Mill throughput at Tahoe Resources' new Escobal silver mine 70 km southeast of Guatemala City, Guatemala, exceeded its design capacity of 3,500 metric tons per day (mt/d) during June and July, averaging 3,709 mt/d in June and 3,788 mt/d in July. For the full three months of the second quarter, throughput averaged 3,410 mt/d.
Mill operations started up at Escobal in late September 2013, and Tahoe declared commercial production in January. The company is forecasting average production of more than 20 million silver equivalent oz/y over Escobal's first 10 years of operation, which will rank it among the world's top five silver mines.
Tahoe CEO Kevin McArthur said, "The ramp-up and optimization at Escobal were completed as planned during the second quarter. We are very happy with the outstanding team performance at the Escobal mine, and we continue to make great strides toward accomplishing our 2014 goals."
Escobal produced 5.8 million oz of silver in concentrates during the second quarter at a total cash cost of $5.65/oz and all-in sustaining costs of $8.04/oz, net of byproduct credits. First-half production totaled 9.9 million oz of silver in concentrates.
The silver grade in Escobal mill feed has been essentially as predicted in Tahoe's budget, and mining has advanced according to plan. With only a small percentage of the deposit mined, preliminary reconciliation indicates silver grade and silver ounces mined thus far are approximately 1% greater than predicted by the 2012 Escobal resource model. Silver recoveries to concentrates have met expectations at 86.5% during the first half and 88.1% during the second quarter.
Escobal generated $104.7 million in revenue from concentrate sales during the second quarter at operating costs of $48.2 million, resulting in earnings from mine operations of $56.5 million. Tahoe's net earnings for the quarter totaled to $36.1 million.
Tahoe is conducting a feasibility study to support an anticipated expansion of mill throughput to 4,500 mt/d. The study is scheduled for completion during the fourth quarter. Meanwhile, paste plant modifications, underground development, and the addition of a fourth tailing filter are all in progress.