VANCOUVER, BC, Dec. 4, 2023
/CNW/ - Luca Mining Corp. ("Luca" or the
"Company") (TSXV: LUCA) (OTCQX: LUCMF) (Frankfurt: Z68)
announces its financial and operating results for the third quarter
and nine months ended September 30,
2023. The Company reports net revenue of $15.1 million in Q3 2023, representing a 2%
increase over net revenue of $14.8
million in Q3 2022. Mine operating income (before
depletion, depreciation, and amortization) in Q3 2023 was
$0.30 million compared to
$1.50 million in Q3 2022. The net
mine operating loss in Q3 2023 was $0.74
million compared to a net mine operating gain of
$1.16 million in Q3 2022.
Highlights
- Tahuehueto is nearing completion of 1,000 tonnes per day of
installed capacity before year end and on track to ramp up to
commercial production in early 2024. First phase production from
the mine is expected to achieve over 40,000 ounces gold equivalent
per year with an AISC of under USD $1,000 per AuEq ounce*.
- Campo Morado initiated an
optimization program designed in cooperation with consulting
metallurgical engineers, Ausenco, which has already demonstrated
substantial increases in both recoveries and grades of the
copper-lead and zinc concentrates.
- The Company expects the optimization program to result in a
revenue increase of at least 40% in 2024 with only very modest
capital expenditures.
"During the third quarter of 2023, the Tahuehueto Mining
project continued progressing towards its objective of achieving
1,000 tonnes per day installed capacity by year-end and
announcement of commercial production early in 2024," said
Mike Struthers, CEO. "Following a
challenging operational performance in Q3 2023 at Campo Morado, in large part due to reduced
throughput as part of a new optimization program by our colleagues
at Ausenco, we now have, for the first time in the history of this
operation, an understanding of how to correctly operate the project
to achieve consistent performance and profitability. The execution
of a new mine-to-mill program, an effective blending strategy, and
multiple initiatives in the processing plant, will translate into
major improvements to the bottom line at Campo Morado. We are very grateful for the
substantial support provided by the Ausenco engineers and look
forward to the improved results to come to fruition in
2024."
Q3 2023 Overview
Campo Morado
Production and concentrate sales for the three months ended
September 30, 2023:
- Produced 5,094 tonnes of zinc concentrate grading an average of
45.8% zinc, 4.08 g/t gold, 450 g/t silver and sold 5,399 tonnes
generating Q3-2023 revenue from zinc concentrate of US$4.59 million.
- Produced 3,674 tonnes of bulk copper-lead concentrate, grading
an average of 14.8% copper, 11.72 g/t gold, 753 g/t silver and sold
3,485 tonnes generating Q3-2023 revenue from copper concentrate of
US$5.97 million
- 128,287 tonnes of mineralized material were processed through
the processing plant at a C1 cash cost per pound payable of zinc at
US$2.74 with average grades of 2.51%
zinc, 0.77% copper, 0.74% lead, 1.62 g/t gold, and 100.91 g/t
silver
- Recoveries during Q3-2023 were 72.6% zinc, 47.8% copper, 28%
gold, and 36.6% silver.
C1 cash costs per pound of payable zinc for the Campo Morado
Mine operation are estimated by adding the total cost to produce
concentrate (mining, milling, site general and administration),
adding the cost of transporting concentrate to the point of sale,
adding the cost of smelter treatment and refining charges,
subtracting the byproduct credits estimated from sales of lead,
silver, gold and dividing by the pounds of payable zinc. By-product
credits are calculated using the realized weighted average metal
price, during the year.
Campo Morado Optimization Program
- In July 2023 Ausenco consultants
reviewed and optimized the comminution circuit, reducing throughput
from 100 to 75 tonnes per hour and adjusting the primary grind from
65 microns to 35 microns to enhance flotation recoveries.
- Subsequent lab tests and plant trials showcased substantial
recovery increases, resulting from effective blending in the mine
and the use of correct reagents.
- The initiative evolved into a project during the quarter,
encompassing a mine-to-mill program, extensive process plant
modifications, and lab tests at ALS laboratories in Canada.
- The project is slated for implementation in Q4 2023, with
results expected over the subsequent months.
- In a news release dated November 20,
2023, Luca announced initial results from the optimization
program.
-
- A bulk concentrate is being produced with greater than 70%
copper recovery (compared to a historical range between 35-40%).
The concentrate produced contained greater than 14-16% copper
(compared to historical values near 11%).
- Overall zinc recovery is expected to increase from 76% to 86%
and the final concentrate grade increases from 46% to 56% zinc over
the next 12 months.
Tahuehueto Mining Project
While the project is still under construction, the following
details the production and concentrate sales for the three months
ended September 30, 2023:
- Produced 782 tonnes of zinc concentrate grading an average of
52.2% zinc, 8.70 g/t gold, 117.15 g/t silver and sold 591 tonnes
generating Q3-2023 revenue from zinc concentrate of US$0.64 million.
- Produced 487 tonnes of lead concentrate grading an average of
38.4% lead, 79.95 g/t gold, 794.12 g/t silver and sold 532 tonnes
generating Q3-2023 revenue from lead concentrate of US$2.61 million.
