Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 13, 2020 | Jun. 28, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-33190 | ||
Entity Registrant Name | MCEWEN MININGĀ INC. | ||
Entity Incorporation, State or Country Code | CO | ||
Entity Tax Identification Number | 84-0796160 | ||
Entity Address, Address Line One | 150 King Street West | ||
Entity Address, Address Line Two | Suite 2800 | ||
Entity Address, City or Town | Toronto | ||
Entity Address, State or Province | ON | ||
Entity Address, Country | CA | ||
Entity Address, Postal Zip Code | M5H 1J9 | ||
City Area Code | 866 | ||
Local Phone Number | 441-0690 | ||
Title of 12(b) Security | Common Stock, no par value | ||
Trading Symbol | MUX | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 489,362,153 | ||
Entity Common Stock, Shares Outstanding | 400,398,425 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000314203 | ||
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
REVENUE: | |||
Revenue | $ 117,019 | $ 128,175 | $ 67,465 |
OPERATING EXPENSES: | |||
Depreciation and depletion | (24,753) | (15,079) | (4,036) |
Gross profit | 8,986 | 32,082 | 20,080 |
OTHER OPERATING EXPENSES: | |||
Advanced projects | (9,520) | (15,063) | (11,129) |
Exploration | (37,744) | (36,576) | (18,624) |
General and administrative | (12,785) | (11,125) | (12,344) |
Loss from investment in Minera Santa Cruz S.A. (note 9) | (8,754) | (11,865) | (44) |
Depreciation | (566) | (1,178) | (1,453) |
Revision of estimates and accretion of asset retirement obligations (note 12) | (3,531) | (3,464) | (2,061) |
Impairment of property and equipment (note 8) | (711) | ||
Total other operating expenses | (72,900) | (79,271) | (46,366) |
Operating loss | (63,914) | (47,189) | (26,286) |
OTHER (EXPENSE) INCOME: | |||
Interest and other finance expense, net | (6,817) | (1,619) | (938) |
Other income (note 4) | 7,140 | 1,168 | 1,221 |
Total other income (expense) | 323 | (451) | 283 |
Loss before income and mining taxes | (63,591) | (47,640) | (26,003) |
Income and mining tax recovery (note 19) | 3,844 | 2,770 | 15,369 |
Net loss | (59,747) | (44,870) | (10,634) |
OTHER COMPREHENSIVE (LOSS) INCOME: | |||
Reclassification of unrealized gain on marketable equity securities disposed of during the period, net of taxes | (840) | ||
Other-than-temporary impairment on marketable equity securities | 356 | ||
Unrealized gain on marketable equity securities, net of taxes | 1,818 | ||
Comprehensive (loss) | $ (59,747) | $ (44,870) | $ (9,300) |
Net loss per share (note 14): | |||
Basic and Diluted (in dollars per share) | $ (0.17) | $ (0.13) | $ (0.03) |
Weighted average common shares outstanding (thousands) (note 14): | |||
Basic and Diluted (in shares) | 361,845 | 337,297 | 313,887 |
Shareholders' distribution declared per common share (note 13) | 0.010 | 0.010 | |
Gold and silver sales | |||
REVENUE: | |||
Revenue | $ 117,019 | $ 128,175 | $ 67,465 |
Production costs applicable to sales | |||
OPERATING EXPENSES: | |||
Cost of goods and services sold | $ (83,280) | $ (81,014) | $ (43,349) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 46,452 | $ 15,756 |
Investments (note 5) | 1,885 | 3,131 |
Receivables and other current assets (note 6) | 5,265 | 3,765 |
Inventories (note 7) | 38,376 | 22,039 |
Restricted cash (note 18) | 14,685 | |
Total current assets | 91,978 | 59,376 |
Mineral Property Interests And Plant And Equipment Net | 418,791 | 423,879 |
Investment in Minera Santa Cruz S.A. (note 9) | 110,183 | 127,814 |
Inventories, long-term (note 7) | 9,603 | 4,591 |
Other assets | 668 | 1,281 |
TOTAL ASSETS | 631,223 | 616,941 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 34,070 | 30,817 |
Flow-through share premium (note 13) | 2,950 | |
Long-term debt, current portion (note 11) | 5,000 | |
Long-term debt to related party, current portion (note 11) | 5,000 | |
Lease liabilities, current portion (note 10) | 2,115 | 1,511 |
Asset retirement obligation, current portion (note 12) | 2,610 | 734 |
Total current liabilities | 48,795 | 36,012 |
Lease liabilities, long-term (note 10) | 5,018 | 4,918 |
Long-term debt (note 11) | 19,758 | 24,603 |
Long-term debt to related party (note 11) | 19,758 | 24,603 |
Asset retirement obligation, long-term (note 12) | 29,591 | 28,668 |
Other liabilities | 3,910 | 5,765 |
Deferred income and mining tax liability (note 19) | 4,914 | 6,426 |
Total liabilities | 131,744 | 130,995 |
Shareholders' equity: | ||
Common stock and additional paid-in capital, no par value, 500,000 shares authorized (in thousands); Common: 400,339 as of December 31, 2019 and 344,560 as of December 31, 2018 issued and outstanding (in thousands) (note 13) | 1,530,702 | 1,457,422 |
Accumulated deficit | (1,031,223) | (971,476) |
Total shareholders' equity | 499,479 | 485,946 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 631,223 | $ 616,941 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 500,000 | 500,000 |
Common, shares issued | 400,339 | 344,560 |
Common, shares outstanding | 400,339 | 344,560 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock and Additional Paid-in CapitalLexam VG Gold | Common Stock and Additional Paid-in CapitalRegistered direct offering | Common Stock and Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit | Lexam VG Gold | Black Fox | Registered direct offering | Total |
Balance at Dec. 31, 2016 | $ 1,360,345 | $ 1,666 | $ (918,972) | $ 443,039 | |||||
Balance (in shares) at Dec. 31, 2016 | 299,570,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 1,311 | 1,311 | |||||||
Shares issued in connection with acquisitions | $ 38,141 | $ 38,141 | |||||||
Shares issued in connection with acquisitions (in shares) | 12,687,000 | ||||||||
Stock issued during the period | $ 43,220 | 43,220 | |||||||
Stock issued during the period (in shares) | 20,700,000 | ||||||||
Exercise of stock options | $ 122 | $ 122 | |||||||
Exercise of stock options (in shares) | 94,000 | 94,000 | |||||||
Shareholder distributions | $ (3,059) | $ (3,059) | |||||||
Other-than-temporary impairment on marketable equity securities | 356 | 356 | |||||||
Reclassification of unrealized gain on marketable securities disposed of during the period, net of taxes | (840) | (840) | |||||||
Unrealized gain on available-for-sale securities, net of taxes | 1,818 | 1,818 | |||||||
Net loss | (10,634) | (10,634) | |||||||
Balance at Dec. 31, 2017 | $ 1,447,879 | 3,000 | (929,606) | 521,273 | |||||
Balance (in shares) at Dec. 31, 2017 | 337,051,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Adoption of ASU 2016-01 (note 2) | Accounting Standards Update 2016-01 | $ (3,000) | 3,000 | |||||||
Balance | $ 1,447,879 | (926,606) | 521,273 | ||||||
Stock-based compensation | 269 | 269 | |||||||
Shares issued in connection with acquisitions (in shares) | 178,321 | ||||||||
Stock issued during the period | $ 918 | 918 | |||||||
Stock issued during the period (in shares) | 515,000 | ||||||||
Exercise of stock options | $ 192 | $ 192 | |||||||
Exercise of stock options (in shares) | 182,000 | 171,000 | |||||||
Shareholder distributions | $ (3,372) | $ (3,372) | |||||||
Shares issued for acquisition of mineral property interests | $ 391 | 391 | |||||||
Shares issued for acquisition of mineral property interests (in shares) | 178,000 | ||||||||
Net loss | (44,870) | (44,870) | |||||||
Balance at Dec. 31, 2018 | $ 1,457,422 | (971,476) | 485,946 | ||||||
Balance (in shares) at Dec. 31, 2018 | 344,560,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 694 | 694 | |||||||
Stock issued during the period | $ 69,467 | $ 1,851 | $ 69,467 | 1,851 | |||||
Stock issued during the period (in shares) | 53,880,000 | 1,010,000 | |||||||
Exercise of stock options | $ 544 | $ 544 | |||||||
Exercise of stock options (in shares) | 535,000 | 535,000 | |||||||
Shares issued for acquisition of mineral property interests | $ 724 | $ 724 | |||||||
Shares issued for acquisition of mineral property interests (in shares) | 354,000 | ||||||||
Net loss | (59,747) | (59,747) | |||||||
Balance at Dec. 31, 2019 | $ 1,530,702 | $ (1,031,223) | $ 499,479 | ||||||
Balance (in shares) at Dec. 31, 2019 | 400,339,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | |||
Net loss | $ (59,747) | $ (44,870) | $ (10,634) |
Adjustments to reconcile net loss from operating activities: | |||
Loss from investment in Minera Santa Cruz S.A., net of amortization (note 9) | 8,754 | 11,865 | 44 |
(Gain) loss on investments (note 5) | (5,259) | 3,324 | (257) |
Loss (gain) on disposal of fixed assets | 96 | 77 | (11) |
Income and mining tax recovery | (3,844) | (2,770) | (15,675) |
Stock-based compensation (note 13) | 694 | 269 | 1,309 |
Revision of estimates and accretion of asset retirement obligations (note 12) | 3,531 | 3,464 | 2,061 |
Unrealized foreign exchange loss (gain) and adjustment to estimate (note 12) | 919 | (1,903) | 1,008 |
Depreciation and amortization | 25,543 | 16,425 | 6,576 |
Impairment of property and equipment (note 8) | (711) | ||
Change in non-cash working capital items: | |||
(Increase) decrease in other current assets related to operations | (17,484) | 20,896 | (13,701) |
Increase (decrease) in current liabilities related to operations | 7,270 | (6,290) | 923 |
Cash (used in) provided by operating activities | (39,527) | 487 | (27,646) |
Cash flows from investing activities: | |||
Additions to mineral property interests and plant and equipment | (29,707) | (81,321) | (8,569) |
Proceeds from disposal of property and equipment | 84 | 33 | |
Investment in marketable equity securities (note 5) | (1,384) | ||
Proceeds from sale of investments (note 5) | 6,769 | 2,895 | 2,155 |
Return of investment received from Minera Santa Cruz S.A. (note 9) | 8,877 | 10,385 | 12,212 |
Cash used in investing activities | (14,061) | (69,341) | (22,260) |
Cash flows from financing activities: | |||
Proceeds from sale of units, net of share issue costs (note 13) | 69,467 | 43,222 | |
Sale of flow-through common shares, net of share issue costs (note 13) | 14,095 | 9,443 | |
Proceeds of loan from related party (note 11 and note 15) | 25,000 | ||
Proceeds of loan (note 11) | 25,000 | ||
Debt issuance costs and lender fees (note 11) | (908) | ||
Proceeds of at-the-market common share issuance (note 13) | 1,851 | 918 | |
Proceeds of exercise of stock options (note 13) | 544 | 192 | 121 |
Payment of finance lease obligations | (1,855) | (485) | |
Shareholders' distribution (note 13) | (3,372) | (3,059) | |
Cash provided by financing activities | 70,007 | 60,440 | 49,727 |
Effect of exchange rate change on cash and cash equivalents | (408) | 1,750 | (108) |
Increase (decrease) in cash, cash equivalents and restricted cash | 16,011 | (6,664) | (287) |
Cash, cash equivalents and restricted cash, beginning of period | 30,489 | 37,153 | 37,440 |
Cash, cash equivalents and restricted cash, end of period (note 18) | 46,500 | 30,489 | 37,153 |
Supplemental disclosure of cash flow information: | |||
Interest paid | (5,218) | (1,923) | |
Interest received | $ 133 | $ 372 | 501 |
Lexam VG Gold | |||
Cash flows from investing activities: | |||
Acquisition costs, net of cash and cash equivalents acquired (note 22) | (840) | ||
Black Fox | |||
Cash flows from investing activities: | |||
Acquisition costs, net of cash and cash equivalents acquired (note 22) | $ (27,251) |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2019 | |
NATURE OF OPERATIONS | |
NATURE OF OPERATIONS | NOTE 1 NATURE OF OPERATIONS McEwen Mining Inc. (the āCompanyā) was organized under the laws of the State of Colorado on July 24, 1979. The Company is engaged in the exploration, development, production and sale of gold and silver and exploration for copper. The Company operates in the United States, Canada, Mexico and Argentina. The Company owns a 100% interest in the Gold Bar mine in Nevada, the Black Fox gold mine in Ontario, Canada, the El Gallo Project in Sinaloa, Mexico, the Fenix silver-gold project in Sinaloa, Mexico, the Los Azules copper deposit in San Juan, Argentina, and a portfolio of exploration properties in Nevada, Canada, Mexico and Argentina. It also owns a 49% interest in Minera Santa Cruz S.A. (āMSCā), owner of the producing San JosĆ© silver-gold mine in Santa Cruz, Argentina, which is operated by the joint venture majority owner, Hochschild Mining plc. ā |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Use of Estimates: The Companyās consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (āU.S. GAAPā). The preparation of the Companyās consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to environmental reclamation and closure obligations; asset useful lives utilized for depletion, depreciation, amortization and accretion calculations; fair value of equity investment and asset groups used in impairment testing; recoverable gold in leach pad inventory; current and long-term inventory; mine development capitalization costs; the collectability of value added taxes receivable; fair values of assets and liabilities acquired in business combinations; reserves; valuation allowances for deferred tax assets; income and mining tax provisions and reserves for contingencies and litigation. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ significantly from these estimates. References to āC$ā refer to Canadian currency. Basis of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated. Investments over which the Company exerts significant influence but does not control through majority ownership are accounted for using the equity method, as described in Investments, Cash and Cash Equivalents and Restricted Cash: The Company considers cash in banks, deposits in transit, and highly liquid term deposits with original maturities of three months or less to be cash and cash equivalents. Because of the short maturity of these instruments, the carrying amounts approximate their fair value. Restricted cash is excluded from cash and cash equivalents and is included in long-term assets, except for flow-through share proceeds which appear as a separate line under current assets. Proceeds from flow-through shares issued are recorded as restricted cash and remain restricted until utilized to fund exploration activities. Investments: The Company accounts for investments over which the Company exerts significant influence but does not control through majority ownership using the equity method of accounting pursuant to ASC Topic 323, Investments ā Equity Method and Joint Ventures Consolidated Balance Sheet share of income and losses of the investee and impairment losses are recognized in the Consolidated Statements of Operations and Comprehensive (Loss) Income Statement of Operations Impairment of Long-lived Assets The Companyās investments in marketable equity securities and warrants are measured at fair value at each period end with changes in fair value recognized in net (loss) income in the Statement of Operations Accumulated Other Comprehensive (Loss) Income Statements of Operations Consolidated Statements of Changes in Shareholdersā Equity). Value Added Taxes Receivable: In Mexico and Canada, value added taxes (āVATā and āHSTā, respectively) are assessed on purchases of materials and services and sales of products. Businesses are generally entitled to recover the taxes they have paid related to purchases of materials and services, either as a refund or as a credit against future taxes payable. With the exception of MSC, in Argentina the Company expenses all VAT as their recoverability is uncertain. Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: Stockpiles represent mineralized material extracted from the mine and available for processing. Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, an estimate of the contained metals (based on assay data) and the estimated metallurgical recovery rates. Costs are allocated to stockpiles based on current mining costs incurred including applicable overhead relating to mining operations. Material is removed from the stockpile at an average cost per tonne. Mineralized material on leach pads is the material that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the mineralized material over a period of time. Costs are attributed to the mineralized material on leach pads based on current mining costs incurred up to the point of placing the ore on the pad. Costs are removed from the leach pad inventory based on the average cost per estimated recoverable ounce of gold on the leach pad as the gold is recovered. The estimates of recoverable gold on the leach pads are calculated from the quantities of mineralized material placed on the leach pads (measured tonnes added to the leach pads), the grade of mineralized material placed on the leach pads (based on assay data) and a recovery percentage. The quantities of recoverable gold placed on the leach pads are reconciled by comparing the grades of ore placed on the pads to the quantities of gold actually recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored, and the engineering estimates are refined based on actual results over time. In-process inventories represent materials that are currently in the process of being converted to a saleable product. In-process material is measured based on assays of the material from the various stages of processing. Costs are allocated to in-process inventories based on the costs of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the in-process conversion costs incurred to that point in the process. Precious metal inventories include gold and silver dorĆ© and bullion that is unsold and held at the Companyās or the refineryās facilities. Costs are allocated to precious metal inventories based on costs of the respective in-process inventories incurred prior to the refining process plus applicable refining costs. Materials and supplies inventories are comprised of chemicals, reagents, spare parts and consumable parts used in operating and other activities. Cost includes applicable taxes and freight. Proven and Probable Reserves: The definition of proven and probable reserves is set forth in Guide 7. Proven reserves are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geological character is so well defined that size, shape, depth and mineral content of the reserves are well-established. Probable reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observations. Mineral Property Interests, Plant and Equipment and Mine Development Costs: Mineral property interests: Development costs include engineering and metallurgical studies, drilling and other related costs to delineate an ore body, and the removal of overburden to initially expose an ore body at open pit surface mines (āpre-strippingā) and building of access paths and other infrastructure to gain access to the ore body at underground mines. Development costs are charged to net income (loss) in the year incurred as Exploration Advanced Projects During the production phase of a mine, costs incurred that provide access to reserves and resources that will be produced in future periods that would not have otherwise been accessible are capitalized and included in the carrying amount of the related mineral property interest. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information, providing greater definition of the ore body or converting non-reserve mineralization to proven and probable reserves and the benefit is expected to be realized over a period beyond one year. All other drilling and related costs are expensed as incurred as Exploration Advanced Projects Mineral property interests are amortized upon commencement of production on a unit-of-production basis over proven and probable reserves, as defined by Guide 7. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs are charged to expense based on the most appropriate method, which includes straight-line method and units-of-production method over the estimated useful life of the mine, as determined by internal mine plans. Plant and Equipment: For properties where the Company did not establish proven and probable reserves as defined by Guide 7, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred, unless the equipment have alternative uses or significant salvage value in which case the equipment is capitalized at cost. Construction-in-progress (āCIPā) costs: Impairment of Long-Lived Assets: The Company reviews and evaluates its long-lived assets for impairment at a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its fair value. For the purpose of recognition and measurement of impairment, the Company groups its long-lived assets by specific mine or project, as this represents the lowest level for which identifiable cash flows exist. For asset groups where an impairment loss is determined using the undiscounted future net cash flows method or discounted future net cash flows method, future cash flows are estimated based on quantities of recoverable mineralized material, expected gold and silver prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine plans. The term ārecoverable mineralized materialā refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during processing and treatment. The Companyās estimates of future cash flows are based on numerous assumptions and uncertainties. It is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold, silver and other commodity prices, production levels and costs of capital are each subject to significant risks and uncertainties. Currently the resource and reserve estimate at the Gold Bar mine is being evaluated in light of significant differences recently observed between modeled and mined ore tonnage and gold grade from the Gold Pick West Pit. Preliminary iterations suggest that a significant reduction in tonnage, an increase in gold grade, and a resulting significant reduction in contained ounces from the existing reserve estimate is likely. The results of this evaluation will directly impact our estimates of future cash flows, which may affect the value of our long-lived assets. For asset groups where the Company is unable to determine a reliable estimate of future net cash flows, the Company adopts a market approach to estimate fair value by using a combination of observed market value per square mile and observed market value per ounce or pound of mineral material based on comparable transactions. Asset Retirement Obligation (āAROā), Reclamation and Remediation Costs: Provisions for environmental rehabilitation are made in respect of the estimated future costs of closure and restoration and rehabilitation costs (which include the dismantling and demolition of infrastructure, removal of residual materials and remediation of disturbed areas) in the accounting period when the related environmental disturbance occurs. The associated asset retirement costs, including periodic adjustments, if any, are capitalized as part of the carrying amount of the long- lived asset when proven or probable reserves exist or if they relate to an acquired mineral property interest; otherwise the costs are charged to the Statement of Operations The fair value of an ARO is measured by discounting the expected cash flows adjusted for inflation, using a credit-adjusted risk free rate of interest. The Company prepares estimates of the timing and amounts of expected cash flows when an ARO is incurred, which are updated to reflect changes in facts and circumstances. Estimation of the fair value of AROs requires significant judgment, including amount of cash flows, timing of reclamation, inflation rate and credit risk. Lease Accounting: Contracts entered into are analyzed to identify whether the contract contains an operating or financing lease according to ASC 842, adopted by the Company effective January 1, 2019 (see āRecently Adopted Accounting Pronouncementsā). If a contract is determined to contain a lease, the Company will include lease payments (the lease liability) and the right-of-use asset (āROUā) representing the right to the underlying asset for the lease term within the Consolidated Balance Sheets Consolidated Balance Sheets Statement of Operations. Operating and ROU asset balances and lease liabilities are recognized at the commencement date based on the present value of the future lease payments over the lease term. The Company utilizes the incremental borrowing rate (āIBRā) in determining the present value of the future lease payments. IBR represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Each leaseās IBR is determined by using the average bond yield ratings for comparable companies. Revenue Recognition: Revenue consists of proceeds received and expected to be received for the Companyās principal products, gold and silver. Revenue is recognized when title to gold and silver passes to the buyer and when collectability is reasonably assured. Title passes to the buyer based on terms of the sales contract, usually upon delivery of the product. Product pricing is determined under the sales agreements which are referenced against active and freely traded commodity markets, for example, the London Bullion Market for both gold and silver, in an identical form to the product sold. Gold and silver dorĆ© produced from the San JosĆ© mine is sold at the prevailing spot market price based on the London A.M. fix, while concentrates are sold at the prevailing spot market price based on either the London P.M. fix or average of the London A.M. and London P.M. fix depending on the sales contract. Concentrates are provisionally priced, whereby the selling price is subject to final adjustments at the end of a period ranging from 30 to 90 days after delivery to the customer. The final price is based on the market price of the precious metal content at the relevant quotation point stipulated in the contract. Due to the time elapsed between shipment and the final settlement with the buyer, MSC must estimate the prices at which sales of metals will be settled. At the end of each financial reporting period, previously recorded provisional sales are adjusted to estimated settlement metals prices based on relevant forward market prices until final settlement with the buyer. In addition to selling refined bullion at spot, the Company has dorĆ© purchase agreements in place with financial institutions and refineries. Under the agreements, the Company has the option to sell approximately 90% of the gold and silver contained in dorĆ© bars prior to the completion of refining by the third party refiner. Revenue is recognized when the Company has provided irrevocable instructions to the refiner to transfer to the purchaser the refined ounces sold upon final processing outturn, and when payment of the purchase price for the purchased dorĆ© or bullion has been made in full by the purchaser. There is no judgement involved in revenue recognition as revenue is recognized when payment has been made by the purchaser and the product has been delivered. ā ā Foreign Currency: The functional currency for the Companyās operations is the U.S. dollar. All monetary assets and liabilities denominated in a currency which is not the U.S. dollar are translated at current exchange rates at each balance sheet date and the resulting adjustments are included in a separate line item under other income (expense). Revenue and expense in foreign currencies are translated at the average exchange rates for the period. ā Stock-Based Compensation: The Company accounts for stock options at fair value as prescribed in ASC 718. The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option-pricing model and provides for expense recognition over the service period, if any, of the stock option. The companyās estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behavior and estimates of forfeitures. Flow-Through Shares: Current Canadian tax legislation permits mining entities to issue flow-through shares to investors by which the deductions for tax purposes related to resource exploration and evaluation expenditures may be claimed by investors instead of the entity, subject to a renouncement process. Under ASC 740, proceeds from the issuance of flow-through shares are allocated first to the common stock based on the underlying quoted price of shares and the residual amount is allocated to the sale of tax benefits, classified as a liability. As the Company incurs qualifying exploration and evaluation expenditures to fulfill its obligation, the liability is drawn down and the sale of tax benefits is recognized in the Statement of Operations as a reduction of deferred tax expense. Income and Mining Taxes: The Company accounts for income and mining taxes under ASC 740 using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related tax basis for such liabilities and assets. This method generates either a net deferred income and mining tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income and mining tax charge or benefit by recording the change in either the net deferred income and mining tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income and mining tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income and mining tax asset will not be realized. Comprehensive (Loss) Income: In addition to net income or loss, comprehensive income or loss includes all changes in equity during a period. Per Share Amounts: Basic income or loss per share is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted income or loss per share reflects the potential dilution of securities that could share in the earnings of the Company and are computed in accordance with the treasury stock method