Excellon Reports Third Quarter 2014 Production
TORONTO, Oct. 14, 2014 /CNW/ - Excellon Resources Inc. (TSX:EXN; OTC:EXLLF) ("Excellon" or the "Company"), Mexico's highest grade silver producer, reports its third quarter 2014 production results and an exploration update from the La Platosa Mine in Durango, Mexico.
Q3 2014 Production Highlights (Compared to Q3 2013)
- 1,681,745 silver equivalent ("AgEq") ounces produced in first nine months of 2014
(9-mos 2013 – 1,504,639 AgEq oz)
- 455,150 AgEq oz produced in Q3 2014 (Q3 2013 – 607,252 AgEq oz), including 216,379 Ag oz, 1.7 million Pb lbs and 2.7 million Zn lbs
- Strong zinc and lead production provides an effective buffer in the current silver price environment
- Exploration drilling further defines gold-bearing jasperoid zone near NE-1 Manto, a potential feeder zone associated with CRD-Source mineralization at depth
- $8.4 million in cash, receivables and marketable securities as at September 30, 2014
($10.9 million as at June 30, 2014)
"Production during the first two months of the third quarter was solid, with costs trending significantly lower," stated Brendan Cahill, President and Chief Executive Officer. "During August, we milled over 8,500 tonnes, a monthly record, at net cash costs of $2.52 per ounce, demonstrating Platosa's potential to significantly improve its cost profile with higher production rates. Unfortunately, a transformer failure in mid-September complicated water management in the 6A and Guadalupe South mantos and limited production during the month, which impacted production totals and costs for the quarter. Production is now returning to normal and development continues into the higher grade 623 and Rodilla mantos."
Q3 2014 Production Results
* Subject to adjustment following settlement with concentrate purchaser.
** Silver equivalent ounces established using average metal prices during the period indicated applied to the recovered metal content of concentrates.
Ore production during the third quarter was primarily from the 6A and Guadalupe South Mantos. While production was down in the third quarter, output during July and August was steady at 12,209 tonnes, averaging approximately 200 tons per day. During August, the mill posted record throughput of 8,556 tonnes at net cash costs of $2.52 per silver ounce payable (net of by-products), demonstrating the mine's profitability potential at higher throughputs. During September, a transformer failure in the Guadalupe South area caused production to fall significantly lower than budgeted. Although the transformer was quickly replaced, water management in the 6A and Guadalupe South mantos impacted the Company's ability to achieve its quarterly targets. Grades during the quarter were generally in line with estimates for the Platosa mineral resources mined during the period. The Company continues development into the high grade 623 Manto, hosting mineral resources of 83,000 tonnes at 1,232 g/t Ag (1,777 g/t AgEq).
Exploration drilling resumed at the end of the second quarter and eleven holes totaling 4,593 metres have been drilled in the current program (nine holes totaling 4,328 metres in the third quarter). Eight of these holes were drilled in the NE-1 Manto area to follow-up on an auriferous jasperoid zone identified during 2010 drilling. This auriferous zone has a variable dip, ranging from subhorizontal to -45° SE, sits roughly 100 metres above the NE-1 massive sulphides and has now been intersected in a total of 25 holes. The zone may be related to a feeder zone following a major NW-SE fault, which cuts and down-drops a portion of the NE-1 Manto. If such a feeder zone can be identified it may be possible to trace it to an intrusive source and associated proximal skarn-sulphide CRD body at some depth below the massive sulphides. Representative intersections among the eight holes were 0.113 g/t Au, 6.1 g/t Ag over 6.58 metres from 178.35 metres to 184.93 metres in hole EX14LP1089A, 0.194 g/t Au, 5.4 g/t Ag over 21.12 metres from 137.34 metres to 158.56 metres in LP1090 and 0.074 g/t Au, 6.2 g/t Ag over 2.20 metres from 189.95 metres to 192.15 metres in LP1094. True thicknesses are estimated to be 50% to 90% of core widths. Additional drilling is planned for the area.
The Company recently received the results of a 2D seismic reflection test conducted by Olson Engineering Inc. over the existing high-grade Pierna and NE-1 mantos. The survey provided significant structural data but did not directly illuminate the massive sulphides associated with the Platosa mantos. The Company is continuing its analysis of the results and is considering future plans to use this effective structural mapping tool in conjunction with other geophysical data.
The Company is focused on incrementally increasing daily production throughout 2014, with an initial target of 210 tpd, a 9% increase over 2013. This target is assessed by management on an ongoing basis as the Company continues to focus on improving and strengthening operational efficiencies at the Platosa mine and Miguel Auza mill. The mill has approximately 55% spare capacity, leaving significant availability for increased tonnage throughput. The Company continues to seek custom milling opportunities in the Miguel Auza region to increase mill utilization.
The Company is currently investigating options to comprehensively reduce water infiltration into the Platosa mine. Exploration drilling is temporarily on hold as the Company is currently drilling water bearing structures near existing mine resources to better understand and reduce the possibility of inflows in the future.
Due to reduced production during September, Excellon expects to provide an update on expected 2014 production with the release of third quarter financial results prior to market open on October 29, 2014.
Excellon's 100%-owned and royalty-free La Platosa Mine in Durango is Mexico's highest grade silver mine, with lead and zinc by-products making it one of the lowest cash cost silver mines in the country. The Company is positioning itself to capitalize on undervalued projects by focusing on increasing La Platosa's profitable silver production and near-term mineable resources.
Additional details on the La Platosa Mine and the rest of Excellon's exploration properties are available at www.excellonresources.com.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this Press Release, which has been prepared by management. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 27E of the Exchange Act. Such statements include, without limitation, statements regarding the future results of operations, performance and achievements of the Company, including potential property acquisitions, the timing, content, cost and results of proposed work programs, the discovery and delineation of mineral deposits/resources/reserves, geological interpretations, proposed production rates, potential mineral recovery processes and rates, business and financing plans, business trends and future operating revenues. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, significant downward variations in the market price of any minerals produced [particularly silver], the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies. All of the Company's public disclosure filings may be accessed via www.sedar.com and readers are urged to review these materials, including the technical reports filed with respect to the Company's mineral properties, and particularly the March 25, 2014 NI 43-101-compliant technical report prepared by Roscoe Postle Associates Inc. with respect to the Platosa Property. This press release is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States.