New York Institutional Gold Conference May 24,...
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New York Institutional Gold Conference May 24, 2005
Transcript of New York Institutional Gold Conference May 24,...
New York Institutional Gold Conference
May 24, 2005
Statements made which are not historical facts, such as anticipated payments, litigation outcome, production, sales of assets, exploration results and plans, costs, prices or sales, performance are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995,and involve a number of risks and uncertainties that could cause
actual results to differ materially from those projected, anticipated, expected or implied. These risks and uncertainties
include, but are not limited to, metals price volatility, volatility of metals production, exploration risks and results, project
development risks, political risks and ability to raise financing. Refer to the company’s Form 10-Q and 10-K reports for a more detailed discussion of factors that may impact expected future
results. The company undertakes no obligation and has no intention of updating forward-looking statements.
Statements made which are not historical facts, such as anticipated payments, litigation outcome, production, sales of assets, exploration results and plans, costs, prices or sales, performance are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995,and involve a number of risks and uncertainties that could cause
actual results to differ materially from those projected, anticipated, expected or implied. These risks and uncertainties
include, but are not limited to, metals price volatility, volatility of metals production, exploration risks and results, project
development risks, political risks and ability to raise financing. Refer to the company’s Form 10-Q and 10-K reports for a more detailed discussion of factors that may impact expected future
results. The company undertakes no obligation and has no intention of updating forward-looking statements.
Forward Looking Statement
Hecla TodayHecla Today
Silver AND Gold Producer
Lowest-Cost Major Primary Silver Producer
Low-Cost Gold Producer
Best Land Package in its History
Major Exploration Focus
World Class Mining Expertise
World Class Mining World Class Mining DistrictsDistricts
La CamorraHistoric High-GradeGold District
Corporate Office
Gold (Au)
Silver (Ag)
Greens CreekWorld Class Ore Body
Lucky Friday1.2 Billion Ounce Silver District
Hollister BlockNevada's Gold Trend
San Sebastian500 Years of DistrictSilver Production
Silver ProductionSilver Production1995 ~ 2005E
0
2
4
6
8
10
1995 1998 2001 2004$0
$1
$2
$3
$4
$5
Production (oz) Total cash cost per ounce(in millions)
Gold ProductionGold Production1999 ~ 2005E
0
50,000
100,000
150,000
200,000
250,000
1999 2001 2003 2005E$0
$50
$100
$150
$200
$250
$300Production (oz) Total cash cost per ounce
Hecla Property Hecla Property PositionPosition
Venezuela
N
EL DORADO
TUMEREMO
EL MIAMO
GUASIPATI
PASTORAGREENSTONE
BELT
EL CALLAO
CUYUNI RIVER
EL DORADOCONCESSIONS
BOTANAMOGREENSTONE
BELT
MINERVENCONCESSIONS
1 2 5
69
3 4
78
1012 11
Block ‘B’
Mina Isidora
Canaima
La Camorra
Caracas
PuertoOrdaz
MAP AREA
Mina Tomi (Crystallex)
Mineria MS
Revemin(Crystallex)
Mina Colombia(Minerven)
La Victoria (Crystallex)
Mina Isidora RampMina Isidora RampVenezuela
Block B Block B -- El CallaoEl Callao
HECLA OFFICE
San AntonioCHILE WEST
Santa Barbara
Revemin Fresh Water Dam
RIO YURUARY
Colombia
El Callao
Peru
San Jorge Sosa MendezLagunaSanta Rita
CHILE VEINS SYSTEM
Small Operations
El Peru Mill
Caratal Mill
Revemin Mill
Twin ShearConductora
Shear
BLOCK ‘C’
CENICERO TREND
EL BRUJO TREND
Venezuela
Block B Panama COLOMBIA MINE4.7 M Au Oz(Past Prod &
Reserves)
CALLAO MINE1.4 M Au Oz (Past Prod)
LAGUNA MINE0.8 M Au Oz (Past Prod)
CHILE MINE0.6 M Au Oz (Past Prod)
Mina IsidoraMina Isidora
La Camorra Shaft La Camorra Shaft ConstructionConstruction
La Camorra Shaft:
2,000 feet deep
Production &Ventilation
Operational 2nd
Half 2005
Venezuela
RIO CUYUNI
TUMEREMO 55km
ELDORADO
10km
NIÑAVI
EMILIAII
NIÑAIII
ELPLACER
NIÑA II
YESSICA
NIÑAIV
NIÑAVII
LAMEDUSA
CANAIMA
SUDOR
NIÑA I
1.0 Km
N
Canaima
Esperanza
Resortera
CVG Exploration ContractExploitation Concession
EMILIAI
Pescador
MartaRosita
Isbelia
BetzySAN
RAFAEL
Main
BELKYS
La CamorraLa CamorraLand PositionLand Position
Venezuela
CAMORRA TREND
ESPERANZA-
DORADA TREND
CANAIMA TREND
LA CAMORRA MINE
VenezuelaPequeños MinerosPequeños Mineros
Traditional Mining Methods
Pequeños MinerosPequeños MinerosVenezuela
No re
0 50
kilometers100
D U R A N G OD U R A N G O
SaladilloSaladilloSaladilloSaladilloSaladilloSaladilloSaladilloSaladilloSaladillo
VelardenaVelardenaVelardenaVelardenaVelardenaVelardenaVelardenaVelardenaVelardena
AvinoAvinoAvinoAvinoAvinoAvinoAvinoAvinoAvino
GuanaceviGuanaceviGuanaceviGuanaceviGuanaceviGuanaceviGuanaceviGuanaceviGuanacevi