based on the average number of common shares and dilutive common share equivalents outstanding. Only those instruments that result in a reduction in income per share are included in the calculation of diluted (loss) income per share. Loans and Borrowings: Borrowings are recognized initially at fair value, net of financing costs incurred, and subsequently measured at amortized cost. Any difference between the amounts originally received and the redemption value of the debt is recognized in the Statements of Operations Fair Value of Financial Instruments: Fair value accounting, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Loans and borrowings: Consolidated Statement of Operations and Comprehensive (Loss) Income Fair Value of Financial Instruments: ā Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). ā Recently Adopted Accounting Pronouncements Leases ā ASC 842: Practical expedients and elections under ASUs and ASC 842 made by the Company are as follows: ASU 2018-11: This update permitted an entity to elect an optional transitional practical expedient to continue to apply ASC 840, including its disclosure requirements, in the comparative periods presented in the year of adoption of ASC 842. Under this optional practical expedient, the Company applied the transition provisions on January 1, 2019 (the date of adoption) rather than January 1, 2017 (the beginning of the earliest comparative period presented); first reporting under the new standard was for the first quarter of 2019. Upon adoption of ASC 842, the Company recognized a nominal cumulative-effect adjustment to the opening accumulated deficit balance. Package of practical expedients ā which permits an entity to (a) not reassess whether expired or existing contracts contain leases, (b) not reassess lease classification for existing or expired leases and (c) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. The Company opted to elect the package of practical expedients. Hindsight practical expedient ā which permits an entity to use hindsight in determining the lease term. The Company opted to elect this provision. Easements practical expedient ā which permits an entity to elect an optional transitional practical expedient to not evaluate land easements that existed or expired before the entityās adoption of ASC 842 that were not previously accounted for as leases under ASC 840. The Company opted to elect this transitional provision and as a result did not evaluate any of its land agreements. Short term election ā which permits an entity to elect not to apply lease accounting to leases that are not greater than twelve months. The Company elected this short term election. Non-lease component election ā which permits lessees to elect to account for non-lease components as part of the lease component to which they relate; an election made by class of underlying asset. The Company opted to make this election. The adoption of ASC 842 resulted in an increase in the Companyās recorded assets and liabilities and a nominal cumulative-effect adjustment to the opening accumulated deficit balance (see N ote 10 Lease Liabilities). Recently Issued Accounting Pronouncements Changes to the Disclosure Requirements for Fair Value Measurement: Income Taxes: |
OPERATING SEGMENT REPORTING
OPERATING SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2019 | |
OPERATING SEGMENT REPORTING | |
OPERATING SEGMENT REPORTING | NOTE 3 OPERATING SEGMENT REPORTING McEwen Mining is a mining and minerals production and exploration company focused on precious metals in the United States, Canada, Mexico and Argentina. The Companyās chief operating decisions maker (āCODMā) reviews the operating results, assesses performance and makes decisions about allocation of resources to these segments at the geographic region level or major mine/project where the economic characteristics of the individual mines or projects are not alike. As a result, these operating segments also represent the Companyās reportable segments. The Companyās business activities that are not considered operating segments are included in General and Administrative and other The CODM reviews segment (loss) income, defined as gold and silver sales less production costs applicable to sales, depreciation and depletion, advanced projects, and exploration costs, for all segments except for the MSC segment which is evaluated based on the attributable equity income or loss. Gold and silver sales and production costs applicable to sales for the reportable segments are reported net of intercompany transactions. The Canada segment includes assets and liabilities of Black Fox Complex and Lexam VG Gold Inc. (āLexamā), acquired on August 25, 2017 and April 26, 2017, respectively, since the date of acquisition ( Note 22 During 2019, the El Gallo Project incurred $11.6 million of operating expenditures, of which $3.4 million is capitalized to inventory as at December 31, 2019, resulting in $8.2 million being included in production cost applicable to sales. The remaining balance of production costs applicable to sales of $10.3 million corresponds to opening leach pad inventory costs that are included as production costs applicable to sales. Capital expenditures include costs capitalized in mineral property interests and plant and equipment in the respective periods. ā Significant information relating to the Companyās reportable operating segments is summarized in the tables below: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2019 USA ā Canada ā Mexico ā MSC Los Azules Total Revenue from gold and silver sales ā $ 43,847 ā $ 50,058 ā $ 23,114 ā $ ā ā $ ā ā $ 117,019 Production costs applicable to sales ā ā (33,614) ā ā (31,121) ā ā (18,545) ā ā ā ā ā ā ā (83,280) Depreciation and depletion ā ā (10,934) ā ā (13,271) ā ā (548) ā ā ā ā ā ā ā ā (24,753) Gross profit ā ā (701) ā ā 5,666 ā ā 4,021 ā ā ā ā ā ā ā ā 8,986 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (649) ā ā (1,636) ā ā (7,235) ā ā ā ā ā ā ā (9,520) Exploration ā ā (8,554) ā ā (25,779) ā ā ā ā ā ā ā ā (3,411) ā (37,744) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (8,754) ā ā ā ā (8,754) Segment loss ā $ (9,904) ā $ (21,749) ā $ (3,214) ā $ (8,754) ā $ (3,411) ā $ (47,032) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (16,559) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (63,591) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 18,806 ā $ 11,464 ā $ ā ā $ ā ā $ ā ā $ 30,270 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 62,024 ā $ 66,151 ā $ ā ā $ ā ā $ 128,175 Production costs applicable to sales ā ā ā ā ā (43,095) ā ā (37,919) ā ā ā ā ā ā ā ā (81,014) Depreciation and depletion ā ā ā ā ā (12,972) ā ā (2,107) ā ā ā ā ā ā ā ā (15,079) Gross profit ā ā ā ā ā 5,957 ā ā 26,125 ā ā ā ā ā ā ā ā 32,082 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (7,959) ā ā ā ā ā (7,104) ā ā ā ā ā ā ā ā (15,063) Exploration ā ā (5,174) ā ā (22,032) ā ā (2,241) ā ā ā ā ā (7,129) ā ā (36,576) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (11,865) ā ā ā ā ā (11,865) Segment (loss) income ā $ (13,133) ā $ (16,075) ā $ 16,780 ā $ (11,865) ā $ (7,129) ā $ (31,422) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (16,218) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (47,640) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 84,713 ā $ 12,584 ā $ 171 ā $ ā ā $ ā ā $ 97,468 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2017 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 11,620 ā $ 55,845 ā $ ā ā $ ā ā $ 67,465 Production costs applicable to sales ā ā ā ā ā (8,151) ā ā (35,198) ā ā ā ā ā ā ā ā (43,349) Depreciation and depletion ā ā ā ā ā (1,737) ā ā (2,299) ā ā ā ā ā ā ā ā (4,036) Gross profit ā ā ā ā ā 1,732 ā ā 18,348 ā ā ā ā ā ā ā ā 20,080 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (6,686) ā ā ā ā ā (4,443) ā ā ā ā ā ā ā ā (11,129) Exploration ā ā (2,132) ā ā (1,661) ā ā (5,610) ā ā ā ā ā (9,221) ā ā (18,624) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (44) ā ā ā ā ā (44) Impairment of mineral property interests and property and equipment ā ā ā ā ā ā ā ā (711) ā ā ā ā ā ā ā ā (711) Segment (loss) income ā $ (8,818) ā $ 71 ā $ 7,584 ā $ (44) ā $ (9,221) ā $ (10,428) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (15,575) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (26,003) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 6,271 ā $ 4,301 ā $ 939 ā $ ā ā $ ā ā $ 11,511 ā ā Geographic information Geographic information includes the following long-lived assets balances and revenues presented for the Companyās operating segments: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā December 31, ā December 31, ā Year ended December 31, ā 2019 2018 2019 ā 2018 ā 2017 USA ā $ 135,854 ā $ 127,617 ā $ 43,847 ā $ ā ā $ ā Canada ā ā 77,147 ā ā 84,119 ā ā 50,058 ā ā 62,024 ā ā 11,620 Mexico ā ā 23,551 ā ā 26,524 ā ā 23,114 ā ā 66,151 ā ā 55,845 Argentina (2) ā ā 302,598 ā ā 319,305 ā ā ā ā ā ā ā ā ā Total consolidated (3) ā $ 539,150 ā $ 557,565 ā $ 117,019 ā $ 128,175 ā $ 67,465 (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $110.2 million as of December 31, 2019 (December 31, 2018 - $127.8 million). (3) Total excludes $1.0 million related to the Companyās ROU office lease asset as the business activities related to corporate are not considered to be a party of the operating segments. As gold and silver can be sold through numerous gold and silver market traders worldwide, the Company is not economically dependent on a limited number of customers for the sale of its product. In 2019, 2018 and 2017, sales to Bank of Nova Scotia were $103.6 million (89%), $123.5 million (96%), and $65.9 million (94%), respectively, of total gold and silver sales. |
OTHER INCOME
OTHER INCOME | 12 Months Ended |
Dec. 31, 2019 | |
OTHER INCOME | |
OTHER INCOME | NOTE 4 OTHER INCOME The following is a summary of other income (expense) for the years ended December 31, 2019, 2018, and 2017: ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Unrealized and realized gain (loss) on investments (note 5) ā $ 5,259 ā $ (3,324) ā $ 257 Foreign currency gain ā ā 1,697 ā ā 3,922 ā ā 694 Other income, net ā ā 184 ā ā 570 ā ā 270 Total other income ā $ 7,140 ā $ 1,168 ā $ 1,221 ā |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2019 | |
INVESTMENTS | |
INVESTMENTS | ā ā NOTE 5 INVESTMENTS The Companyās investment portfolio consists of marketable equity securities and warrants of certain publicly-traded companies. The following is a summary of the activity in investments for the years ended December 31, 2019 and 2018: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain (loss) on ā December 31, ā 2018 period securities sold period securities held 2019 Marketable equity securities ā $ 2,718 ā $ 2,314 ā $ 3,396 ā $ (7,279) ā $ 736 ā $ 1,885 Warrants ā 413 ā ā ā 1,127 ā (1,540) ā ā ā ā Investments ā $ 3,131 ā $ 2,314 ā $ 4,523 ā $ (8,819) ā $ 736 ā $ 1,885 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain (loss) on ā December 31, ā 2017 period securities sold period securities held 2018 Marketable equity securities ā $ 6,404 ā $ 1,882 ā $ (767) ā $ (2,895) ā $ (1,906) ā $ 2,718 Warrants ā 1,567 ā ā 201 ā ā ā ā ā (704) ā ā (651) ā ā 413 Investments ā $ 7,971 ā $ 2,083 ā $ (767) ā $ (3,599) ā $ (2,557) ā $ 3,131 ā ā During the years ended December 31, 2019, 2018 and 2017, the Company sold marketable equity securities for $6.8 million, $2.9 million and $2.2 million, respectively. As of December 31, 2019, the cost of the marketable equity securities was $1.3 million (December 31, 2018 ā cost of marketable equity securities and warrants was $2.9 million). The Company maintained a portfolio of warrants in equity interests of publicly-traded companies for investment purposes which are not used in any hedging activities. The Company recorded warrants at fair value using the Black-Scholes option pricing model. As the warrants met the definition of derivative instruments, gains or losses arising from their revaluation are recorded in the Statement of Operations |
RECEIVABLES AND OTHER CURRENT A
RECEIVABLES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2019 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
RECEIVABLES AND OTHER CURRENT ASSETS | NOTE 6 RECEIVABLES AND OTHER CURRENT ASSETS Receivables and other current assets as at December 31, 2019 and 2018 consisted of the following: ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Government sales tax receivable ā $ 2,658 ā $ 2,079 Other current assets ā ā 2,607 ā ā 1,686 Receivables and other current assets ā $ 5,265 ā $ 3,765 ā Government sales tax receivable includes $0.7 million of Mexican VAT at December 31, 2019 (December 31, 2018 ā $1.1 million). The Company collected $2.2 million of VAT during the year ended December 31, 2019 (December 31, 2018 and 2017 ā $8.3 million and $5.9 million, respectively). |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
INVENTORIES | ā NOTE 7 INVENTORIES Inventories at December 31, 2019 and 2018 consist of the following: ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Material on leach pads ā $ 37,328 ā $ 14,961 In-process inventory ā 3,847 ā 3,446 Stockpiles ā 1,384 ā 1,272 Precious metals ā 1,038 ā 3,421 Materials and supplies ā 4,382 ā 3,530 Inventories ā $ 47,979 ā $ 26,630 Current portion ā ā 38,376 ā ā 22,039 Long-term portion ā $ 9,603 ā $ 4,591 ā During the year ended December 31, 2019, the Company recorded a write-down of $1.7 million in the Statement of Operations $nil |
MINERAL PROPERTY INTERESTS AND
