Commercial production at the Relief Canyon mine, in Nevada, has been delayed to the fourth quarter, precious metals mining company Americas Gold and Silver reported on Monday.

The company’s newest asset has experienced various startup challenges, including equipment issues with the radial stacker, inconsistent practices and variable solution application rates.

The operation has now begun stacking ore and initial leach solution grades have been encouraging.

"Although the Relief Canyon mine has taken longer to reach commercial production due to complications related to the Covid-19 pandemic, equipment challenges regarding the radial stacker and lower grade ore in the upper fringes of the deposit, as we access, have placed and leached the first of the higher grade ore, we continue to remain confident that these issues will be solved in the near term. These are typical startup challenges when commissioning a new operation," said Americas Gold and Silver president and CEO Darren Blasutti. 

Following the acquisition of Pershing Gold, the company set an ambitious target of constructing the Relief Canyon mine in under nine months with an estimated budget range of $28-million to $30-million. 

To assist with the continued ramp-up of Relief Canyon, Americas Gold and Silver has hired Phil Dalke as GM of the operation. He has experience at some of the largest heap leach mines in the world, including chief metallurgist at the Yanacocha mine.

Meanwhile, at Cosalá, in Mexico, an illegal blockade that has been in place since the end of January has been resolved and the company now aims to restart the operation in September.

Owing to the blockade, Cosalá did not operate during the second quarter and operated for only the first 26 days of 2020. As such, results for the second quarter were not comparable to the second quarter of 2019.

Americas Gold and Silver posted revenue of $4.6-million and a net loss of $10.8-million in the second quarter.

GALENA COMPLEX
Meanwhile, the company also announced “encouraging” results from the initial deep level drilling at the Galena complex, which it owns in a 60:40 partnership with Eric Sprott.

Blasutti said the initial drill results from Galena, in Idaho, from the 5500 level had yielded several bonanza grades.

“The initial deep drilling is targeting the 72 Vein which historically was a major contributor of ore during the peak silver production years at combined grades of over 650 g/t silver.  There are two additional systems which the company is excited about at depth including the ‘triple point’ and deeper extensions of the 360 Complex that will be drilled during the remainder of 2020 and into 2021.”

The recapitalisation plan for Galena, announced in September 2019, has budgeted about 39 000 m of exploration drilling, of which 13 000 m have been completed.