Americas Gold and Silver Corporation (TSX: USA) (NYSE American:
USAS) (“Americas” or the “Company”), a growing North American
precious metals producer, reports consolidated financial and
operational results for the year ended December 31, 2020 along with
an operational update.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20210322005227/en/
Figure 1: Long Section (Looking West)
depicting some significant intercepts from East Coeur drilling
(Photo: Americas Gold and Silver Corporation)
This earnings release should be read in conjunction with the
Company’s Management’s Discussion and Analysis, Financial
Statements and Notes to Financial Statements for the corresponding
period, which have been posted on the Americas Gold and Silver
Corporation SEDAR profile at www.sedar.com, and on its EDGAR
profile at www.sec.gov, and which are also available on the
Company’s website at www.americas-gold.com. All figures are in U.S.
dollars unless otherwise noted.
Highlights
- Revenue of $27.9 million and a net loss of $30.1 million for
2020 or a loss of ($0.24) per share including a $9.0 million net
loss in Q4-2020.
- Consolidated operating metrics from 2020 were generally not
comparable to 2019 due to the illegal blockade at the Cosalá
Operations, suspension of operating metrics during the Galena
Recapitalization Plan (“Recapitalization Plan”) implementation, and
the continued ramp-up of operations at Relief Canyon with
commercial production declared effective January 11, 2021.
- The Galena Complex had a strong finish to the year with Q4-2020
production of 294,000 ounces of silver and 6.0 million pounds of
lead (503,500 ounces AgEq [1]) compared with 160,000 ounces of
silver and 2.6 million pounds of lead in Q4-2019 (293,500 ounces
AgEq), a year-over-year increase of over 70% on a AgEq basis.
- The Company continues to benefit from the success of the Phase
1 drill program as part of the Recapitalization Plan, with current
results from the East Coeur drilling, targeting the area between
Galena’s historically prolific West Argentine mining front and the
Coeur mine, yielding several high-grade intercepts. Results
include:
- Hole 34-113: 4,554 g/t silver and 5.0% copper (5,069 g/t silver
equivalent [2]) over 0.3 m [3]
- Hole 34-114: 5,418 g/t silver and 3.6% copper (5,788 g/t silver
equivalent) over 0.3 m 1,205 g/t silver and 1.2% copper (1,334 g/t
silver equivalent) over 1.3 m Including: 8,642 g/t silver and 7.4%
copper (9,404 g/t silver equivalent) over 0.2 m
- Hole 34-120A: 5,712 g/t silver and 2.7% copper (5,992 g/t
silver equivalent) over 0.7 m Including: 6,653 g/t silver and 2.8%
copper (6,944 g/t silver equivalent) over 0.5 m
- Relief Canyon declared commercial production on January 11,
2021 and is expected to ramp-up to full production by the end of
Q2-2021. The ramp-up has been challenging, most recently by the
impact of a COVID-19 outbreak at site in December 2020-January 2021
and severe weather in February 2021.
- The Company remains optimistic regarding a resolution for the
illegal blockade at the Cosalá Operations, with several upcoming
meetings planned with senior members of the Mexican federal
government at their request.
- The Company had a cash balance of $4.7 million as at December
31, 2020. On January 29, 2021, the Company closed a bought deal
financing for aggregate gross proceeds of approximately $26.7
million.
“Last year was expected to be transformational for the Company
but was met by a series of unexpected challenges. I would
personally like to thank our stakeholders for their patience and
support as we continue to meet these challenges and demonstrate to
the market the tremendous value of our assets,” stated Americas
Gold and Silver President & CEO Darren Blasutti. “I am
confident the success at the Galena Complex will continue as
indicated by the most recent drill results, the illegal blockade at
our Cosalá Operations will be resolved, and Relief Canyon will
reach full production following a difficult ramp-up period.”
Galena Complex
The Galena Complex is benefiting from the Recapitalization Plan
that commenced in October 2019. Successful exploration drilling led
to the increased mineral resource estimate as at June 30, 2020,
with further increases expected based on continued strong drill
results. Completion of key underground development and equipment
purchases contributed to significantly increased year-over-year
production in Q4-2020.
Measured and indicated silver resources on a 100% basis
increased from 27.4 million ounces to 37.3 million ounces and
inferred silver resources increased from 39.0 million ounces to
78.6 million ounces as at June 30, 2020. This increase represents a
36% and 101% increase, respectively, from the previously reported
estimate.
