Hochschild Mining production up in H2

Hochschild Mining slipped this morning on lower metal prices despite releasing a production report showing second half production slightly higher than in the first half.

In an update for the 12 months to 31 December, total production for the second half was 6.1 million ounces of silver and 93 thousand ounces of gold, as expected. Silver production went up 12% in H2 from the six months to 30 June, primarily due to increased production at Arcata and Selene. The planned expansions at Arcata and Selene, taking the capacity from 350 ktpa to 420 ktpa and from 350 ktpa to 700 ktpa, respectively, are on schedule for completion within budget during 2007.

But total gold production was down 10% in the second six month period versus the first half due to the anticipated decrease in ore grade at Ares, it said.

The company, which raised over £270m from its float last November at 350p, added that the Ares processing plant will be undergoing testing during January 2007.

Hochschild’s three new projects, scheduled to begin production during 2007, are also on track, said the firm.

San Jose will start producing during the second quarter, while Pallancata and Mina Moris will start in the third quarter, with all three expected to contribute to profits in 2008.