pan american SILVER ANNOUNCES First silver concentrate
produced at San vicente’s new processing
facility
(All amounts in U.S. dollars unless otherwise
indicated)
Vancouver, B.C. April 1, 2009 Pan American Silver Corp. (Pan American or
the Company), (NASDAQ: PAAS; TSX: PAA) is pleased to announce that the new
processing facility at its San Vicente mine in Bolivia began producing silver
and zinc concentrates on March 25, 2009.
Pan American has a 95% interest in the San Vicente
mine, which is located in the Potosi
department and is operated as a joint-venture with Bolivian state-owned
COMIBOL. Over the past several years, mining operations at San Vicente
were conducted on a limited basis, where ore was trucked to a small third party
mill for processing. Given the discovery of the high grade Litoral vein system, Pan American decided in mid-2007 to
invest in constructing its own processing facility and to increase the
production rates.
Construction of a 750 tonne-per-day
processing facility and expansion of the underground mine started in September
of 2007. After 16 months of intense work, plant commissioning began in
mid-January 2009 and is now close to completion. The Company expects San
Vicente to reach design capacity within the next few months. The total
investment to expand San Vicente and build the new processing facility is
estimated to be $70 million.
Commenting on San Vicente’s expansion, Geoff
Burns, President & CEO said: “This
is another major accomplishment for Pan American’s construction and
development team. Despite the challenges posed by an extremely remote
location, and the intense competition for construction and mining supplies
during much of the build, we have completed San Vicente’s expansion on
schedule and within 10% of the original budget. With our own plant and
expanded mining capacity, I am confident that we will now begin to realize the
full value of the San Vicente ore deposit.”
Mr. Burns added: Only two weeks ago we inaugurated the
Manantial Espejo mine in Argentina.
Now with San Vicente’s new processing plant in operation, we are right
where we planned to be, setting ourselves up to produce 21.5 million ounces of
silver this year. Finally, I would like to extend both my congratulations
and thanks to all our employees and construction contractors whose efforts have
launched San Vicente as our eighth silver mine.
San Vicente Operational Update
Commissioning of the new processing facility commenced
in mid January with the first concentrate being produced on March 25th.
Site activities are now focused on stabilizing plant throughput rates and
metal recovery, as well as on finishing the installation of the permanent water
supply system.
The underground development of the Litoral
vein has advanced significantly accomplishing over 5,000 meters of decline,
ramp, and lateral development to allow mechanized mining of this high grade
deposit. Mining continues in the older parts of the underground mine and
overall mine production is ramping-up to the planned 750 tpd
production rate.
In 2009, Pan American expects to produce 1.9 million
ounces of silver at San Vicente for its account, at a cash cost of
approximately $6.98 per ounce, which represents a doubling of production and a
7.5% reduction in cash costs from 2008 levels. At full capacity, the mine
is expected to contribute an average of just under 3.0
million ounces of silver annually to the Company’s production
profile.
Pan American
is on track to produce 21.5 million ounces of silver in 2009 at cash costs
estimated at $6.28 per ounce. With operations at the new Manantial Espejo mine running smoothly, the Company also expects to more than
double its gold production to 85,000 ounces in 2009, which will increase Pan
American’s revenues derived from silver and gold to approximately 75% of
its total sales.
About Pan American Silver
Pan American Silver’s mission is to be the world’s
largest and lowest cost primary silver mining company by increasing its low
cost silver production and silver reserves. The Company has eight
operating mines in Mexico,
Peru, Bolivia,
and Argentina.
Technical information contained in this news release has been reviewed
by Michael Steinmann, P.Geo., Executive Vice
President Geology & Exploration, and Martin Wafforn,
P.Eng., Vice President Technical Services, who are
the Company’s Qualified Persons for the purposes of NI
43-101.
Information
Contact
Kettina Cordero
Coordinator, Investor Relations
(604) 684-1175
info@panamericansilver.com
www.panamericansilver.com
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