TSX.V: SCZ
FSE: 1SZ
OTCQX: SZSMF
VANCOUVER, Oct. 20, 2015 /CNW/ - Santacruz Silver Mining Ltd. (TSX.V:SCZ) (the "Company" or "Santacruz") is pleased to announce operating results from the Rosario Mine in San Luis Potosi, Mexico for the third quarter of 2015 ("Q3").
Q3 HIGHLIGHTS:
- Silver equivalent produced ounces of 277,487, up 4.38% from Q2;
- Head grade increased to 356.87 g/t Ag Eqv. Oz, up 10.58% from Q2;
- Transitioned from underground mining contractor to in-house mining which will further reduce costs.
"Santacruz has again improved upon the previous quarter's production performance at the Rosario Mine in Q3," stated Arturo Préstamo, CEO of Santacruz. "During Q3 we successfully transitioned from third party contractor underground mining to an in-house mining operations team. This action was taken to both further reduce the cost structure at the Rosario Mine and to ensure more management control over the day to day mining operations. We are pleased to be now hitting our stride at the Rosario Mine and we anticipate further improvements both operationally and financially. This performance comes at a key time in the Company's development and will allow us to continue our path forward."
2015 Third Quarter Operational Highlights
| Operations Summary | Q3 2015 | Q2 2015 | Percent change |
| Ore processed (tonnes milled) | 25,007 | 26,493 | (5.61%) |
| Silver eqv. ounce production 1 | 277,487 | 265,834 | 4.38% |
| Silver ounce production | 164,467 | 150,738 | 9.11% |
| Gold ounce production | 109 | 113 | (3.54%) |
| Lead production (tonnes) | 278 | 233 | 19.31% |
| Zinc production (tonnes) | 567 | 615 | (7.80%) |
| Average Head Grade (g/t Ag Eqv. Oz.)1 | 356.87 | 322.73 | 10.58% |
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Note 1 AgEqvOz=(Au*Pau/31.1035)+(Ag*Pag/31.1035)+(Pb*Ppb*22.05)+(Zn*Pzn*22.05)
(Pag)
Metal Prices: Ag $17.75, Au $1,250.00, Pb $0.83, Zn $1.09
Q3 Grade & Recovery Table
| Q3 2015 | Au | Ag | Pb | Zn |
| g/t | % |
| July | 0.21 | 232.04 | 1.22 | 2.66 |
| August | 0.18 | 224.96 | 1.28 | 2.54 |
| September | 0.18 | 181.76 | 1.04 | 2.28 |
| Average | 0.18 | 213.09 | 1.18 | 2.50 |
| Total Recoveries |
| July | 69.97% | 94.11% | 93.47% | 91.09% |
| August | 77.99% | 96.75% | 94.42% | 90.74% |
| September | 82.55% | 97.66% | 95.10% | 90.71% |
| Average | 75.97% | 96.00% | 94.28% | 90.87% |
Operations Plan for 2015
After assessing the benefits and costs of using a third party mining contractor as compared to bringing the mining activities in-house, management made the decision during the quarter to transition all mining activities at the Rosario Mine to an in-house mining team. This action will allow the Company to maintain better operational control over the mining operation and realize lower operating costs. Notwithstanding that this transition took place during the quarter, the Company was able to modestly increase its Ag Eqv. Oz. production with only a slight decrease in tonnes milled. Going forward it is anticipated that both the production rates and operating costs will continue to improve.
The goal for the Rosario Mine is to have both the mine and mill operating at 400 – 450 tonnes per day with the average silver equivalent head grade to be in the 325 - 350 g/t Ag Eqv. Oz.
Qualified Person
All technical information which is included in this statement has been reviewed and approved by Donald E. Hulse P.E. of Gustavson Associates LLC. Mr. Hulse is independent of the Company and a qualified person, pursuant to the meaning of such terms in National Instrument 43-101 Standards of Disclosure for Mineral Projects.
About Santacruz Silver Mining Ltd.
Santacruz is a Mexican focused silver company with a producing mine (Rosario); two advanced-stage projects (San Felipe and Gavilanes) and an early-stage exploration project (El Gachi). The Company is managed by a technical team of professionals with proven track records in developing, operating and discovering silver mines in Mexico. Our corporate objective is to become a mid-tier silver producer.
'signed'
Préstamo Elizondo,
President, Chief Executive Officer and Director
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward looking information
Certain statements contained in this news release, such as planned production and milling levels, costs, sales prices and efficiencies, constitute "forward-looking information" as such term is used in applicable Canadian securities laws. Forward-looking information is based on plans, expectations and estimates of management at the date the information is provided and is subject to certain factors and assumptions, including, that the Company's financial condition and development plans do not change as a result of unforeseen events, that third party ore to be milled by the Company has properties consistent with management's expectations, that the Company obtains all required regulatory approvals, and that future metal prices and the demand and market outlook for metals remains stable or improves. Forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates and actual results to vary materially from those projected in such forward-looking information. Factors that could cause the forward-looking information in this news release to change or to be inaccurate include, but are not limited to, the risk that any of the assumptions referred to prove not to be valid or reliable, which could result in lower revenue, higher cost, lower production levels, delays, and/or cessation in planned work, that the Company's financial condition and development plans change, delays in regulatory approval, risks associated with the interpretation of data (including in respect of the third party ore), the geology, grade and continuity of mineral deposits, the possibility that results will not be consistent with the Company's expectations, as well as the other risks and uncertainties applicable to mineral exploration and development activities and to the Company as set forth in the Company's Annual Information Form filed under the Company's profile at www.sedar.com. There can be no assurance that any forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader should not place any undue reliance on forward-looking information or statements. The Company undertakes no obligation to update forward-looking information or statements, other than as required by applicable law.
Financial outlook information contained herein about the Company's prospective costs of production and sales prices is based on assumptions about future events, as described above, based on management's assessment of the relevant information currently available. The purpose of such financial outlook is to provide information about management's current expectations as to the anticipated results of its proposed business activities for the coming quarters. Readers are cautioned that any such financial outlook information contained herein should not be used for purposes other than for which it is disclosed herein.
Rosario Mine
The decision to commence production at the Rosario Mine was not based on a feasibility study of mineral reserves demonstrating economic and technical viability, but rather on a more preliminary estimate of inferred mineral resources. Accordingly, there is increased uncertainty and economic and technical risks of failure associated with this production decision. Production and economic variables may vary considerably, due to the absence of a complete and detailed site analysis according to and in accordance with NI 43-101.
SOURCE Santacruz Silver Mining Ltd.
