ME2018: Hecla Mining Co.
Last updated 10/21/2018 at 6:05pm
Thanks to its ongoing exploration success, Hecla Mining Company entered 2018 with the highest silver, gold and lead reserves in its 127-year history, as well as the highest level of zinc reserves in the past five years. Going into 2018, the Idaho-based miner had reserves totaling 2.3 million ounces of gold, up 12 percent from the beginning of 2017; 177 million oz of silver, an increase of 3 percent; 737,290 tons of zinc, an 8 percent increase; and 840,870 tons of zinc, up 15 percent.
Using the same metal price assumptions as the year before, Hecla simply added more metals to its reserves through drilling than it mined in 2017.
"We believe that our investment in exploration is a key step towards generating real value for shareholders," said Hecla President and CEO Phillips Baker, Jr.
The Greens Creek Mine in Southeast Alaska is a prime example of where Hecla is generating value with the drill bit.
Going into 2018, Greens Creek had 7.55 million tons of proven and probable reserves averaging 11.9 oz/t (90.22 million oz) silver, 0.1 oz/t (725,000 oz) gold, 8.1 percent (614,840 tons) zinc and 3 percent (225,050 tons) lead.
This reflects an increase in all four metals, despite the operation producing 10.8 million oz of silver, 78,245 oz of gold, 60,858 tons of zinc and 22,870 tons of lead during 2017.
Underground drilling at Greens Creek in 2018 focused on expanding high-grade silver resources and reserves along the East Ore, Upper Plate, Deep 200 South and Deep Southwest mineralized trends.
Hecla said the high-grade intersections encountered during definition drilling at East Ore – including one 12.9-foot interval averaging 47.2 oz/t silver, 0.76 oz/ton gold, 23.1 percent zinc and 12.6 percent lead; and 24.1 feet (7.3 meters) of 18.8 oz/ton silver, 0.24 oz/ton gold, 12.4 percent zinc and 4.7 percent lead – confirm previously modeled resource estimates, particularly at higher elevations.
The company said step-out drilling at East Ore Zone – including a 10.4-foot intercept of 23.2 oz/ton silver, 0.02 oz/ton gold, 3.97 percent zinc and 1.68 percent lead – suggest strong mineralization continues beyond the resource to the south and at depth.
Aggressive drilling of the East Ore Zone is continuing throughout 2018 and into 2019.
Drilling of the Upper Plate Zone, which is in the upper reaches of the mine near the portal, suggests the two, flat-lying bands of mineralization found there are thicker than modeled and higher in elevation toward the west.
Hecla said the upper band cut 20.8 feet (6.3 meters) 21 oz/ton silver, 0.02 oz/ton gold, 9.7 percent zinc and 5.8 percent lead. The company said recent drilling has extended this mineralization to the west and south, and drilling from surface in the third quarter could expand this resource further to the west and north.
Drill results show the lower band of mineralization is similar in thickness to that modeled but occurs beyond the currently outlined resource to the west and south. South of the current lower band, step-out drilling has cut 24.1 feet (7.3 meters) averaging 42.9 oz/ton silver, 0.04 oz/ton gold, 3.1 percent zinc and 1.5 percent lead.
One hole drilled in the southern portion of Deep 200 South cut eight feet (2.4 meters) averaging 101.4 oz/t silver, 0.09 oz/ton gold, 4.2 percent zinc and 2.1 percent lead. Hecla Mining said bench mineralization is confirmed to be present as two flat-lying, high-grade lenses that have been upgraded to an indicated resource.
Exploration drilling has extended 200 South Bench mineralization another 250 feet to the south with a 23.6-foot (7.2 meters) intersection averaging 31.8 oz/ton silver, 0.01 oz/ton gold, 2.2 percent zinc and 1 percent lead.
The miner also reports that drilling of the Gallagher zone confirmed modeled thicknesses and may have increased the resource and mineralization farther to the west. Intersections from this program include 23.9 feet (7.3 meters) of 10.6 oz/ton silver, 0.04 oz/ton gold, 2 percent zinc and 1 percent lead. Exploration drilling also intersected ore lithologies (characteristics). Future drilling is planned to see if the current precious metal-rich mineralization transitions into broader and higher-grade precious and base metal-rich mineralization in an area along and west of the Gallagher Fault.
Hecla also continued exploration at Kinskuch, a silver project in northwestern British Columbia that it acquired in 2016. Three holes drilled at Kinskuch in 2011 cut significant widths of high-grade silver mineralization, including a 2.8-meter interval averaging 318 g/t silver 0.40 g/t gold, 6.5 percent zinc and 2.2 percent lead. Hecla carried out a drill program on Kinskuch in 2017 but has not reported assay results from this work. The company, however, said drilling is continuing at the Golden Triangle property in 2018.
Hecla budgeted US$30 to US$37 million on exploration across all its properties in 2018, a significant increase over the US$23.5 million spent in 2017.
Hecla Mining Co. - NYSE: HL
President and CEO: Phillips Baker Jr.
Chairman: Ted Crumley
Senior VP, Exploration: Dean McDonald
6500 N Mineral Dr., Ste. 200, Coeur d'Alene, ID 83815-9408