Coeur d’Alene Mines Corporation (NYSE:CDE) (TSX:CDM) (ASX:CXC) announced today that it is pursuing an expansion of mining operations at its Rochester silver and gold mine in Nevada. This planned expansion is expected to add an average of 2.9 million ounces of incremental annual silver production and 30,000 ounces of further gold production through 2017.
The Bureau of Land Management supports a third-party prepared Environmental Assessment for the proposed expansion, the completion of which could lead to initiation of production in 2011. The Company has completed an internal scoping study showing the expansion to have a $34 million net present value based on a $16.00 per ounce silver price, a $950 per ounce gold price, and a 10% discount rate. A new leach pad would be constructed during 2010 with an estimated cost of approximately $28 million, leading to annual average estimated net cash flows of approximately $20 million. This cash flow and production is incremental to the ounces and cash flow currently being generated by ongoing residual leaching activities, which the Company expects will continue through 2014.
As of December 31, 2008, Rochester contained measured and indicated resources of 61.8 million ounces of silver and 531,000 ounces of gold. Since beginning operations in 1986, the mine has produced over 125 million ounces of silver and 1.4 million ounces of gold and has contributed over $23 million in annual payroll and nearly $13 million in annual state and local tax revenues. The planned expansion would add approximately 200 jobs to this historic silver and gold mine. In addition, the mine recently received two top awards by both the Nevada Mining Association and the Mine Safety and Health Administration for safe operations.
Coeur d’Alene Mines Corporation is one of the world’s leading silver companies and also a significant gold producer. Coeur will have its first full year of production this year at the world’s largest pure silver mine - San Bartolomé in Bolivia – and began production in March at another world-leading silver mine – Palmarejo in Mexico. The Company also operates underground mines in southern Chile and Argentina and one surface mine in Nevada; and owns a non-operating interest in a low-cost mine in Australia. The Company also owns a major gold project - Kensington in Alaska - and conducts exploration activities in Argentina, Chile and Mexico. Coeur common shares are traded on the New York Stock Exchange under the symbol CDE, the Toronto Stock Exchange under the symbol CDM, and its CHESS Depositary Interests are traded on the Australian Securities Exchange under symbol CXC.
This press release contains forward-looking statements within the meaning of securities legislation in the United States, Canada, and Australia, including statements regarding anticipated operating results. Such statements are subject to numerous assumptions and uncertainties, many of which are outside the control of Coeur. Operating, exploration and financial data, and other statements in this presentation are based on information that Coeur believes is reasonable, but involve significant uncertainties affecting the business of Coeur, including, but not limited to, future gold and silver prices, costs, ore grades, estimation of gold and silver reserves, mining and processing conditions, construction schedules, currency exchange rates, and the completion and/or updating of mining feasibility studies, changes that could result from future acquisitions of new mining properties or businesses, the risks and hazards inherent in the mining business (including environmental hazards, industrial accidents, weather or geologically related conditions), regulatory and permitting matters, risks inherent in the ownership and operation of, or investment in, mining properties or businesses in foreign countries, as well as other uncertainties and risk factors set out in filings made from time to time with the SEC, the Canadian securities regulators, and the Australian Securities Exchange, including, without limitation, Coeur’s reports on Form 10-K and Form 10-Q. Actual results, developments and timetables could vary significantly from the estimates presented. Readers are cautioned not to put undue reliance on forward-looking statements. Coeur disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, Coeur undertakes no obligation to comment on analyses, expectations or statements made by fourth parties in respect of Coeur, its financial or operating results or its securities.
Donald J. Birak, Coeur's Senior Vice President of Exploration, is the qualified person responsible for the preparation of the scientific and technical information concerning Coeur's mineral projects in this press release. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources, as well as a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant factors, please see the Technical Reports for each of Coeur's properties as filed on SEDAR at www.sedar.com.
Cautionary Note to U.S. Investors – The United States Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this press release, such as “measured,” “indicated,” and “inferred” “resources,” that are recognized by Canadian and Australian regulations, but that SEC guidelines generally prohibit U.S. registered companies from including in their filings with the SEC. U.S. investors are urged to consider closely the disclosure in our Form 10-K which may be obtained from us, or from the SEC’s website at http://www.sec.gov/edgar.shtml