Coeur Mining, a precious metals producer with assets located in the United States, Canada and Mexico, has bet on mineral exploration.
The company developed the largest exploration program in its history, thereby extending mine life and driving resource growth.
Coeur increased total exploration spending 41% year-over-year in 2021, to $71 million in 2021, bringing its five-year cumulative exploration spending to nearly $240 million and significant increases in reserves and resources.
Beginning with the 2021 program, mine life extensions at Palmarejo and Wharf, as well as significant resource additions at Silvertip and Kensington, continue to lay the foundation for future organic growth.
Coeur Mining’s general and administrative expenses were up $6.7 million, or 20%, primarily due to higher compensation, travel and outside service costs.
At the same time, exploration spending increased $8.5 million, or 20%, as the company remained committed to a higher level of exploration investment after completing the largest and most successful drilling campaign in Coeur’s history during 2020.
The company completed 746,900 feet (227,650 meters) of expansion drilling and 417,200 feet (127,175 meters) of infill drilling in 2021 compared to 617,500 feet (188,225 meters) of expansion drilling and 165,700 feet (50,475 meters) of infill drilling in 2020.
Pre-development, reclamation and other expenses decreased $7.0 million, or 13%, due to lower costs incurred in connection with the company’s Covid-19 health and safety protocols, partially offset by ongoing transportation costs of the entire year and the absence of one-time costs in 2020 associated with the suspension of mining and processing activities at Silvertip.
Gold, silver, zinc and lead prices are affected by many factors beyond the company’s control, including the strength or weakness of the US dollar, speculation, global currency values, global and regional demand and production, political and economic conditions and other factors.
In addition, Exchange Traded Funds (ETFs), which have substantially facilitated the ability of large and small investors to buy and sell precious and base metals, have become major holders of gold, silver, zinc and lead.
Gold and silver prices are also affected by prevailing interest rates and returns on other asset classes, expectations regarding inflation, and government monetary decisions regarding central bank holdings.
Coeur Mining reported revenue of $833 million in 2021, of which $79 million was from gold sales. Its scheduled exploration expenditures for 2022 total between $16 million and $23 million.