 

0.20

 

0.23

 

0.17

 

0.16

Average recovery rate

93.0%

 

90.2%

 

93.0%

 

91.8%

 

92.6%

Gold ounces produced

34,049

 

29,973

 

35,335

 

26,809

 

25,570

Gold ounces sold

34,415

 

31,335

 

33,202

 

25,648

 

28,165

Average realized price per gold ounce

$1,312

 

$1,286

 

$1,246

 

$1,161

 

$1,269

  • Commercial production at Jualin was declared on December 1, 2018. The figures shown in the table above include pre-commercial production
  • Gold production during the second quarter increased 14% to 34,049 ounces compared to the prior quarter. Year-over-year gold production increased 33%. Average gold grade was approximately 15% higher quarter-over-quarter and 44% higher year-over-year driven by additional ore feed from the high-grade Jualin deposit
  • Jualin accounted for approximately 17% of Kensington’s second quarter production, compared to approximately 10% in the prior quarter. For the full year, Jualin is expected to account for approximately 20% of Kensington's total production
  • Full-year 2019 production guidance is unchanged at 117,000 – 130,000 ounces of gold

Wharf, South Dakota

 

2Q 2019

 

1Q 2019

 

4Q 2018

 

3Q 2018

 

2Q 2018

Tons placed

919,435

 

1,090,510

 

1,644,168

 

1,127,391

 

1,075,820

Average gold grade (oz/t)

0.023

 

0.020

 

0.020

 

0.023

 

0.023

Ounces produced

 

 

 

 

 

 

 

 

 

Gold

15,680

 

16,902

 

16,960

 

19,437

 

22,507

Silver (000's)

12

 

13

 

13

 

13

 

13

Ounces sold

 

 

 

 

 

 

 

 

 

Gold

15,301

 

18,086

 

15,306

 

19,874

 

23,053

Silver (000's)

12

 

14

 

11

 

12

 

14

Average realized price per gold ounce

$1,311

 

$1,317

 

$1,247

 

$1,198

 

$1,285

  • Gold production in the second quarter declined 7% quarter-over-quarter and 30% year-over-year to 15,680 ounces
  • Lower production was largely driven by inclement weather, which diluted leach pad solutions, as well as lower crusher throughput during the quarter. The Company has engaged a third party contractor to crush an additional 300,000 tons of ore primarily during the third quarter to supplement operating activities
  • Production is also anticipated to increase for the remainder of 2019 due to the placement of higher-grade ore late in the second quarter and is expected to continue during the third and fourth quarters
  • The Company is maintaining full-year 2019 production guidance of 82,000 – 87,000 ounces of gold

Silvertip, British Columbia

 

2Q 2019

1Q 2019

4Q 2018

3Q 2018

2Q 2018

Tons milled

59,689

62,051

38,802

28,080

14,450

Average silver grade (oz/t)

7.48

5.50

6.06

7.29

14.15

Average zinc grade (%)

7.5%

5.9%

5.8%

8.0%

8.2%

Average lead grade (%)

5.4%

3.7%

3.9%

4.6%

8.1%

Average recovery rate – Ag

77.0%

69.9%

60.5%

47.0%

42.3%

Average recovery rate – Zn

59.1%

50.5%

69.1%

49.1%

57.9%

Average recovery rate – Pb

77.3%

66.8%

54.7%

44.4%

40.5%

Produced

 

 

 

 

 

Silver (000's ounces)

344

239

142

96

87

Zinc (000's lbs)

5,322

3,719

3,083

2,207

1,372

Lead (000's lbs)

4,980

3,077

1,658

1,159

949

Sold

 

 

 

 

 

Silver (000's ounces)

365

215

127

131

10

Zinc (000's lbs)

5,303

4,723

2,552

1,772

469

Lead (000's lbs)

5,186

2,748

1,444

1,645

Average realized price per silver ounce, gross

$15.18

$14.98

$15.54

$14.62

$16.31

Treatment and refining charges per silver ounce

$1.18

$1.24

$1.38&lt

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About the Author: Sidney Martin

Sidney Marin Is a researcher and law student at York University (TORONTO). He has worked as the Director of the Graduate Lawyering Program. He worked for American law firms in Moscow, Russia for three years. Hegraduated from Columbia Law School, Columbia School of International and Public Affairs and Harvard College. He research interest is in human rights and health law, with a particular focus on the law and policy of vaccination.