Mr. Robert Archer reports
GREAT PANTHER SILVER REPORTS SECOND QUARTER 2016 PRODUCTION RESULTS
Great Panther Silver Ltd. has released the production results for the second quarter of 2016 from its two wholly owned Mexican silver mining operations: the Guanajuato mine complex (GMC), which includes the San Ignacio mine, and the Topia mine in Durango.
2016 second quarter production highlights (compared with the second quarter of 2015):
- Consolidated metal production decreased 5 per cent to 1,037,728 silver equivalent ounces;
- Silver production decreased 17 per cent to 536,726 silver ounces;
- Gold production increased 13 per cent with 6,010 gold ounces produced;
- Ore processed increased 14 per cent to 99,905 tonnes milled.
"Great Panther's second quarter production of 1.04 million ounces AgEq was consistent with the previous quarter and is in line with the company's annual guidance, reflecting our continued focus on operational efficiencies," stated Robert Archer, president and chief executive officer. "The increase in gold production and decrease in silver production compared to a year ago and to the first quarter of 2016 are a direct result of the increased production from San Ignacio, which has a higher gold-to-silver ratio. By maintaining consistent production at low cost, Great Panther is well positioned to benefit from the recent rise in commodity prices."
CONSOLIDATED OPERATIONS SUMMARY
Q2 2016 Q2 2015 Q2 2016 Q1 2016
Ore processed (tonnes milled) 99,905 87,476 99,905 88,683
Silver equivalent ounce production (1) (2) 1,037,728 1,088,355 1,037,728 1,009,828
Silver ounce production 536,726 648,810 536,726 539,472
Gold ounce production 6,010 5,322 6,010 5,599
Lead production (tonnes) 290 300 290 282
Zinc production (tonnes) 433 491 433 424
(1) Silver equivalent ounces for 2016 were calculated using a 70:1 Ag:Au ratio, and ratios
of 1:0.0504 and 1:0.0504 for the price per ounce of silver to price per pound of lead and
zinc, respectively.
(2) Silver equivalent ounces for 2015 were calculated using a 65:1 Ag:Au ratio, and ratios
of 1:0.05 and 1:0.056 for the price per ounce of silver to price per pound of lead and
zinc, respectively.
Guanajuato mine complex
In the second quarter of 2016, metal production at the GMC increased 2 per cent compared with the previous quarter, but decreased by 5 per cent to 774,160 ounces AgEq when compared with the same quarter in the previous year. The decrease was attributed to lower silver grades and recoveries at San Ignacio, reflecting local variation in the resource block. These factors were partly offset by 14-per-cent and 18-per-cent increases in ore processed compared with the first quarter of 2016 and second quarter of 2015, respectively.
GMC OPERATIONS SUMMARY
Q2 2016 Q2 2015 Q2 2016 Q1 2016
Ore processed (tonnes milled) 84,134 71,131 84,134 73,649
Silver equivalent ounce production (1) (2) 774,160 818,841 774,160 755,555
Silver ounce production 366,943 482,551 366,943 375,273
Gold ounce production 5,817 5,174 5,817 5,433
Ag grade (g/t) 159 233 159 179
Au grade (g/t) 2.52 2.49 2.52 2.58
Ag recovery (%) 85.3% 90.5% 85.3% 88.5%
Au recovery (%) 85.2% 91.0% 85.2% 89.0%
(1) Silver equivalent ounces for 2016 were calculated using a 70:1 Ag:Au ratio.
(2) Silver equivalent ounces for 2015 were calculated using a 65:1 Ag:Au ratio.
San Ignacio accounted for 60 per cent of the overall metal production and 62 per cent of the total ore processed at the GMC in the second quarter of 2016, compared with 52 per cent and 53 per cent, respectively, in the first quarter of 2016. The rising production at San Ignacio accounts for the higher average gold grades and lower average silver grades at the GMC.
Topia mine
Total metal production increased 4 per cent over the previous quarter, but decreased by 2 per cent to 263,568 ounces AgEq when compared with the same quarter in the previous year. The decrease in metal production is attributed to lower tonnes milled, reflecting a greater effort to control dilution, which resulted in higher head grades and recoveries.
TOPIA OPERATIONS SUMMARY
Q2 2016 Q2 2015 Q2 2016 Q1 2016
Ore processed (tonnes milled) 15,771 16,345 15,771 15,034
Silver equivalent ounce production (1) (2) 263,5682 69,514 263,568 254,273
Silver ounce production 169,783 166,258 169,783 164,199
Gold ounce production 192 149 192 167
Lead production (tonnes) 290 300 290 282
Zinc production (tonnes) 433 491 433 424
Ag grade (g/t) 367 350 367 373
Au grade (g/t) 0.59 0.48 0.59 0.55
Ag recovery (%) 91.3% 90.5% 91.3% 91.0%
Au recovery (%) 64.0% 59.2% 64.0% 62.9%
(1) Silver equivalent ounces for 2016 were calculated using a 70:1 Ag:Au ratio, and
ratios of 1:0.0504 and 1:0.0504 for the price per ounce of silver to price per
pound of lead and zinc, respectively.
(2) Silver equivalent ounces for 2015 were calculated using a 65:1 Ag:Au ratio, and
ratios of 1:0.05 and 1:0.056 for the price per ounce of silver to price per pound
of lead and zinc, respectively.
Outlook
Production in the second quarter of 2016 was consistent with the annual guidance of four million to 4.2 million ounces AgEq (using a 70:1 silver:gold ratio). This rate of production is currently anticipated to continue for the balance of the year. It is possible that the transition of the phase I tailings dam at Topia to the phase II dry-stack dam, scheduled for the third and fourth quarters, may result in a temporary disruption of throughput at the plant while mined ore is stockpiled for later processing. This transition is targeted to extend the life of the company's tailings storage facility by five to seven years of production.
Production from the San Ignacio mine is expected to gradually increase through the balance of 2016, with a corresponding decrease from the main Guanajuato mines. This should result in higher gold production relative to silver.
Additionally, the company is completing its evaluation of the Coricancha mine in Peru and continues to review acquisition opportunities in the Americas on a regular basis.
The technical information contained in this news release has been reviewed and approved by Robert F. Brown, PEng, vice-president of exploration for the company, who is the qualified person for the Guanajuato mine complex and the Topia mine under the meaning of National Instrument 43-101. Aspects relating to mining and metallurgy are overseen by Ali Soltani, chief operating officer for Great Panther.
We seek Safe Harbor.
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