Production in Q4-2020 increased to 294,000 ounces of silver and
6.0 million pounds of lead (503,500 ounces AgEq) compared with
160,000 ounces of silver and 2.6 million pounds of lead in Q4-2019
(293,500 AgEq), a year-over-year increase of over 70% on a AgEq
basis.
The Company expects 2021 to be a transitional year at the Galena
Complex from a production standpoint with continued exploration
drilling supporting production growth toward a 2 million silver
ounce per year plan. Longer term and assuming continued exploration
success, the Company is confident that the operation will again
reach peak historical annual production levels of approximately 5
million ounces per year.
The operation has continued to yield tremendous exploration
drill results. In addition to continued success on the 4300 Level,
the Company began to target mineralization at East Coeur in January
2021, targeting the area between Galena’s historically prolific
West Argentine mining front and the Coeur mine. The initial
drilling has been successful with several high-grade intercepts.
Key results from the East Coeur drilling includes:
- Hole 34-113: 4,554 g/t silver and 5.0% copper (5,069 g/t silver
equivalent) over 0.3 m
- Hole 34-114: 5,418 g/t silver and 3.6% copper (5,788 g/t silver
equivalent) over 0.3 m 1,205 g/t silver and 1.2% copper (1,334 g/t
silver equivalent) over 1.3 m Including: 8,642 g/t silver and 7.4%
copper (9,404 g/t silver equivalent) over 0.2 m
- Hole 34-115: 926 g/t silver and 1.3% copper (1,068 g/t silver
equivalent) over 1.3 m
- Hole 34-118: 686 g/t silver and 1.0% copper (784 g/t silver
equivalent) over 0.9 m
- Hole 34-120A: 686 g/t silver and 0.7% copper (756 g/t silver
equivalent) over 0.9 m 5,712 g/t silver and 2.7% copper (5,992 g/t
silver equivalent) over 0.7 m Including: 6,653 g/t silver and 2.8%
copper (6,944 g/t silver equivalent) over 0.5 m
- Hole 34-125: 1,900 g/t silver and 2.4% copper (2,154 g/t silver
equivalent) over 0.4 m
- Hole 34-126: 6,001 g/t silver and 6.7% copper (6,697 g/t silver
equivalent) over 0.1 m
- Hole 34-127: 1,103 g/t silver and 1.1% copper (1,224 g/t silver
equivalent) over 0.4 m Including: 2,977 g/t silver and 3.5% copper
(3,344 g/t silver equivalent) over 0.1 m
- Hole 34-130: 1,098 g/t silver and 1.1% copper (1,214 g/t silver
equivalent) over 1.7 m
Based on historical production and drilling to-date,
mineralization at the Coeur mine is composed mainly of high-grade
silver-copper ore. Resumption of hoisting from the Coeur shaft and
processing ore at the Coeur mill would be part of the plan to
increase annual production at the Galena Complex to 5 million
ounces in the longer term.
A full table of drill results can be found at:
https://americas-gold.com/site/assets/files/4297/dr20210322.pdf.
Development of the new drill station on the 5500 Level is
complete and drift development work continues to advance further
east towards the Caladay shaft. The new drill station on the 5500
Level will provide a better angle to target the Triple Point
(intersection of the Silver, 175 and 185 Veins) as well as the down
dip extension of the 360 Complex.
The Company is targeting further mineral resource additions at
the Galena Complex from the remainder of Phase 1 drilling through
June 2021. In addition to the deep drilling and success on the 4300
Level, the recent East Coeur drilling is expected to positively
contribute to the updated mid-year resource estimate with the
potential increase exceeding the targeted addition of 50 million
ounces of silver.
Relief Canyon
The Relief Canyon mine declared commercial production effective
January 11, 2021 following the return of the Company’s large radial
stacker in December 2020 and meeting the target stacking rates.
This was the final item required to declare commercial
production.
The ramp-up at Relief Canyon has been a challenge and continues
to be challenging into Q1-2021. The Company and its consultants
performed extensive analysis and implemented a number of procedural
changes to address the start-up challenges typical of a heap leach
operation, including improved ore control, increased training,
standardization of operating practices and reagent optimization.
The operation was further impacted by a number of key staff
contracting the COVID-19 virus in December 2020-January 2021 which
was followed by severe weather challenges in February 2021.
The Company remains focused on reaching full production by the
end of Q2-2021 but Q1-2021 results will be negatively impacted by
the slow start to the year.
