TORONTO, April 09, 2019 (GLOBE NEWSWIRE) -- McEwen Mining Inc. (NYSE: MUX) (TSX: MUX) reports consolidated production for Q1 2019 of 26,789 gold ounces and 703,217 silver ounces, or 36,166 gold equivalent ounces(1)(“GEOs”).
Consolidated Production Summary
Q1 Full Year
2018 2019 2018 2019 Guidance
Gold (oz) 35,069 26,789 135,203 162,000
Silver (oz) 695,651 703,217 3,032,694 3,225,000
GEOs(1) 44,344 36,166 175,640 205,000
(1) Using a 75:1 gold to silver ratio.
“ I am very pleased to say that after a tough start to the year at our Black Fox and Gold Bar mines, we have delivered a strong close to the first quarter. In March, gold production improved significantly at Black Fox, allowing us to achieve 93% of our budgeted production for the quarter. The issues that pushed the start-up of commercial production at Gold Bar from Q1 into Q2 have largely been resolved. The San Jos é and El Gallo mines are performing well and are on-track to deliver over 50% of our planned 2019 production of 205,000 gold equivalent ounces . I’m excited about starting our exploration drilling programs in Timmins and Nevada, which will generate results for the rest of the year,” said Rob McEwen, Chairman and Chief Owner.
Gold Bar Mine, USA (100%)
The ramp-up of production at Gold Bar is progressing and we are addressing the challenges with the crushing plant. Several issues related to material handling have been resolved and throughput at the crushing and stacking plant is increasing. Other aspects of the mine are performing as designed.
The first gold ingot was poured at Gold Bar on February 16. Since then the mine has poured gold regularly with Q1 production totalling 2,052 gold ounces. Guidance has been reduced by 10% as a result of the slower than expected start-up. We expect Gold Bar to achieve commercial production during Q2 2019, and produce 50,000 gold ounces during the full year.
Our 2019 exploration budget for the Gold Bar property is $5 million. Exploration drilling will target both near surface and deep Carlin-type mineralization. Drilling is expected to start in early May and continue throughout the rest of the year.
Black Fox Mine, Canada (100%)
Black Fox produced 8,765 gold ounces in Q1. In spite of the primary contractor-operated crushing plant being shut down for 6 weeks in February and March due to a fire, our team recorded strong production of 5,335 gold ounces in March, and achieved 93% of our budgeted production for the quarter. The crusher has been repaired and is now operating normally and we maintain our guidance of 50,000 gold ounces for 2019.
Our 2019 exploration budget for the Black Fox Complex is $17 million and includes surface and underground drilling. Surface drilling with three drill rigs started up again at the beginning of April, and we expect to announce initial results in late May.
San José Mine, Argentina (49%(2))
Our attributable production from San José was 10,559 gold ounces and 701,341 silver ounces, for a total of 19,910 GEOs in Q1. Production at San José is typically lower in the first quarter due to regularly scheduled maintenance. The mine is on-track to achieve our full year guidance for 2019 of 92,000 GEOs. We received approximately $2 million in dividends from our interest in San José during Q1.
El Gallo Project, Mexico (100%)
El Gallo produced 5,413 gold ounces in Q1. El Gallo continues to recover gold from residual leaching of the heap leach. During the quarter the process plant underwent a small expansion to improve efficiency and enable faster gold recovery.
Work on the Fenix Project feasibility study and permitting is progressing. We expect the feasibility study to be complete in Q2 2019.
As part of our capital allocation strategy we are exploring the potential sale of our Mexican assets. We anticipate that half of the net proceeds from the potential sale would be used to advance our development projects, and the balance would be used to retire a portion of our debt.
First Quarter Financial Results
Operating costs for the quarter ended March 31, 2019 will be released with our 10-Q Quarterly Financial Statements in early May.