Hochschild Mining Share Discussion Threads

[stevea171] 27/1/2024 11:07

The years of exploration around Pallancata have finally paid off. Royropata 100k GEO pa from 2027. silver/gold. It's the permitting in Peru which takes years which is holding things up. Yet again.

[sotolo] 26/1/2024 22:07

Orcle of Omaha sadly not, cash costs $1445 aisc $1953, San Jose must be one of the very most expensive gold mines in the world. I know it is an amazing figure that belies belief, especially how much and how quickly this already high cost mine has become a ludicrous one. San Jose has never made us much and just been getting worse. Mara Rosa has taken 9 figures of investment to buy some hugely needed production as old Pallancata and San Jose price themselves out, the core is Inmaculada which is great other than the local agro, plus with decent investment Pallancata exploration could eventually pay off

[stevea171] 26/1/2024 21:56

Sotolo. Thanks. Hope you are well and Centamin's second mine gets a go on!

Yes, silly costs by Q3 at San Jose. We can only hope the new President of Argentina can work some magic over his first year or two of office starting with shock treatment to the socialist systems in place for the past 40 years or so. Since 2020 San Jose has been held back by unreasonable nanny state covid regulations which hasn't helped! Hopefully we can avoid mothballing the plant there.

Volcan has big pocket neighbours - Barrick, Kinross and Yamana. You would think one of them would get their check book out when you just can't find 10 million oz gold projects for sale these days and it is large projects that interests them the most. The value of a sale will increase as gold goes to $2,500, $3000 or so in the coming year or two.

[theoracleofomaha] 26/1/2024 21:52

Realy? Surely $1953 the selling price and $1445 aisc

[sotolo] 26/1/2024 17:39

You are right Steven as ever but really horrific, McEwan (co-owners with us of San Jose) q3 results back on Nov 8th said “ AISC per GEO(4) sold for San José were $1,445 and $1,953, respectively. We expect costs to remain approximately 15% above 2023 guidance due to additional capital development costs associated with the operator’s revised mine plan.” So aisc was $1953 and rising back then, San Jose is effectively making no money, maybe should mothball like Pallancata. If we just had Inmaculada and the new Mara Rosa we would be a smaller but decently profitable mine. However this makes even clear why the huge capital investment and indebtedness of Mara Rosa is so essential as we were a company of mainly dying mines (exc Pallancata) and no one has ever thought worth developing Volcan

[stevea171] 26/1/2024 08:31

TheOracle. Thanks for posting. Yes that sounds like the explanation for guidance being no reduction in AISC this year but coming later.

No news on sale of Volcan. M&I resources of c. 10 million oz.
PEA gives NPV (5%) = $826 million and IRR = 21% at $1,800/oz gold price, after-tax.
With gold now $2000+ this can only enhance its value and saleability. If they can offload this it could clear the debt at a stroke.

14/8/23. Volcan Project highlights.
Created a new Canadian Company, Tiernan Gold Corp ("Tiernan"), as a subsidiary of Hochschild Mine Holdings UK.

Restructured the Project to be owned by Tiernan.

Completed an updated Mineral Resource Estimate[1] to Canadian NI 43-101 standards, which outlined:
o 463.3 Mt of Measured and Indicated Resources at 0.66 g/t gold for 9.8 million ounces of gold contained
o 75.0 Mt of Inferred Resources at 0.516 g/t gold for and additional 1.2 million ounces of gold contained.

Completed a positive Preliminary Economic Assessment[2] to Canadian NI 43-101 standards, which highlighted:
o 22mtpa open-pit, heap leach operation with a 14 year mine life
o Average of 332,000 ounces per year of gold production for first 10 years of operations with 3.8 million ounces produced over the estimated mine life
o Initial capital cost of $900 million, with life of mine sustaining capital an additional $276 million
o Cash costs[3] of $921/oz and All-in-Sustaining-Costs[4] of $1,002/oz, life-of-mine
o NPV (5%) = $826 million and IRR = 21% at $1,800/oz gold price, after-tax

Executed an agreement for a $15 million financing with the sale of a new 1.5% NSR royalty on the Project to Franco-Nevada

Engaged Canaccord Genuity to evaluate strategic alternatives for Tiernan

[wisteria2] 25/1/2024 16:17

A decent rise in the value of silver and HOC will smash its debt...

[wisteria2] 25/1/2024 16:13

Gold imv has still got some upside over this year, and silver seems to have been relatively flat so is overdue a rise. Precious metals are vogue because of the terrible wars sparking up around the globe, and the cost to humanity is grim.

[arlington chetwynd talbott] 25/1/2024 14:44

The set up here does seem promising, whether you are a trader or an investor.

[stevea171] 25/1/2024 09:06

2023 production: 300,749 GEO
2024 guidance: 343,000-360,000 GEO

So approx 17% increase in production is expected this year.

[stevea171] 25/1/2024 08:23

Debt should start to come down when commercial production is declared at Mara Rosa in Q2.

The CEO in the CC yesterday added that all the HOC experts who brought in Inmaculada in 2015 with start up, first pour and commercial production all without problems and very close together, well ahead of expectation, are on site at Mara Rosa and have been involved in the build and all the activities there.

So I am expecting that HOC will beat its conservative forecasts here likewise.

cf Shanta's recent Singida mine start up.

