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Power issues delay SilverCrest’s first metal sale from Las Chispas

Construction of Las Chispas processing plant. (Image courtesy of SilverCrest Metals.)

SilverCrest Metals (TSX: SILV), which is in the midst of commissioning its Las Chispas gold-silver mine in Sonora, Mexico, said reliability issues with electricity power supplies have affected plans to complete its first metal from the mine.

The Canadian precious metals exploration and development company said power supply to its operation were not “at a steady state”, but noted they should improve in the last quarter of the year, when it expects to begin selling metals from the mine.

Despite the issue, SilverCrest anticipates to reach commercial production at the underground mine before the end of the year, as originally planned. Initially, Las Chispas will generate 600 to 700 tonnes of ore per day, slightly lower than the 750 tonnes per day indicated in the feasibility study.

“Starting up a new mining operation is a dynamic period, and our team and contractors continue to navigate and address mostly typical ramp-up issues,” COO Pierre Beaudoin said in the statement.

During the first three months of commissioning, the Las Chispas processing plant has performed in-line or ahead of the design curve on all metrics, the company said. 

A total of 53,600 tonnes of material have been processed since start-up with August 2022 average throughput of 784 tpd, up 46% from July 2022, it noted.

Located approximately 180 km northeast of Hermosillo, the Las Chispas silver project currently has 3.4 million tonnes of proven and probable reserves grading 461 g/t silver and 4.81 g/t gold.

Only 21 of 45 known veins on the property were included in this reserve estimate, SilverCrest said.

As of August 31, the Vancouver-based miner had cash and cash equivalents of $101.6 million and decided not to draw the remaining $30 million it has available under its $120 million credit facility.