Hecla Mining Reports Record Setting Reserves


Hecla Has Struck Gold, Literally:

  • Precious and base metals miner Hecla Mining (NYSE: [stock_market_widget type=”inline” template=”generic” color=”default” assets=”HL” markup=”{symbol} {currency_symbol}{price} ({change_pct})” api=”yf”]) recently revealed that it is sitting on the highest gold, silver, and lead reserves in its 128-year history, and also updated investors regarding its exploration programs for the fourth quarter of 2018.
  • Hecla’s exploration efforts last year led to the largest single-year increase in the company’s reserves, which management believes is a positive development in light of the declining reserves seen in general across the globe.
  • Hecla also maintains that it has been able to declare the reserves using “the most conservative price assumptions” on account of the strong economics of its deposits.
Do you remember the differences between reserves, resources and what they represent? Check out our guide»

Exploration Results Show Significant Reserve Increases:

  • Hecla’s Greens Creek mine has witnessed a 23% increase in reserve tons, while gold ounces increased 16%, silver ounces increased 19%, lead tons increased 17%, and zinc tons shot up 15%.
  • Hecla generates nearly 50% of its revenue from the Greens Creek mine. The mine now has a life of approximately 11 years from the reserves alone.
  • The Casa Berardi mine, from where Hecla gets around 35% of its revenue, witnessed a 28% increase in gold ounces thanks to a new pit at West Mine Crown Pillar, and also due to the expansion of the Principal pit. The reserve tons at the mine increased by 70%.
  • Hecla has assumed a price of $14.50 per ounce of silver, $1,200 per ounce of gold, $0.90 per pound of lead, and $1.15 per pound of zinc while calculating reserves. The company claims that all these price assumptions are below the current spot prices of these commodities.
  • Hecla was sitting on record proven and probable gold reserves of 2.85 million ounces at the end of 2018. That represents a 26% increase over 2017 levels.
  • Hecla’s proven and probable silver reserves shot up 9% in 2018 to 191 million ounces. The company’s proven and probable lead reserves increased 5% to 774,000 tons, while proven and probable zinc reserves increased 11% during the year to their highest levels since 2009 to 931,730 tons.

Hecla’s Exploration Pays Off:

  • Hecla has kept up its exploration efforts in a bid to keep boosting its reserves and extend the life of its mines.
  • At the critical Greens Creek mine, the company is focused on expanding high-grade resources close to the surface in the Upper Plate and East Ore zones.
  • The company’s underground drilling efforts have allowed it to upgrade and expand its resources and reserves at several zones at Casa Berardi.
  • Hecla turned up its exploration efforts big time in 2018. The company spent $8.3 million on exploration in the fourth quarter of 2018 and $35.9 million for the full year, a jump of 41% and 53% as compared to the prior-year periods.
  • Hecla claims that its exploration program last year turned out to be a successful one at not just its mines, but also at certain exploration properties. For 2019, the company will allocate around half of its exploration budget to Nevada, with San Sebastian and Casa Berardi being the other two areas of focus.

Harsh Singh Chauhan has a wealth of experience evaluating publicly-traded companies across several verticals, including technology, oil and gas, retail, and consumer goods. His financial writing has been published across platforms such as The Motley Fool, TheStreet, and Seeking Alpha. Harsh's philosophy is to find great businesses for the long run based on company fundamentals and industry prospects. Address: 682 Indian Road, Toronto, Ontario, M6P 2C9. Phone: 416-721-8257.


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