Cosalá Operations
In February 2020, the Company announced that an illegal blockade
was put in place at the Cosalá Operations by a group of individuals
including a small minority of the Company’s hourly workforce. As a
result, the Cosalá Operations was put on care and maintenance where
it currently remains.
Since the start of 2021, a number of meetings and discussions
have taken place between the Company and senior members of the
Mexican federal government at their request. As a result of these
meetings, the Company agreed to a framework for regaining access to
the operations and towards a restart of sustainable activity at the
Cosalá Operations. The Company is now awaiting actions from the
applicable authorities in support of this plan.
In addition, the Company released its first sustainability
report for the Cosalá Operations, “Working Towards Sustainability”,
which highlights the Company’s commitment to the mining industry in
Mexico and to the Cosalá community in Sinaloa. The report accounts
for the fulfillment of the Company’s labour commitments as well as
the environmental, safety and economic impact in the community
where the Cosalá Operations are located, which are in accordance
with international business best practices. The report can be
viewed on the sustainability section of the Company’s website
at:
https://americas-gold.com/site/assets/files/5635/sus_full_eng.pdf
In regard to comments made by the Mexican President on March 17,
2020, while the reference to the Company’s Cosalá Operations
concessions is concerning, the Company is confident that there is
no basis in the facts or in the law that would diminish the
Company’s property rights. The Company looks forward to continuing
to work with the Canadian government, the Mexican Minister of
Economy and the Minister of Foreign Affairs in providing the facts,
providing solutions and resolving the issues to avoid an
arbitration issue between Canada and Mexico. The Company looks with
optimism to getting our employees back on the job as soon as
possible.
About Americas Gold and Silver Corporation
Americas Gold and Silver Corporation is a high-growth precious
metals mining company with multiple assets in North America. The
Company’s newest asset, the Relief Canyon mine in Nevada, USA, has
achieved commercial production and is expected to ramp up to full
production by the end of Q2-2021. The Company also owns and
operates the Cosalá Operations in Sinaloa, Mexico and manages the
60%-owned Galena Complex in Idaho, USA. The Company also owns the
San Felipe development project in Sonora, Mexico. For further
information, please see SEDAR or www.americas-gold.com.
Qualified Persons
Niel de Bruin, P. Geo., Director of Geology, who is an employee
of the Company and a “qualified person” under National Instrument
43-101, have approved the applicable contents of this news
release.
Technical Information
The diamond drilling program used NQ-size core. Americas Gold
and Silver’s standard QA/QC practices were utilized to ensure the
integrity of the core and sample preparation at the Galena Complex
through delivery of the samples to the assay lab. The drill core
was stored in a secure facility, photographed, logged and sampled
based on lithologic and mineralogical interpretations. Standards of
certified reference materials, field duplicates and blanks were
inserted as samples shipped with the core samples to the lab.
Analytical work was carried out by American Analytical Services
Inc. (“AAS”) located in Osburn, Idaho. AAS is an independent,
ISO-17025 accredited laboratory. Sample preparation includes a
30-gram pulp sample analyzed by atomic absorption spectrometry
(“AA”) techniques to determine silver, copper, and lead, using aqua
regia for pulp digestion. Samples returning values over 514g/t Ag
are re-assayed using fire-assay techniques for silver.
Additionally, samples returning values over 23% Pb are re-assayed
using titration techniques.
Duplicate pulp samples were sent out quarterly to ALS Global, an
independent, ISO-17025 accredited laboratory based in Reno, Nevada
to perform an independent check analysis. A conventional AA
technique was used for the analysis of silver, copper and lead at
ALS Global with the same industry standard procedures as those used
by AAS. The assay results listed in this report did not show any
significant contamination during sample preparation or sample bias
of analysis.
Cautionary Statement on Forward-Looking Information:
This news release contains “forward-looking information” within
the meaning of applicable securities laws. Forward-looking
information includes, but is not limited to, Americas Gold and
Silver’s expectations, intentions, plans, assumptions and beliefs
with respect to, among other things, estimated and targeted
production rates and results for gold, silver and other precious
metals, as well as the related costs, expenses and capital
expenditures; the recapitalization plan at the Galena Complex,
including the replacement of the Galena hoist and associated and
expected costs; the Company’s production, development plans and
performance expectations at the Relief Canyon Mine and its ability
to finance, develop and operate Relief Canyon, including the
potential impact of the discovery of the carbonaceous material
within the Relief Canyon pit and the Company’s initial analysis and
determination of the extent and impact thereof and the expected
timing to complete such analysis and determination, as well as its
ability to address or mitigate such impacts and the extent thereof.
