Greens Creek | Admiralty Island, Alaska
Hecla’s 100%-owned and operated Greens Creek mine in southeast Alaska is one of the largest and lowest-cost primary silver mines in the world, last year producing 7.4 million ounces of silver at a cash cost, after by-product credits, per silver ounce of $4.42 (a non GAAP measure)(1). Production in 2014 is expected to be 6.5 to 7.0 million ounces.
In 2013, drilling at Greens Creek replaced reserves and made progress in realizing the potential of the Deep 200 South and 200 South trend. The 200 South and Deep 200 South zones currently represent a mineralization trend that extends over 3,000 feet along strike and over 1,000 feet of dip. Definition and exploration drilling of the Deep 200 South has defined three stacked folds of high-grade mineralization that represents up to 600 feet of down-dip continuity. Drill intersections continue to be very encouraging and mineralization remains open to the south. Deep 200 South had some of the widest and highest grade intercepts in recent history at the mine and include 48.0 oz/ton silver, 0.07 oz/ton gold, 6.6% zinc and 3.3% lead over 26.7 feet and 32.5 oz/ton silver, 0.46 oz/ton gold, 17.0% zinc and 7.3% lead over 35.0 feet. Similar southward trending mineralization remains open along the 5250 and Gallagher trends, and the Southwest Bench and Northwest-West zones are open to the southwest. Definition drilling of the East Ore confirmed reserves in the central part of the zone and refined resources on the perimeter. See drill assay highlights in Table B at the end of the release.
Underground drilling in 2014 is expected to consist mainly of in-fill drilling in order to develop a mine plan on the Deep 200 South and the Southwest Bench. Additional exploration drilling will test for mineralization along the limbs of the lower fold, as well as the projected intersection of the Gallagher Fault and the Deep 200 South mineralization. The remaining exploration drilling is expected to test a 1,000 foot gap in drilling at the junction of the projection of the Southwest Bench, 200 South and Deep 200 South.
In 2013, surface drilling at the Killer Creek area, which is less than a mile from the current Greens Creek mine infrastructure, intersected broad mineralized zones up to 400 feet with stringer veins locally grading up to 10% copper and 10.4% combined lead-zinc. Widely spaced drilling currently covers an area of 2,500 feet by 2,500 feet and suggests mineralization open in all directions. In general, the northern holes are more copper-gold rich and the southeast area is more zinc, lead and silver rich. The Company believes these “stockwork veins” are characteristic of a vent or source area for the mineralizing fluids for either the Greens Creek deposit or a completely separate sulfide deposit. The planned 20,000 feet of surface drilling at Killer Creek is designed to better define the outward extent of the stockwork area and to intercept the mine contact at depth.
The mine holds current proven and probable silver reserves of 92.5 million ounces, 713,000 ounces of proven and probable gold reserves, as well as 256,130 tons of lead and 677,940 tons of zinc in proven and probable reserves.
There are an additional 9.4 million ounces of silver measured and indicated resource and 31.8 million ounces of silver inferred resources. Measured and indicated gold resources measure 72,000 ounces and inferred gold resources measure 216,000 ounces.
Drilling efforts over the past ten years have replaced production and added new reserves and resources. Exploration efforts are ongoing along the trend of numerous orebodies underground and aggressively exploring the highly prospective 27-square-mile land package on surface. Underground drilling efforts this year are looking to convert resources to reserves and define extensions to the 200 South, Southwest Bench and NNW. Surface drilling at Killer Creek may define a new mineralizing center at Greens Creek.
(1) Cash cost, after of by-product credits, per silver ounce is a non-GAAP measurement. A reconciliation of cash cost to cost of sales and other direct production costs and depreciation, depletion and amortization (GAAP) can be found in the legal page of this website.