McEwen Mining Reports Record Production

 

TORONTO - McEwen Mining Inc. reported record annual production in 2015, solid fourth quarter production results, and the outlook for 2016.

Highlights: 22% increase in production year-over-year to 154,529 gold equivalent ounces (1) in 2015; New pro-business government elected in Argentina, positive policy changes already enacted; 4.2 grams per tonne (gpt) average crushed gold grade at El Gallo Mine in Q4 2015 vs. 2.3 gpt in Q3 2015; Production guidance of 141,000 gold equivalent ounces in 2016; No debt (2), $5.2 million line of credit repaid in full; $32 million (2) in cash, cash equivalents and precious metals.

At El Gallo Mine, Mexico, production in 2015 was 64% higher year-over-year at 63,366 gold equivalent ounces, compared to 38,556 gold equivalent ounces in 2014. Our revised guidance for the year was slightly exceeded. Higher production was the result of higher-grade ore being mined and placed on the leach pad, better metallurgical recovery, reduced downtime, and continued strong operational performance from our team in Mexico.

In Q4, the mine produced 11,092 gold equivalent ounces, compared to 14,236 gold equivalent ounces during same period in 2014. Production in Q4 was deliberately slowed as part of the optimized mine plan, and will accelerate significantly next quarter as a result of higher average ore grade (4.2 gpt Au) crushed in Q4. Full year guidance for El Gallo in 2016 is 52,000 gold equivalent ounces.

At the San Josa Mine, Argentina the attributable production from San Josa in 2015 was 47,353 gold ounces and 3,285,751 silver ounces, for a total of 91,163 gold equivalent ounces. Compared to 2014, gold and silver production was up 3% and 4% respectively. In Q4, attributable production was 14,424 gold ounces and 976,879 silver ounces, for a total of 27,449 gold equivalent ounces.

The newly elected government in Argentina has taken several steps that improve operating conditions for mining companies by eliminating the 5% export taxes on gold in dora, and by officially revaluing the Argentine Peso lower. These measures are welcome steps in the right direction that should enable San Josa to generate distributable cash in 2016. Full year production guidance for San Josa in 2016 is 45,000 gold ounces and 3.3 million silver ounces, for a total of 89,000 gold equivalent ounces.