Often, but not always, forward-looking information can be
identified by forward-looking words such as “anticipate”,
“believe”, “expect”, “goal”, “plan”, “intend”, “potential’,
“estimate”, “may”, “assume” and “will” or similar words suggesting
future outcomes, or other expectations, beliefs, plans, objectives,
assumptions, intentions, or statements about future events or
performance. Forward-looking information is based on the opinions
and estimates of Americas Gold and Silver as of the date such
information is provided and is subject to known and unknown risks,
uncertainties, and other factors that may cause the actual results,
level of activity, performance, or achievements of Americas Gold
and Silver to be materially different from those expressed or
implied by such forward-looking information. With respect to the
business of Americas Gold and Silver, these risks and uncertainties
include risks relating to widespread epidemics or pandemic outbreak
including the COVID-19 pandemic; the impact of COVID-19 on our
workforce, suppliers and other essential resources and what effect
those impacts, if they occur, would have on our business, including
our ability to access goods and supplies, the ability to transport
our products and impacts on employee productivity, the risks in
connection with the operations, cash flow and results of the
Company relating to the unknown duration and impact of the COVID-19
pandemic; interpretations or reinterpretations of geologic
information; unfavorable exploration results; inability to obtain
permits required for future exploration, development or production;
general economic conditions and conditions affecting the industries
in which the Company operates; the uncertainty of regulatory
requirements and approvals; fluctuating mineral and commodity
prices; the ability to obtain necessary future financing on
acceptable terms or at all; the ability to operate the Relief
Canyon Project; and risks associated with the mining industry such
as economic factors (including future commodity prices, currency
fluctuations and energy prices), ground conditions and other
factors limiting mine access, failure of plant, equipment,
processes and transportation services to operate as anticipated,
environmental risks, government regulation, actual results of
current exploration and production activities, possible variations
in ore grade or recovery rates, permitting timelines, capital and
construction expenditures, reclamation activities, labor relations
or disruptions, social and political developments and other risks
of the mining industry. The potential effects of the COVID-19
pandemic on our business and operations are unknown at this time,
including the Company’s ability to manage challenges and
restrictions arising from COVID-19 in the communities in which the
Company operates and our ability to continue to safely operate and
to safely return our business to normal operations. The impact of
COVID-19 on the Company is dependent on a number of factors outside
of its control and knowledge, including the effectiveness of the
measures taken by public health and governmental authorities to
combat the spread of the disease, global economic uncertainties and
outlook due to the disease, and the evolving restrictions relating
to mining activities and to travel in certain jurisdictions in
which it operates. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking information,
there may be other factors that cause results not to be as
anticipated, estimated, or intended. Readers are cautioned not to
place undue reliance on such information. Additional information
regarding the factors that may cause actual results to differ
materially from this forward‐looking information is available in
Americas Gold and Silver’s filings with the Canadian Securities
Administrators on SEDAR and with the SEC. Americas Gold and Silver
does not undertake any obligation to update publicly or otherwise
revise any forward-looking information whether as a result of new
information, future events or other such factors which affect this
information, except as required by law. Americas Gold and Silver
does not give any assurance (1) that Americas Gold and Silver will
achieve its expectations, or (2) concerning the result or timing
thereof. All subsequent written and oral forward‐looking
information concerning Americas Gold and Silver are expressly
qualified in their entirety by the cautionary statements above.
1 AgEq results were calculated based on
average realized prices for silver and lead for Q4-2020 ($24.41/oz
silver and $0.86/lb lead) and Q4 2019 ($17.40/oz silver and
$0.91/lb lead). Note that AgEq is different for production results
versus drill results.
2 Silver equivalent was calculated using
metal prices of $20.00/oz silver, $3.00/lb copper and $1.05/lb
lead.
3 Meters represent “True Width” which is
calculated for significant intercepts only and based on orientation
axis of core across the estimated dip of the vein.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210322005227/en/
Stefan Axell VP, Corporate Development & Communications
Americas Gold and Silver Corporation 416-874-1708
Darren Blasutti President and CEO Americas Gold and Silver
Corporation 416‐848‐9503
Americas Gold and Silver (TSX:USA)
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