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The Galena mine has a history dating back to 1887, but modern history and mining commenced in 1953, under the management of ASARCO. Since 1953, production was primarily a silver-copper ore, with minor production of silver-lead ores. Total production since 1953 has exceeded 160 million ounces of silver, 116 million pounds of copper, and 22 million pounds of lead from 7 million tons of ore. The average grade of the silver-copper ore was 22.9 ounces of silver per ton and 0.83% copper. The average grade of the silver-lead ore was 8.2 ounces silver and 8.8% lead, per ton of ore.
Lead-silver ore was discovered in an outcrop on this property in 1887, four years after the initial discovery of precious metals in the Coeur d'Alene Mining District. For the next 30 years, ore was mined from a series of surface tunnels, and in 1917 Day Mines started what is now known as the Galena shaft. The mine operated discontinuously until 1953 when the discovery of the Silver Vein prompted ASARCO to begin sinking the Galena shaft to its current depth of over 5,500 feet. Over the past 53 years, the Silver vein alone has produced in excess of 100 million ounces of silver and is still in production today. The No. 3 shaft was sunk in the 1960's and is now the principal shaft on the property, operating to a depth of 5800 feet. The Galena shaft is currently under repair.
In 1995, a new joint-venture company was created between ASARCO and Coeur D'Alene Mines called Coeur Silver Valley. This JV included the Coeur and the Caladay Mines as well. In 1999 Coeur d'Alene Mines Corporation purchased 100% of the Coeur Silver Valley assets. This wholly owned subsidiary was purchased 100% by U.S. Silver Corporation in June 2006, for US $15 million.
An aggressive exploration and development program conducted by U.S. Silver since taking over ownership and operation of the Galena mine in June 2006, has resulted in a 60 percent increase in proven and probable silver ounces as compared to the December 31, 2006 estimate. Silver ounces contained in silver-lead ore increased by 87 percent, with a 79 percent increase in contained tons of lead. The tons of silver-lead ore reserves increased by 126 percent since December 2006.
During 2007, management placed an increased emphasis on development and diamond drilling of the silver-lead zones that exist at the Galena mine. Recent exploration demonstrated that the silver-lead zone may be potentially larger than originally indicated. While exploration and development of silver-copper ore continues on par with silver-lead development, the company expects the silver-lead resource to grow faster in the near term as it had been largely ignored by previous operators. The silver-lead ore is being processed at the Company's Coeur mill while silver-copper ore continues to be processed at the Galena mill.
The Company commenced production of silver-lead ore during the fourth quarter of 2007 and restarted the Coeur mill to process the silver-lead ores. Development activities were focused on the exploration and development of the multiple areas where silver-lead ores were identified in historic workings or drill holes in the Galena mine. Development activity produced silver-lead ores on the 3000 and 3700 levels by the end of 2007.
Development of silver-copper ores continues on many levels, with the primary focus being on the 2400, 3400, 3700, 4600, and 4900 levels. Production started in the new 3400 and 4600 level discoveries during the year and will commence from the new discovery on the 2400 level in the second quarter of 2008. The 3700 and 4900 developments will also commence production during the second quarter of 2008.
The rehabilitation of the Galena Shaft began in 2007. The Galena Shaft had a large section of the shaft collapse about 10 years ago, resulting in the inability to use the shaft for its full length. The main section of repair should be completed in the 4th quarter of 2008 and should allow for hoisting of personnel, materials, ore and waste rock through the shaft.
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