VANCOUVER (miningweekly.com) – US gold producer Hecla Mining has signed a toll milling agreement with Mexico's highest-grade silver miner Excellon Resources, to process sulphide ore from the San Sebastian mine, in Mexico, at Excellon's Miguel Auza flotation mill facility.
The ore will be trucked 42 km between the two operations, with Excellon providing 440 t/d of milling capacity to Hecla, with the mill to eventually be upgraded to include a copper flotation circuit.
The five-year toll-milling arrangement is expected to start in 2019, pending a successful 4 000 t bulk sample testing programme at the Miguel Auza mill in the third quarter.
"This is a significant step towards extending the life of the San Sebastian mine, and is in keeping with our strategy of maximising the cash flow and minimising capital investment by using third-party facilities," Hecla president and CEO Phillips Baker Jr said in a statement.
San Sebastian sulphides have the potential for five years of mine life and considerable upside with the recent exploration discoveries, Hecla advised.