Canadian miner Silver Standard Resources Inc. (SSRI) has unfurled its production statistics for 2012 and guidance for 2013. The company said that its Pirquitas mine in Argentina produced a record 8.6 million ounces of silver last year, surpassing the high end of its guidance range.
The Pirquitas mine produced 2.3 million ounces of silver during the fourth quarter, up 4.9% sequentially. Increased silver recoveries and higher mill throughput led to the higher production at the plant.
Zinc production, at the Pirquitas mine, was 11.2 million pounds for full-year 2012 including 3.2 million pounds in the fourth quarter. The annual production was near the high-end of the company's guidance range.
The company milled 4,433 tons per day on average during 2012, 11% above the Pirquitas plant's nominal design. Silver recovery averaged 76% during the year.
During the fourth quarter, roughly 417,000 tons of ore were milled at the Pirquitas mine at an average rate of 4,531 tons per day. The average recovery rate for silver rose to 79.9% from 77.7% in the third quarter.
Looking ahead, the company expects to produce 8.2 to 8.5 million ounces of silver and 20 million pounds of zinc in 2013. Total cash cost is expected to be between $17.00 and $18.50 per silver ounce.
Moreover, Silver Standard expects capital spending of $25 million at the Pirquitas mine. It plans to spend roughly $15 million on exploration this year, of which, around $7 million has been targeted for exploration at its Mexican projects.
The company also plans to spend at least $17 million on development in 2013. Roughly $8 million and $7 million of this budget will be will be allocated at the Pitarrilla and San Luis (Peru) projects, respectively. This is in sync with the company's aim of advancing these projects to construction decisions.
Silver Standard remains focused on exploration. The company completed the feasibility study for its fully-owned Pitarrilla Project in Mexico during fourth-quarter 2012. The study indicated robust silver mineral reserves (of roughly 480 million ounces), strong economic returns and high leverage to silver prices.
The Pitarrilla mine is expected to produce 15 million ounces of silver per year on an average during the first 18 years of production. The company said that it remains focused on advancing the project towards a construction decision.
Silver Standard currently retains a short-term Zacks Rank #1 (Strong Buy). Great Panther Silver Ltd (GPL), which also belongs to the silver mining industry, retains a Zacks Rank #2 (Buy).