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2019 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | NOTE 8 MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT The cost and carrying value of mineral property interests and plant and equipment at December 31, 2019 and 2018 are as follows: ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Mineral property interests, cost ā $ 339,374 ā $ 326,086 Less: accumulated depletion ā ā (28,154) ā ā (16,941) Mineral property interests, carrying value ā $ 311,220 ā $ 309,145 ā ā ā ā ā ā ā Plant and equipment, cost ā ā ā ā ā ā Land ā $ 8,746 ā $ 8,699 Construction in progress ā ā 2,961 ā ā 74,643 Plant and equipment ā ā 133,014 ā ā 49,578 Subtotal ā $ 144,721 ā $ 132,920 Less: accumulated depreciation ā (37,150) ā ā (18,186) Plant and equipment, carrying value ā $ 107,571 ā $ 114,734 ā ā ā ā ā ā ā Mineral property interests and plant and equipment, carrying value ā $ 418,791 ā $ 423,879 ā Plant and equipment at December 31, 2019 includes $1.4 million of capitalized interest related to the Gold Bar mine (December 31, 2018 ā $0.8 million). On February 16, 2019, first production occurred at the Gold Bar mine and related construction-in-progress costs were transferred into the appropriate category of plant and equipment and amortized. As at December 31, 2018, the Gold Bar project construction-in-progress included expenditures incurred for the construction of the heap leach, ADR, and crusher facilities as well as expenditures for mobilization, design and engineering among others. ā Mineral property interest carrying value at December 31, 2019 and 2018 includes the following: ā ā ā ā ā ā ā ā ā ā ā ā ā Name of Property/Complex State/Province ā Country ā 2019 ā 2018 Black Fox Complex ā Ontario ā Canada ā $ 14,627 ā $ 16,365 ā Lexam ā Ontario ā Canada ā ā 41,595 ā ā 41,595 ā Los Azules Copper Project San Juan Argentina ā ā 191,490 ā ā 191,490 ā Tonkin Properties Nevada United States ā 4,833 ā 4,833 ā Gold Bar Project Nevada United States ā 48,492 ā 44,131 ā Battle Mountain Complex Nevada United States ā 785 ā 785 ā El Gallo Project Sinaloa Mexico ā 3,591 ā 4,139 ā Fenix Project Properties Sinaloa Mexico ā 5,807 ā 5,807 ā Total mineral property interests ā ā ā ā ā $ 311,220 ā $ 309,145 ā ā Black Fox and Gold Bar mineral property interest are depleted based on the units of production method from production commencement date over the proven and probable reserves. The El Gallo Project is depleted and depreciated using the straight line or units-of-production method over the stated mine life, as the project does not have proven and probable reserves compliant with Guide 7 . The Company conducts a review of potential triggering events for impairment for all its mineral projects on a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. No triggering events were identified for the years ended December 31, 2019 and 2018. For the year ended December 31, 2017, the Company recorded an impairment charge of $0.7 million against certain construction-in-progress equipment relating to the Fenix Project. |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | 12 Months Ended |
Dec. 31, 2019 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | NOTE 9 INVESTMENT IN MINERA SANTA CRUZ S.A. (āMSCā) - SAN JOSĆ MINE The Company accounts for investments over which it exerts significant influence but does not control through majority ownership using the equity method of accounting. In applying the equity method of accounting to the Companyās investment in MSC, MSCās financial statements, which are originally prepared by MSC in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, have been adjusted to conform with U.S. GAAP. As such, the summarized financial data presented under this heading is in accordance with U.S. GAAP. ā A summary of the operating results of MSC for the year ended December 31, 2019, 2018, and 2017 is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā ā 2019 ā 2018 ā 2017 Minera Santa Cruz S.A. ( 100% ) ā ā ā ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 263,887 ā $ 213,096 ā $ 235,650 ā Production costs applicable to sales ā ā (159,915) ā ā (151,779) ā ā (156,347) ā Depreciation and depletion ā ā (69,995) ā ā (52,200) ā ā (48,278) ā Gross profit ā ā 33,977 ā ā 9,117 ā ā 31,025 ā Exploration ā ā (10,635) ā ā (5,884) ā ā (5,198) ā Other expenses (1) ā ā (13,065) ā ā (12,840) ā ā (12,527) ā Net income (loss) before tax ā $ 10,277 ā $ (9,607) ā $ 13,300 ā Current and deferred tax expense ā ā (14,556) ā ā (10,934) ā ā (18,050) ā Net loss ā $ (4,279) ā $ (20,541) ā $ (4,750) ā ā ā ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. ( 49% ) ā ā ā ā ā ā ā ā ā ā Net loss ā $ (2,097) ā $ (10,065) ā $ (2,328) ā Amortization of fair value increments ā (9,448) ā (9,730) ā (9,632) ā Income tax recovery ā ā 2,791 ā ā 7,930 ā ā 11,916 ā Loss from investment in MSC, net of amortization ā $ (8,754) ā $ (11,865) ā $ (44) ā (1) Other expenses include foreign exchange, accretion of asset retirement obligations and other finance related expenses. The loss from investment in MSC attributable to the Company includes amortization of the fair value increments arising from the initial purchase price allocation and related income tax recovery. The income tax recovery reflects the impact of devaluation of the Argentine peso against the U.S. dollar on the peso-denominated deferred tax liability recognized at the time of acquisition, as well as income tax rate changes over the periods. On December 29, 2017, the Senate of Argentina passed a significant tax reform to the Countryās tax system, with the corporate tax rates changing from 35% to 25% by 2020; as a result, in 2017 the Company recorded a $5.6 million deferred tax recovery. In December 2019, the Argentina government approved a decree delaying the corporate tax rate to drop from 30% to 25% to the end of 2021. Changes in the Companyās investment in MSC for the year ended December 31, 2019 and 2018 are as follows: ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Investment in MSC, beginning of period ā $ 127,814 ā $ 150,064 Attributable net loss from MSC ā ā (2,097) ā ā (10,065) Amortization of fair value increments ā (9,448) ā (9,730) Income tax recovery ā ā 2,791 ā ā 7,930 Dividend distribution received ā (8,877) ā (10,385) Investment in MSC, end of period ā $ 110,183 ā $ 127,814 ā A summary of the key assets and liabilities of MSC as at December 31, 2019, before and after adjustments for fair value increments arising from the purchase price allocation, are as follows: ā ā ā ā ā ā ā ā ā ā ā As at December 31, 2019 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 82,660 ā $ 444 ā $ 83,104 Total assets ā ā 180,832 ā ā 119,707 ā ā 300,539 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (39,381) ā $ ā ā $ (39,381) Total liabilities ā ā (69,438) ā ā (6,238) ā ā (75,676) ā |
LEASE LIABILITIES
LEASE LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
LEASE LIABILITIES | |
LEASE LIABILITIES | NOTE 10 LEASE LIABILITIES On January 1, 2019, the Company adopted ASC 842, āLeases,ā under a modified retrospective transition method and recorded a nominal cumulative-effect adjustment to the opening accumulated deficit balance. The Companyās lease obligations include equipment, vehicles and office space. Leased assets are included in plant and equipment ( Note 8 ā Lease liabilities as at December 31, 2019 and 2018 are as follows: ā ā ā ā ā ā ā ā ā ā Total discounted lease liabilities ā ā December 31, 2019 ā December 31, 2018 Finance leases ā $ 6,229 ā $ 6,429 Operating lease ā ā 904 ā ā ā Lease liabilities ā $ 7,133 ā $ 6,429 Current portion ā ā (2,115) ā ā (1,511) Long-term portion ā $ 5,018 ā $ 4,918 ā Lease liabilities at December 31, 2019 are recorded using a weighted average discount rate of 8.73% and 7.28%, respectively, for operating and finance leases and have average remaining lease terms of five years and three years, respectively. ā During the year ended December 31, 2019, the Company recorded $1.8 million in interest and other finance costs related to leases. A breakdown of the lease related costs for the year ended December 31, 2019 are as follows: ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā ā ā ā ā ā 2019 Finance leases: ā ā ā ā ā ā Amortization of ROU assets ā ā ā ā $ 1,123 Interest expense ā ā ā ā ā 517 Total ā ā ā ā $ 1,640 ā ā ā ā ā ā ā Operating lease: ā ā ā ā ā ā Rent expense ā ā ā ā $ 193 ā Future minimum undiscounted lease payments as at December 31, 2019 are as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā 2020 2021 2022 2023 2024 Total Operating lease obligation ā $ 226 ā $ 230 ā $ 232 ā $ 237 ā $ 158 ā $ 1,083 Finance lease obligations ā 2,340 ā 2,385 ā 2,081 ā 105 ā ā ā 6,911 Total future minimum lease payments ā $ 2,566 ā $ 2,615 ā $ 2,313 ā $ 342 ā $ 158 ā $ 7,994 Less: Imputed interest ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (861) Total ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 7,133 ā |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2019 | |
LONG-TERM DEBT. | |
LONG-TERM DEBT | NOTE 11 LONG-TERM DEBT On August 10, 2018, the Company finalized a $50.0 million senior secured three year term loan facility with Royal Capital Management Corp. (āRoyCapā), as administrative agent, and the lenders party thereto (āLendersā). An affiliate of Robert McEwen, Chairman and Chief Executive Officer and the beneficial owner of 23% of the Companyās common stock, contributed $25.0 million of the $50.0 million total term loan. The term loan was raised to finance construction of the Gold Bar mine in Nevada and for general corporate purposes. The loan bears interest at 9.75% per annum with interest due monthly and is secured by a lien on certain of the Companyās and its subsidiariesā assets. Scheduled payments on the loan are as follows: $2.0 million monthly payments starting in August 2020 for twelve months and a final $26.0 million payment on August 10, 2021. The term loan can be retired in full or in part any time during the first two years upon payment of the outstanding principal and accrued interest plus a fee linked to the remaining life of the loan, and during the third year upon payment of the remaining principal and accrued interest plus a fee equal to 3% of the remaining principal. The Company incurred $0.9 million in debt issuance costs in connection with the loan, which have been included in the carrying amount of the loan. The loan was recorded at $49.1 million at initial recognition (fair value, net of debt issuance costs) and is subsequently measured at amortized cost using the effective interest method, with the movements for the year ended December 31, 2019 and 2018 as below: ā ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 ā Balance, initial recognition ā $ ā ā $ 49,092 ā Balance, beginning of year ā 49,206 ā ā ā Interest expense ā 5,185 ā 2,037 ā Interest payments ā (4,875) ā (1,923) ā Balance, end of year ā $ 49,516 ā $ 49,206 ā Current portion ā ā (10,000) ā ā ā ā Long-term portion ā $ 39,516 ā $ 49,206 ā ā The long-term and current portion at December 31, 2019 and 2018 are equally split between debt to related party and third parties. During the year ended December 31, 2019 and 2018, interest expense of $0.6 million and $0.8 million, respectively, was capitalized in plant and equipment for Gold Bar mine ( Note 8 ā The Credit Agreement underlying the term loan contains affirmative and negative covenants customary for financings of this type, including, but not limited to, limitations on additional borrowings, additional investments and asset sales. The agreement contains restrictions on the payment of certain distributions to shareholders (see Note 13 Shareholdersā Equity-Shareholder Distributions |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 12 Months Ended |
Dec. 31, 2019 | |
ASSET RETIREMENT OBLIGATIONS | |
ASSET RETIREMENT OBLIGATIONS | NOTE 12 ASSET RETIREMENT OBLIGATIONS The Company is responsible for reclamation of certain past and future disturbances at its properties. The most significant properties subject to these obligations are the Gold Bar and Tonkin properties in Nevada, the Timmins properties in Canada, and the El Gallo Project in Mexico. ā A reconciliation of the Companyās asset retirement obligations for the years ended December 31, 2019 and 2018 are as follows: ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Asset retirement obligation liability, beginning balance ā $ 29,402 ā $ 24,722 Settlements ā (513) ā (392) Accretion of liability ā 1,680 ā 1,205 Adjustment reflecting updated estimates ā 1,012 ā 5,024 Foreign exchange revaluation ā ā 620 ā ā (1,157) Asset retirement obligation liability, ending balance ā $ 32,201 ā $ 29,402 Current portion ā ā (2,610) ā ā (734) Long-term portion ā $ 29,591 ā $ 28,668 ā The adjustment reflecting updated estimates during the year ended December 31, 2019 includes a reduction of $5.3 million for the estimated environmental obligations for the Black Fox mine and an increase of $4.2 million for the estimated environmental obligations for the Gold Bar mine. The reduction in the estimated liability for Black Fox mine reflects the approval obtained from the Ministry of Energy, Northern Development and Mines, of Ontario, Canada for the amended environmental closure plan filed during the period. The increase for the Gold Bar mine liability is the result of additional disturbances during the year (December 31, 2018 - an additional $3.7 million related to disturbances). Reclamation expense in the Statement of Operations ā The Companyās reclamation expenses consisted of the following: ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Reclamation adjustment reflecting updated estimates ā $ 1,851 ā $ 2,259 ā $ 1,426 Reclamation accretion ā ā 1,680 ā ā 1,205 ā ā 635 Total ā $ 3,531 ā $ 3,464 ā $ 2,061 ā |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 13 SHAREHOLDERSā EQUITY Equity Issuances November 2019 Offering On November 20, 2019 (the āNovember Offeringā), the Company issued 37,750,000 Units at $1.325 per Unit, for net proceeds of $46.6 million (net of issuance costs of $3.5 million). Each Unit consisted of one share of common stock and one The Company concluded that both common stock and warrants are equity-linked financial instruments and should be accounted for permanently in the shareholdersā equity section in the Consolidated Balance Sheets, with no requirement to subsequently revalue any of the instruments. Of the net proceeds of $46.6 million, $37.3 million was allocated to common stock and $9.3 million was allocated to warrants based on their relative fair value at issuance. ā The Company used the Black-Scholes pricing model to determine the fair value of warrants issued in connection with the November Offering using the following assumptions: ā ā ā ā ā ā ā ā ā ā ā ā ā ā November 20, 2019 ā Risk-free interest rate ā ā ā ā ā 1.55 % Dividend yield ā ā ā ā ā 0.00 % Volatility factor of the expected market price of common stock ā ā ā ā ā 60 % Weighted-average expected life ā ā ā ā ā 5 years ā Weighted-average grant date fair value ā ā ā ā $ 0.52 ā ā All 21,706,250 warrants under the November Offering remain outstanding and unexercised as at December 31, 2019. March 2019 Offering On March 29, 2019, the Company issued 16,129,032 Units at $1.55 per Unit, for net proceeds of $22.9 million (net of issuance costs of $2.1 million). These Units include 1,935,484 Subscription Receipt Units approved for issuance on May 23, 2019 issued to certain of its executive officers, directors, employees and consultants. Each Unit consisted of one share of common stock and one The Company concluded that both common stock and warrants are equity-linked financial instruments and should be accounted for permanently in the shareholdersā equity section in the Consolidated Balance Sheets, with no requirement to subsequently revalue any of the instruments. Of the net proceeds of $22.9 million, $20.3 million was allocated to common stock and $2.6 million was allocated to warrants based on their relative fair value at issuance. The Company used the Black-Scholes pricing model to determine the fair value of warrants issued in connection with the March Offering using the following assumptions: ā ā ā ā ā ā ā ā ā Issued on: March 29, 2019 ā ā May 23, 2019 ā Risk-free interest rate ā 2.30 % ā ā 2.14 % Dividend yield ā 0.00 % ā ā 0.00 % Volatility factor of the expected market price of common stock ā 50 % ā ā 45 % Weighted-average expected life ā 3 years ā ā ā 3 years ā Weighted-average grant date fair value $ 0.43 ā ā $ 0.22 ā ā All 8,064,516 warrants under the March Offering remain outstanding and unexercised as at December 31, 2019. Flow-Through Shares and Restricted Cash On December 20, 2018, the Company issued 6,634,000 flow-through shares of common stock within the meaning of subsection 66(15) of the Income Tax Act (Canada) The Company was required to spend flow-through share proceeds on flow-through eligible Canadian exploration expenditures (āCEEā) as defined by subsection 66(15) of the Income Tax Act (Canada) and accordingly recorded the proceeds as restricted cash. The Company spent the entire proceeds from the 2018 issuance and 2017 issuance as of December 31, 2019 and December 31, 2018, respectively. Net proceeds from the 2018 issuance of $14.1 million were allocated as $11.1 million to common stock and $3.0 million to flow-through premium liability (2017 issuance - $9.4 million of net proceeds allocated as $7.8 million to common stock and $1.6 million to flow-through premium liability). The proceeds from the 2018 and 2017 flow-through offerings have been spent by the end of 2019 and 2018, respectively. The corresponding flow-through premium liabilities have been amortized and recorded in income and mining tax recovery on the Statement of Operations At-the-Market (āATMā) Offering Pursuant to an equity distribution agreement dated November 8, 2018, the Company was permitted to offer and sell from time to time shares of its common stock having an aggregate offering price of up to $90.0 million, with the net proceeds to fund working capital and general corporate purposes. During the three months ended March 31, 2019, the Company issued an aggregate of 1,010,545 shares of common stock for proceeds of $1.9 million (year ended December 31, 2018 ā the Company issued an aggregate of 514,897 shares of common stock for gross and net proceeds of approximately $0.9 million). The Company terminated the agreement on March 13, 2019. Shares Issued for Acquisition of Mineral Property Interests During the year ended December 31, 2019, the Company issued a total of 353,570 shares of common stock for the acquisition of mineral interests adjacent to Gold Bar (year ended December 31, 2018 - issued 178,321 shares of common stock in exchange for the acquisition of mineral property interests adjacent to the Black Fox Complex). Issuances Related to 2017 Acquisitions The Company issued 12,687,035 shares of common stock as part of the Lexam acquisition completed on April 26, 2017. See Note 22 Acquisitions September 2017 Offering On September 22, 2017, the Company issued 20,700,000 shares of common stock and 10,350,000 warrants in a public offering for net proceeds of $43.2 million, after deducting issuance costs of $3.4 million. Each share of common stock sold entitled the holder to receive half a warrant, and each whole warrant entitled the holder to purchase one share of common stock at a price of $2.70. All warrants expired unexercised on September 28, 2018. The Company concluded that both common stock and warrants are equity-linked financial instruments and should be accounted for permanently in the shareholdersā equity section in the Consolidated Balance Sheets ā ā ā ā ā Risk-free interest rate ā 1.56 % Dividend yield ā 0.36 % Volatility factor of the expected market price of common stock ā 71 % Weighted-average expected life ā 53 weeks ā Weighted-average grant date fair value $ 0.40 ā ā Stock Options The Companyās Amended and Restated Equity Incentive Plan (āPlanā) allows for equity awards to be granted to employees, consultants, advisors, and directors. The Plan is administered by the Compensation Committee of the Board of Directors (āCommitteeā), which determines the terms pursuant to which any award is granted. The Committee may delegate to certain officers the authority to grant awards to certain employees (other than such officers), consultants and advisors. issued under the Plan before it was amended, with no more than 1 million shares subject to grants of options to an individual in a calendar year. The Plan provides for the grant of incentive options under Section 422 of the Internal Revenue Code (the āCodeā), which provide potential tax benefits to the recipients compared to non-qualified options. At December 31, 2019, 4,221,023 awards were authorized and available for issuance under the Plan (December 31, 2018 ā 5,776,483 awards). During the year ended December 31, 2019, 535,000 shares of common stock (December 31, 2018 ā 171,000) were issued upon exercise of stock options under the Plan, at a weighted average exercise price of $1.02 (2018 ā $1.02) per share for proceeds of $0.5 million (2018 ā $0.2 million). Shareholder Distributions During the year ended December 31, 2019 the Company did not make any shareholder distributions. During the year ended December 31, 2018, the Company paid two semi-annual distributions to shareholders totaling $0.01 (year ended December 31, 2017, distributions totaling $0.01) per share of common stock, for a total distribution of $3.4 million (December 31, 2017 ā $3.1 million). These distributions were treated as dividends for tax purposes. Pursuant to the term loan facility dated August 10, 2018 ( Note 11 Stock-Based Compensation The following table summarizes information about stock options outstanding under the Plan at December 31, 2019: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Weighted ā ā ā ā ā ā Weighted ā Average ā ā ā ā ā ā ā Average ā Remaining ā ā ā ā ā Number of ā Exercise ā Contractual ā Intrinsic ā ā Shares ā Price ā Life (Years) ā Value ā ā (in thousands, except per share and year data) Balance at December 31, 2016 4,720 ā $ 2.41 3.4 ā $ 4,388 ā Granted 338 ā ā 2.99 ā ā ā ā ā ā Exercised (94) ā ā 1.30 ā ā ā ā 87 ā Forfeited ā (37) ā ā 4.28 ā ā ā ā ā ā Expired ā (21) ā ā 5.00 ā ā ā ā ā ā Balance at December 31, 2017 4,906 ā $ 2.45 2.6 ā $ 2,564 ā Granted 375 ā ā 1.90 ā ā ā ā ā ā Exercised (171) ā ā 1.02 ā ā ā ā 195 ā Forfeited (405) ā ā 3.99 ā ā ā ā ā ā Expired (462) ā ā 2.27 ā ā ā ā ā ā Balance at December 31, 2018 4,243 ā $ 2.33 2.0 ā $ 1,475 ā Granted 3,050 ā ā 1.73 ā ā ā ā ā ā Exercised (535) ā ā 1.01 ā ā ā ā 419 ā Forfeited (700) ā ā 2.56 ā ā ā ā ā ā Expired ā (789) ā ā 2.90 ā ā ā ā ā ā Balance at December 31, 2019 5,269 ā $ 2.00 3.0 ā $ 364 ā Exercisable at December 31, 2019 2,234 ā $ 2.27 1.2 ā $ 364 ā ā Stock options have been granted to key employees, directors and consultants under the Plan. Options to purchase shares under the Plan were granted at or above market value of the common stock as of the date of the grant. During the year ended December 31, 2019, the Company granted stock options to certain employees and directors for an aggregate of 3.1 million shares of common stock (2018 ā 0.4 million, 2017 ā 0.3 million) at a weighted average exercise price of $1.73 per share (2018 ā $1.90, 2017 ā $2.99). The options vest equally over a three-year period if the individuals remain affiliated with the Company (subject to acceleration of vesting in certain events) and are exercisable for a period of five years from the date of grant. The fair value of the options granted under the Plan was estimated at the date of grant, using the Black-Scholes option-pricing model, with the following weighted-average assumptions: ā ā ā ā ā ā ā ā ā ā ā ā ā 2019 ā ā 2018 ā ā 2017 Risk-free interest rate ā ā 1.45% to 1.87% ā ā 2.67% to 2.89% ā ā 1.46% to 1.60% Dividend yield ā ā 0.00% ā ā 0.36% to 0.53% ā ā 0.31% to 0.36% Volatility factor of the expected market price of common stock ā ā 58% ā ā 63% to 64% ā ā 72% to 74% Weighted-average expected life of option ā ā 3.5 years ā ā 3.5 years ā ā 3.5 years Weighted-average grant date fair value ā $ 1.73 ā $ 1.90 ā $ 2.99 ā During the year ended December 31, 2019, the Company recorded stock option expense of $0.7 million (2018 ā $0.3 million, 2017 ā $1.3 million) while the corresponding fair value of awards vesting in the period was $0.4 million (2018 ā $0.7 million and 2017 ā $1.3 million). At December 31, 2019, there was $1.0 million (2018 ā $0.4 million, 2017 - $0.7 million) of unrecognized compensation expense related to 3.0 million (2018 ā 0.7 million, 2017 ā 1.5 million) unvested stock options outstanding. This cost is expected to be recognized over a weighted-average period of approximately 1.5 years (2018 ā 1.4 years, 2017 ā 1.3 years). The following table summarizes the status and activity of non-vested stock options for the year ended December 31, 2019, for the Companyās Plan and the replacement options from the acquisition of Lexam ( Note 22 ā ā ā ā ā ā ā ā ā ā ā Weighted ā ā ā ā Average ā ā Number of ā Grant Date ā Shares Fair Value ā ā (in thousands, except per share amounts) Non-vested, beginning of year ā 691 ā $ 1.28 Granted ā 3,050 ā $ 0.58 Cancelled/Forfeited ā (402) ā $ 0.74 Vested ā (304) ā $ 1.44 Non-vested, end of year ā 3,035 ā $ 0.64 ā |
NET LOSS PER SHARE
NET LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2019 | |
NET LOSS PER SHARE | |
NET LOSS PER SHARE | NOTE 14 NET LOSS PER SHARE Basic net income (loss) per share is computed by dividing the net income or (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed similarly except that the weighted average number of common shares is increased to reflect all dilutive instruments. Diluted net income per share is calculated using the treasury stock method. In applying the treasury stock method, employee stock options with an exercise price greater than the average quoted market price of the common shares for the period outstanding are not included in the calculation of diluted net income per share as the impact is anti-dilutive. Potentially dilutive instruments are not considered in calculating the diluted loss per share, as their effect would be anti-dilutive. Below is a reconciliation of the basic and diluted weighted average number of common shares and the computations for basic and diluted net (loss) per share for the years ended December 31, 2019, 2018 and 2017: ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 ā ā (amounts in thousands, unless otherwise noted) Net loss ā $ (59,747) ā $ (44,870) ā $ (10,634) ā ā ā ā ā ā ā ā ā Weighted average common shares outstanding: ā ā 361,845 ā ā 337,297 ā ā 313,887 Diluted shares outstanding: ā ā 361,845 ā ā 337,297 ā ā 313,887 ā ā ā ā ā ā ā ā ā ā Net loss per share - basic and diluted ā $ (0.17) ā $ (0.13) ā $ (0.03) ā For the years ended December 31, 2019, 2018 and 2017, all outstanding options to purchase shares of common stock were excluded from the computation of diluted loss per share, as the Company was in a loss position, all potentially dilutive instruments were anti-dilutive and therefore not included in the calculation of diluted net loss per share. In 2019, warrants to purchase 29,770,766 shares of common stock at prices of $1.72 and $2.00 were excluded from the computation of diluted weighted average shares outstanding because their effect would have been anti-dilutive (2018 ā nil |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 15 RELATED PARTY TRANSACTIONS The Company incurred the following expense in respect to the related parties outlined below during the periods presented: ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Lexam L.P. $ 133 ā $ 91 ā $ 152 REVlaw ā 188 ā ā 266 ā ā 330 ā The Company has the following outstanding accounts payable (receivable) balance in respect to the related parties outlined below: ā ā ā ā ā ā ā ā December 31, 2019 ā December 31, 2018 REVlaw $ 22 ā $ 32 ā An aircraft owned by Lexam L.P. (which is controlled by Robert R. McEwen, limited partner and beneficiary of Lexam L.P. and the Companyās Chairman and Chief Executive Officer) has been made available to the Company in order to expedite business travel. In his role as Chairman and Chief Executive Officer of the Company, Mr. McEwen must travel extensively and frequently on short notice. Mr. McEwen is able to charter the aircraft from Lexam L.P. at a preferential rate approved by the Companyās independent board members under a policy whereby only the variable expenses of operating this aircraft for business related travel are eligible for reimbursement by the Company. REVlaw is a company owned by Ms. Carmen Diges, General Counsel of the Company. The legal services of Ms. Diges as General Counsel and other support staff, as needed, are provided by REVlaw in the normal course of business and have been recorded at their exchange amount. An affiliate of Mr. McEwen participated as a lender in the $50.0 million senior secured three-year term loan facility, by providing $25.0 million of the total $50.0 million Term Loan. During the year ended December 31, 2019, the Company paid $2.4 million (year ended December 31, 2018 - $1.0 million) in interest to this affiliate. The payments to Mr. McEwen are on the same terms as the non-affiliated lender ( Note 11 |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE ACCOUNTING | |
