Lucky Friday Mine Restarts Production

COEUR D'ALENE, ID - Hecla Mining Company reported that the Lucky Friday Mine has restarted production and is expected to ramp up to full production in the first quarter. The plans to resume production were completed on schedule and involved developing a new secondary egress consisting of a ramp of 1,600 feet and a 290-foot vertical escapeway. The Company received a favorable coverage determination letter and expects to start receiving insurance proceeds during the first quarter.

The Lucky Friday mine produced 3.1 million ounces of silver in 2023, 30% lower than in 2022, due to the suspension of production since August due to a fire in the secondary escapeway (#2 shaft). Fourth quarter production was nominal as the mill processed residual material from ore pockets.

"Hecla faced multiple challenges in 2023 with the fire at the Lucky Friday mine and improving the safety culture at Keno Hill, but despite these challenges, silver production exceeded last year as Greens Creek delivered another strong year, Lucky Friday's production through July with our patented UCB method produced more silver than the mine typically produced in a full year with the old mining method, and the roughly half year of production at Keno Hill shows its potential to be a meaningful producer,” said Phillips S. Baker, Jr., Hecla's President and CEO. "As planned, we began the transition of Casa Berardi’s production to surface mining, which lowered production but increased margins."

Baker continued, “We look forward to a strong year in 2024 as we execute our growth strategy to deliver up to 20 million ounces of silver production by 2025. With silver's critical role in energy transition and its application in solar electricity generation, Hecla will play an important role in producing silver as the world’s fastest-growing established silver producer and the dominant producer of silver in the U.S. and soon Canada.

Silver production of 14.3 million ounces exceeded 2022 production of 14.2 million ounces, despite the temporary shutdown at the Lucky Friday mine since August 2023. As expected, annual gold production decreased 14% as Casa Berardi transitions to an open pit mine; Greens Creek gold production increased 26%. Keno Hill produced 1.5 million ounces, with the Bermingham deposit achieving the highest mined tonnage in December; initiated a safety action plan to build a strong operational foundation at the mine.”

The Greens Creek mine produced 9.7 million ounces of silver and 60,896 ounces of gold for the year. Fourth quarter production was 2.3 million ounces of silver and 14,651 ounces of gold. Throughput for the quarter was 2,393 tons per day (tpd), 4% lower compared to the third quarter, and was impacted by two significant weather events in November and one in December, causing road blockages and unplanned mill downtime, resulting in approximately 12 days of lost production. The mill achieved a throughput of 2,600 tpd when operating. Annual throughput averaged 2,506 tpd, an increase of 9% over the prior year. Annual silver production was unchanged from 2022 as higher throughput offset lower grades and recoveries. Annual gold production increased by 26% due to higher throughput, grades, and recoveries.

Keno Hill produced 1.5 million ounces of silver in 2023, with 608,301 ounces produced in the fourth quarter. Throughput for the quarter averaged 214 tpd with silver grades of 32 ounces per ton. As safety has improved, so has mining, with Bermingham achieving the highest production in December, exceeding 9,500 tons mined. Ore inventory at the end of the year was approximately 3,000 tons at a silver grade of 27 ounces per ton.

Hecla's injury-free standard drives the pace of production and development at Keno Hill. A safety action plan, which will be executed over the year, has been initiated, focusing on training, supervision, mining practices, and implementation of the safety processes.

The Casa Berardi mine produced 90,363 and 22,517 ounces of gold in 2023 and the fourth quarter, respectively. As expected, annual gold production declined by 29% due to wildfire-related closures in June and lower underground tonnage as the mine transitions to a surface operation by mid-2024. Fourth quarter gold production was 7% lower than the third quarter due to lower milled grades partially offset by higher throughput. The mine set another quarterly record for surface tonnage handled as the in-house equipment fleet was fully commissioned. The mill operated at an average of 3,859 tpd in the fourth quarter, a 3% increase over the third quarter attributable to improved performance of the gravity circuit.