Back to work at Lucky Friday
SPOKANE - Hecla Mining Co. announced Tuesday it resumed production late last week at its Lucky Friday mine in Mullan and that it expects to produce two million ounces of silver this year.
"Production levels are expected to ramp up during the first half of the year, and we expect to reach normal production levels by mid-year," said Hecla's president and CEO, Phillips S. Baker Jr. "This is really a great day for the Silver Valley, for miners, for families, and for Hecla."
At a press conference at the DoubleTree by Hilton Hotel in downtown Spokane, Hecla senior management also announced that rehabilitation work on the mine's main access shaft is complete and necessary clearance has been received by the company from the federal Mine Safety and Health Administration.
The Coeur d'Alene-based company used 12 months of down time at the mine to clean and improve the efficiency of the so-called Silver Shaft, and make other improvements to the mine's operations. Lucky Friday was shut down for the past year after a string of serious accidents.
In a typical year, Lucky Friday would produce about three million ounces of silver. With silver valued around $30 per ounce last year, the lost silver production equals about $90 million, said Jim Sabala, Hecla's chief financial officer. Silver represents about two-thirds of the production value of Lucky Friday, which also produces lead and zinc.
While not in production mode last year, the company did its best to make good use of the time, management said.
"We did more than 7.5 miles of improvements to underground workings, putting in more than 61,000 bolts and 20 miles of chain-link fence and installed technologically advanced rock-holds," Baker said. The company also purchased $2.3 million in new equipment, including mechanized rock bolters, which will be used to implement new ground-control measures.
The mine has been 100 percent owned and operated by Hecla for more than 50 years. The 122-year-old company expects production at Lucky Friday to continue for generations.
"We believe the mine is in better condition today than at any time in its history," Baker said.
He said the company has nearly reached full staffing at the mine, with 300 employees. All employees, both returning and new, have completed a week of supplemental safety training on risk assessment and accident prevention.
Larry Radford, vice president for operations, said, "This training is basically a methodical way of looking at any given hazard and determining the best way to eliminate the hazard. This training was given throughout the mine and is a very powerful tool for the miners themselves."
In addition to the Hecla employees at the mine, there also will be another 150 employees of Hecla contractors back at work at the mine starting either this quarter or next, Baker said.
"Ninety percent of the (Hecla) employees that we had previously have come back," Baker said. "That's an extraordinary number of employees to come back. I think it is evidence of the sort of culture that we have at Lucky Friday. And it's the nature of the Silver Valley people."
The company was able to retain roughly 175 Lucky Friday employees in 2012 to work on projects at the mine other than production. The company also placed roughly 25 employees at other operations in 2012. The remainder of the 300 employees at the mine had to find other employment.
In addition to the additional safety training, the company hired a new safety manager at the mine and one at the corporate office. Radford said the new hires were not replacements but provide an additional layer of safety management.
Hecla has spent a total of $29.8 million on the rehab of the primary access shaft and an additional $26.2 million on other capital projects at Lucky Friday that are unrelated to the shaft renovation.