Mining companies report Q2 results

Mining companies report Q2 results

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Barrick Gold

Barrick Gold Corp.’s earnings were up in the second quarter to $194 million, or 11 cents per share. Net earnings for the quarter compared with a net loss of $94 million, or 8 cents per share, in the second quarter of 2018, according to Barrick’s announcement.

Adjusted net earnings for the 2019 quarter totaled $154 million, or 9 cents per share. That compared with adjusted net earnings in the 2018 quarter of $81 million, or 7 cents per share.

The realized gold price for the quarter was $1,317 per ounce, up slightly from $1,313 in the 2018 quarter.

Gold production companywide in the quarter totaled 1.35 million ounces, up from 1.07 million ounces in the 2018 quarter, according to earnings report. Total cash costs were $651 per ounce in the 2019 quarter, compared with $605 in the 2018 quarter. All-in sustaining costs averaged $869 per ounce in the 2019 quarter and $856 in the prior year.

Copper production totaled 97 million pounds, up from 83 million pounds in the 2018 quarter.

Looking at Nevada, Barrick President and Chief Executive Officer Mark Bristow said in an earnings presentation that all the Nevada Gold Mines joint venture operations north of Carlin will now have one name.

The complex of underground and open pit mines and processing facilities “will be known as the Carlin Mine going forward,” he said.

Those mines include the Gold Quarry open pit, Leeville underground, Goldstrike’s open pit Betze-Post operation and Meikle and Rodeo underground mines and additional former Newmont pits and underground operations on the Carlin Trend.

Bristow was speaking during a presentation and call on Barrick’s second-quarter earnings, which don’t include the Nevada Gold Mines joint venture that went into effect July 1. He said Barrick will be “reporting our attributed share” of the joint venture in future quarters.

Barrick operates the joint venture, 61.5 percent owned by Barrick and 38.5 percent owned by Newmont Goldcorp Corp.

Bristow’s report on Nevada also featured an update on the Goldrush and Fourmile deposits on the Battle Mountain-Eureka Trend. He said there are “best-ever, eyewatering intersections” in the exploration at Fourmile, which isn’t part of the joint venture but can be when a feasibility study points to mining the deposit.

Barrick reported a new model calls for its Goldrush deposit to merge with Fourmile. Meanwhile, construction of twin declines continues to further access the orebody from underground at Goldrush. Surface drilling continues at Fourmile.

Nevada production in the second quarter of Barrick operations totaled 526,000 ounces, compared with 533,000 ounces in the 2018 quarter.

At Cortez near Crescent Valley production totaled 280,000 ounces of gold, compared with 294,000 ounces in the 2018 quarter, and the company stated that the operation continues its transition to a higher proportion of double refractory, underground ore.

The underground Deep South is expected to begin contributing to Cortez production in 2020. Barrick is expecting a record of decision from the U.S. Bureau of Land Management in the second half of this year on Deep South.

At Goldstrike north of Carlin, gold production totaled 181,000 ounces, up from 170,000 ounces in the second quarter of last year.

Turquoise Ridge underground mine in Humboldt County posted lower gold production of 65,000 ounces, compared with 69,000 in the 2019 quarter because of unplanned shaft repairs and power interruptions, combined with lower cut-off grades, Barrick stated in a slide presentation. Barrick owned 75 percent of Turquoise Ridge and Newmont, 25 percent, until the July 1 joint venture.

Construction of a third shaft at Turquoise Ridge is on schedule and on budget, Barrick reported.

Nevada Gold Mines is expected to produce between 2.1 million and 2.3 million ounces in a year, and Bristow said predicted synergy savings with the joint venture are happening.

In the Aug. 12 earnings report, Barrick’s chief operating officer for North America, Catherine Raw, stated that integration of the Barrick and Newmont operations was a simple objective but a complex task that required enormous effort.

Nevada Gold Mines is now an integrated company with 7,000 employees under the banner “One Team. One Mission,” Raw reported.

Toronto-based Barrick’s second-quarter report was the second to include former Randgold Resources mines that became part of Barrick with the Jan. 1 merger of the two companies.

