Hochschild unveils production increase

Shares in Hochschiled Mining rose on news that after successfully completing two feasibility studies the company is set to increase production from 2014 by almost 50%.

An independent consultant carried out the studies on the Inmaculada and Crespo projects, both of which are now on track to start production in the fourth quarter of 2013.

The studies revealed that the they are both profitable projects, with a combined average attributable production of around 10m silver equivalent ounces per annum providing strong growth profile.

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Inmaculada, which is 60% owned, is now set to start construction with total initial capital expenditure of $315m for a 3,500 tonne per day underground operation with average annual production of 12m silver equivalent ounces.

Wholly owned Crespo is set to add another 2.7m silver equivalent ounces from 2014 at an initial capital cost of $111m for a 6,850 tonne per day operation. This relatively simple open pit project is expected to have a unit cost per tonne of $13.5 and high gold recovery rates, the firm said.

Meanwhile, the Azuca feasibility study has been postponed to allow resource optimisation through further exploration of new higher grade areas.

The share price rose 3.4% to 434.9p by 08:49.

NR