FAIR VALUE ACCOUNTING | NOTE 16 FAIR VALUE ACCOUNTING As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Assets and liabilities measured at fair value on a recurring basis. The following tables identify the Companyās assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy as at December 31, 2019 and 2018, as reported in the Consolidated Balance Sheets: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at December 31, 2019 Fair value as at December 31, 2018 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 1,885 ā $ ā ā $ 1,885 ā $ 2,718 ā $ ā ā $ 2,718 Warrants ā ā ā ā ā ā ā ā ā ā ā ā ā ā 413 ā ā 413 Total investments ā $ 1,885 ā $ ā ā $ 1,885 ā $ 2,718 ā $ 413 ā $ 3,131 ā The Company's investments mainly consist of marketable equity securities which are exchange-traded and are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the investments is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. Furthermore, as noted in Note 5 Investments, The Company does not have any Level 3 financial assets or liabilities. The fair value of other financial assets and liabilities were assumed to approximate their carrying values due to their short-term nature and historically negligible credit losses. Long-term debt is recorded at a carrying value of $49.5 million at December 31, 2019 (December 31, 2018 - $49.2 million) and is assumed to approximate its fair value due to the Company recently having acquired the debt. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 17 COMMITMENTS AND CONTINGENCIES Commitments In addition to commitments for payments on operating and finance leases ( Note 10 Note 11 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā ā 2020 ā 2021 ā 2022 ā 2023 ā 2024 ā Thereafter ā Total Mining and surface rights ā 2,926 ā 465 ā 470 ā 366 ā 335 ā ā ā ā 4,562 Reclamation costs (1) ā ā 2,548 ā ā 4,115 ā ā 4,637 ā ā 2,279 ā ā 549 ā ā 27,637 ā ā 41,765 Other plant and equipment ā ā 1,249 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 1,249 Exploration ā ā 219 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 219 Total ā $ 6,942 ā $ 4,580 ā $ 5,107 ā $ 2,645 ā $ 884 ā $ 27,637 ā $ 47,795 (1) Amounts presented represent the undiscounted uninflated future payments. Reclamation Bonds As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations in the United States and Canada. These bonding obligations are satisfied by surety bonds, as discussed below. Pursuant to the requirements imposed by the United States Bureau of Land Management (āBLMā), the Company has Nevada obligations of $20.1 million which primarily pertains to the Tonkin and Gold Bar properties. Under Canadian regulations, the Company has bonding obligations of $11.5 million (C$14.9 million) with respect to the Black Fox Complex. Furthermore, under Canadian regulations, the Company was required to deposit approximately $0.1 million with respect to its Timmins properties acquired from Lexam; the $0.1 million is recorded as restricted cash in Other assets ( Note 18 Surety Bonds As at December 31, 2019, the Company has a surety facility in place to cover all its bonding obligations, which include $20.1 million of bonding in Nevada and $11.5 million (C$14.9 million) of bonding in Canada. The terms of the facility carry an annual financing fee of 2% and no deposit requirements. The surety bonds are available for draw down by the beneficiary in the event the Company does not perform its reclamation obligations. If the specific reclamation requirements are met, the beneficiary of the surety bonds will release the instrument to the issuing entity. The Company believes it is in compliance with all applicable bonding obligations and will be able to satisfy future bonding requirements, through existing or alternative means, as they arise. Streaming Agreement As part of the acquisition of the Black Fox Complex in 2017, the Company assumed a gold purchase agreement (streaming contract) related to production, if any, from certain claims. The Company is obligated to sell 8% of gold production from the Black Fox mine and 6.3% at the adjoining Pike River property (Black Fox Extension) to Sandstorm Gold Ltd. at the lesser of market price or $551 per ounce (with inflation adjustments of up to 2% per year) until 2090. The Company records revenue on these shipments based on the contract price at the time of delivery to the customer. During the year December 31, 2019, the Company recorded revenue of $1.5 million (2018 ā $2.2 million) related to the gold stream sales. Other potential contingencies The Companyās mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company conducts its operations so as to protect public health and the environment, and believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations. The Company and its predecessors have transferred their interest in several mining properties to third parties throughout its history. The Company could remain potentially liable for environmental enforcement actions related to its prior ownership of such properties. However, the Company has no reasonable belief that any violation of relevant environmental laws or regulations has occurred regarding these transferred properties. |
CASH AND CASH EQUIVALENTS AND R
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 12 Months Ended |
Dec. 31, 2019 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | ā ā NOTE 18 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash and cash equivalents, and restricted cash reported within the Consolidated Balance Sheets Consolidated Statements of Cash Flows ā ā ā ā ā ā ā ā ā ā December 31, 2019 ā December 31, 2018 Cash and cash equivalents ā $ 46,452 ā $ 15,756 Restricted cash ( note 13 ā ā ā ā ā 14,685 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 46,500 ā $ 30,489 ā |
INCOME AND MINING TAXES
INCOME AND MINING TAXES | 12 Months Ended |
Dec. 31, 2019 | |
INCOME AND MINING TAXES. | |
INCOME AND MINING TAXES | NOTE 19 INCOME AND MINING TAXES The Companyās deferred income and mining tax benefit consisted of: ā ā ā ā ā ā ā ā ā ā ā ā 2019 2018 2017 United States ā $ 2,420 ā $ 2,185 ā $ 10,349 Foreign ā ā 1,424 ā ā 585 ā ā 5,020 Deferred tax benefit ā $ 3,844 ā $ 2,770 ā $ 15,369 ā The Companyās net loss before income and mining tax consisted of: ā ā ā ā ā ā ā ā ā ā ā ā ā 2019 2018 ā 2017 United States ā $ (22,319) ā $ (27,001) ā $ (19,913) Foreign ā ā (41,272) ā ā (20,639) ā ā (6,090) Loss before income and mining taxes ā $ (63,591) ā $ (47,640) ā $ (26,003) ā A reconciliation of the tax provision for 2019, 2018 and 2017 at statutory U.S. Federal and State income tax rates to the actual tax provision recorded in the financial statements is computed as follows: ā ā ā ā ā ā ā ā ā ā ā Expected tax recovery at 2019 2018 2017 Loss before income and mining taxes ā $ (63,591) ā $ (47,640) ā $ (26,003) Statutory tax rate ā ā 21% ā ā 21% ā ā 35% US Federal and State tax expense at statutory rate ā ā (13,354) ā ā (10,004) ā ā (9,101) Reconciling items: ā ā ā ā ā ā ā ā ā Equity pickup in MSC ā 2,626 ā 2,966 ā (16) Deferred foreign income inclusion ā 598 ā 5,963 ā 21,002 Realized flow-through expenditures ā ā 3,150 ā ā 2,100 ā ā ā Realized flow-through premium ā ā (2,954) ā ā (1,675) ā ā ā Foreign tax credits ā ā ā ā ā ā ā (16,628) Tax rate changes ā ā 976 ā ā ā ā 28,048 Adjustment for foreign tax rates ā (200) ā 40 ā 115 Other permanent differences ā 8,540 ā 4,419 ā (1,761) Unrealized foreign exchange rate (loss)/gain ā (1,095) ā (6,935) ā 2,469 NOL expires and revisions ā 810 ā (120) ā (2,806) Valuation allowance ā (2,941) ā 476 ā (36,691) Income and mining tax recovery ā $ (3,844) ā $ (2,770) ā $ (15,369) ā The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities as at December 31, 2019 and 2018 respectively are presented below: ā ā ā ā ā ā ā ā ā ā 2019 2018 Deferred tax assets: ā ā ā ā ā ā ā Net operating loss carryforward ā $ 57,667 ā $ 55,515 ā Mineral Properties ā 60,299 ā 62,345 ā Other temporary differences ā 14,356 ā 15,198 ā Total gross deferred tax assets ā 132,322 ā 133,058 ā Less: valuation allowance ā (121,212) ā (124,153) ā Net deferred tax assets ā $ 11,110 ā $ 8,905 ā Deferred tax liabilities: ā ā ā ā ā ā ā Acquired mineral property interests ā ā (16,024) ā ā (15,331) ā Total deferred tax liabilities ā $ (16,024) ā $ (15,331) ā Deferred income and mining tax liability ā $ (4,914) ā $ (6,426) ā ā The Company reviews the measurement of its deferred tax assets at each balance sheet date. On the basis of available information at December 31, 2019, the Company has provided a valuation allowance for certain of its deferred assets where the Company believes it is more likely than not that some portion or all of such assets will not be realized. The change in valuation allowance of approximately $2.9 million primarily reflects the impact of the Argentina peso devaluation and Argentina tax inflationary adjustments. The table below summarizes changes to the valuation allowance: ā ā ā ā ā ā ā ā ā ā ā ā ā ā For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2019 ā $ 124,153 ā $ 2,104 ā $ (5,045) ā $ 121,212 2018 ā ā 123,648 ā ā 12,232 ā ā (11,727) ā ā 124,153 2017 ā ā 111,621 ā ā 51,220 ā ā (39,193) ā ā 123,648 (a) The additions to valuation allowance mainly results from the Company and its subsidiaries incurring losses and exploration expenses for tax purposes which do not meet the more-likely-than-not criterion for recognition of deferred tax assets. (b) The reductions to valuation allowance mainly results from release of valuation allowance, expiration of the Companyās tax attributes, foreign exchange reductions of tax attributes in Canada, Mexico and Argentina and inflationary adjustments to tax attributes in Argentina. As at December 31, 2019 and 2018, the Company did not have any income-tax related accrued interest and tax penalties. The following table summarizes the Companyās losses that can be applied against future taxable profit: ā ā ā ā ā ā ā ā ā Country Type of Loss Amount Expiry Period United States (a) ā Net-operating losses ā $ 129,409 ā 2020-2039 Mexico ā Net-operating losses ā ā 34,876 ā 2020-2029 Canada (a) ā Net-operating losses ā ā 36,692 ā 2020-2039 Argentina (a) ā Net-operating losses ā ā 41,922 ā 2020-2024 (a) The losses in the United States, Canada, and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. ā The Company or its subsidiaries file income tax returns in the United States, Canada, Mexico, and Argentina. These tax returns are subject to examination by local taxation authorities provided the tax years remain open to audit under the relevant statute of limitations. The following summarizes the open tax years by major jurisdiction: United States: 2016 to 2019 Canada: 2012 to 2019 Mexico: 2015 to 2019 Argentina: 2015 to 2019 On December 22, 2017 the US Tax Cuts and Jobs Act (the āActā) was enacted. The Act reduced the US federal corporate tax rate from 35% to 21%, required companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. In 2017, the Company re-measured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. The impact of this re-measurement was $28.0 million. As at December 31, 2018, the Company completed the accounting for the transition tax corresponding to the 2017 tax year. Proposed regulations under Section 965 of the Internal Revenue Code, issued during the third quarter of 2018, limited the use of certain foreign tax credits which would have redeemed the one-time transition tax. The Companyās foreign tax credits originating from MSC are captured under the proposed regulation changes. As a result of the proposed changes, the Company reported in its 2017 US tax return, $13.6 million of taxable income. The taxable income was offset by the use of net-operating losses. ā Effective January 1, 2018, the Act also subjects a US shareholder to tax on global intangible low-taxed income (āGILTIā) earned by certain foreign subsidiaries. The FASB Staff Q&A, Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. The Company has elected to account for GILTI as a tax expense in the year the tax is incurred, as a period expense only. |
UNAUDITED SUPPLEMENTARY QUARTER
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | NOTE 20 UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION The following table summarizes unaudited supplementary quarterly information for the years ended December 31, 2019 and 2018. ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019 ā ā (unaudited) (in thousands, except per share) Revenue from gold and silver sales ā $ 15,583 ā $ 36,383 ā $ 32,691 ā $ 32,362 Gross profit ā ā 1,429 ā ā 4,677 ā ā 1,619 ā ā 1,261 Net (loss) ā ā (10,136) ā ā (13,014) ā ā (11,465) ā ā (25,132) Net (loss) per share: ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā $ (0.02) ā $ (0.04) ā $ (0.03) ā $ (0.07) Weighted average shares outstanding: ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā ā 345,497 ā ā 346,998 ā ā 362,175 ā ā 378,543 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018 ā ā (unaudited) (in thousands, except per share) Revenue from gold and silver sales ā $ 41,041 ā $ 33,806 ā $ 26,896 ā $ 26,432 ā Gross profit ā ā 14,228 ā ā 9,092 ā ā 6,013 ā ā 2,749 ā Net (loss) ā ā (5,211) ā ā (5,380) ā ā (13,290) ā ā (20,989) ā Net (loss) per share: ā ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā $ (0.02) ā $ (0.02) ā $ (0.04) ā $ (0.06) ā Weighted average shares outstanding: ā ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā 337,062 ā ā 337,087 ā ā 337,278 ā 337,936 ā ā |
COMPARATIVE FIGURES
COMPARATIVE FIGURES | 12 Months Ended |
Dec. 31, 2019 | |
COMPARATIVE FIGURES | |
COMPARATIVE FIGURES | NOTE 21 COMPARATIVE FIGURES Certain amounts in prior years have been reclassified to conform to the current yearās presentation. Reclassified amounts were not material to the financial statements and relate to the presentation of Other Operating Expenses. Advanced projects Statement of Operations Exploration Statement of Operations General and Administrative Statement of Operations |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2019 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 22 ACQUISITIONS Acquisition of Lexam VG. Gold Inc. On The Companyās total purchase price of $39.2 million was comprised of 12,687,035 common shares issued from treasury valued at $3.00 per share, share replacement awards of $0.1 million and transaction costs totaling $1.0 million. The Lexam acquisition was accounted for as an asset acquisition and transaction costs associated with the acquisition were capitalized to the mineral property interests acquired, consistent with the Companyās mineral property interests accounting policy. The following table sets out the allocation of the purchase price to assets acquired and liabilities assumed, based on managementās estimates of relative fair value: ā ā ā ā ā Total purchase price: ā ā Common shares issued for acquisition ā $ 38,141 Transaction fees incurred ā ā 1,017 ā ā $ 39,158 Fair value of assets acquired and liabilities assumed: ā ā ā Mineral property interests ā $ 41,595 Cash and cash equivalents ā ā 177 Other current assets ā ā 86 Other assets ā ā 312 Accounts payable and accrued liabilities ā ā (288) Reclamation obligations ā ā (570) Deferred income tax liabilities ā ā (2,154) ā ā $ 39,158 ā The mineral property interests acquired include a 100% interest in the Buffalo Ankerite, Fuller and Davidson-Tisdale prospects and a 61% interest in the Paymaster prospect all located in Timmins, Ontario. The remaining 39% interest in the Paymaster property is held by Goldcorp Inc., a joint venture partner. Certain properties are also subject to a net profit interest (āNPIā) in the 10% to 20% range, payable to an unrelated third party. Acquisition of Black Fox Complex On August 25, 2017, the Company entered into an Asset Purchase Agreement (the āAPAā) with Primero Mining Corp. (āPrimeroā), whereby the Company, through its wholly-owned subsidiary, purchased and assumed the Purchased Assets and Assumed Liabilities as defined within the APA related to the Black Fox Complex for total cash consideration of $27.5 million, which is the purchase price of $35.0 million less closing adjustments. The Black Fox Complex includes the Black Fox mine site, mill, property, plant and equipment and adjacent exploration properties located in Township of Black River-Matheson, Ontario, Canada. The Company concluded that the acquired assets and assumed liabilities constitute a ābusinessā under U.S. GAAP and accordingly, the acquisition was accounted for as a business combination rather than an asset acquisition. The transaction was completed on October 6, 2017. Fair value measurements of assets acquired and liabilities assumed were made during the fourth quarter of 2017. There were no changes in the fair value measurements when the company finalized its fair value analysis in the third quarter of 2018. ā The following table summarizes the amounts assigned to the assets acquired and liabilities assumed as of the acquisition date: ā ā ā ā ā Total purchase price: ā ā Purchase price ā $ 35,000 Adjustments to purchase price ā ā (7,500) ā ā $ 27,500 Fair value of assets acquired and liabilities assumed: ā ā ā Cash ā $ 249 Accounts Receivable ā ā 470 Prepaids ā ā 63 Inventory ā ā 4,704 Mineral Property Interests ā ā 8,954 Plant and Equipment ā ā 33,683 Accounts Payable ā ā (5,247) Accrued Liabilities ā ā (3,213) Short term capital lease liability ā ā (557) Asset retirement obligation ā ā (11,233) Long term capital lease liability ā ā (172) Deferred tax liability ā ā (201) Net assets acquired in acquisition ā $ 27,500 ā The Company recognized $1.3 million of acquisition-related costs associated with the acquisition of the Black Fox Complex. These costs were expensed and were included in general and administrative costs in 2017. