Yamana gold Inc. is pleased to announce that it has started operations at its Mercedes mine. The Mercedes mine, located in Sonora, Mexico, is Yamana's newest mine and represents the first of a number of new mines to begin production into 2013.
With mine development and plant commissioning well advanced, and a sufficient stockpile having been created during the mine development period, a first gold pour occurred, which marks the formal start-up of production at the mine. The Company has been working on the commissioning of various components of the operation since October. The Company announced in August that it was six months ahead of schedule and would be starting operations by the end of year instead of the middle of 2012. With further progress and advancements, the Company is again ahead of schedule with start-up occurring well before year end.
To date, there have been over 11,000 metres of underground development completed, including the start of development of the Barrancas zone, which includes the higher grade Lagunas Norte vein, one of the newest discoveries at the mine, which was not included in the original mine plan and represents a significant opportunity to increase production.
Mining is at a rate consistent with the original plan and the plant is ramping up to the rate of 1500 tonnes per day as contemplated in the feasibility study.
During the mine development period, 114,000 tonnes of ore were stockpiled with an average gold grade of 7.84 g/t and 114.9 g/t of silver which represents approximately 30,000 gold equivalent ounces (GEO)(1) in stockpile.
Production is initially planned at 120,000 GEO per year although the Company is evaluating the potential to increase throughput to 1800 tonnes per day through modest plant modifications and optimizations. With increased plant capacity along with the additional ore from Barrancas, and as accelerated underground development work advances during 2012, the Company expects production to increase to over 130,000 GEOs in 2013.
An updated mineral reserves and resources statement for Mercedes is expected in February which will reflect the new ounces from the additional vein structures in the Barrancas zone, and the more recently discovered Diluvio zone of the Lupita vein structure. Commercial production is expected in the second quarter of 2012.
Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions in Brazil, Argentina, Chile, Mexico and Colombia. Yamana plans to continue to build on this base through existing operating mine expansions, throughput increases, development of new mines, advancement of its exploration properties and by targeting other gold consolidation opportunities with a primary focus in the Americas.