GOLDEN, CO -- (Marketwire) -- 04/10/12 --Golden Minerals Company (NYSE Amex: AUMN) (TSX: AUM) ("Golden Minerals" or "the Company") is pleased to report first quarter 2012 results for the Velardeña Operations that continue to reflect significant operational improvements and the ramp up of production. From January 1 through March 31, 2012, month over month during the quarter, gold production increased by approximately 25% and silver production increased by more than 40%.
First quarter 2012 payable production totaled 1,500 ounces of gold and 95,000 ounces of silver, exceeding guidance by approximately 15% for gold and 6% for silver. Silver equivalent production for the quarter, calculated based on only gold byproducts (excluding zinc and lead) and using a silver to gold ratio of 50:1, totaled 170,000 ounces. Also during the first quarter, the Velardeña Operations had payable base metals production of approximately 200,000 pounds of lead and 275,000 pounds of zinc.
The following table shows actual precious metals production compared to guidance for January through March 2012 and our previous guidance for the remainder of 2012.
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Q1 2012 Q1 2012 Full Year
Guidance Actual Q2 2012 Q3 2012 Q4 2012 2012
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Production (payable metals)
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Gold (oz) 1,300 1,500 2,000 2,600 3,100 9,000
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Silver (oz) 90,000 95,000 150,000 230,000 270,000 740,000
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Since the merger with ECU Silver on September 2, 2011, Golden has continued to make operational improvements at the Velardeña Operations, located in the State of Durango, Mexico. The Company's primary focus has been on improving head grade and optimization to improve recoveries and product quality in both the oxide and sulfide processing plants. Construction of a flotation circuit ahead of the current oxide plant to improve recoveries of sulfides mixed with the oxides is well underway, with projected completion in the third quarter.
Engineering studies are also underway for the phased expansion, which will consist of adding an additional ball mill, flotation cells, tailings dam and concentrate handling equipment. The additional ball mill has been purchased. The phased expansion is expected to increase combined oxide and sulfide plant throughput to 1,300 tonnes per day in early 2013, with annualized production estimated to be approximately 2 million ounces of silver and 29,000 ounces of gold.
The Company now expects to complete an updated NI 43-101 compliant resource estimate for the Velardeña Operations during the second quarter 2012. In line with the Company's emphasis on the higher classes of mineral resources (measured and indicated), management and their qualified advisors have decided to narrow the definition of the lowest resource class (inferred resources) to include only that material meeting strict and readily-justifiable geostatistical and conservative geologic criteria. Because of this, we expect to report a smaller inferred resource base at Velardeña compared to the inventory carried in the past. Management and their advisors do not believe that this stricter interpretation of inferred resources reflects upon the quality of the resource at Velardeña or the likely longevity of the operations.
About Golden Minerals
Golden Minerals is a Delaware corporation based in Golden, Colorado, primarily engaged in the ramp up and expansion of existing production at the Velardeña and Chicago Mines in Mexico and advancement of the evaluation stage El Quevar project in Argentina.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and applicable Canadian securities laws, including statements regarding forecasts of production from the Velardeña Operations and the effects on such forecasts of development work, mining and process improvements, operational changes, processing facility improvements, planned phased expansion of the existing sulfide plant and the timing and amount of the anticipated increase in combined oxide and sulfide plant throughput and annualized production; anticipated improvements in feed head grades, sulfide and metal recoveries, and concentrate production and quality; anticipated updates of resource estimates for the Velardeña properties and the timing thereof; anticipated reduction in the amount of inferred resources at Velardeña These statements are subject to risks and uncertainties, including unexpected events at the Velardeña Operation, including lower than anticipated production or greater than anticipated costs; variations in ore grade and relative amounts, grades and metallurgical characteristics of oxide and sulfide ores; delays or failure in receiving required government approvals or permits; technical, permitting, mining, metallurgical or processing issues; failure to achieve anticipated increases in production and improvements in head grades, recoveries and concentrate production and quality at the Velardeña Operations; delays in or failure to realize anticipated benefits of plant optimization efforts; timing and availability of external funding on acceptable terms that may be required to construct the planned sulfide plant; unfavorable interpretations of geologic information; inability to complete the phased expansion and anticipated throughput increase on time or at all or failure to realize anticipated production and throughput improvements from the phased expansion; unfavorable results of new resource estimates; loss of and inability to adequately replace skilled mining and management personnel; possible disputes with customers or joint venture partners; delays in the arrival of or loss of equipment being procured for the Velardeña operation; development of unfavorable information or conclusions regarding the economic or technical aspects of the planned phased expansion of the Velardeña Operation, or interpretations of geologic information; volatility or other changes in the U.S. and Canadian securities markets; availability and cost of materials, supplies and electrical power required for mining operations and exploration; fluctuations in silver, gold, zinc and lead prices, costs and general economic conditions; changes in political conditions, tax, environmental and other laws, and diminution of physical safety of employees in Mexico. Additional risks relating to Golden Minerals Company may be found in the periodic and current reports filed with the Securities Exchange Commission by Golden Minerals Company, including the Annual Report on Form 10-K for the year ended December 31, 2011.
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