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates: The Companyās consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (āU.S. GAAPā). The preparation of the Companyās consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to environmental reclamation and closure obligations; asset useful lives utilized for depletion, depreciation, amortization and accretion calculations; fair value of equity investment and asset groups used in impairment testing; recoverable gold in leach pad inventory; current and long-term inventory; mine development capitalization costs; the collectability of value added taxes receivable; fair values of assets and liabilities acquired in business combinations; reserves; valuation allowances for deferred tax assets; income and mining tax provisions and reserves for contingencies and litigation. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ significantly from these estimates. References to āC$ā refer to Canadian currency. |
Basis of Consolidation | Basis of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated. Investments over which the Company exerts significant influence but does not control through majority ownership are accounted for using the equity method, as described in Investments, |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash: The Company considers cash in banks, deposits in transit, and highly liquid term deposits with original maturities of three months or less to be cash and cash equivalents. Because of the short maturity of these instruments, the carrying amounts approximate their fair value. Restricted cash is excluded from cash and cash equivalents and is included in long-term assets, except for flow-through share proceeds which appear as a separate line under current assets. Proceeds from flow-through shares issued are recorded as restricted cash and remain restricted until utilized to fund exploration activities. |
Investments | Investments: The Company accounts for investments over which the Company exerts significant influence but does not control through majority ownership using the equity method of accounting pursuant to ASC Topic 323, Investments ā Equity Method and Joint Ventures Consolidated Balance Sheet share of income and losses of the investee and impairment losses are recognized in the Consolidated Statements of Operations and Comprehensive (Loss) Income Statement of Operations Impairment of Long-lived Assets The Companyās investments in marketable equity securities and warrants are measured at fair value at each period end with changes in fair value recognized in net (loss) income in the Statement of Operations Accumulated Other Comprehensive (Loss) Income Statements of Operations Consolidated Statements of Changes in Shareholdersā Equity). |
Value Added Taxes Receivable | Value Added Taxes Receivable: In Mexico and Canada, value added taxes (āVATā and āHSTā, respectively) are assessed on purchases of materials and services and sales of products. Businesses are generally entitled to recover the taxes they have paid related to purchases of materials and services, either as a refund or as a credit against future taxes payable. With the exception of MSC, in Argentina the Company expenses all VAT as their recoverability is uncertain. |
Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies | Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: Stockpiles represent mineralized material extracted from the mine and available for processing. Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, an estimate of the contained metals (based on assay data) and the estimated metallurgical recovery rates. Costs are allocated to stockpiles based on current mining costs incurred including applicable overhead relating to mining operations. Material is removed from the stockpile at an average cost per tonne. Mineralized material on leach pads is the material that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the mineralized material over a period of time. Costs are attributed to the mineralized material on leach pads based on current mining costs incurred up to the point of placing the ore on the pad. Costs are removed from the leach pad inventory based on the average cost per estimated recoverable ounce of gold on the leach pad as the gold is recovered. The estimates of recoverable gold on the leach pads are calculated from the quantities of mineralized material placed on the leach pads (measured tonnes added to the leach pads), the grade of mineralized material placed on the leach pads (based on assay data) and a recovery percentage. The quantities of recoverable gold placed on the leach pads are reconciled by comparing the grades of ore placed on the pads to the quantities of gold actually recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored, and the engineering estimates are refined based on actual results over time. In-process inventories represent materials that are currently in the process of being converted to a saleable product. In-process material is measured based on assays of the material from the various stages of processing. Costs are allocated to in-process inventories based on the costs of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the in-process conversion costs incurred to that point in the process. Precious metal inventories include gold and silver dorĆ© and bullion that is unsold and held at the Companyās or the refineryās facilities. Costs are allocated to precious metal inventories based on costs of the respective in-process inventories incurred prior to the refining process plus applicable refining costs. Materials and supplies inventories are comprised of chemicals, reagents, spare parts and consumable parts used in operating and other activities. Cost includes applicable taxes and freight. |
Proven and Probable Reserves | Proven and Probable Reserves: The definition of proven and probable reserves is set forth in Guide 7. Proven reserves are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geological character is so well defined that size, shape, depth and mineral content of the reserves are well-established. Probable reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observations. |
Mineral Property Interests, Plant and Equipment and Mine Development Costs | Mineral Property Interests, Plant and Equipment and Mine Development Costs: Mineral property interests: Development costs include engineering and metallurgical studies, drilling and other related costs to delineate an ore body, and the removal of overburden to initially expose an ore body at open pit surface mines (āpre-strippingā) and building of access paths and other infrastructure to gain access to the ore body at underground mines. Development costs are charged to net income (loss) in the year incurred as Exploration Advanced Projects During the production phase of a mine, costs incurred that provide access to reserves and resources that will be produced in future periods that would not have otherwise been accessible are capitalized and included in the carrying amount of the related mineral property interest. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information, providing greater definition of the ore body or converting non-reserve mineralization to proven and probable reserves and the benefit is expected to be realized over a period beyond one year. All other drilling and related costs are expensed as incurred as Exploration Advanced Projects Mineral property interests are amortized upon commencement of production on a unit-of-production basis over proven and probable reserves, as defined by Guide 7. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs are charged to expense based on the most appropriate method, which includes straight-line method and units-of-production method over the estimated useful life of the mine, as determined by internal mine plans. Plant and Equipment: For properties where the Company did not establish proven and probable reserves as defined by Guide 7, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred, unless the equipment have alternative uses or significant salvage value in which case the equipment is capitalized at cost. Construction-in-progress (āCIPā) costs: |
Impairment of Long-lived Assets | Impairment of Long-Lived Assets: The Company reviews and evaluates its long-lived assets for impairment at a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its fair value. For the purpose of recognition and measurement of impairment, the Company groups its long-lived assets by specific mine or project, as this represents the lowest level for which identifiable cash flows exist. For asset groups where an impairment loss is determined using the undiscounted future net cash flows method or discounted future net cash flows method, future cash flows are estimated based on quantities of recoverable mineralized material, expected gold and silver prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine plans. The term ārecoverable mineralized materialā refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during processing and treatment. The Companyās estimates of future cash flows are based on numerous assumptions and uncertainties. It is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold, silver and other commodity prices, production levels and costs of capital are each subject to significant risks and uncertainties. Currently the resource and reserve estimate at the Gold Bar mine is being evaluated in light of significant differences recently observed between modeled and mined ore tonnage and gold grade from the Gold Pick West Pit. Preliminary iterations suggest that a significant reduction in tonnage, an increase in gold grade, and a resulting significant reduction in contained ounces from the existing reserve estimate is likely. The results of this evaluation will directly impact our estimates of future cash flows, which may affect the value of our long-lived assets. For asset groups where the Company is unable to determine a reliable estimate of future net cash flows, the Company adopts a market approach to estimate fair value by using a combination of observed market value per square mile and observed market value per ounce or pound of mineral material based on comparable transactions. |
Asset Retirement Obligation, reclamation and remediation costs | Asset Retirement Obligation (āAROā), Reclamation and Remediation Costs: Provisions for environmental rehabilitation are made in respect of the estimated future costs of closure and restoration and rehabilitation costs (which include the dismantling and demolition of infrastructure, removal of residual materials and remediation of disturbed areas) in the accounting period when the related environmental disturbance occurs. The associated asset retirement costs, including periodic adjustments, if any, are capitalized as part of the carrying amount of the long- lived asset when proven or probable reserves exist or if they relate to an acquired mineral property interest; otherwise the costs are charged to the Statement of Operations The fair value of an ARO is measured by discounting the expected cash flows adjusted for inflation, using a credit-adjusted risk free rate of interest. The Company prepares estimates of the timing and amounts of expected cash flows when an ARO is incurred, which are updated to reflect changes in facts and circumstances. Estimation of the fair value of AROs requires significant judgment, including amount of cash flows, timing of reclamation, inflation rate and credit risk. |
Lease Accounting | Lease Accounting: Contracts entered into are analyzed to identify whether the contract contains an operating or financing lease according to ASC 842, adopted by the Company effective January 1, 2019 (see āRecently Adopted Accounting Pronouncementsā). If a contract is determined to contain a lease, the Company will include lease payments (the lease liability) and the right-of-use asset (āROUā) representing the right to the underlying asset for the lease term within the Consolidated Balance Sheets Consolidated Balance Sheets Statement of Operations. Operating and ROU asset balances and lease liabilities are recognized at the commencement date based on the present value of the future lease payments over the lease term. The Company utilizes the incremental borrowing rate (āIBRā) in determining the present value of the future lease payments. IBR represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Each leaseās IBR is determined by using the average bond yield ratings for comparable companies. |
