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Silver production edges upwards

January 28, 2013

Alexco moves to bring its Onek and Lucky Queen deposits into production in Keno, Yukon. On Admiralty Island, Alaska Hecla’s Greens Creek deposit is thought to contain 100 M oz. of silver.

Alexco expects that silver production in 2013 will come from three mines: Bellekeno, Onek and Lucky Queen. Operations at Bellekeno are expected to continue at generally the same pace as 2012, with guidance for silver production in the range of 1.9 million to 2.1 million ounces of silver, as well as approximately 17 million pounds of lead and 9 million pounds of zinc. Full production guidance for 2013 will be revised upward when regulatory authorizations are received for the Onek and Lucky Queen mines. Alexco expects the Yukon Water Board hearing to lake place this quarter.

Alexco owns and operates the Bellekeno silver mine, Canada’s only operating primary silver mine and one of the world’s highest-grade silver mines with a production grade of up to 1,000 grams per tonne. The Company owns 100% of the historic Keno Hill Silver District, located in Canada’s Yukon Territory. Alexco has a goal of identifying 100 million ounces of silver in this prospective District and ramping up to more than 7 million ounces of annual silver production within the next decade. The mining operation employs around 100-125 people. Alexco (ticker AXR on TSX) trades at $3.98 with a market cap of $240 M.

Hecla spent $7 M on its Greens Creek exploration program in 2012. In 2011, Hecla produced 7.5 million ounces of silver at Greens Creek, plus significant gold values. Greens Creek is the largest silver mine in the United States. Put into production in 1989 with a seven-year mine life, it has consistently replaced reserves – to the point where, 23 years later, we’ve extended that mine life another 10 years.

Greens Creek is an underground mine which produces approximately 2,100 to 2,300 tons of ore per day. The primary mining methods are cut and fill and longhole stoping. The ore is processed on site at a mill, which produces lead, zinc and bulk concentrates, as well as gold doré. In 2011, ore was processed at an average rate of approximately 2,115 tons per day. During 2011, mill recovery totaled approximately 73% silver, 79% zinc, 68% lead and 62% gold. There were 364 employees at the Greens Creek at December 31, 2011. The Greens Creek operation is partially powered by diesel generators and the operation has reduced production costs to the extent power has been available.

Hecla Mining Company’s rich history of mining has distinguished it as a respected precious metals producer. Hecla is the largest silver producer in the United States and oldest precious metals mining company in North America. Hecla (ticker HL on NYSE) trades at $5.20 and has a market cap of $1.5 B.


Hecla’s Greens Creek mine is four times the size of Alexco’s Keno operation. But Alexco is slowly opening new deposits and increasing production.