Bristow said the Barrick has created new teams for three regions of the world and is acquiring minority interests in Acacia Mining in Tanzania, after brokering a solution for Acacia’s long stand-off with the Tanzanian government.

“That’s a lot of boxes ticked in a short time,” he said.

He also said Barrick is pursuing the sale of its 50 percent ownership in the Kalgoorie gold mine in Australia that is operated by Newmont Goldcorp, which is the other 50 percent owner.

Additionally, Bristow said Barrick sees the Pueblo Viejo Mine in Dominican Republic as offering exciting growth prospects with the plant expansion project under way. Barrick operates the mine, which is 50 percent owned by Newmont Goldcorp.

Newmont Goldcorp

Newmont Goldcorp Corp.’s earnings were down in the second quarter, the first since the Newmont-Goldcorp merger and the last quarterly report before the Nevada Gold Mines joint venture between Newmont and Barrick Gold Corp. took effect.

Newmont Chief Executive Officer Gary Goldberg said in an earnings call that highlights of the quarter included closing the deal with Goldcorp and completing a historic joint venture with Barrick Gold Corp. for Nevada mines.

“Our proven strategy is driving improvements across the newly combined portfolio. Closing the Goldcorp acquisition, coupled with the successful close of the Nevada Gold Mines joint venture, has positioned Newmont Goldcorp as the world’s leading gold business for decades to come,” Goldberg said in the earnings announcement.

The joint venture, called Nevada Gold Mines, went into effect July 1, with Barrick as the operator and holding 61.5 percent ownership. Newmont owns 38.5 percent.

Newmont Goldcorp will proportionately consolidate its ownership interest in Nevada Gold Mines and will report the company’s interest in the joint venture as a separate segment it its consolidated financial statements beginning in the third quarter, the company reported.

Newmont Goldcorp reported a second-quarter gain of $1 million, or zero cents per share, in the quarter, down $273 million from the second quarter of last year because of added costs. Adjusted earnings also were down.

The company’s adjusted earnings totaled $92 million, or 12 cents per share, compared with $144 million, or 26 cents per share, in the second quarter of last year. The adjustments related to integration and transaction costs associated with the Newmont Goldcorp merger and Nevada joint venture, an increase in the fair value of investments, a gain on asset and investment sales, and reclamation and remediation charges for legacy sites.

Newmont Goldcorp lost $25 million in the second quarter, however, before including income loss or gains from operations and discontinued operations. This is the Generally Accepted Accounting Principles (GAAP) figure The Associated Press used in its story on the Greenwood Village, Colo.-based company earnings.

For the second quarter, the company stated that earnings also were affected by costs incurred while the Peñasquito Mine in Mexico and Musselwhite Mine in Canada weren’t operational, higher interest expense and a prior-year gain from the sale of the company’s royalty portfolio, partially offset by higher gold prices.

Newmont’s president and chief operating officer, Tom Palmer, stated in the call that “North American operations were impacted by near-term challenges in the second quarter. Our performance is expected to improve in the second half of the year as we work to fully integrate the Goldcorp assets and set them up for sustainable future success.”

Challenges included a temporary shutdown at Peñasquito because of local protests, but operations were ramped back up in June. Also, at Musselwhite, there was a conveyor fire. Rehabilitation of the conveyor ramp is roughly 70 percent complete, Palmer said, and development activities and work on the material handlings project is under way.

Nevada’s production is expected to be 1.5 million ounces this year, Newmont reported after an adjustment of roughly 70,000 ounces to reflect the impact of a slide in the Gold Quarry open pit north of Carlin.

Nevada operations contributed 365,000 ounces in the quarter, which was before the joint venture, compared with 366,000 ounces in the 2018 quarter.

The operations included the Leeville underground mine, the Gold Quarry Mine and other underground and open pit mines north of Carlin, as well as the Twin Creeks Mine in Humboldt County, the Long Canyon Mine between Wells and West Wendover, the Phoenix Mine near Battle Mountain and Emigrant south of Carlin.

Companywide, Newmont produced 1.59 million ounces of gold in the second quarter at an all-in sustaining cost of $1,016 per ounce, compared with 1.16 million ounces in the 2018 quarter at an all-in-sustaining cost of $957 per ounce, up 37 percent over the 2018 quarter.

