ALBUQUERQUE, N.M.--(BUSINESS WIRE)--Santa Fe Gold Corporation (OTCBB: SFEG), a U.S. based mining and exploration enterprise focused on acquiring and developing precious metals and industrial minerals properties, today provided an update to shareholders.
Summit Silver-Gold Mine, New Mexico
Ramp up is continuing and the operation is on track to achieve commercial production during March 2012. Mechanized long-hole mining began in late December 2011 and has proved to be very successful. Production rates have increased steadily since January 2012 and currently are in the range of 200 to 300 tons per day. The company expects to be able to reach a consistent rate of 400 tons per day later in the month.
Pierce Carson, President and CEO, said, “Results of mechanized mining demonstrate that mining rates of 400 tons per day or greater should be readily achievable. In fact, ten thousand tons of drilled and blasted broken ore currently are awaiting removal from underground. This broken ore is sufficient to provide a month’s worth of feed to the mill at the full targeted processing rate.
“We are making improvements that will enable us to more rapidly extract broken ore from underground and to consistently produce at the rate of 400 tons per day. Among others, these improvements include construction of more draw points for better access to broken ore. The additional draw points will be completed shortly. We also have ordered additional mining equipment to help in the mining and removal process. And we have increased the company’s work force, which now numbers 70.”
Dr. Carson continued, “With the greater levels of production, we are pleased to report also that we have begun to increase deliveries of silica flux material to one of the Arizona smelters.”
Revenues are expected to increase progressively over the course of 2012 reflecting increases in both tonnage and grades. Annual life of mine revenue at full production is estimated to be approximately $40 million at recent gold and silver prices. Ore reserves are estimated to average 10.78 ounces per ton silver and 0.143 ounces per ton gold (0.35 ounces per ton gold equivalent). Direct operating costs are projected to be $364 per ounce of gold equivalent produced over the life of the mine.
Acquisition of Columbus Silver (TSXV: CSC)
The acquisition of Columbus Silver appears to be on track for potential completion around the end of March 2012. Santa Fe announced December 15, 2011 it had conditionally agreed to acquire all of the common stock of Columbus Silver for CDN$0.20 per share in a cash transaction valued at approximately $10 million. The acquisition remains subject to conditions, including Columbus Silver obtaining shareholder and regulatory approvals. Columbus Silver has submitted a circular to its shareholders for voting approval of the transaction. The acquisition, when completed, will add significantly to Santa Fe’s silver and gold resources potentially available for processing at its fully permitted and operating flotation mill near Lordsburg, New Mexico.
About Santa Fe Gold:
Santa Fe Gold is a U.S.-based mining and exploration enterprise focused on acquiring and developing gold, silver, copper and industrial mineral properties. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began processing operations in 2010; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Ortiz gold property in north-central New Mexico; (iv) the Black Canyon mica deposit and processing equipment near Phoenix, Arizona; and (v) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.
To learn more about Santa Fe Gold, visit www.santafegoldcorp.com.
Cautionary Note Regarding Forward-Looking Statements:
This press release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable US and Canadian securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, the Company's inability to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Company’s Annual Report on Form 10-K for the year ended June 30, 2011 and its most recent quarterly reports filed with the United States Securities and Exchange Commission (the “SEC”), and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company's US public disclosure filings may be accessed via www.sec.gov and its Canadian public disclosure filings may be accessed via www.sedar.com, and readers are urged to review these materials.