Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Coeur Mining’s (NYSE: CDE) shares rose on Thursday after the company reported positive operating metrics for the expanded Rochester silver-gold mine in Nevada, keeping it on track to achieve its ore placement and production targets in the second half.
During August, Coeur placed 2.7 million tonnes of ore on the new Stage IV leach pad at Rochester, a substantial 39% increase over July’s ore stacking figures.
The company stated it remains on track to place 7 to 8 million tonnes per quarter during the second half of 2024 and to achieve its full-year production guidance of 4.8 to 6.6 million oz. of silver and 37,000 to 50,000 oz. of gold.
Shares of Coeur Mining were up 15.47% by 12:14 a.m. EDT. The miner has a market capitalization of $2.62 billion.
“Today’s update shows the company is well on track to achieve H2 targets,” BMO wrote in a note.
“We continue to expect that the Rochester expansion will facilitate a shift to positive free cash flow for Coeur in H2.”
With the crusher running at full capacity, Coeur’s focus has shifted to optimizing recoveries by reducing the crush size of the Rochester ore.
Coeur’s year-end target is to reduce the crush size to 80% passing 5/8″, and the company has indicated it is currently exceeding expectations, with recent improvements yielding a crush size of 3/4″.
Located in Pershing county, Nevada, the Rochester mine first began operations in 1986. After a brief pause between 2007 and 2010, operations resumed in 2011.
Once operating at full capacity, throughput levels are expected to be approximately 2.5 times higher than historical levels, making Rochester one of the world’s largest open-pit heap-leach operations.
Rochester is also expected to be the largest source of US-produced and refined silver.
