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Sunshine Silver Mining & Refining is designing a mill that could process up to 2,000 tonnes of ore per day, double the capacity in its initial mine plan. The company expects a feasibility study in the second quarter of next year to assess the larger design, its costs and the path to a targeted late-2028 restart.
Sunshine Silver Mining & Refining is designing a mill for its Idaho silver mine that could process up to 2,000 tonnes of ore per day, double the roughly 1,000-tonne daily capacity assumed in its initial mine plan. The larger design is under consideration ahead of a feasibility study expected in the second quarter of next year; it is not yet an approved expansion or a confirmed production plan.
The proposed mill would give the company room to increase throughput if further drilling expands and upgrades the mine’s resources, according to the company’s second-quarter filing. Sunshine’s initial assessment, released in March, modeled a smaller operation. Its production and cost estimates therefore do not describe the proposed higher-capacity plant.
The initial assessment estimated capital spending of $286.9 million (C$409.2 million) and forecast average annual silver production of 6.7 million ounces over the first five years of a 24-year mine life. Those figures apply to the smaller operation. The feasibility study is expected to test whether the deposit can support the higher throughput and what extra capital the restart would require.
Sunshine expects to finish a mine-and-mill feasibility study in the second quarter of next year before making a final investment decision. The company has raised $310.5 million before expenses through its June initial public offering; net proceeds were $286.5 million, according to a September investor presentation. Crews are dismantling the old mill, while the company has installed a new hoist and acquired underground equipment.
A Larger Mill Could Change Restart Economics
Mill capacity affects how quickly ore can be processed and can shape the scale of a mine’s potential output. A plant designed for up to 2,000 tonnes per day could leave more room for production growth than the initial 1,000-tonne plan, but only if the mine has enough suitable material and the project can fund and build the additional capacity.
The distinction matters for investors, workers and communities near the Sunshine mine in Idaho’s Silver Valley: the proposed design is a study option, not a commitment to double output. The initial assessment’s capital and production figures cannot be applied to the larger mill. The feasibility work must establish updated costs, operating assumptions and whether the expanded throughput can be supported before the company’s targeted late-2028 restart.
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Drilling Will Test the Mine’s Scale
The Sunshine mine is near Kellogg, Idaho, about 430 kilometres north of Boise. The company’s February resource estimate reported 103.9 million ounces of indicated silver resources in 3.16 million tonnes grading 1,022 grams per tonne, and 159.8 million ounces of inferred resources in 6.41 million tonnes grading 776 grams per tonne. These are resource estimates, not guaranteed reserves or production.
A 50,000-metre underground drilling program is intended chiefly to upgrade inferred resources to the higher-confidence indicated category for the feasibility study. Sunshine said in its September exploration update that it expected to complete the program this month and report results from deeper mine areas this quarter. The initial assessment’s mine plan includes both indicated and inferred resources; inferred material carries greater geological uncertainty.
The company has also expanded its mineral rights by 60% to about 154 square kilometres and outlined a separate 45,000-metre surface drilling program at East Sunshine, Pine Creek and Rock Creek. That exploration could inform longer-term district plans, but it does not establish that those areas will support additional mines.
“We see immense opportunity in our district holdings for a multi-mine potential opportunity beyond the Sunshine Mine itself.”
— Heather White, speaking to The Northern Miner
Costs and Throughput Still Need Testing
The company has not confirmed whether it will build the 2,000-tonne-per-day mill, how much it would cost, or what production it could support. The March estimate of $286.9 million and the forecast of 6.7 million ounces of average annual silver production in the first five years relate to the smaller plan, not the proposed design.
It is also unclear how much of the inferred resource will be upgraded through drilling, how the final mine plan will treat material that remains inferred, and how much additional capital the project may need. Sunshine estimates that replacing the existing infrastructure would cost about $600 million, but the source material does not establish that as the cost of the proposed mill or as a final project budget.
The separate antimony-plant and silver-copper-refinery proposals also require feasibility studies and investment decisions. Their potential capacities should not be read as approved production plans for the mine.
Feasibility Study Sets the Next Milestone
Sunshine expects to complete its underground drilling program and report results from deeper parts of the mine this quarter, according to its September update. The company then plans to finish the mine-and-mill feasibility study in the second quarter of next year. That work is expected to address whether higher throughput is supported by the resource and what capital is required to reach production.
The company has said it expects to make a final investment decision after the study. Its late-2028 restart remains a target, not a confirmed start date. Separate feasibility work on a proposed antimony plant and a restart of the silver-copper refinery is expected in the first half of next year, according to BMO. Permitting, final project costs, funding and construction schedules remain subject to further work and decisions.
Key Questions
What mill capacity is Sunshine Silver considering?
The company is designing a mill that could process up to 2,000 tonnes per day, compared with about 1,000 tonnes per day in its initial mine plan. The larger capacity remains under study.
Has Sunshine approved the larger mill?
No. The company is evaluating the design. It expects a feasibility study in the second quarter of next year, followed by a final investment decision.
Do the initial production and cost estimates apply to the larger mill?
No. The March initial assessment estimated $286.9 million in capital spending and average annual silver production of 6.7 million ounces during the first five years for the smaller operation. Those projections do not describe the proposed larger design.
When does Sunshine expect the mine to restart?
The company is targeting a late-2028 restart. That remains a target, dependent on feasibility work, a final investment decision, funding and project execution.
What drilling is supporting the study?
Sunshine has a 50,000-metre underground drilling program aimed mainly at upgrading inferred resources to indicated resources for the feasibility study. The company has also outlined a separate 45,000-metre surface program across nearby properties.
Source: northernminer.com
