TORONTO, ONTARIO – July 17, 2017 – Americas Silver Corporation (TSX: USA) (NYSE “MKT”: USAS) (“Americas Silver” or the “Company”) is pleased to provide a construction update on its 100% owned and fully funded San Rafael development project located in Sinaloa, Mexico.
Budget & Timeline
Construction commenced in early Q4, 2016 with an estimated initial capital expenditure of US $22 million based on the March 30, 2016, San Rafael pre-feasibility study. The initial capital estimate was subsequently reduced to US $18 million due to project optimization related to the mill expansion, refurbishing existing equipment and ramp development, as well as favourable movements in the Mexican peso. As at June 30, 2017, the Company has spent approximately $10.5 million of the revised budget and expects to have sufficient cash on hand and cash flow generated from continuing operations to fund the project development.
Management expects that initial processing of material at the existing Los Braceros mill will occur by mid-September. The initial targeted throughput of 1,500 tonnes per day from the pre-feasibility study is expected early in Q4, 2017. In early 2018, management will evaluate a potential mill expansion based on realized mill throughput of the San Rafael ore, achievable future mining rates and current metal prices.
San Rafael is expected to deliver average annual production of 1 million ounces of silver, 50 million pounds of zinc and 20 million pounds of lead over a 6 plus year mine life at negative all-in sustaining costs based on current reserves and metal prices. The project is expected to have an IRR of greater than 100%, generate substantial free cash flow and provide a step change in the Company’s cash cost and all-in sustaining cost profile in 2018.