News Details

Exploration budget increasing by $1.1 million for additional drilling at San Sebastian

COEUR D’ALENE, Idaho--(BUSINESS WIRE)-- Hecla Mining Company (NYSE:HL) today provided an update on its exploration programs during the second quarter.

Second Quarter Exploration Highlights

• High-grade intersections at the East Francine Vein confirm a robust resource and, in combination with the East Middle Vein resource nearby, may represent a new underground mining area at San Sebastian.
• Drilling of the West Middle Vein has confirmed potential new reserves that are close to the underground development at San Sebastian.
• Additional $1.1 million in planned exploration expenditures at San Sebastian to identify deeper, base metal rich mineralization in the Middle and West Francine veins with similar minerology as the Hugh Zone.
• Company expects to have sufficient material at San Sebastian to fill the mill, and has secured it, through 2020.
• Surface drilling has defined resources that may increase the number and size of the open pits along the Casa Berardi Fault.
• Drilling of East Ore, NWW and Upper Plate zones should convert resources into reserves in the upper and central part of the Greens Creek Mine.

“Our continued and focused exploration programs at San Sebastian, Casa Berardi and Greens Creek are paying off with potential pit expansions and the discovery of new high-grade zones underground,” said Phillips S. Baker, Jr., President and CEO. “At San Sebastian, we have discovered new high-grade underground mineralization on the Middle and East Francine veins and mineralization on new veins that have the potential to further extend mine life. Four years after acquiring Casa Berardi, we continue to have success identifying high-grade reserves underground and expanding the open pit potential. Finally, drilling at Greens Creek is upgrading resources to reserves, confirming our understanding of the mineralized trends and discovering new mineralization.”

San Sebastian

Due to significant drilling success over the past four years, near-surface, high-grade zones are being open pit mined on the project. Now reserves are being developed for underground mining. During the quarter three core drills were active along the Middle and Francine veins, refining recently discovered resources to prolong high margin metals production and on drilling the newly defined San Judas veins. A RC (reverse circulation) drill has been drilling newly identified mineralized veins north and northwest of the mine area.

In-fill holes were drilled along the western portion of the Middle Vein to aid stope design for underground mine development. Recent high-grade intercepts of the Middle Vein immediately west of the current underground mine development include 0.03 oz/ton gold, 12.2 oz/ton silver, 1.0% lead, 1.5% zinc, and 0.9% copper over 11.0 feet. Significantly, these intercepts are to the west of the current underground mine development and could expand the near-term underground mine plan in this area. Although these veins are narrow they show good continuity and are open to the west and at depth. Deeper drilling in this area has identified similar base metal-bearing mineralization to the previously discovered Hugh Zone at depth in the Francine Vein. Significant drilling will be initiated to evaluate the potential of “Hugh Zone-like” base metal mineralization at depth along the Middle and West Francine veins targeting high temperature Fluid Inclusion and Raman Spectrometry data.

In late 2016, a new ore shoot at the East Francine Vein was discovered and drilling has defined an area over 800 feet of strike length and 600 feet down dip. We are also exploring for new ore shoots in the vicinity. Recent assay results from the East Francine Vein include 0.72 oz/ton gold and 288.2 oz/ton silver over 4.6 feet and 0.68 oz/ton gold and 136 oz/ton silver over 4.7 feet. Drilling of the East Middle Vein, which defines an area over 700 feet of strike length and 600 feet down-dip, recently intersected 0.23 oz/ton gold and 18.6 oz/ton silver over 6.7 feet. The East Middle Vein is open along strike to the east and is parallel to recently discovered mineralization along the East Francine Vein. The proximity of these two resources may provide the critical mass to develop a new mining area east of historic mining of the Francine Vein.

In the fall of 2016, the San Judas Vein was discovered by RC drilling approximately 1,000 feet north of the North Vein open pit. Drilling results in the second quarter include 0.01 oz/ton gold and 3.7 oz/ton silver over 5.2 feet, although a number of assays are pending. The San Judas Vein has very large size potential and has only been drill tested over a fraction of its known strike length.

