SilverCrest Releases Update on Las Chispas ConstructionBy Lorenzo Núñez | Wed, 08/11/2021 - 10:25
SilverCrest has provided an update on construction activities at the Company’s Las Chispas Project in Sonora, Mexico.
At the end of the first half of 2021, Las Chispas construction progress was 33 percent complete compared to scheduled completion of 28 percent. Construction has progressed well with the confined COVID-19 camp facility and earthworks completed. Concrete foundation work is 74 percent complete, plant tank construction and key infrastructure projects (powerline, road, and bridge) commenced, underground infrastructure ongoing, and plant detailed engineering 90 percent complete. According to the company’s press release, construction progress has benefited from no delays due to COVID-19 or any other reason and it is right on schedule.
Capital spending is also right on budget target. Sixty percent of the US$137.7 million capital cost estimate was committed, of which 35 percent has been spent across all capital cost scopes, in-line with budget. SilverCrest also announced that their Underground Development is well advanced. For instance, 4.6 km of underground development was completed during the first half of 2021 for a total of 13.1 km ever since underground development began in 1Q2019. This has given access to four veins or areas and 33 in-vein work fronts. In addition, site safety has remained a key priority with COVID-19 risk mitigation efforts continued successfully, including completion of the confined 513 bed single occupancy construction camp which averaged approximately 70 percent occupancy. More than 5,000 COVID-19 tests for employees and contractors were completed with positivity rates prior to site access remaining low (less than 2 percent) and no serious occurrences on site. The company´s funding position has remained strong during the construction. As of July 31, 2021, SilverCrest remains well funded with cash and cash equivalents of US$188.0 million and US$90.0 million available under a US$120 million project financing facility. Once fully ramped up and using Base Case metal prices ($1,500/oz Au and $19.00/oz Ag) which are more than 15 percent and 23 percent respectively, Las Chispas could generate after-tax project free cash flow of approximately US$160 million in 2023 and an estimated average of US$110 million per year from 2023 to 2029.
“We are extremely proud of our team and contractors who have worked together to safely set the construction on a positive path with numerous critical construction milestones completed in H1, 2021. We are very pleased with the progress to date which includes on time and on budget construction since the formal start on February 1, 2021. We expect to reach approximately 80 percent completion of construction by the end of 2021, with plant ore commissioning expected as planned in late Q2, 2022”, said N. Eric Fier, CEO of SilverCrest.