The average realized price for gold in the quarter was $1,317 per ounce, up $25 over the 2018 quarter. The average realized price of copper was $2.48 per pound, down 51 cents per pound.

Palmer said that since the merger, Newmont’s experienced supply chain team “is actively chasing value across several fronts,” and the company is using its technical expertise to turn the former Goldcorp assets around.

He said in the earnings call that Newmont had done its due diligence before the merger, but there may be two to three years needed to bring the former Goldcorp operations up to expectations.

Kinross Gold

Kinross Gold Corp.’s net earnings for the second quarter were way up at $71.5 million, or 6 cents per share, compared with $2.4 million, or zero cents per share, in the 2018 quarter, while adjusted net earnings were $79.6 million, or 6 cents per share, compared with $37.8 million or 3 cents per share, last year.

Net earnings are from continuing operations attributable to common shareholders.

The Toronto-based company reported gold equivalent production of 648,251 ounces, up from 602,049 ounces in the second quarter of 2018, and a consolidated production cost of sales per gold equivalent ounce of $663 per ounce, down from $767 last year. The all-sustaining cost was $925 per ounce, down from $1,018 per ounce in the 2018 quarter.

“In the second quarter, we delivered excellent operating and financial results as our portfolio of mines increased production and lowered costs compared with the previous quarter and year,” J. Paul Rollinson, president and chief executive officer, stated in the earnings announcement.

He said performance at the company’s latest assets bolstered results at Paracatu in Brazil, Kupol in Russia and Tasiast in Mauitania, which represent 63 percent of Kinross production.

“Our Nevada development projects – Round Mountain Phase W and Bald Mountain Vantage Complex – achieved a major milestone as both produced their first gold bars,” Rollinson said.

Round Mountain Phase W continues to be on budget and on schedule, with the processing circuit commissioned ahead of schedule, Kinross reported. The first gold bar from the completed vertical carbon-in-column plant poured in late May.

The truck shop, warehouse, wash bay and fuel island are roughly 95 percent complete and expected to be completed in the current third quarter, according to the announcement, which also states that mine stripping is progressing and will continue into late 2020. Initial near-surface Phase W ore is now encountered.

At Bald Mountain, the Vantage Complex has begun production, and the first gold bar from the project was poured in late June. However, weather-related challenges, higher labor costs than expected and supply issues continue to challenge the project budget and ramp-up of production, Kinross reported.

The company wrote that despite the challenges, commissioning for the project is well-advanced with the vertical carbon-in-column plant and heap leach pads now substantially complete and in production. The construction of the truck shop, warehouse and wash bay are nearing completion.

Kinross reported Round Mountain increased production over the first quarter mainly due to the timing of ounces recovered from the heap leach pads, partially offset by lower mill grades. Production was down from the second quarter of last year mainly due to timing of ounces processed through the mill.

Round Mountain in Nye County produced 90,833 gold equivalent ounces in the quarter ending June 30, 2019, compared with 97,650 ounces in the 2018 quarter.

Bald Mountain in White Pine County produced 40,564 ounces in the 2019 quarter, down from 71,435 in the 2018 quarter.

Production was down at Bald Mountain compared with the 2018 quarter because of weather-related challenges that impacted mining rates, resulting in less ore placed on the leach pads.

Kinross also reported exploration in the first half of this year at Bald Mountain has returned promising results at Redbird, including high-grade intercepts adjacent to the current Redbird resource pit shell. Exploration in the second half of the year will test the mineralization along the northeast trend and southeast extension.

Separately, Kinross announced on July 31 that it had reached an agreement with N-Mining Ltd. to acquire Chulbatkan, a development project in Russia for $283 million.

Kinross has been operating in Russia 24 years.

SSR Mining

SSR Mining Inc. announced net income of $12.4 million, or 9 cents per share, in the second quarter, up from $2.6 million, or 4 cents per share, in the 2018 quarter and that revenue grew 49 percent on increased sales.

Adjusted net income was $17.8 million, or 15 cents per share in the quarter, compared with nearly $12.1 million, or 10 cents per share, in the 2018 quarter. Revenue was $155.2 million, compared with $104 million in the second quarter.

