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Kensington helps set record quarter numbers for Coeur

Posted: August 10, 2011 - 9:12pm

Coeur d’Alene Mines Corp. reports strong numbers in its second quarter and first half of the year. On top of that, the company expects more production value for 2011 with the aid of increasing gold prices.

Coeur credits Kensington with a lot of this increase, as the mine was not in operation during last year’s second quarter.

The first half of the year has brought in net metal sales of $430.7 million, which is a 128 percent increase over the first half of 2010. The net metal sales for this quarter came to $231.1 million.

There were 113,786 ounces of gold from all of its mines in the first half. This is up 133 percent over this time last year. Silver was up 17 percent with 8.9 million ounces.

Company-wide gold production for this quarter in all mines was 60,656 ounces and silver was 4.8 million ounces. Both were an increase of 14-16 percent over last year’s second quarter.

“Our second quarter performance reflects record high production and record low costs per ounce at Palmarejo, another consistent quarter at San Bartolomé, and steady progress at Kensington,” Coeur President and Chief Executive Officer Mitchell J. Krebs said in a release. “Overall, we feel comfortable that full-year 2011 silver production will reach 19.5 million to 20.5 million ounces and gold production will be 240,000 to 250,000 ounces.”

Coeur spokesman Tony Ebersole said this production plus the gold processes makes 2011 look like a record year for the company.

“We’ll be seeing increasing production and lower costs at most of our mines,” said Ebersole.

Kensington is expected to contribute a good part of the anticipated rise for 2011. Coeur expects the Southeast Alaska mine to slightly increase its gold production during the second half. Ebersole said the company is looking at about 100,000 ounces of gold from Kensington for the year.

Ebersole said the current strong metal prices will make significant impacts to the company in the second half, as gold recently reached $1,700 per ounce and silver being close to $40 per ounce.

“So at those levels, even below those levels, we’re expecting to have about close to a billion dollars in revenue and that 100,000 (gold ounces from Kensington) so those increases will really make an impact,” he said.

Kensington also accounts for additional capital projects that have increased the parent company’s anticipated expenditures of $120 million to up to $140 million.

Full-year cash operating costs from Kensington are at approximately $850 per ounce of gold and $5.75 per ounce of silver.

• Contact reporter Jonathan Grass at 523-2276 or jonathan.grass@juneauempire.com.

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