Mine Acquisitions Positive Sign For Silver
Devil’s metal got some attention over Fox Business news today, where CEO of Silver Standard John Smith discussed the outlook for silver, saying that he believes the GFMS 2013 revised outlook of an average silver price of $36 is a good conjecture. The topic of the discussion based around recent mine acquisitions in the mining industry and their good omen for global silver demand.
There has been a flurry of recent mine acquisitions. For example, Ardent Mines recently agreed to terms for the purchase of 100% of the shares of Sociedad Minera Las Cumbres operation of a silver mine in the Churin region of Peru, about 150 miles northeast of the capital city of Lima. Ardent Mines has also entered into an option agreement with Alfredo de Lima SMRL to purchase the mineral rights for the Condorsenga mine, where the Las Cumbres operation is located.
Fortuna Silver Mines Inc. in January entered into an agreement with Compania Minera Cuzcatlan and Plata Pan American have entered into an acquisition and option agreement for the 6,254 hectares surrounding San Jose Mine in Oaxaca, Mexico. . “We will be planning an aggressive exploration program to immediately follow up on targets that we have developed.”
All-in-all, besides the bloodbath that mining stocks have been as late, things are active in the industry.
Here is Silver Standards’2012 Earnings Call Transcript:
Silver Standard Resources (SSRI) Q4 2012 Earnings Call March 1, 2013 11:00 AM ET
Good day, everyone, and welcome to the Silver Standard’s Fourth Quarter 2012 Year-End Finals Results and Product Update Conference Call. This call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to John Smith, President and CEO.
John Smith – Chief Executive Officer, President and Director
Thank you, Kevin. Good morning, ladies and gentlemen. Welcome to Silver Standard’s Fourth Quarter 2012 Conference Call, during which we’ll provide a review of our financial performance and give an update on our business.
Joining me on the call this morning is Greg Martin, our CFO; Ron Burk, Vice President, Exploration. Also present is John DeCooman, Vice President, Business Development and Strategy; and Andrew Sharp, our Vice President, Technical Services. We also welcome into the company Alan Pangbourne, our new Senior Vice President of Projects.
Our financial statements and management’s discussion and analysis have been filed on SEDAR and are also available on our website. To accompany our comments today, there is also an online webcast, and you’ll find the information on this in our news release relating to the call. We will be making forward-looking statements today, and I refer you to the disclosure accompanying our slides, news release and also on SEDAR.
So now we will review progress in driving value within our business and positioning us strongly for the future. In my time as CEO of Silver Standard, we have focused on unlocking the value from our business. Each year, as a management team, we have systematically planned and delivered with this objective in mind. In 2010 and ’11, it was ensuring funding was in place to allow us to develop the business and address the skills and experience we needed to be a truly successful mining company, and that included both technical and commercial capability.
In 2012, we focused on operating Pirquitas to plan quarter-by-quarter, notwithstanding the challenges in Argentina. We also made a significant step forward in driving value from the portfolio with the completion of a feasibility study for Pitarrilla, a large long-life mine that underpins our future.
As we step into 2013, we will keep delivering at Pirquitas and we are well-funded for our development opportunities. The convertible debt that we raised in January not only allows us to repay the existing convertible note due in March, but adds to our actually already strong balance sheet for Pitarrilla construction.
We have the people, the projects, a unique portfolio and an enviable balance sheet, the right elements for a great business. So now let me review our operations development activity, and I’ll start with Pirquitas Mine in Argentina.
Our operating team at Pirquitas have delivered strong results, allowing us to exceed the high-end of the 2012 production guidance. We have had exploration success in the Cortaderas Valley, expanding the resource and identified future targets for 2013.
Mining cost for 2012 were $12.61 per ounce of silver produced, in line with our guidance of $11.85 to $12.85 per ounce. Costs are always a challenge in a high inflationary environment, but our management team in Argentina completed the year within guidance range. In 2013, cost management will continue to be a major focus area.