SilverCrest Mines (CVE:SVL)(NYSE MKT:SVLC)(AMEX:SVLC) topped silver production forecasts for last year, it said Wednesday, with 2012 marking its first full of commercial production.
The company, which produces from its Santa Elena mine in Sonora, Mexico, produced 579,609 ounces of silver in 2012 - exceeding market guidance for 435,000 ounces of silver by 33%.
A three year expansion plan is underway to double metals production at the mine, while exploration programs are also advancing the definition of the large polymetallic deposit at the company's La Joya property in Mexico.
The silver miner also produced 33,004 ounces of goldin 2012, just under market forecasts for 33,500 ounces, for a total of 2.37 million silver equivalent ounces, compared to 1.74 million ounces a year earlier.
In 2012, crusher throughput averaged 3,162 tonnes per day, 26% above the daily designed capacity of 2,500 tonnes per day.
In the fourth quarter, silver equivalent ounces produced fell to 588,948 from 667,805 in the year-ago period despite pure silver production increasing 17% to a record 153,863 ounces as gold output fell by 18%.
"2012 was a very successful year for SilverCrest that marked our first full year in commercial production," said president J. Scott Drever.
"We look forward to another exciting year at Santa Elena, remaining focused on continuing steady production, optimizing operations, and ensuring the expansion plan to double metal production in 2014 is kept on schedule and within budget."
Drever said that silver production continues to set quarterly records due to improvement in recoveries and higher grade ore being loaded on the phase II leach pad, which was completed on schedule and budget, adding two years of capacity.
"Open pit tonnes and grades continue to reconcile closely with the geological block model and mine plan. All aspects of operations continue to function well. The crushing circuit had an excellent fourth quarter with average throughput of 3,355 tonnes per day, 3% below the same quarter in 2011 and 34% above the daily design capacity of 2,500 tonnes per day," the president added.
The company said that it installed a new conveyor and stacker system for ore transport to the leach pad, reducing operating costs.
SilverCrest added that virtually all operating parameters in 2012 exceeded those of 2011, with the exception of the gold grade and gold ounces delivered to the pad. The cut-off grade was reduced last year, and much of the planned mining in 2012 was scheduled in a portion of the open pit, which was of a lower grade when compared to those gold grades mined in 2011, the company said.
In the fourth quarter, average silver grade loaded on the pad was 59.59 grams per tonne (g/t), compared to 49.55 g/t a year earlier, while gold grade fell to 1.42 g/t versus 1.9 in the fourth quarter of 2011.
Gold and silver grades are expected to rise this year, the silver and gold miner said.
Last year, the company also completed around 30,000 metres of drilling, which confirmed underground resources to be converted to reserves, and discovered the new high grade El Cholugo zone at the site. It also extended the main mineralized zone at Santa Elena by more than 200 metres along strike and down plunge.
Earlier this week, SilverCrest announced further drilling results from its Santa Elena mine, which the company said continued to be "extremely encouraging". As of Monday, 94 of a planned 100 holes were completed to help upgrade indicated and inferred resources to probable reserves and expand current underground resources.
For 2013, the company is targeting the completion of a new 3,000 tonne per day mill facility, with commercial production anticipated in the first quarter of next year.
It is also aiming to produce 625,000 ounces of silver for the year and 33,000 ounces of gold, for 2.4 million ounces of silver equivalent - with consistent production levels expected each quarter. Cash costs are estimated at $850 per silver equivalent ounce.
In terms of exploration expenses, it is planning to spend $10.5 million in 2013 at its La Joya property in Mexico.
Shares in the silver miner edged up by 0.38% to $2.65 early Wednesday.