For the remainder of the year, drilling will seek to expand further the precious metal-rich resources along the Middle, North and Francine veins and evaluate new vein targets such as the San Judas and Zapata Norte veins. This program will also evaluate deeper base metal targets on the Middle and Francine veins. Shallow RC drilling from 1,000 to 3,000 feet northwest of the North Vein intersected the western extension of the San Judas Vein carrying anomalous gold and silver values. A DC (Direct Current) resistivity geophysical survey at San Sebastian was conducted during the second quarter to evaluate vein extensions to the Middle, North and Francine veins.

More complete drill assay highlights from San Sebastian can be found in Table A at the end of this release and a presentation showing drill intersection locations is available at the following http://ir.hecla-mining.com/interactive/newlookandfeel/4130678/Hecla-Q2-2017-ExplorationUpdate.pdf.

Casa Berardi – Quebec

During the second quarter five underground drills were used to refine stope designs and expand reserves and resources in the 118, 123, and 124 zones. Up to three drills on surface completed both in-fill and exploration drilling to define a possible series of open pit areas along the Casa Berardi Fault.

Drilling of the Lower 118 Zone confirmed the continuity of multiple mineralized lenses that extend for over 1,600 feet down-plunge and remain open to depth below the bottom of the current workings. This drilling also confirmed previous intersections from surface drilling and expanded the resource to the west. The new resources to the west show strong mineralization and included intersections of 0.18 oz/ton gold over 26.0 feet and 0.23 oz/ton gold over 17.1 feet.

Drilling of stacked, high-grade lenses of the 123 Zone show that mineralized lenses identified higher in the mine extend to depth and define a semi-continuous mineralized zone of over 3,000 feet down dip and 1,600 feet of strike length. Initial drilling lower in the mine suggests sulfide-rich mineralization is open to the east and to depth. Drilling of the lower 123 Zone at the bottom of the mine confirmed the high-grade resource model with intersections of 0.74 oz/ton gold over 18.3 feet and 0.25 oz/ton gold over 40.4 feet and suggest there is good potential to find mineralization down-plunge below the current workings of the mine. The proximity of these new lenses to mine infrastructure should enable near-term production. Underground definition and exploration drilling of the 124 Zone intersected extensions of earlier defined lenses from surface, returning 0.33 oz/ton gold over 9.8 feet and 0.22 oz/ton over 20.6 feet, and showing the lenses that start on surface remain open down-plunge to the east.

The surface open pit potential on the mine property is good and a series of potential pits along the Casa Berardi Fault are being investigated. Surface drilling along the northeast extension of the proposed Principal Pit area confirmed its continuity to the northeast and includes an intersection of 0.18 oz/ton gold over 82.0 feet and shows the potential to increase a future Principal pit.

Recent surface drilling near the Casa Berardi Fault at the 134 Zone has identified a series of high-grade, sub-parallel veins including 0.32 oz/ton gold over 42.2 feet within broad zones of mineralization including 0.10 oz/ton gold over 105.1 feet that show promise for an open pit. Definition drilling of the 160 Zone, including 0.15 oz/ton gold over 66.0 feet and 0.25 oz/ton gold over 16.6 feet has upgraded the resource to indicated resource category, and is the basis for the current investigation into the viability of an open pit.

Surface drilling of the west extension of the East Mine Crown Pillar (EMCP) pit and southwest on the adjacent 146 Zone has intersected strong mineralization including 0.11 oz/ton gold over 35.8 feet that shows continuity and may extend the open pit. Surface drilling west of the West Shaft has intersected strong mineralization up-dip of the Lower Inter and South West zones including 0.07 oz/ton gold over 180 feet and is an early indication of the near-surface potential. Assay results from drilling in the West Block of Casa Berardi confirmed gold mineralization near the Casa Berardi Fault and include 0.13 oz/ton gold over 17.9 feet and 0.14 oz/ton gold over 3.5 feet. These drill results are being compiled and targets defined for a follow-up program next year.

Due to the identification of new resource trends near surface and underground throughout the West Mine, there was a significant increase in inferred ounces in 2016. In-fill drilling in 2017 may convert a large portion of those to indicated category with the eventual incorporation into the life of mine plan and exploration drilling continues to expand these mineralized zones.

