27
CAYLLOMA MINE, PERU
DRIVING GROWTH FROM WITHIN
Silver production increased by 5% over 2013 to 2.2 million ounces because of higher
metallurgical recovery and slightly higher head grade. Zinc production increased 9% as
a result of higher head grades and metallurgical recoveries. Lead production decreased
9% because of lower zinc head grades.
Cash cost per tonne was $90.57 per tonne of processed ore, a decrease of 1% from
the prior year and 3% above annual guidance. AISCC was $14.13, or 32% lower than
2013 and 17% below annual guidance.
Capital expenditures, primary property, plant and equipment and brownfields
exploration, were $9.9 million. This included $5.1 million for mine development
and $4.0 million for equipment and infrastructure.
2015 – 2017 Production Guidance
Silver (Moz)
2.0
2.0
2013
2012
2011
2.1
2.2
1.9
2.0 2.0
2014
2015E 2016E 2017E
2015 Production and Cost Guidance
Tonnes milled
464,100
Metal production
Silver (Moz)
1.9
Gold (koz)
1.9
Zinc (Mlbs)
32.1
Lead (Mlbs)
19.5
Head grade
Silver (g/t)
175
Gold (g/t)
0.30
Lead (%)
2.05
Zinc (%)
3.12
Unit costs
Cash cost/t
$90.3
AISCC ($/oz Ag)
$12.78
Outlook for 2015
We have budgeted $10.4 million for mine development
and plant optimization in 2015. We expect the
improvements to increase the recovery of silver to
approximately 88% from 84.5% achieved in 2014.
Additionally, we anticipate a 10% gain in throughput
capacity from improvements to the lead floatation
circuit and the use of high-frequency sieving instead
of hydrocyclones for separation.
Brownfields exploration
Our exploration budget of $0.7 million is similar to
the expenditure of $0.8 million in 2014. The modest
budget is temporary and made possible by our
success in building a Mineral Reserve and Resource
base. This is now sufficient to maintain short- or mid-
term production levels without compromising future
operations. Exploration in 2015 will focus on
evaluating and defining high-grade gold and silver
targets in the northern portion of the Caylloma District.
2014 Operating and Financial Highlights
