Greens Creek sets record $147 million quarter as Hecla weighs three paths for tailings

Greens Creek, Hecla Mining's mine about 18 miles southwest of Juneau on Admiralty Island, generated a record $147 million in free cash flow, before exploration and corporate costs, in the third quarter, Hecla reported Tuesday. The prior record, $130 million, was set the quarter before.

Output fell from a year earlier. Silver dropped 17.6% and gold dropped 23%. Hecla blamed less ore milled and lower grades. It said higher-than-planned maintenance cut silver output 6% from the prior quarter, and more maintenance is planned this quarter.

Sales still rose, to $222.2 million from $178.1 million, and Hecla's quarterly report credits higher metal prices, partly offset by lower sales volumes, for most of the gain in gross profit.

Hecla estimates its dry tailings pile, the stacked waste left after milling, held 10.7 million tons on Sept. 30, with about 51 million ounces of silver, nearly 600,000 ounces of gold and additional critical minerals. It puts their gross value at about $6.4 billion, before costs it expects to be significant. Its results release says the material is not a mineral resource or reserve, and recovery would depend on further testing, a suitable processing arrangement and favorable economics. In August, Hecla put the pile at 10.6 million tons and about $6.1 billion.

Hecla then described one reprocessing project. It now describes three possible paths, or a combination: a third-party metallurgical study whose third testing phase finished in August, with results pending; sale as low-grade feedstock; and an onsite plant that could need new or amended permits. Hecla expects to begin evaluating the onsite plant in the first quarter of 2027, with results possibly by spring. It expects to load a test parcel of about 5,500 dry metric tonnes this quarter for sale to a third-party smelter.

Hecla says reprocessing could reduce the space needed for tailings storage and help lower the mine's long-term reclamation liability. "These opportunities are still early stage," President and CEO Rob Krcmarov said.

The state renewed the mine's waste permit and reclamation approval on Sept. 14, with $127.5 million in financial assurance for cleanup, up from $92.2 million approved in 2020. Neither document mentions reprocessing.

During public comment on the renewal, Jon Wunrow of the Angoon Community Association asked that the existing permit be extended until a complete third-party audit and consultation with the tribe took place, the state's summary says. Tyler Breen of the Southeast Alaska Conservation Council asked for a current independent cleanup estimate rather than inflation increases on a 2014 one. The state listed no changes in response, saying the company updated its estimate with third-party quotes and the amount is adequate.