Coeur's La Preciosa Project PEA Indicates 17-Year Initial Mine Life; Average Annual Silver Production Of 9.1 Million Ounces Over The First 14 Years

Coeur Mining, Inc. (the “Company” or “Coeur”) (NYSE: CDE, TSX: CDM) announced results from a Preliminary Economic Assessment (PEA) for its wholly-owned La Preciosa silver-gold project located in Durango state, Mexico. The PEA indicates an initial estimated mine life of 17 years recovering an estimated 134.5 million ounces of silver and generating a 17% after-tax internal rate of return (IRR) using price assumptions of $25 per silver ounce and $1,500 per gold ounce.

Over the first 14 years of production, La Preciosa is expected to produce an average 9.1 million ounces of silver per year at anticipated average cash operating costs 1 of $13.86 per silver ounce, and is expected to average approximately $93 million in operating cash flow 1 per year. At forecast production rates, La Preciosa would be one of the top 10 primary silver mines in the world. The references herein are in U.S. dollars and U.S. customary units.

Table 1: PEA (Base Case) Highlights and Assumptions
 

Preliminary Economic
 

Assessment
Silver/gold price assumptions $25/$1,500
Initial capital expenditures $348 million
Strip ratio 10.6:1
Estimated initial mine life 17 years
Average daily processing rate ~11,000 tons per day
Years 1-14 average grade 2.65 ounces silver per ton
Total silver ounces recovered (% of current resource) 73% of 184 million ounces
Years 1-14 average annual silver production 9.1 million ounces
Years 1-14 average annual cash operating cost per ounce 1 $13.86
Years 1-14 average annual operating cash flow 1 $93 million
After-tax IRR 17%
After-tax NPV (5% discount) $314 million
 

Mitchell J. Krebs, Coeur's President and Chief Executive Officer, said, “The results of this initial PEA demonstrate the viability of the La Preciosa open pit project at higher silver and gold prices and provide a solid foundation from which we believe we will enhance the project's economics over time. Subject to Board authorization, the Company intends to proceed with a feasibility study, which is expected to be completed in mid-2014. Upon completion of the feasibility study, the Company and its Board will evaluate the economics of the project, assess the silver market and determine whether to proceed with construction.”

If you liked this article you might like

Coeur Mining Stock Rising on First Quarter Production Results

Carnival, Network Appliance, Schlumberger, Randgold: 'Mad Money' Lightning Round

Domino's vs. Target in Consumer Smackdown: Cramer's 'Mad Money' Recap (Tuesday 2/28/17)

Here's a New List of Stocks That Show Bullish or Bearish Reversal Patterns

Coeur Mining (CDE) Stock Falls on Lower Gold, Silver Prices