Sunshine Mining & Refining Co. will double production at its flagship mine here and hire about 60 more workers this year.
The company’s decision to expand, announced Monday, adds another ray of hope for the Silver Valley and for Sunshine, which has suffered this decade through bankruptcy and low silver prices.
“It gives you a bit of a positive attitude,” said Chuck Slaton, a 39-year-old miner hired just two months ago when Sunshine began to slowly build up its work force in anticipation of the announcement. “It gives you a little more job security so that you don’t have to jump across the country looking for work.”
When the metals price crunch of 1991 hit the Silver Valley, many miners packed up their belongings and went where the work was: Arizona, Nevada, Montana. Now, many can come back.
Slaton worked at Hecla’s Republic (Wash.) unit and also mined in Montana before jumping on with Sunshine, where he hopes to stay as long as possible.
The expansion offers 60 more families a shot at good-paying jobs. Monday’s announcement is the second major positive mining event for the valley this year; Silver Valley Resources Corp. announced last month that it will reopen the Coeur and Galena silver mines this spring, hiring 100 miners.
Optimism about mining’s future in the Silver Valley has hit a peak not seen this decade.
“Now all we need to do is get silver at around $12 an ounce,” said Ron Kalmback of Cataldo, a longtime Sunshine worker coming off his morning shift Monday.
That may be a little too ambitious, since silver sold for only $5.37 an ounce Monday, about the level it traded at most of last year.
But mining companies are extremely optimistic that prices will rise. And Silver Valley residents are eager to share in that optimism.
Kalmback is just one of many residents who are trying to repair flood-damaged homes while continuing to work.
“We just need to tell people to go out and buy a few thousand ounces of silver,” he said.
Sunshine’s workers get paid more money as silver prices rise. Their hourly wages rise penny for penny when silver rises above $5.50 an ounce, up to $10.50 an ounce.
An extra dollar $5 an hour would help Kalmback with the $65,000 of damage he’s looking at.
“It’s awfully tough when you get damage like this.”
The groundwork for this expansion has been in the works since 1993, when Sunshine geologists shifted their attention from the eastern end of the Sunshine mine - where rich veins made it the world’s most productive silver dig during the 1980s - to the untapped West Chance area.
In its glory days, the Sunshine found about 32 ounces for every ton of rock hoisted up the Jewell Shaft.
For the past few years, the grade has dipped to 20 ounces, then 16 ounces. As that number dropped, Sunshine’s losses grew.
The company’s costs to get the silver to a refinery rose to $6.62 last year, while the price it got for each silver ounce barely reached $5.20 an ounce.
By increasing the amount of silver the mine produces, Sunshine can lower its costs - hopefully enough to put the mine in the black, said Harry Cougher, vice president and head of mining for Boise-based Sunshine.
The numbers from the West Chance drill holes had Sunshine geologists excited.
At some intercepts, engineers found as much as 174 ounces per ton of silver in the West Chance.
Cougher said Monday that Sunshine will gradually hire more miners for its second shift, which starts work at 4 p.m.
That second shift, previously used mostly for maintenance, will become more of a producing shift to help the mine increase daily production to 1,000 tons per day, up from the 500 produced now.
With the Coeur, Galena and now Sunshine mine looking for quality miners, it’s a good time to have experience in the mining trade.
Sunshine Mine Manager Mark Hartmann said that he hasn’t had too much trouble getting good workers so far.
The mine currently employs 210 workers, which will rise to 270 by year-end, Cougher said. The mine produced 1.7 million ounces of silver in 1995, but should produce between 2.7 million and 3.2 million ounces in 1996.
In 1984, the Sunshine Mine employed 587 people and produced 4.8 million ounces of silver.
, DataTimes ILLUSTRATION: Color photo
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