The company said the rise in revenue was due to increased sales at the Marigold Mine in Nevada, increased sales at the Puna operations in Argentina, where delivery of silver/lead and zinc concentrates into annual contracts began, and more gold production at the Seabee operations in Saskatchewan.

“The operations continued to deliver with nearly 100,000 gold equivalent ounces production in the quarter at slightly better all-in sustaining costs,” said Paul Benson, president and chief executive officer of the Vancouver-based company.

SSR reported the company achieved quarterly consolidated production of 98,334 gold equivalent ounces in the second quarter and a cash cost of $775 per ounce, with Marigold production at 54,922 ounces of gold at a cash cost of $835 per ounce, compared with 49,436 ounces at a cash cost of $700 per ounce in the 2018 quarter.

SSR is looking to expand at Marigold with the June 27 acquisition of 21,992 acres at Trenton Canyon and Buffalo Valley from Newmont Goldcorp Corp. and Fairmile Gold Mining Inc. for $22 million.

The land is adjacent to Marigold in Humboldt County and brings the Marigold land holdings to 48,926 acres.

The deal that includes a 0.5 percent royalty to Newmont covers land and heap leach pads and processing facilities at Trenton Canyon, where Newmont mined from 1996 to 2001. Buffalo Valley produced 50,000 ounces of gold from 1989 to 1991 and was 70 percent owned by Newmont, 30 percent by Fairmile.

SSR stated that exploration and permitting activities are scheduled through the second half of the year at the Mackay pit, North and South Red Dot, Valmy, East Basalt and the newly acquired Trenton Canyon areas. Exploration at Trenton Canyon is targeted to begin in the third quarter.

The company said the focus of exploration this year is at Red Dot to increase reserves, and Marigold has completed preliminary pit designs and economic valuations based on a gold price of $1,250 per ounce. Red Dot could extend Marigold mine life into the early 2030s without expansion of the mining fleet and the associated costs, according to SSR.

Looking ahead, SSR stated that it expects to produce 400,000 gold equivalent ounces this year due to strong production results at all three mines.

Seabee produced 26,539 ounces of gold at cash costs of $526 per ounce, up from 23,582 ounces at a cash cost of $616 per ounce in the second quarter of last year.

The company reported four new pieces of underground equipment that were delivered over the ice road to Seabee in the first quarter were commissioned in the beginning of the second quarter.

Puna produced 1.5 million ounces of silver at cash costs of $9.80 per ounce in the quarter, up from 954,000 ounces of silver in the 2018 quarter. The mine also produced lead and zinc.

SSR also announced an agreement on July 22 to acquire the remaining 25 percent of Puna for $34 million from Golden Arrow Resources Corp.

McEwen Mining

McEwen Mining Inc. announced a consolidated net loss of $13 million, or 4 cents per share, for the second quarter ending June 30, compared with a loss of $5.4 million, or 2 cents per share, in the 2018 quarter.

“The good news is that the balance of the year is looking much better,” Chairman and chief owner Rob McEwen said in the earnings report.

He said the Gold Bar mining operation in Eureka County only declared commercial production one month before the end of the second quarter “and is gaining momentum.”

McEwen Mining stated that at Gold Bar gold production is expected to improve in the second half of this year. Production, including pre-commercial, in the second quarter totaled 7,940 gold ounces. Cash costs were $901 per ounce in the quarter.

The mining company reported the revised mining plan for this year calls for Gold Bar to produce 15,000 ounces in the third quarter and 17,000 ounces in the last quarter of the year, and production guidance has been lowered to 42,000 ounces for the year from 50,000 ounces.

McEwen also stated that exploration drilling for 2019 has started in Nevada and Timmins, Ontario.

The company reported companywide gold production in the second quarter totaled 36,216 ounces and silver production totaled 850,525 ounces, or 45,881 ounces of gold equivalent ounces, slightly lower than the second quarter of 2018 of 47,258 gold equivalent ounces.

At the Black Fox Mine in Ontario, water infiltration from temporary flooding of the western part of the mine affected gold production in the second quarter, but the issue has been resolved, according to McEwen Mining.