SombrereteSombrereteSombrereteSombrereteSombrereteSombrereteSombrereteSombrereteSombrereteChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites DistrictChalchihuites District
San MartinSan MartinSan MartinSan MartinSan MartinSan MartinSan MartinSan MartinSan Martin
FresnilloFresnilloFresnilloFresnilloFresnilloFresnilloFresnilloFresnilloFresnilloLa ColoradaLa ColoradaLa ColoradaLa ColoradaLa ColoradaLa ColoradaLa ColoradaLa ColoradaLa Colorada
ZacatecasZacatecasZacatecasZacatecasZacatecasZacatecasZacatecasZacatecasZacatecas
Geology LegendTertiary Volcanic & Intrusive RocksSedimentary Rocks & AlluviumPaleozoic & Mesozoic Rocks
HERMOSILLO
DURANGO CITY
MEXICO CITY
~750 Million Ag oz
700+ Million Ag Oz
500+ Million AgEq Oz
~180 Million Ag Oz
San SebastianSilver Belt GeologySilver Belt Geology
Property PositionProperty PositionSan Sebastian
Concession Boundary
VeinsGeophysical Targets
Geological TargetsMineralized Trends
CERRO BLANCO
TREND
JUDITH TREND
FRANCINE
TREND
Don Sergio Vein
Francine Vein
Hugh Zone Long SectionHugh Zone Long SectionSan Sebastian
Hugh Zone 8.9’ @ 9.6 opt Ag, 0.42 opt Au
2.7% Cu, 2.6% Pb, 6.7% Zn
8.9’ @ 15.7 opt Ag, traces Au5.2 % Cu, 12.3% Pb, 8.5% Zn
6.6’ @ 18.7 opt Ag, traces Au5.4% Cu, 16.7% Pb, 12.1% Zn
Underground DevelopmentUnderground Development
Future DevelopmentD
ecline
RoadsVeins
Clementine Vein System
GwenivereVein System
Hollister Block, Nevada
Lucky Friday Lucky Friday Historic ProductionHistoric Production
"Out of the Earth, "Out of the Earth, Into Our Lives"Into Our Lives"
1942-2004Silver129,541,046 ozs.
Lead877,774 tons
Zinc112,898 tons
Reserve/ResourceReserve/ResourceOutlineOutline
Lucky Friday
Mined Out4900 LEVEL
2003 Reserve
5900 LEVEL2003 Resource
2004 Additional Reserve & Resource
2004 Reserve
2200 feet
2005 drill holes
>20 opt Ag
<10 opt Ag10-20 opt Ag
View from South
Greens Creek Greens Creek –– West GallagherWest Gallagher
Rising DemandRising Demand
0
100
200
300
400
500
600
700
800
900
77 79 81 83 85 87 89 91 93 95 97 99 01 03 05p
Other Uses
Other Countries
Electronics
Jewelry & Silverware
Photography
Imports into the Transitional Economies
Million Ounces
2004 World Silver Demand2004 World Silver Demand
Industrial (43%)
Coins (4%) ProducerDe-Hedging
(1%)
Jewelry & Silverware
(30%)
Photography (22%)
(GFMS forecast, Oct. 2004)
“Despite the emotional reaction to the decline sales of film in photography, we do not foresee any major shift in the need for silver in producing silver halide products
over the next five years." Silver Inst. 02/04
Digital ImpactDigital Impact
Silver’s Unique Properties: Silver’s Unique Properties: The Ideal Industrial MaterialThe Ideal Industrial Material
• Strength• Sensitivity to light• Malleability and ductility• Electrical and thermal
conductivity• Reflectivity• Ability to endure extreme
temperature changes• Antibacterial power
Bacteria are becoming immune to antibiotics. This can not occur with silver..
Silver: The AntibacterialSilver: The Antibacterial
Silver in RefrigeratorsSilver in Refrigerators
• LG Electronics TV refrigerator
• Uses ‘Bio Silver’ and ‘Bio Shield’ brand of nano silver technology
• Provides antibacterial protection
SuperconductorsSuperconductors
Power transmission.Testing by DetroitEdison. Cheaper todeliver power.
Ship propulsion motors and generators: Lower weight, quieter, smaller size and volume, higher efficiency than conventional motors.
Water PurificationWater Purification
Floatron eliminates the need for harsh chemicals to purify pools. Powered by solar cells. Releases silver and copper ions.
Mine ProductionMine Production
050
100150
200250300350
400450500550
1990 1992 1994 1996 1998 2000 2002 2004p
Mexico
Million Ounces
Peru
Canada U.S.Australia
Other Countries
0
200
400
600
800
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003F
Mill
ion
ou
nce
s
1000 ScrapMine Production
Demand
Source: Gold Fields Minerals Services, Nov. 2003
Supply/Demand DeficitSupply/Demand Deficit19941994--20032003
Bullion InventoriesBullion Inventories
0
400
800
1,200
1,600
2,000
2,400
50 54 58 62 66 70 74 78 82 86 90 94 98 02
Million Ounces
05p
Government Silver InventoriesGovernment Silver InventoriesAre LowAre Low
100125150175200225
250275300325350375
70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02
Million Ounces
03
Silver Price in Silver Price in "Real" Terms is Low"Real" Terms is Low
1
10
100
68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04
Real Silver Price
Nominal Silver Price
$/Ounce
Silver: The Indispensable, Silver: The Indispensable, Green MetalGreen Metal
DemandDoubled in two decadesNo good substitute for silverMany new uses
SupplyProduction gapInventories nearly depleted
Price PredictionHigher for five yearsHigh volatility
Hecla 2005Hecla 2005
Low Cost Gold and Silver Production4 Development Projects
Mina Isidora, La Camorra Shaft, Lucky Friday Expansion, Hollister Exploration Ramp
Major $23 Million Exploration ProgramVenezuela, Mexico, U.S.
Continued Acquisitions Focus
