Hecla readies mines to weather COVID-19
Sets up protocols to protect health of employees, business North of 60 Mining News – March 20, 2020
Last updated 9/26/2020 at 12:33pm
Hecla Mining Company March 19 announced that it has taken measures to ensure its silver and gold operations in Alaska, Idaho, Mexico and Quebec can weather COVID-19, along with the market and logistical disruptions that come with it.
These de-risking measures include:
• Securing contracts that guarantee a US$16 per ounce silver price and US$1,450/oz gold price for the second quarter of this year, and US$1,650/oz gold for third quarter, while maintaining exposure to the upside, after the costs of these transactions.
• Has implemented and is following recommended health and hygiene protocols at it mines and offices.
• Restricting mine site staff to essential personnel and contractors.
• Stockpiled critical mining supplies – up to six months' worth in some cases – to protect against possible future supply disruptions.
• Completed a US$475 million Senior Note refinancing in February, significantly de-risking the business by extending the maturity to 2028.
• Renewed a US$250 million revolving credit facility for the next three years, which could provide working capital needs if necessary.
"Over the past year, Hecla took steps to de-risk all aspects of the business, which now puts us in a position to respond to COVID-19," said Hecla Mining President and CEO Phillips Baker, Jr. "While Hecla is at risk like any other business, we have not seen any disruptions with our customers or suppliers, we have bought put options which should offer us some protection from recent weakness in the silver and gold prices and our employees are diligently implementing our safety and hygiene systems. We believe our 129-year culture of preparedness and flexibility is helping us adjust to this challenge."