Lucky Friday Mine to reopen in 2013

November 7, 2012

The Lucky Friday Mine in Idaho is expected to return to production in the first quarter of 2013, Hecla Mining Co. announced.

The Silver Shaft at the Lucky Friday Mine was ordered last year by the federal Mine Safety and Health Administration for removal of built-up sand and concrete material. This shutdown, combined with factors such as lower metals prices and a mark-to-market adjustment on base-metals derivative contracts, contributed to a net loss applicable to common shareholders of $1 million for Hecla in the third quarter, compared to net income of $55.8 million in the year-ago period. Earnings per share were flat, compared to 20 cents in the year-ago period, Kitco News reported.

The mine is expected to produce more than 62.2 t (2 million oz) of silver in 2013 and to ramp up to full production for more than 93.3 t (3 million oz) in 2014.

“We’ve made excellent progress at the Lucky Friday Silver Shaft,” said Hecla’s president and chief executive officer, Phillips S. Baker, Jr., in a conference call with analysts.

Rehabilitation work on the Silver Shaft began in the first quarter of this year and is now completed to around the 1,700-m (5,700-ft) level, which is around 122 m (400 ft) from the shaft bottom, the company said.

“We’ve been doing more than required, replacing corroded steel—in fact 10 times as much as we allowed for in our plans—so we will not have to do it later in our normal shaft maintenance program,” Baker said. “Crews have also installed metal brattices, or steel curtains, down the middle of the shaft so if we choose to, we can install another hoist, which increases workforce efficiency and throughput.”

The company anticipates replacing the controls of the hoist early next year. Also, crews are at work at the 1,800-m (5,900-ft) level developing a bypass around a rock burst from a year ago.

“We know how difficult the shutdown has been for employees and shareholders,” Baker said. “So we’ve worked hard to transform the shutdown into something that will be positive for both long into the future.”

Hecla has recalled all employees necessary to reach full production, reported Kitco News. Additional safety training is occurring.

Hecla has also begun preparatory work for sinking of No. 4 Shaft, which is planned to access extensions to reserves, resources and additional exploration targets. The $200 million project is expected to be completed in early 2016, with $90 million spent so far.

“Deeper access is expected to give the mine decades of future production,” Baker said. This is expected to result in a ramp-up of Lucky Friday output to some 155 t (5 million oz) by 2017, he added.


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