Americas Gold says silver production up 66% in Q1

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Americas Gold and Silver Corp. [USA-TSX, USAS-NYSE American] has reported consolidated attributable silver production of 500,000 ounces in the first quarter of 2023, marking a 66% increase from 300,000 ounces in the first quarter of 2022.

Americas Gold and Silver is a growing precious metals mining company with multiple assets in North America. The company owns and operates the Cosala Operations in Sinaloa, Mexico, manages the 60%-owned Galena Complex in Idaho, and is re-evaluating the Relief Canyon mine in Nevada. The company also owns the San Felipe development project in Sonora, Mexico.

Despite the large first quarter increase, production was impacted by a 2.5-week shutdown at the Cosala operations tailings facility in February. This enabled work crews to perform remedial work on the decan tunnel. As a result, silver equivalent (AgEq) production in the first quarter was down approximately 8.0% to 1.2 million ounces, compared with the first quarter of 2022.

The company said the tunnel is no longer required and decommissioning of the tunnel is part of the long-term environmental plan at the operations.

Meanwhile, mining operations at the Galena complex have resumed after they were temporarily suspended for two days following a tragic accident that resulted in the death of an employee on April 11, 2023.

The company’s production guidance remains unchanged.

Production is expected to increase at both Cosala operations and the Galena complex due to the mining of higher-grade silver zones with additional production benefits expected once the Galena hoist becomes operational, likely before the end of the second quarter of 2023.

The company previously said its attributable silver equivalent (AgEq) production is expected to increase to a range of 5.5 – 6.0 million ounces this year from 5.3 million ounces in 2022. It said further increases are expected to push production to between 6.5-7.0 million ounces in 2024.

Silver equivalent ounces for the 2023 guidance and 2023 production outlook references were calculated based on US$22 per ounce silver, US$1.00 per pound lead, and 1.45 a pound zinc. Forecasts for 2023 and 2024 include only the Cosala Operations and Galena Complex.

The Galena Complex has been impacted by an industry-wide shortage of labour, which is reflected in the company’s silver equivalent production guidance for 2023. The company is estimating that increasing the hourly workforce at Galena by 10% would boost silver production in 2023 by approximately 20%.

Consolidated cash cost (net of by-product credits) for 2023 is expected to be in the range of between US$8.00 and US$9.00 per silver ounce, assuming zinc and lead prices of US$1.45 a pound and US$1.00 a pound respectively.

On April 13, 2023, Americas shares closed at 77 cents and currently trade in a 52-week range of $1.44 and 50 cents.

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