Hecla busts company record with 148 million ounces of silver reserves

Hecla Mining reported the largest resource calculation in company history today with 148 million ounces of silver reserves and 281 million ounces of resources. The silver numbers represented a 4% increase in reserves and a 13% bump in resources. Hecla also noted a 33% increase in gold resources to 597,600 ounces, while lead and zinc increased a respective 21% and 26%.

Hecla (NYSE:HL), the largest silver produce in the United States, said the update came from exploration results from its four land packages in the US and Mexico, as well as its three pre-development projects.

“For the sixth consecutive year, Hecla has increased its reserves and resources, setting a new record for both categories in 2011,” said Phillips S. Baker, Jr., Hecla’s President and Chief Executive Officer. “A number of milestones were achieved with our three pre-development initiatives in the Silver Valley and Colorado during 2011, with the Star scoping study on the Upper Country nearing completion, progress at the San Juan Silver property with infrastructure development at the Bulldog well under way, and commencement of underground drilling at the Equity. Exploration activities in 2011 have yielded strong results with a further extension of mine life at the Lucky Friday mine, discovery of higher-grade mineralization at Greens Creek, expansion of the resource at the Star, and the definition of a new resource at San Sebastian. As a result of these successes, we are planning a significant investment in exploration in 2012.”

Hecla is budgeting $28 million for exploration in 2012. The company will also be completing scoping and preliminary economic evaluations to potentially re-open the Star, San Juan Silver, and San Sebastian properties, which would contribute to Hecla’s goal of 50% silver production growth over the next five years.

HIGHLIGHTS

  • Silver reserves and resources increased by 4% and 13% to 148 million ounces and 281 million ounces, respectively; gold resources increased by 33% to 597,600 ounces; and lead and zinc resources increased 21% and 26%, respectively.
  • More than a 16% increase in the contained metal (silver, lead, zinc) in Lucky Friday’s proven and probable reserve with the addition of high-grade tons.
  • Drilling at the Greens Creek mine has defined two high-grade areas within the Gallagher zone with good exploration potential for extensions to the south.
  • Resources at the Star in the Silver Valley significantly increased and underground rehabilitation was completed to provide new exploration platforms for drilling and evaluation of multiple mineralized veins.
  • A new gold-silver resource has been outlined in the Andrea Vein at the San Sebastianproperty in Mexico.
  • Underground drilling in the Equity Vein system at the San Juan Silver property in Coloradohas outlined multiple zones of high-grade, gold/silver-bearing veins. Construction of the portal to access the Bulldog resource is being initiated.

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