Production at Black Fox in the second quarter totaled 9,420 gold ounces, down from 14,042 ounces in the second quarter of last year. Cash costs were $837 per ounce.

On the bright side, McEwen said in the earnings announcement that early assay results from Black Fox and Grey Fox exploration sites “have been very encouraging.”

Production in the second quarter for McEwen’s 49 percent interest at the San Jose Mine in Argentina totaled 13,518 ounces of gold and 848,268 silver ounces for a total of 23,157 gold equivalent ounces, compared with 22,395 ounces in the 2018 quarter. Cash costs in the quarter averaged $960 per ounce.

The mine is on track for a 2019 gold production of 49,000 ounces and nearly 3.23 million ounces of silver, according to the announcement.

The El Gallo Mine in Mexico is expected to reach 16,000 ounces of gold production for the year at a cash cost of $875 per ounce. The mine produced 5,354 ounces in the second quarter, down from 10,786 ounces in the 2018 quarter. The mine was under transition from mining to residual leaching in the quarter.

Coeur Mining

Coeur Mining Inc. reported a second-quarter loss from continuing operations of $36.8 million, or 18 cents per share, including a non-cash write-down of $11.9 million, compared with net income of $2.9 million, or 2 cents per share, in the 2018 quarter.

Adjusted net loss for the Chicago-based company was $23 million, or 11 cents a share, compared with a gain of $1.1 million, or 1 cent per share, last year, on revenue of $162.1 million, up 5 percent over the first quarter of this year but lower than the $170 million in revenue in the second quarter of last year.

“We made solid operational and financial progress on multiple fronts during the second quarter and are well positioned to deliver on our key initiatives in the second half of 2019,” Coeur President and Chief Executive Officer Mitchell Krebs said in the second-quarter announcement.

He said the company had improved cost management, improved operational results and repaid $82 million of outstanding debt under a revolving credit facility while continuing exploration that included encouraging results at Kensington in Alaska and Silvertip in British Columbia.

Gold production in the quarter was 86,584 ounces and 3.1 million ounces of silver, down from the 94,052 gold ounces and 3.2 million silver ounces produced in 2018 quarter. The average realized gold price was $1,277 per ounce, and the average realized silver price was $14.75 per ounce. Those prices compare with a gold price of $1,241 and a silver price of $16.48 in the 2018 quarter.

Zinc sales totaled 5.3 million pounds and lead, 5.2 million pounds, in the 2019 quarter, with no production to compare with for the 2018 quarter. Zinc and lead are produced at Silvertip, which went into commercial production on Sept. 1, 2018.

In Nevada, Coeur’s Rochester Mine near Lovelock has successfully commissioned an enhanced crushing unit that includes a high-pressure grinding roll, and is in full mining and processing mode, according to the earnings announcement. Coeur reported that that the new crushing circuit is expected to improve silver recoveries and reduce operating costs the second half of the year.

The company reported preliminary metallurgical test work from newly crushed material is in line with expectations at Rochester, and production results will continue to improve in the second half of the year.

Silver production at Rochester totaled 971,000 ounces and gold production was 8,609 ounces in the second quarter, compared with silver production of nearly 1.13 million ounces and 12,273 ounces of gold production in the 2018 quarter.

Costs applicable to sales at Rochester were $13.19 per silver ounce and $1,153 per gold ounce, compared with $11.89 per silver ounce in the second quarter of 2018 and $936 per gold ounce.

Coeur’s full-year guidance for Rochester production remains at 4.2 million to 5 million ounces of silver and 40,000 to 50,000 ounces of gold.

Coeur also reported resource expansion drilling at the Sterling and Crown exploration properties in southern Nevada.

At Palmarejo in Mexico, Coeur saw gold production of 28,246 ounces and silver production of nearly 1.74 million ounces, down roughly 16 percent from 33,702 ounces of gold produced in the second quarter of 2018 and 2.07 million ounces of silver, according to the earnings report.

The gold mine Kensington produced 34,049 ounces of gold, up from 25,570 ounces in the 2018 quarter, and the ore grade was 44 percent higher than last year mainly due to the high-grade Jualin deposit. Jualin went into production on Dec. 1, 2018.