More complete drill assay highlights from Casa Berardi can be found in Table A at the end of the release and a presentation showing drill intersection locations is available at the following http://ir.hecla-mining.com/interactive/newlookandfeel/4130678/Hecla-Q2-2017-ExplorationUpdate.pdf.

Greens Creek – Alaska

At Greens Creek, drilling in the second quarter refined resources of the East Ore, NWW, Upper Plate, and West zones for possible conversion to reserves and may also have expanded some of these zones. Significant assay results from previous drilling were also received from the 9A and Deep Southwest zones. This program has been successful in defining potential reserves in the core area of the mine close to surface and the mine portal.

Drilling of the East Ore Zone compares favorably to previously modeled resource estimates at higher elevations that may expand the current resource model. Recent intersections include 26.7 oz/ton silver, 0.10 oz/ton gold, 10.0% zinc, and 5.4% lead over 5.6 feet and 29.7 oz/ton silver, 0.07 oz/ton gold, 1.8% zinc, and 1.0% lead over 5.4 feet. Exploration drilling immediately west of the East Ore Zone in the Klaus Shear structure also identified new mineralization. Recent drilling of the West Zone suggests resource additions along the nose and eastern limb as well as along the Maki Fault. Intersections include 643.5 oz/ton silver, 1.8 oz/ton gold, 14.9% zinc, and 7.8% lead over 4.8 feet and 31.7 oz/ton silver, 0.21 oz/ton gold, 13.6% zinc, and 6.5% lead over 4.6 feet.

Recent assay results from the 9A Zone suggest the current resource may increase and include 27.5 oz/ton silver, 0.03 oz/ton gold, 15.8% zinc, and 7.9% lead over 8.2 feet and 10.4 oz/ton silver, 0.04 oz/ton gold, 11.3% zinc, and 2.2% lead over 45.0 feet. These resources are immediately available to existing ramps. Drilling of the Deep Southwest Zoneidentified mineralization that extends north of previous mining in the zone and down to the upper limb of the NWW. Recent assay results include 47.2 oz/ton silver, 0.22 oz/ton gold, 4.3% zinc, and 2.0% lead over 7.9 feet.

Surface drilling at Greens Creek commenced in late June at the Gallagher target. Initial drilling has intersected a mineralized zone up to 100-feet thick with sheared veins and breccia locally containing strong base metal mineralization along the flat-lying Klaus Shear. These intersections are over 1,500 feet west of ore zones on the Klaus Shear at the mine and may represent extensions of known mineralization at the mine. The surface program at Greens Creek is planned for over 21,000 feet to evaluate the Gallagher, East Ore and 5250 zone targets.

More complete drill assay highlights from Greens Creek can be found in Table A at the end of this release and a presentation showing drill intersection locations is available at the following http://ir.hecla-mining.com/interactive/newlookandfeel/4130678/Hecla-Q2-2017-ExplorationUpdate.pdf.

Other Properties

Summer fieldwork on the Opinaca-Wildcat project near the Eleonore Mine in northern Quebec, and summer drilling at the Little Baldy property in Idaho and the Kinskuch property in northern British Columbia are underway. Resource modeling of the Montanore mineralization is complete and coordination with hydrologic and geotechnical consultants is underway to augment mine design and future drilling. The mine plan for Montanore is expected to be updated with the new 2016 block model.

ABOUT HECLA

Founded in 1891,Hecla Mining Company (NYSE:HL) is a leading low-cost U.S. silver producer with operating mines in Alaska, Idaho and Mexico, and is a growing gold producer with an operating mine in Quebec, Canada. The Company also has exploration and pre-development properties in seven world-class silver and gold mining districts in the U.S., Canada, and Mexico, and an exploration office and investments in early-stage silver exploration projects in Canada.

Cautionary Statements Regarding Forward Looking Statements

Statements made or information provided in this news release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of Canadian securities laws. Words such as “may”, “will”, “should”, “expects”, “intends”, “projects”, “believes”, “estimates”, “targets”, “anticipates” and similar expressions are used to identify these forward-looking statements. The material factors or assumptions used to develop such forward-looking statements or forward-looking information include that the Company’s plans for development and production will proceed as expected and will not require revision as a result of risks or uncertainties, whether known, unknown or unanticipated, to which the Company’s operations are subject.

