Michael Steinmann // President & CEO
In 2019, Pan American Silver celebrates its silver anniversary – 25 years of growth and creating value for our shareholders, employees, host countries, and communities. We are committed to building a world-class mining company through increased productivity, cost-efficiency, and long-term sustainability. It is most fitting that on our 25th anniversary we took a major step in fulfilling that vision.
Through our recent acquisition of Tahoe Resources, we added five new mines to our portfolio, three in Latin America, and two in Canada. This acquisition doubles our silver reserves, improves our geographic diversification, and enhances our robust growth profile. As a result, Pan American Silver is now the largest publicly-traded silver mining company by free float(1). A priority in 2019 will be the integration of the Tahoe assets into our portfolio, including applying our sustainability approach, an approach based on partnership and collaboration.
Through our acquisition of Tahoe, we became the owner of the Escobal mine in Guatemala where operations have been suspended since mid-2017. We must gain the confidence of the local communities, civil society and government, and assist with the court-mandated consultation process, before we are able to re-start the mine. We believe our proven 25-year track record of responsibly constructing and operating mines in Latin America and building relationships with communities will help us earn a lasting social license for operations at Escobal.
In 2018, we continued our support for 11 long-term socio-economic development programs in our host communities. We also supported over 5,000 students in obtaining primary and post-secondary education. We increased water recycling at our mines in Bolivia and Peru, and neared completion of a program of independent tailings storage facility safety reviews at all our operations. We approved Corporate Environmental Standards on tailings management, and biodiversity and mine closure, which are being implemented along with the Mining Association of Canada’s Towards Sustainable Mining program at our mines.
Responsible resource development that respects the environment and communities is the cornerstone of our business operations and the foundation for our future success.
Another highlight was the significant exploration discovery at our La Colorada mine, where exploration results indicate the potential to substantially expand the mineral resources and future production. Reserve replacement and new discoveries are important for a sustainable business, which benefits all stakeholders.
We also had our challenges in 2018. The greatest disappointment was the fatality at our Dolores mine. Health and safety is the priority for our Company and zero fatal accidents is our long-standing goal. Following a thorough investigation of the incident at Dolores, we are implementing measures to prevent a similar incident from occurring in the future, including increasing training of employees and contractors and instituting additional safety procedures.
In 2018, operations were also temporarily disrupted at our Huaron and Dolores mines. At Huaron, dialogue with local community members was successful in reaching agreements and lifting a community-instituted roadblock. At Dolores, additional support from Mexican authorities improved the security situation on the access road to the mine and enabled us to resume transportation on these roads. We have learned from both of these incidents and have been able to improve our internal processes and relationships with local communities as a result.
As we celebrate Pan American Silver’s silver anniversary, I am very excited about the future of the Company. We have a diversified and superior portfolio of assets, a strong financial position, and a highly experienced and motivated management team. I am very proud of our team, and I would specifically like to congratulate Matt Andrews, Vice President of Environment and Sustainability, and Monica Moretto, Vice President of Social Sustainability, who were recipients of the Robert R. Hedley Award for Excellence in Social and Environmental Responsibility from the Association for Mineral Exploration.(1) As per Bloomberg Financial Markets, pro-forma free float is an estimate and assumes upfront consideration only. Market data as at November 13, 2018