In South Dakota, Coeur entered into a purchase agreement with Barrick Gold Corp. for the Richmond Hill Project adjacent to Coeur’s Wharf Mine to provide the company with the opportunity to leverage existing infrastructure to expand and extend Wharf’s mine life.

Hecla Mining

Hecla Mining Co. posted losses in the second quarter financial report that President and Chief Executive Officer Phillips Baker said was “poor and impacted by several items.”

The net loss applicable to common shareholders was $46.7 million, or 10 cents per share, in the second quarter, compared to income of $11.9 million, or 3 cents per share, in the 2018 quarter.

He said in an earnings call that the Greens Creek Mine in Alaska provided strong cash flow and exploration there has added to reserves, “but with Nevada not working as we hoped, we’re reducing expenses companywide.”

Phillips said in the earnings report that the changes in Nevada were made in June “so they did not have much impact on the financial results for the second quarter but should help improve the cash flow in the second half of the year.”

The company suspended operations at the Hollister underground mine in Elko County, and Hecla stopped using a contractor for mining at Midas. Fire Creek near Crescent Valley is still operating.

Baker stated the company has “taken several steps in anticipation of refinancing our senior notes, due in 21 months. First, we bought put options that assure us of the minimum prices for the next few quarters that we receive for gold and silver. Next, we amended certain terms of our revolving credit agreement to improve availability to borrow funds.”

He said the final step is the reduction in expenditures to increase cash flow so the company “has no net revolver debt at year end.”

The company bought put option contracts in an amount approximating the expected gold and silver sales though a portion of 2020, setting a minimum average price of $1,400 per gold ounce and $15.13 per silver ounce.

Companywide, Hecla produced 3 million ounces of silver and 60,768 ounces of gold in the second quarter. The company reported it is increasing its annual estimate for silver production throughout the company to 11.7 million ounces because of higher grades at Greens Creek.

In Nevada, the company produced 12,694 ounces of gold and 49,449 ounces of silver in the quarter, and the company expects to mine at Midas only through the third quarter. At Fire Creek, only currently developed material is being mined.

At Greens Greek, the mine produced 2.4 million ounces of silver and 13,257 ounces of gold in the second quarter, compared with 2 million silver ounces and 13,719 gold ounces in the 2018 quarter.

At Casa Berardi in Quebec, there were 31,270 ounces of gold produced, down from 42,722 in the 2018 quarter, because of lower ore grades and lower mill recovery, according to Hecla.

At San Sebastian in Mexico, there were 463,735 ounces of silver and 3,547 ounces of gold produced in the quarter, down from 559,647 ounces of silver and 3,872 ounces of silver in the second quarter of last year.

Lucky Friday Mine in Idaho produced 127,147 ounces of silver, up from 24,687 ounces in the 2018 quarter mainly due to a shift in focus from development to production by the salaried staff. The added production is helping defray costs associated with a strike at Lucky Friday that started in the spring.

Hecla also announced management changes. Lauren Roberts joined as senior vice president and chief operating officer, after service a similar role for Kinross Gold Corp., and Larry Radford, formerly the COO, is moving to chief technical officer as he moves toward retirement.

Dean McDonald, senior vice president for exploration, is retiring after being with Hecla since 2006, and his role will be divided between Keith Blair, who becomes chief geologist, and Kurt Allen, who becomes director of exploration.

Alio Gold Inc.

Alio Gold Inc., which operates the Florida Canyon Mine in Nevada, posted a net loss of $3.8 million, or 5 cents per share, in the second quarter, compared with earnings of $3.3 million, or 5 cents per share, in the 2018 quarter.

The Vancouver-based company reported gold production of 21,483 ounces produced at an all-sustaining cost of $1,307 per ounce.

“The second quarter came in lower than expected primarily as a result of lower production at the Florida Canyon Mine, resulting from low equipment availability of the aged mining fleet,” said Mark Backens, president and chief executive officer.

He said the company is well-advanced in securing a replacement loading and hauling fleet that should address the problem.

“This is a major milestone for Florida Canyon and is expected to facilitate a significant increase in mining capacity and gold production and reduced cost over the life of the mine,” Backens stated in the earnings report. “The new equipment will be phased into production over the next three to four months.”