Forward-looking statements 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 and costs, litigation, regulatory and environmental risks, operating risks, project development risks, political risks, labor issues, ability to raise financing and exploration risks and results. Refer to the Company's Form 10K and 10-Q 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 other than as may be required by law.

Cautionary Statements to Investors on Reserves and Resources

Reporting requirements in the United States for disclosure of mineral properties are governed by the SEC and included in the SEC'sSecurities Act Industry Guide 7, entitled “Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations” (Guide 7). However, the Company is also a “reporting issuer” under Canadian securities laws, which require estimates of mineral resources and reserves to be prepared in accordance with Canadian National Instrument 43-101 (NI 43-101). NI 43-101 requires all disclosure of estimates of potential mineral resources and reserves to be disclosed in accordance with its requirements. Such Canadian information is being included here to satisfy the Company's “public disclosure” obligations under Regulation FD of the SEC and to provide U.S. holders with ready access to information publicly available in Canada.

Reporting requirements in the United States for disclosure of mineral properties under Guide 7 and the requirements in Canada under NI 43-101 standards are substantially different. This document contains a summary of certain estimates of the Company, not only of proven and probable reserves within the meaning of Guide 7, which requires the preparation of a “final” or “bankable” feasibility study demonstrating the economic feasibility of mining and processing the mineralization using the three-year historical average price for any reserve or cash flow analysis to designate reserves and that the primary environmental analysis or report be filed with the appropriate governmental authority, but also of mineral resource and mineral reserve estimates estimated in accordance with the definitional standards of the Canadian Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101. The terms “measured resources”, “indicated resources,” and “inferred resources” are Canadian mining terms as defined in accordance with NI 43-101. These terms are not defined under Guide 7 and are not normally permitted to be used in reports and registration statements filed with the SEC in the United States, except where required to be disclosed by foreign law. The term “resource” does not equate to the term “reserve”. Under Guide 7, the material described herein as “indicated resources” and “measured resources” would be characterized as “mineralized material” and is permitted to be disclosed in tonnage and grade only, not ounces. The category of “inferred resources” is not recognized by Guide 7. Investors are cautioned not to assume that any part or all of the mineral deposits in such categories will ever be converted into proven or probable reserves. “Resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of such a “resource” will ever be upgraded to a higher category or will ever be economically extracted. Investors are cautioned not to assume that all or any part of a “resource” exists or is economically or legally mineable. Investors are also especially cautioned that the mere fact that such resources may be referred to in ounces of silver and/or gold, rather than in tons of mineralization and grades of silver and/or gold estimated per ton, is not an indication that such material will ever result in mined ore which is processed into commercial silver or gold.

Qualified Person (QP) Pursuant to Canadian National Instrument 43-101

Dean McDonald, PhD. P.Geo., Senior Vice President - Exploration of Hecla Mining Company, who serves as a Qualified Person under National Instrument 43-101, supervised the preparation of the scientific and technical information concerning Hecla’s mineral projects in this news release. Information regarding data verification, surveys and investigations, quality assurance program and quality control measures and a summary of sample, analytical or testing procedures for the Greens Creek Mine are contained in a technical report prepared for Hecla titled “Technical Report for the Greens Creek Mine, Juneau, Alaska, USA” effective date March 28, 2013, and for the Lucky Friday Mine are contained in a technical report prepared for Hecla titled “Technical Report on the Lucky Friday Mine Shoshone County, Idaho, USA” effective date April 2, 2014, for the Casa Berardi Mine are contained in a technical report prepared for Hecla titled "Technical Report on the Mineral Resource and Mineral Reserve Estimate for the Casa Berardi Mine, Northwestern Quebec, Canada" effective date March 31, 2014 (the "Casa Berardi Technical Report"), and for the San Sebastian Mine are contained in a technical report prepared for Hecla titled "Technical Report for the San Sebastian Ag-Au Property, Durango, Mexico" effective date September 8, 2015. Also included in these three technical reports is a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant factors. Copies of these technical reports are available under Hecla's profile on SEDAR at www.sedar.com.

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Hecla Mining Company
Mike Westerlund, 800-HECLA91 (800-432-5291)
Vice President, Investor Relations
hmc-info@hecla-mining.com
www.hecla-mining.com

Source: Hecla Mining Company