Coeur d'Alene Mines announced that proven and probable reserves for the Palmarejo silver-gold project in Mexico have increased to 62.4 million ounces of silver and 750,000 ounces of gold.
In a news release issued Tuesday, Idaho-based Coeur said a completed feasibility study for the Palmarejo project anticipates production beginning in the first half of 2009 with an estimated silver production of 5.1 million ounces and 67,000 ounces of gold.
For the first full year of production in 2010, Palmarejo is expected to yield 7.4 million ounces of silver and 92,000 ounces of gold, which will increase Coeur's total silver output by 43% to 25 million ounces. Coeur's total gold production is expected to increase 48% to 282,000 ounces in 2010.
As a result of the Palmarejo feasibility study, which has not yet been made public, Coeur's total companywide proven and probable reserves have increased 29% to 278.8 million ounces of silver and 2.2 million ounces of gold. Total companywide measured and indicated reserves had been reported at 144.4 million ounces of silver and 1.1 million ounces of gold.
Donald Birak, Senior Vice President of Exploration, said in a news release, These new proven and probable mineral reserve results are just for the Palmarejo deposit, one of the three large mineral deposits identified to-date-Palmarejo, Guadalupe and La Patria-in this large and prospective property. We expect to increase these initial reserves during the remainder of the year, and beyond, through continued exploration on the district's multiple exploration targets.
He added that new mineral resources models are currently underway for both Guadalupe and La Patria.
Dennis Wheeler, Chairman, President and CEO for Coeur said in a news release, Once in production, Palmarejo will add significantly to Coeur's growing silver and gold production profile, reduce companywide cash costs, and substantially boost our cash flow. While the Palmarejo project feasibility study has not yet been made public, Coeur's news release estimated a total capex of $235.1 million for this year and $62.5 million for plant and infrastructure and mine equipment in 2009.