Alio Gold is leasing 13 Caterpillar haul trucks and three Caterpillar loaders for Florida Canyon, according to the report.

The company also stated that permits have been received and activities moving ahead on the planning construction of a storm water diversion channel and permitting of the phase II heap leach pad is proceeding on schedule. Alio hopes to begin construction of the leach pad in September.

Florida Canyon at Imlay produced 11,253 ounces of gold and 8,577 ounces of silver in the second quarter. There is no 2018 comparison because the mine was in a rehabilitation period in April 2018.

Alio acquired the prior Florida Canyon operator, Rye Patch Gold Corp., in May of 2018.

Alio Gold operates a second mine, the San Franciso Mine in Mexico, which produced 10,230 gold ounces and 5,112 silver ounces in the quarter, compared with 14,466 gold ounces and 7,661 silver ounces in the second quarter of 2018.

The company reported gold and silver production was lower because the open-pit mining has ended, and low-grade stockpile material was processed through the crushing circuit. Alio decided in January to stop mining after looking at options that it found weren’t financially viable for the company.

Alio also has a development project called Ana Paula in Mexico and exploration properties in the United States and Mexico.

Comstock Mining

Comstock Mining Inc. reported a realignment of the company, formation of a new mercury-recovery company and a net loss of $3.9 million, or 5 cents per share, in the second quarter, compared with a loss of $4.9 million, or 9 cents per share, in the 2018 quarter.

“Our focus on realigning and transforming the company and its balance sheet is finally coming to fruition,” said the Virginia City-based company’s executive chairman and chief executive officer, Corrado De Gasperis.

“We have now received $3.4 million in non-refundable cash deposits and stock valued at $5 million for the Lucerne sale, launched a globally focused mercury remediation business with world-class technology and experience and facilitated the formation of an opportunity zone fund that will monetize our assets and further fund these strategic ventures, all while continuing to lower operating costs,” he said in the Aug. 15 announcement.

Comstock, which is selling its Lucerne property to Tonogold Resources Inc., amended the sale agreement for a third-quarter closing. The company’s board approved the sale in the first quarter. Tonogold is buying the Lucerne Resource Area for $15 million, plus assumption of certain liabilities and a 1.5 percent royalty to Comstock for Lucerne production.

Lucerne is a gold and silver site that is part of the historic mining district between Reno and Carson City.

According to Comstock, the board in the first quarter approved a focus on activities that could include metals exploration, engineering, resource development, economic feasibility assessments, mineral production, metal processing and related supply chain acquisitions and ventures of environmentally friendly, conservation-based mining technologies and processes.

The new mercury cleanup company is called Mercury Clean Up LLC, which will provide clean technology to remediate mercury not just in Nevada but anywhere in the world. The Mercury Clean Up subsidiary is a collaboration with Oro Industries Inc.

The collaboration is for the manufacture and global deployment of mercury remediation systems with proprietary mechanical, hydro, electro-chemical and oxidation processes to reclaim, treat and remediate mercury from tailings and industrial effluents derived from mining and other industrial applications, the earnings report states.

Mercury Clean Up will work closely with the Nevada Division of Environmental Protection and U.S. regulators, Comstock reported.

“We have already been contacted with requests for mercury solutions, and we are committed to safe, clean solutions for global jurisdictions and their miners,” De Gasperis said.

Comstock’s realignment also includes a new arrangement of subsidiaries, in addition to Mercury Clean Up, to cover exploration and development, mining, the industrial park and real estate.

The company recently announced a Nevada district court ruling in favor of Comstock and Lyon County on the one remaining due process rights claim associated with the county’s master plan amendment and zone change associated with mineralized properties within Comstock’s Dayton resource area, just south of the Lucerne properties and near Silver City.

As a result, Comstock is going forward with the Dayton Project to a full feasibility assessment, including creating a list of new drill targets to further expanding the mineral resource.

Comstock plans to continue exploring into Spring Valley, as well.

Looking ahead, Comstock stated it is moving forward with the sale of Silver Springs properties for more than $10 million in the fourth quarter.

Comstock ceased mining in 2015 and gold and silver production ended in 2016.


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