2021 Tipped As Important Year For Company‘s Development
Sierra Metals Inc. (TSX: SMT) has reported positive fourth quarter 2020 and full year 2020 production results, as well as 2021 guidance for production, cost, EBITDA and capex.
Results are from Sierra Metals’ three underground mines in Latin America: The Yauricocha polymetallic mine in Peru, and the Bolivar copper and Cusi silver mines in Mexico.
2020 Consolidated Production Highlights
- Copper production of 44.3 million pounds; an 11% increase from 2019
- Silver production of 3.5 million ounces; a 3% increase from 2019
- Gold production of 13,771 ounces; an 18% increase from 2019
- Zinc production of 81.9 million pounds; a 1% increase from 2019
- Lead production of 33.0 million pounds; a 7% decrease from 2019
- Total of 2.8 million ore tonnes processed; a 6% increase from 2019
- Consolidated copper equivalent production of 118.2 million pounds; an increase of 6% from 2019, which is within the upper end of revised guidance
CEO, Luis Marchese, said the company achieved annual throughput that was 6% higher than the 2019 annual throughput despite the various COVID-19 related operational challenges including government-mandated shutdowns in the second quarter of the year. Annual 2020 consolidated production of silver, copper, zinc, and gold increased 3%, 11%, 1%, and 18% respectively, while lead production decreased by 7% compared to 2019.
Fourth Quarter 2020 Production Highlights
- Copper production of 10.6 million pounds; a 6% decrease from Q4 2019
- Silver production of 0.9 million ounces; a 6% increase from Q4 2019
- Gold production of 3,363 ounces; a 7% decrease from Q4 2019
- Zinc production of 21.6 million pounds; a 16% decrease from Q4 2019
- Lead production of 7.6 million pounds; a 23% decrease from Q4 2019
Mr Marchese said that despite the continued COVID-19 related operational challenges Q4 2020, consolidated quarterly ore throughput of 778,236 tonnes increased by 6% over Q4 2019, as higher throughput from the Mexican operations was partially offset by a 3% decline in Q4 2020 throughput from the Yauricocha mine.
Copper equivalent production at Yauricocha declined 20% during Q4 2020 due to a 3% decrease in quarterly throughput combined with lower head grades and recoveries. At Bolivar, 10% higher ore throughput and higher recoveries were partially offset by lower head grades resulting in Q4 2020 copper equivalent pounds production that was in line with Q4 2019.
Q4 2020 silver equivalent production at the Cusi mine was 83% higher than Q4 2019 due to 35% higher throughput realised, in addition to higher silver and gold head grades and 65% higher gold recoveries as compared to Q4 2019.
“We continue to put the health and safety of our employees and communities first,” Mr Marchese said.
“Despite the impacts of COVID-19 on our operations, I am very pleased with the Company’s strong production results. The hard work and efficiency gains of our employees resulted in a solid year of production in 2020. The company performed within the upper end of the range for its consolidated copper equivalent production guidance that was issued in a press release on August 13, 2020.
“The company has been able to continue ramping up production at the Bolivar Mine and Cusi Mines despite a high-level of COVID-19 case counts encountered during our safety screens in Q4 2020. Both the Bolivar and Cusi Mines saw increases in throughput as compared to the same quarter last year.
“Yauricocha’s throughput was slightly lower in Q4 2020 due to similar COVID-19 issues resulting from lower active employee headcount levels and backlog operational issues.
“2020 wrapped up on a positive note for the Company despite the challenges faced. We saw mineral resource increases at all mines. We completed and issued preliminary economic assessments (PEA) for all three mines boasting positive economics and supportive of potential expansion plans at all three mines. The price environment improved significantly for all metals produced by the company, highlighting the strong positioning of Sierra’s expanded and diversified portfolio of mining assets for the future.”
“2021 will be an important year for the company as we expect to receive the permits to increase Yauricocha’s production capacity by 20% in the second quarter. Furthermore, we expect to complete Pre-Feasibility Studies across all three mines which are expected to give us further insight into, and support, our growth plans. It is an exciting time for the Company as we continue with strong brownfield and greenfield exploration programs to support future mineral resource and production growth. We continue to focus on improving and modernizing our mine operations and increasing operating efficiencies with a focus on improving productivity and reducing costs.”