Greens Creek Drilling Expands Mineralization Both From Surface And Underground

COEUR D'ALENE, ID - Hecla Mining Company, President and CEO, Phillips S. Baker reported, "Greens Creek had another strong quarter and has generated over $100 million in free cash flow for the first nine months, and our plans for returning Lucky Friday to production in early 2024 are well underway. We are pleased with the start of the transition to an open pit only operation at Casa Berardi. While exploration drilling at Keno Hill has yielded encouraging results and we expect to increase our reserves and resources, the production ramp-up has been slowed due to key mine infrastructure projects that are just now being completed. However, more importantly, safety performance at Keno Hill has been below Hecla’s standards, and we are assessing our safety processes and mining practices to set the mine up for long term success. Hecla is already the largest silver producer in the U.S. and will be Canada's largest when Keno Hill achieves full production. Hecla is the fastest-growing established silver producer, and we expect to produce up to 20 million ounces of silver by 2025. Because silver is a key component in solar power generation, which is the fastest growing source of renewable energy, Hecla will be a direct contributor to the energy transition."

The Greens Creek Mine, in Alaska, produced 2.3 million ounces of silver in the third quarter, same as the prior quarter. Gold production decreased by 8% to 15,010 ounces due to lower grades; zinc and lead production was consistent with the prior quarter. The Company is increasing silver production guidance for the mine to 9.8 – 10 million ounces. Cash cost and AISC per ounce (each after by-product credits) guidance for the mine is also increased due to lower than expected zinc and gold production attributable to lower grades due to mine sequencing in the second half of the year.

Greens Creek drilling has expanded mineralization both from surface and underground. Four underground drills completed over 43,000 feet of drilling in 109 holes focused on resource conversion and exploration that extends mineralization of known resources. Additionally, two helicopter supported drills completed over 11,900 feet of drilling in 21 holes which extended Upper Plate and East ore zones.

Underground drilling completed three drillholes in the 5250 zone to extend mineralization in the upper portion of zone spanning 150 feet of strike length. Only one hole has assay results which shows two zones of ore grade mineralization that should expand mineralization. The other two drillholes intersected very thick sequences of mineralized white ore and massive sulfide ore lithologies above the modeled resource and, though assays are pending, these drillholes should expand mineralization in the zone. Surface exploration drilling targeted gaps and margins in the upper part of the East Zone resource in addition to initial follow up drilling on historic drill intercepts. Drilling occurred over a strike length of 1,650 feet and assay results received to date indicate expansion of mineralization in those areas drilled. Underground drilling targeted the northern, central, and eastern portion of the Upper Plate zone, targeting mineralization for upgrading and expanding resources over 900 feet of strike length. Surface exploration drilling targeted the western extensions of the Upper Plate resource along strike, the northern extensions up-dip, and the southern extensions down-dip of the current resource. Initial drilling results to date indicate that drilling is upgrading and expanding mineralization in the Upper Plate Zone.

In Idaho, the Lucky Friday Mine produced 0.5 million ounces of silver during the quarter before production was suspended in August. In August, the Company reported a fire in the secondary escapeway (#2 shaft), which is also used as an exhaust ventilation airway for the mine. The fire was extinguished but damaged the bottom of the shaft. Mitigation plans to bring the mine back into production include developing a new secondary escapeway ramp of 1,600 feet and a 290-foot vertical ladderway to bypass the damaged portion of the secondary escapeway. A vent bypass raise of 850 feet will also be developed to replace the lost ventilation. As of the date of the release, 35% of ramp development and 10% of the escapeway raise was complete. The Company is increasing the capital guidance for the mine to reflect the mitigation plans. Lucky Friday production is suspended for the remainder of 2023 while the new secondary escapeway is completed but the suspension is not expected to materially impact 2024 production.

The Casa Berardi Mine, in Quebec, produced 24,259 ounces of gold in the third quarter, an increase of 28% over the prior quarter. The increase was due to the prior quarter being negatively impacted by the wildfire-related road closures. The mill operated at an average of 3,735 tpd during the third quarter compared to 4,600 tpd during the first two months of the prior quarter. The lower throughput in the third quarter is primarily attributable to planned mill maintenance shutdowns. Open pit tons moved during the quarter set a record as the first phase of the in-house equipment fleet was commissioned.

In the Yukon Territory, the Keno Hill Mine continued ramping up production in the third quarter, producing 710,012 ounces of silver. Throughput in the quarter averaged 268 tpd with silver grades of 33 ounces per ton. Tonnage mined was constrained by delays in infrastructure construction which has impacted development rates. Key underground infrastructure projects include the shotcrete plant, which is now complete, and the cemented rockfill plant, which is expected to be completed at the end of November. With the delay in major construction projects, camp facilities at the mine were constrained, which was also a factor in the slower ramp-up of the mine. Modifications to the secondary crushing circuit are substantially complete, and commissioning is underway. The changes are expected to increase crusher availability and efficiency.

Capital spend during the quarter was $11.5 million for underground and surface infrastructure, mine development and equipment purchases. All-Injury Frequency Rate at the mine trended higher during the quarter and was higher than the Company's standards. An assessment is being made to determine steps necessary to improve safety procedures and evaluate current mining practices, so production guidance is reduced to 1.6-1.8 million ounces of silver.

At Keno Hill, the underground definition and surface exploration drilling programs are focused on extending mineralization, resource conversion in the high-grade Bermingham Bear Zone Veins (Bear, Footwall, and Main Vein Zones), and defining new mineral resources. During the third quarter, two underground drills completed over 13,000 feet of definition and geotechnical drilling, and two surface core drills completed over 23,000 feet of exploration drilling targeting the Bermingham, Bermingham Townsite, Hector-Calumet Chance, and Coral Wigwam target areas.

Bermingham underground definition and exploration drilling on the Bear Zone is extending mineralization to the northeast outside of the current reserve shapes and down-dip on the three mineralized veins reserve shapes. The northeast drilling is expanding high-grade silver mineralization with the discovery of a new high-grade mineralized shoot outside of the current planned stopes which is also open at depth along plunge. Downdip drilling continues to confirm wide and high-grade silver mineralization within the planned stopes and outside of the planned stopes in the area between the veins where strong stockwork mineralization occurs near their intersection. High-grade silver mineralization has been intersected in both the steep and shallow plunging targets of the Bermingham Townsite Zones and is open for expansion and continues to confirm the exploration potential within the district. An initial core-hole testing for continuity of the Deep Bermingham vein system intersected mineralized veining 1,050 feet below the existing resource (assays pending). In addition, the favorable Basal Quartzite host stratigraphy was shown to extend a minimum of 350 feet below this where the hole was ended, or 2,850 feet below surface and indicates that significant potential for expansion exists below the current Bermingham resource.