SilverCrest Metals Inc. (TSX:SIL) (NYSE:SILV) is pleased to report the Company’s unaudited financial results for the second quarter of 2022. The unaudited condensed consolidated interim financial statements and management’s discussion and analysis for the three and six months ended June 30, 2022 are available under the Company’s SEDAR profile on www.sedar.com or on SilverCrest’s website www.silvercrestmetals.com. All amounts herein are presented in United States Dollars, unless otherwise stated.
The Company’s top priority is the high-grade, historic Las Chispas mining district in Sonora, Mexico, where it has completed a feasibility study and construction of its Las Chispas Mine. Commissioning is underway at the Las Chispas Mine and achievement of commercial production is expected during Q4, 2022. Details of the Feasibility Study, including an updated Mineral Resource Estimate and an initial Mineral Reserve Estimate, are provided in a technical report filed under the Company’s SEDAR profile entitled, “NI 43-101 Technical Report & Feasibility Study on the Las Chispas Project” with an effective date of January 4, 2021.
Highlights – First Half 2022
At June 30, 2022, the Company held $118.6 million (December 31, 2021 – $176.5 million) as cash and cash equivalents, had value-added taxes receivable in Mexico of $26.3 million (December 31, 2021 – $23.3 million), inventory of $19.4 million (December 31, 2021 – $Nil) and mineral property, plant and equipment of $200.0 million (December 31, 2021– $165.7 million).
To date, the Company has financed its operations through the issuance of common shares and debt. During H1, 2022, the Company did not generate revenue from its Las Chispas Mine, as the precious metal poured on June 30, 2022 was recorded as inventory. During H1, 2022, the Company incurred income of $0.9 million (H1, 2021 – loss of $21.4 million) and a comprehensive loss of $6.0 million (H1, 2021 – $7.1 million).
Please refer to the Company’s Q2, 2022 unaudited condensed consolidated interim financial statements and MD&A for additional information.
Under the Credit Facility, in which the Company entered into with an affiliate of RK Mine Finance (“RK”) on December 31, 2020, a final tranche of $30 million is available to the Company until August 31, 2022. With the completion of plant construction on time and on budget, $118.6 million of cash and cash equivalents as of June 30, 2022, and the planned progression towards achieving commercial production in Q4, 2022, the Company has decided not to draw down the final $30.0 million tranche of the Credit Facility.
Las Chispas Processing Plant Completion and Commissioning
During Q2, 2022, Ausenco Engineering Canada Inc. completed construction and handed over the Las Chispas processing plant to SilverCrest, ahead of the Feasibility Study schedule. Other construction activities handled directly by SilverCrest (road, bridge, dry stack tailings facility, temporary diesel power plant and assay lab) have also been completed, some of which are subject to testing and commissioning. While the final capital costs incurred remain to be settled, the capital cost of the Las Chispas Mine is anticipated to be below the US$137.7 million budget estimated in the Feasibility Study.
Processing plant commissioning is now underway, and 12,700 tonnes of low-grade ore was milled during June 2022. Overall, plant commissioning is tracking in-line with our objective to reach commercial production in Q4, 2022. Given the extensive amount of underground development completed to date, there is a significant amount of stockpiled ore on surface to allow for operational flexibility and a more measured ramp-up of underground mining over the first few years of production.
The Las Chispas Mine had its first pour of silver and gold on June 30, 2022, consisting of 312 kg of doré with approximately 9,200 oz of silver and 100 oz of gold.
Las Chispas Expenditures
During H1, 2022, Las Chispas expenditures recorded under mineral property, plant and equipment totaled $35.6 million (inclusive of unpaid accrued expenditures), of which $5.5 million was for plant and equipment purchases, $12.2 million for construction in progress costs, and $17.9 million for mineral property costs, which is net of $13.7 million of mineral property costs that were reclassified to inventory.
ABOUT SILVERCREST METALS INC.
SilverCrest is a Canadian precious metals exploration and development company headquartered in Vancouver, BC, that is focused on new discoveries, value-added acquisitions and near-term production in Mexico’s historic precious metal districts. The Company’s top priority is on the high-grade, historic Las Chispas mining district in Sonora, Mexico, where it has completed construction of its Las Chispas Mine and commissioning is underway. SilverCrest is the first company to successfully drill-test the historic Las Chispas Property resulting in numerous high-grade precious metal discoveries. The Company is led by a proven management team in all aspects of the precious metal mining sector, including taking projects through discovery, finance, on time and on budget construction, and production.
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We acknowledge the [financial] support of the Government of Canada.