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查看配图Workers inside the tunnel at the Sunshine mine. Credit: Sunshine Silver Mining & Refining
Sunshine Silver Mining & Refining (NYSE: SSMR) is designing a mill with roughly twice the capacity assumed in its initial mine plan, seeking room to expand production after a targeted late-2028 restart in Idaho.
The proposed plant would process up to 2,000 tonnes a day compared with about 1,000 tonnes in the initial assessment, according to the company’s second-quarter filing. The Sunshine silver mine lies near Kellogg in Idaho’s Silver Valley, about 430 km north of the state capital, Boise.
“Clearly, getting those feasibility studies wrapped up first half of next year, that will position us to look at what remaining capital would be needed to fund us all the way through to production,” CFO Heather White told The Northern Miner in late September at the Mining Forum Americas in Colorado.
The larger mill is to give Sunshine room to increase output as drilling expands and upgrades its resource. But the company’s March initial assessment estimated capital costs for a smaller operation. Next year’s feasibility study must establish whether the mine can support higher throughput and how much additional funding the restart requires.
A new mine entrance should give Sunshine more flexibility in the Upper Country area, where drilling suggests potential resource growth and a larger contribution to the mine plan, BMO Capital Markets analyst Kevin O’Halloran wrote in an Oct. 19 note.
Restart funding
Sunshine expects to complete the mine-and-mill feasibility study in the second quarter of next year before making a final investment decision. The initial assessment estimated capital spending at $286.9 million (C$409.2 million) for the smaller operation, according to company disclosures.
That plan forecast average annual silver production of 6.7 million oz. over the first five years of a 24-year mine life. Those projections don’t describe the proposed larger operation.
Sunshine raised $310.5 million before expenses in its June initial public offering, including the underwriters’ full exercise of their option to purchase additional shares. Net proceeds totalled $286.5 million, according to an investor presentation in September.
Crews are dismantling the old mill, and the company has installed a new hoist and purchased underground equipment. A working shaft and a tunnel into the mine’s upper levels provide access to the deposit, White said.
Replacing the existing infrastructure would cost about $600 million, the company estimates.
Drilling support
A 50,000-metre underground drilling program aims chiefly to upgrade inferred resources to the higher-confidence indicated category for the feasibility study. Sunshine expects to finish the program this month and report results from deeper parts of the mine this quarter, it said in its September exploration update.
The February resource estimate outlined 3.16 million indicated tonnes grading 1,022 grams silver per tonne for 103.9 million ounces. Inferred resources totalled 6.41 million tonnes grading 776 grams for 159.8 million ounces.
The initial assessment’s production plan includes both categories. Inferred resources carry greater geological uncertainty, and White said drilling would continue beyond the study’s cutoff to upgrade more material.
Sunshine is exploring whether surrounding properties could support additional mines. It expanded its mineral rights holdings by 60% to about 154 sq. km in September and outlined a separate, multiyear program of 45,000 metres of surface drilling. Work is expected to begin this quarter at East Sunshine, Pine Creek and Rock Creek, the company said.
Refining studies
Two other feasibility studies, expected in the first half of next year, according to BMO, will assess building a new antimony plant and restarting the existing silver-copper refinery.
The proposed antimony plant could produce up to 35 million lb., or about 15,900 tonnes, of finished antimony annually as metal and antimony trioxide. Major permits are in place, with normal updates and some outstanding permits anticipated for the existing silver-copper refinery, which has a nameplate capacity of 10 million oz. of silver a year, White said.
Sunshine is evaluating processing antimony from outside suppliers alongside its own material. Both refining projects remain subject to feasibility work and investment decisions.
“We see immense opportunity in our district holdings for a multi-mine potential opportunity beyond the Sunshine Mine itself,” White said.