Tahoe Resources is rolling up its sleeves this year to expand and deepen the Bell Creek Mine in Timmins.
The Vancouver miner announced its 2017 financial and operating guidance on Jan. 5.
Project capital expenditures this year will be between $150 million to $175 million, the two largest projects being the shaft deepening at Bell Creek, along with the construction of a crushing and agglomeration plant in Peru.
Tahoe acquired the former Lake Shore Gold in a $945-million deal last year, adding the Timmins West and Bell Creek gold mines in Timmins to Tahoe’s stable of operations in Guatemala and Peru.
More than $50 million of the $80 million capital requirement for the Bell Creek shaft project is planned for this year, with project completion expected in the first half of 2018.
Bell Creek is located 20 kilometres by road, northeast of Timmins.
The mine contains a large resource at depth which offers an opportunity to expand production and extend mine life
Last January, a proven and probable mineral reserve of 2.1 million tonnes with an average grade of 4.5 grams per tonne containing 309,000 ounces of gold was identified.
Tahoe plans to set aside between $35 million and $45 million for drilling programs this year. Included in the mix is the Fenn-Gib project, east of Timmins, and the Juby project, south of the city at Shining Tree, as Tahoe intends to take a look at some of the longer term potential in the area.
Tahoe president-CEO Ron Clayton said the acquisition of Lake Shore contributed to a “pivotal year” with record silver and gold production in 2016.
Silver production in 2016 was a record 21.3 million ounces, surpassing the guidance of 18 to 21 million ounces.
Gold production for the year totaled 385,111 ounces, in line with guidance of 370,000 to 430,000 ounces, including 121,562 ounces of production from the Canadian operations from April 1 to the end of the year.
"Looking ahead to 2017, we are ramping up development of multiple projects, which are expected to drive growth in gold production starting in 2018,” said Clayton in a release.
“Key capital projects include deepening the Bell Creek shaft and further development of Shahuindo (Peru) as we move that mine towards full production. We are targeting higher production from both our Canadian operations and Shahuindo to offset reduced gold output at La Arena, while Escobal (Guatemala) is poised for another excellent year."
Guidance for gold production in 2017 is similar to the target range for 2016 issued following the Lake Shore Gold acquisition, with production expected to increase in 2018 as capital programs at both Bell Creek and Shahuindo are completed, the company said in a release.