- 19,433 tonnes of mineralized material were processed through
the processing plant with average grades of 3.27% zinc, 1.34% lead,
3.05 g/t gold, and 32.79 g/t silver.
- Recoveries during Q3-2023 were 64.1% zinc, 79.4% lead, 82.3%
gold, and 82.7% silver.
- Daily output has varied considerably during the period, as
equipment and systems are tested, optimized, installed, and
commissioned. The average daily throughput during the period was
211 tonnes per day, with a peak production output of 440 tonnes per
day tonnes per day.
Management Discussion and Analysis Refiling
On November 27, 2023, the Company
filed its condensed interim consolidated financial statements and
corresponding management discussion and analysis ("MD&A") for
the period ending September 30, 2023.
Subsequently, the Company became aware of minor update revisions
and typographical corrections (including, but not limited to, page
7 of such MD&A under the heading "Operational Performance
Results) required to the MD&A and as a result the Company has
refiled its MD&A on November 30,
2023. These corrections do not materially impact the
substantive content or key insights presented in the original
MD&A but aim to ensure the precision and accuracy of our
communication.
About Luca Mining Corp.
Luca Mining Corp. is a Canadian based mining company with two
100% owned Mexican gold, silver, and base metal mining
projects. With one mine ramping up, and another going through
an optimisation program, the Company expects these operations to
generate consistent, positive free cash flow starting in early
2024.
Luca's Tahuehueto Mine is a new underground gold mine in
northwestern Durango State, Mexico, located within the prolific Sierra
Madre Mineral Belt which hosts numerous producing and historic
mines along its trend. Currently in the final stages of
construction to the nameplate capacity of 1,000 tonnes per day,
Tahuehueto is on track to become a significant and one of
Mexico's newest gold mines to come
into production. The Pre-Feasibility Study updated in 2022
contemplates an operation achieving production of 40,000 ounces
gold-equivalent per year, with approximately 75% of the revenues
from precious metals, and a 10-year mine life.
The Campo Morado Mine, located in Guerrero State, Mexico, is an operating underground base and
precious metals mine with a throughput of approximately 600,000
tonnes per year, producing zinc, copper, and lead concentrates with
significant precious metals credits. It is currently undergoing an
optimisation program which is already generating significant
improvements in recoveries and grades, and cashflows.
*Pre-feasibility report dated April 21,
2022.
Qualified Persons
The technical information contained in this News Release has
been approved by Mr. Mike Struthers,
C.Eng., CEO and Director at Luca Mining, a Qualified Person for the
Company as defined in National Instrument 43-101.
Visit: www.lucamining.com
On Behalf of the Board of Directors
(signed) "Mike Struthers"
Mike Struthers, CEO and
Director
Cautionary Note Regarding
Production Decisions and Forward-Looking
Statements
It should be noted that Luca declared commercial production at
Campo Morado prior to completing a
feasibility study of mineral reserves demonstrating economic and
technical viability. Accordingly, readers should be cautioned that
Luca's production decision has been made without a comprehensive
feasibility study of established reserves such that there is
greater risk and uncertainty as to future economic results from the
Campo Morado mine and a higher
technical risk of failure than would be the case if a feasibility
study were completed and relied upon to make a production decision.
Luca has completed a preliminary economic assessment ("PEA") mining
study on the Campo Morado mine
that provides a conceptual life of mine plan and a preliminary
economic analysis based on the previously identified mineral
resources (see News Release dated November
8, 2017, and April 4,2018).
Statements contained in this news release that are not
historical facts are "forward-looking information" or
"forward-looking statements" (collectively, "Forward-Looking
Information") within the meaning of applicable Canadian securities
laws. Forward Looking Information includes, but is not limited to,
disclosure regarding the planned program to improve mining
operations at Campo Morado; and
other possible events, conditions or financial performance that are
based on assumptions about future economic conditions and courses
of action; the timing and costs of future activities on the
Company's properties, such as production rates and increases;
success of exploration, development and bulk sample processing
activities, and timing for processing at its own mineral processing
facility on the Tahuehueto project site. In certain cases,
Forward-Looking Information can be identified using words and
phrases such as "plans," "expects," "scheduled," "estimates,"
"forecasts," "intends," "anticipates" or variations of such words
and phrases. In preparing the Forward-Looking Information in this
news release, the Company has applied several material assumptions,
including, but not limited to, that the current exploration,
development, environmental and other objectives concerning the
Campo Morado Mine and the Tahuehueto Project can be achieved; that
the program to improve mining operations at Campo Morado will proceed as planned; the
continuity of the price of gold and other metals, economic and
political conditions, and operations. Forward-Looking Information
involves known and unknown risks, uncertainties and other factors
which may cause the actual results, performance, or achievements of
the Company to be materially different from any future results,
performance or achievements expressed or implied by the
Forward-Looking Information. There can be no assurance that
Forward-Looking Information will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on Forward-Looking Information. Except as
required by law, the Company does not assume any obligation to
release publicly any revisions to Forward-Looking Information
contained in this news release to reflect events or circumstances
after the date hereof or to reflect the occurrence of unanticipated
events.
Neither 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.
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SOURCE Luca Mining Corp.