8 Sept 2015 Hochschild Achieves Commercial Production at Inmaculada

Hochschild Mining plc is pleased to announce the declaration of commercial production at its Inmaculada mine, located in south west Peru. The first production of dore was announced on 5 June 2015 and approximately 25,000 oz of gold and 622,000 ounces of silver have been produced to date, a portion of which was produced during the ramp-up and commissioning phase.

[amazoner] 25/1/2024 07:39

guys, how would hoc repay the debt? not enough cash generated organically yet

[stevea171] 24/1/2024 11:39

2023 AISC expected to meet revised guidance of $1,490-1,580 per GEO.
2024 guidance: $1,510-$1,550 per GEO.

How is this possible when high cost Pallancata is closed Q4/23 and replaced by low cost Mara Rosa in Q1/24?

Maybe this has something to do with it. Inflation Rate in Argentina increased to 211.40 percent in December from 160.90 percent in November of 2023. FRES today is commenting on the extra costs of $180 million combined for devaluation of the Mexican peso and local cost of inflation which is nothing cf Argentina.

[stevea171] 24/1/2024 10:39

Canaccord initiates coverage. 14 Dec 2023. TP 145p.

The Canadian bank reckons that the first gold pour and commercial production at Mara Rosa should provide two strong near-term potential catalysts for Hochschild in the first and second quarters of 2024 respectively.

[juju44] 24/1/2024 09:57

Bought back in here this morning

[juju44] 24/1/2024 09:57

Bought back in here this morning . Lookin good

[wisteria2] 24/1/2024 09:53

nilla, Quite astonishing really, coming on stream next month, and this year hopefully see a decent rise in the value of silver. gla holders

[stevea171] 24/1/2024 09:30

Mara Rosa (Brazil) 100k oz gold pa from February. Cost $200 million.
2024 guidance: 83,000-93,000 ounces of gold at AISC of $1,090-$1,120 per oz

Video:



The videos are from last year showing construction progress. First gold pour is now just a few weeks away. Commercial production in Q2/24.

CEO says that the processing facility has been designed with 'gaps' to accomodate new installations to increase production capacity from 100k oz pa by 10 or 20% if exploration for new resources is successful.

It is thought that another 1 million gold oz may be discovered from near mine drilling.

[sotolo] 24/1/2024 09:00

Yes, heavy investment in Mara Rosa but it starts producing next month and at an aisc a stunning quarter below our expensive other mines so a v necessary investment which should return the company to one that is investible which it hasn’t been the last 4 years, to which 4 fold fall in share price attests. Now this massive investment is helping put us back on the recovery road, if not helping the balance sheet

[blackhorse23] 24/1/2024 08:25

Debt is double & cash is half

[nilla159] 24/1/2024 08:17

For those not experienced in investing,todays production report is a buy signal.IMO.

[stevea171] 24/1/2024 08:13

24 January 2024
Production Report for the 12 months ended 31 December 2023
Eduardo Landin, Chief Executive Officer said:

"Our operational team delivered a robust performance in the fourth quarter of 2023, and we have therefore ended the year at the top end of our revised production guidance with costs anticipated to be in line with expectations. I am also very pleased with our safety and environmental performance, where we achieved our best results in recent Company history.

In Brazil, we are in the final stages of the Mara Rosa project's construction and commissioning phases and are looking forward to the first gold pour in February. This exciting new mine forms a key part of our recently announced growth strategy and is set to enable Hochschild to increase output this year by over 15%."

Operational highlights

-- Full year attributable production ([1])
o 186,091 ounces of gold
o 9.5 million ounces of silver
o 300,749 gold equivalent ounces at the high end of revised guidance of 289,000-303,000 ounces
o 25.0 million silver equivalent ounces
-- 2023 all-in sustaining costs expected to meet revised guidance of $1,490-1,580 per gold equivalent ounce ($18.0-19.0 per silver equivalent ounce)

Project highlights

-- Mara Rosa project is 99.8% complete with first gold pour expected in February
o On time and on budget
o 5 million hours completed on the project without any loss time accidents

Financial position

-- Total cash of approximately $89 million as at 31 December 2023 ($144 million as at 31 December 2022)
-- Net debt of approximately $252 million as at 31 December 2022 (net debt of $175 million as at 31 December 2022)
-- Current Net Debt/LTM EBITDA of approximately 0.97x as at 31 December 2023, improved from 1.12x in September 2023
-- Zero cost collar executed for 100,000oz of 2024 gold production from Inmaculada an average floor of $2,000/oz and an average cap of $2,252/oz

Growth in 2024

-- New Mara Rosa mine set to produce 83,000-93,000 ounces of gold at AISC of $1,090-$1,120 per oz
-- Overall production target:
o 343,000-360,000 gold equivalent ounces
-- All-in sustaining costs target:
o $1,510-$1,550 per gold equivalent ounce
-- Total sustaining and development capital expenditure expected to be approximately $171-178 million

[nilla159] 24/1/2024 08:09

Mara Rosa mine 99.8% completed,
5 Million hours spent on this project,
On Time and On Budget,
Not many can say that these days,Well done Hoc.

[nilla159] 23/1/2024 14:43

Production report out tomorrow wed 24th Jan, and hopefully an update on Mara Rosa The new mine in Brazil.