(1) Silver equivalent ounces for 2013 were established in November 2012 using prices of US$28 per oz, US$1,680 per oz (60:1 ratio), US$0.85 per lb and US$0.85 per lb for silver, gold, lead & zinc, respectively, and applied to the recovered metal content of the concentrates that were produced by the two operations. For consistency, these prices will be used for the balance of 2013.
The majority of the metal production during the quarter was obtained from the 1522 and Durangueno mines, followed closely by the Argentina and El Rosario mines, which showed increased production. Silver grades were lower than anticipated due to the continuous narrow vein formations resulting in higher dilution. However, a trend of increasing silver grades was noticed from month to month during the quarter due to ongoing efforts towards improving grade control.
Underground development at Topia consisted of 2,254 metres, down 14% compared to the same period in 2012. The development program for the quarter was focused on deepening main ramps at the Argentina and La Prieta mines to access new mineralized levels indicated by exploration drilling results. In addition, development was carried out to prepare sublevels, raises and stopes for production. Development reached level 4 as planned at the Argentina main ramp, whereas development of the La Prieta ramp was temporarily suspended giving priority to preparatory work for production.
Taking into account constantly changing metal prices, management continues to conduct mine by mine reviews to determine the profitability of individual mines at Topia, thereby determining where to best concentrate the mining efforts and reduce costs. To date, two of the fourteen mines have been temporarily shut down, and supplemented with increased production at other more profitable mines.
Improvements are being made to the Topia processing plant by the installation of a cone crusher that will significantly increase the crushing capacity at the plant and reduce maintenance and electricity costs. In addition, a performance improvement analysis is being undertaken in order to further optimize the mill and flotation sections of the plant.
San Ignacio Project
The Company received approval of the Land Use permit earlier than anticipated during the second quarter and submitted a revised Environmental Impact Assessment which is expected to be approved by the end of the third quarter.
A new mine plan is being compiled for San Ignacio incorporating the latest geological resource model based on the known veins, grade ranges and elevation for commencement of mining.
An infill and extension drilling campaign is anticipated to begin in September at San Ignacio to better define the resource. In addition, mine and earthwork contractors will be selected and the installation of the water supply for the mine will be completed by the end of the third quarter.
A surface drill program consisting of 24 drill holes for a total of 2,156 metres was completed during the second quarter. The program was laid out along 650 metres of strike length on the Diamantillo vein and also tested various splays and nearby parallel structures and veins.
Assay results have been received and are being compiled and interpreted. A wireframe and 3D model are being constructed such that the continuity of grade and vein widths can be determined. An internal resource estimate and preliminary economic assessment will be prepared in the third quarter.
With first half production totaling 1,287,713 silver equivalent ounces, the Company is on track to meet its guidance of 2.4 to 2.5 million silver equivalent ounces for fiscal 2013.
As precious metals prices dropped significantly in the second quarter, the Company has heightened its focus on improving and strengthening the operational efficiency of its operations. Cash cost guidance is being reviewed and the Company will provide an update in our second quarter earnings release, expected in early August.
ABOUT GREAT PANTHER
Great Panther Silver Limited is a profitable, primary silver mining and exploration company listed on the Toronto Stock Exchange trading under the symbol GPR, and on the NYSE MKT trading under the symbol GPL. The Company's current activities are focused on the mining of precious metals from its two wholly-owned operating mines in Mexico, Topia and Guanajuato. Great Panther is also in the process of developing its San Ignacio Project and has two exploration projects, El Horcon and Santa Rosa.
For further information, please visit the Company's website at www.greatpanther.com.
This news release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario) (together, "forward-looking statements"). Such forward-looking statements may include but are not limited to the Company's plans for production at its Guanajuato and Topia Mines in Mexico, exploring its other properties in Mexico, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risks involving the Company's operations in a foreign jurisdiction, uncertainty of production and cost estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of silver, gold and base metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company's Annual Information Form for the year ended December 31, 2012 and Material Change Reports filed with the Canadian Securities Administrators available at www.sedar.com, and reports on Form 40-F and Form 6-K filed with the Securities and Exchange Commission and available at www.sec.gov.
Great Panther Silver Limited
Chief Executive Officer
Great Panther Silver Limited
Vice President Corporate Communications
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