TORONTO (miningweekly.com) – Precious metals producer SilverCrest Mines has its sights firmly set on achieving senior silver producer status within the next five years, as it expects to double production from its Santa Elena mine, in Sonora state, Mexico, in 2014, and make a development decision on its La Joya project, in Durango, also in Mexico, by 2015.

The company at the end of January announced an updated National Instrument 43-101-compliant inferred resource at the La Joya project, which is shaping up to be a significant high-grade resource holding 100.8-million ounces of silver at a cutoff grade of 60 g/t. The resource is also reported to hold 75.1-million pounds of tungsten trioxide (WO₃) at a 0.05% cutoff grade.

“I expect the 60 g/t silver-equivalent portion of the deposit, with an estimated tonnage of 27.9-million tons grading 112 g/t silver equivalent, constitutes a priority area to be examined as a potential ‘starter pit’ for initial conceptual operations that would be looked at in the preliminary economic assessment to be started shortly,” SilverCrest COO Eric Fier told Mining Weekly Online on Monday.

The La Joya resource models separate the deposits into two broad categories based on the main mineralogy. The first category is comprised of silver, gold and copper mineralisation, with smaller amounts of WO₃, molybdenum (Mo), lead (Pb), and Zinc (Zn). The second category is mainly WO₃ and Mo mineralisation, with lesser amounts of silver, copper, gold, Pb and Zn.

The initial resource at La Joya is 51.3-million silver ounces and current exploration is expected to double this resource when the resource is updated in the short term.

The plan is to develop the property, which is estimated to cost about $150-million, using a staged approach. This would be in keeping with the company’s previous experience in developing the Santa Elena mine, by starting out with a smaller operation to generate free cash flow, before upgrading to a larger production profile at a later stage.

And this is what the company is currently undertaking with the Santa Elena mine expansion. Fier explained it made much more economic sense to start out with a less expensive heap-leach operation, than to construct an expensive plant from the outset.

The three-year expansion plan would focus on the installation of a counter current decantation (CCD) processing plant, which would ramp up production from 2 500 t/d to 3 000 t/d.

SilverCrest produced 2.37-million silver-equivalent ounces in 2012.

The Vancouver-based company expects that once the new processing plant is operational, use of the leach pads would be discontinued; however, gold and silver metals inventory remaining on the leach pads is currently being assessed as part of the mill feed for the expansion plan.

Based on in-pit grade control, crusher composites and produced metals to date, about 1.9-million tons containing significant residual gold and silver ounces exists on the leach pad. Based on the current mine schedule, almost four-million tons of heap leached material may be available for reprocessing once the CCD processing plant is constructed.

The Santa Elena mine is a high-grade, epithermal gold and silver producer, with an estimated life-of-mine (LoM) cash cost of $8/oz of silver equivalent. Fier said the challenge is to meticulously manage the company’s projects in an effort to keep operating expenses low.

SilverCrest expects the Santa Elena facility to recover about 4.8-million ounces of silver and 179 000 oz of gold over the six-and-a-half year life of the openpit phase of the mine.

However, Fier said ongoing exploration to update the compliant resources of the Cruz de Mayo project, as part of the Santa Elena expansion project, would help to “reset” the LoM clock of the Santa Elena operation to more than ten years.

The company has no debt and has a market capitalisation of nearly $300-million. Its Toronto-listed stock closed 0.77% lower at C$2.57 apiece on Monday.