Revenue Recognition | Revenue Recognition: Revenue consists of proceeds received and expected to be received for the Companyās principal products, gold and silver. Revenue is recognized when title to gold and silver passes to the buyer and when collectability is reasonably assured. Title passes to the buyer based on terms of the sales contract, usually upon delivery of the product. Product pricing is determined under the sales agreements which are referenced against active and freely traded commodity markets, for example, the London Bullion Market for both gold and silver, in an identical form to the product sold. Gold and silver dorĆ© produced from the San JosĆ© mine is sold at the prevailing spot market price based on the London A.M. fix, while concentrates are sold at the prevailing spot market price based on either the London P.M. fix or average of the London A.M. and London P.M. fix depending on the sales contract. Concentrates are provisionally priced, whereby the selling price is subject to final adjustments at the end of a period ranging from 30 to 90 days after delivery to the customer. The final price is based on the market price of the precious metal content at the relevant quotation point stipulated in the contract. Due to the time elapsed between shipment and the final settlement with the buyer, MSC must estimate the prices at which sales of metals will be settled. At the end of each financial reporting period, previously recorded provisional sales are adjusted to estimated settlement metals prices based on relevant forward market prices until final settlement with the buyer. In addition to selling refined bullion at spot, the Company has dorĆ© purchase agreements in place with financial institutions and refineries. Under the agreements, the Company has the option to sell approximately 90% of the gold and silver contained in dorĆ© bars prior to the completion of refining by the third party refiner. Revenue is recognized when the Company has provided irrevocable instructions to the refiner to transfer to the purchaser the refined ounces sold upon final processing outturn, and when payment of the purchase price for the purchased dorĆ© or bullion has been made in full by the purchaser. There is no judgement involved in revenue recognition as revenue is recognized when payment has been made by the purchaser and the product has been delivered. |
Foreign Currency | ā ā Foreign Currency: The functional currency for the Companyās operations is the U.S. dollar. All monetary assets and liabilities denominated in a currency which is not the U.S. dollar are translated at current exchange rates at each balance sheet date and the resulting adjustments are included in a separate line item under other income (expense). Revenue and expense in foreign currencies are translated at the average exchange rates for the period. ā Stock-Based Compensation: The Company accounts for stock options at fair value as prescribed in ASC 718. The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option-pricing model and provides for expense recognition over the service period, if any, of the stock option. The companyās estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behavior and estimates of forfeitures. |
Stock-Based Compensation | ā |
Flow-through Shares | Flow-Through Shares: Current Canadian tax legislation permits mining entities to issue flow-through shares to investors by which the deductions for tax purposes related to resource exploration and evaluation expenditures may be claimed by investors instead of the entity, subject to a renouncement process. Under ASC 740, proceeds from the issuance of flow-through shares are allocated first to the common stock based on the underlying quoted price of shares and the residual amount is allocated to the sale of tax benefits, classified as a liability. As the Company incurs qualifying exploration and evaluation expenditures to fulfill its obligation, the liability is drawn down and the sale of tax benefits is recognized in the Statement of Operations as a reduction of deferred tax expense. |
Income and Mining Taxes | Income and Mining Taxes: The Company accounts for income and mining taxes under ASC 740 using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related tax basis for such liabilities and assets. This method generates either a net deferred income and mining tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income and mining tax charge or benefit by recording the change in either the net deferred income and mining tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income and mining tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income and mining tax asset will not be realized. |
Comprehensive (Loss) Income | Comprehensive (Loss) Income: In addition to net income or loss, comprehensive income or loss includes all changes in equity during a period. |
Per Share Amounts | Per Share Amounts: Basic income or loss per share is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted income or loss per share reflects the potential dilution of securities that could share in the earnings of the Company and are computed in accordance with the treasury stock method based on the average number of common shares and dilutive common share equivalents outstanding. Only those instruments that result in a reduction in income per share are included in the calculation of diluted (loss) income per share. |
Loans and borrowings | Loans and Borrowings: Borrowings are recognized initially at fair value, net of financing costs incurred, and subsequently measured at amortized cost. Any difference between the amounts originally received and the redemption value of the debt is recognized in the Statements of Operations |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: Fair value accounting, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Loans and borrowings: Consolidated Statement of Operations and Comprehensive (Loss) Income Fair Value of Financial Instruments: ā Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). |
Recently Adopted And Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements Leases ā ASC 842: Practical expedients and elections under ASUs and ASC 842 made by the Company are as follows: ASU 2018-11: This update permitted an entity to elect an optional transitional practical expedient to continue to apply ASC 840, including its disclosure requirements, in the comparative periods presented in the year of adoption of ASC 842. Under this optional practical expedient, the Company applied the transition provisions on January 1, 2019 (the date of adoption) rather than January 1, 2017 (the beginning of the earliest comparative period presented); first reporting under the new standard was for the first quarter of 2019. Upon adoption of ASC 842, the Company recognized a nominal cumulative-effect adjustment to the opening accumulated deficit balance. Package of practical expedients ā which permits an entity to (a) not reassess whether expired or existing contracts contain leases, (b) not reassess lease classification for existing or expired leases and (c) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. The Company opted to elect the package of practical expedients. Hindsight practical expedient ā which permits an entity to use hindsight in determining the lease term. The Company opted to elect this provision. Easements practical expedient ā which permits an entity to elect an optional transitional practical expedient to not evaluate land easements that existed or expired before the entityās adoption of ASC 842 that were not previously accounted for as leases under ASC 840. The Company opted to elect this transitional provision and as a result did not evaluate any of its land agreements. Short term election ā which permits an entity to elect not to apply lease accounting to leases that are not greater than twelve months. The Company elected this short term election. Non-lease component election ā which permits lessees to elect to account for non-lease components as part of the lease component to which they relate; an election made by class of underlying asset. The Company opted to make this election. The adoption of ASC 842 resulted in an increase in the Companyās recorded assets and liabilities and a nominal cumulative-effect adjustment to the opening accumulated deficit balance (see N ote 10 Lease Liabilities). Recently Issued Accounting Pronouncements Changes to the Disclosure Requirements for Fair Value Measurement: Income Taxes: |
OPERATING SEGMENT REPORTING (Ta
OPERATING SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
OPERATING SEGMENT REPORTING | |
Schedule of the financial information relating to the Company's segments | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2019 USA ā Canada ā Mexico ā MSC Los Azules Total Revenue from gold and silver sales ā $ 43,847 ā $ 50,058 ā $ 23,114 ā $ ā ā $ ā ā $ 117,019 Production costs applicable to sales ā ā (33,614) ā ā (31,121) ā ā (18,545) ā ā ā ā ā ā ā (83,280) Depreciation and depletion ā ā (10,934) ā ā (13,271) ā ā (548) ā ā ā ā ā ā ā ā (24,753) Gross profit ā ā (701) ā ā 5,666 ā ā 4,021 ā ā ā ā ā ā ā ā 8,986 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (649) ā ā (1,636) ā ā (7,235) ā ā ā ā ā ā ā (9,520) Exploration ā ā (8,554) ā ā (25,779) ā ā ā ā ā ā ā ā (3,411) ā (37,744) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (8,754) ā ā ā ā (8,754) Segment loss ā $ (9,904) ā $ (21,749) ā $ (3,214) ā $ (8,754) ā $ (3,411) ā $ (47,032) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (16,559) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (63,591) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 18,806 ā $ 11,464 ā $ ā ā $ ā ā $ ā ā $ 30,270 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 62,024 ā $ 66,151 ā $ ā ā $ ā ā $ 128,175 Production costs applicable to sales ā ā ā ā ā (43,095) ā ā (37,919) ā ā ā ā ā ā ā ā (81,014) Depreciation and depletion ā ā ā ā ā (12,972) ā ā (2,107) ā ā ā ā ā ā ā ā (15,079) Gross profit ā ā ā ā ā 5,957 ā ā 26,125 ā ā ā ā ā ā ā ā 32,082 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (7,959) ā ā ā ā ā (7,104) ā ā ā ā ā ā ā ā (15,063) Exploration ā ā (5,174) ā ā (22,032) ā ā (2,241) ā ā ā ā ā (7,129) ā ā (36,576) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (11,865) ā ā ā ā ā (11,865) Segment (loss) income ā $ (13,133) ā $ (16,075) ā $ 16,780 ā $ (11,865) ā $ (7,129) ā $ (31,422) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (16,218) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (47,640) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 84,713 ā $ 12,584 ā $ 171 ā $ ā ā $ ā ā $ 97,468 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, 2017 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 11,620 ā $ 55,845 ā $ ā ā $ ā ā $ 67,465 Production costs applicable to sales ā ā ā ā ā (8,151) ā ā (35,198) ā ā ā ā ā ā ā ā (43,349) Depreciation and depletion ā ā ā ā ā (1,737) ā ā (2,299) ā ā ā ā ā ā ā ā (4,036) Gross profit ā ā ā ā ā 1,732 ā ā 18,348 ā ā ā ā ā ā ā ā 20,080 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (6,686) ā ā ā ā ā (4,443) ā ā ā ā ā ā ā ā (11,129) Exploration ā ā (2,132) ā ā (1,661) ā ā (5,610) ā ā ā ā ā (9,221) ā ā (18,624) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (44) ā ā ā ā ā (44) Impairment of mineral property interests and property and equipment ā ā ā ā ā ā ā ā (711) ā ā ā ā ā ā ā ā (711) Segment (loss) income ā $ (8,818) ā $ 71 ā $ 7,584 ā $ (44) ā $ (9,221) ā $ (10,428) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (15,575) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (26,003) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 6,271 ā $ 4,301 ā $ 939 ā $ ā ā $ ā ā $ 11,511 |
Schedule Of Geographic Information | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā December 31, ā December 31, ā Year ended December 31, ā 2019 2018 2019 ā 2018 ā 2017 USA ā $ 135,854 ā $ 127,617 ā $ 43,847 ā $ ā ā $ ā Canada ā ā 77,147 ā ā 84,119 ā ā 50,058 ā ā 62,024 ā ā 11,620 Mexico ā ā 23,551 ā ā 26,524 ā ā 23,114 ā ā 66,151 ā ā 55,845 Argentina (2) ā ā 302,598 ā ā 319,305 ā ā ā ā ā ā ā ā ā Total consolidated (3) ā $ 539,150 ā $ 557,565 ā $ 117,019 ā $ 128,175 ā $ 67,465 |
OTHER INCOME (Tables)
OTHER INCOME (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
OTHER INCOME | |
Schedule of other income (expense) | ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Unrealized and realized gain (loss) on investments (note 5) ā $ 5,259 ā $ (3,324) ā $ 257 Foreign currency gain ā ā 1,697 ā ā 3,922 ā ā 694 Other income, net ā ā 184 ā ā 570 ā ā 270 Total other income ā $ 7,140 ā $ 1,168 ā $ 1,221 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVESTMENTS | |
Summary of investment portfolio | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain (loss) on ā December 31, ā 2018 period securities sold period securities held 2019 Marketable equity securities ā $ 2,718 ā $ 2,314 ā $ 3,396 ā $ (7,279) ā $ 736 ā $ 1,885 Warrants ā 413 ā ā ā 1,127 ā (1,540) ā ā ā ā Investments ā $ 3,131 ā $ 2,314 ā $ 4,523 ā $ (8,819) ā $ 736 ā $ 1,885 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain (loss) on ā December 31, ā 2017 period securities sold period securities held 2018 Marketable equity securities ā $ 6,404 ā $ 1,882 ā $ (767) ā $ (2,895) ā $ (1,906) ā $ 2,718 Warrants ā 1,567 ā ā 201 ā ā ā ā ā (704) ā ā (651) ā ā 413 Investments ā $ 7,971 ā $ 2,083 ā $ (767) ā $ (3,599) ā $ (2,557) ā $ 3,131 |
RECEIVABLES AND OTHER CURRENT_2
RECEIVABLES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
Schedule of balances in receivables and other current assets | ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Government sales tax receivable ā $ 2,658 ā $ 2,079 Other current assets ā ā 2,607 ā ā 1,686 Receivables and other current assets ā $ 5,265 ā $ 3,765 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
Schedule of inventories | ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Material on leach pads ā $ 37,328 ā $ 14,961 In-process inventory ā 3,847 ā 3,446 Stockpiles ā 1,384 ā 1,272 Precious metals ā 1,038 ā 3,421 Materials and supplies ā 4,382 ā 3,530 Inventories ā $ 47,979 ā $ 26,630 Current portion ā ā 38,376 ā ā 22,039 Long-term portion ā $ 9,603 ā $ 4,591 |
MINERAL PROPERTY INTERESTS AN_2
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
Schedule of property and equipment | ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Mineral property interests, cost ā $ 339,374 ā $ 326,086 Less: accumulated depletion ā ā (28,154) ā ā (16,941) Mineral property interests, carrying value ā $ 311,220 ā $ 309,145 ā ā ā ā ā ā ā Plant and equipment, cost ā ā ā ā ā ā Land ā $ 8,746 ā $ 8,699 Construction in progress ā ā 2,961 ā ā 74,643 Plant and equipment ā ā 133,014 ā ā 49,578 Subtotal ā $ 144,721 ā $ 132,920 Less: accumulated depreciation ā (37,150) ā ā (18,186) Plant and equipment, carrying value ā $ 107,571 ā $ 114,734 ā ā ā ā ā ā ā Mineral property interests and plant and equipment, carrying value ā $ 418,791 ā $ 423,879 |
Summary of mineral property interests | ā ā ā ā ā ā ā ā ā ā ā ā ā Name of Property/Complex State/Province ā Country ā 2019 ā 2018 Black Fox Complex ā Ontario ā Canada ā $ 14,627 ā $ 16,365 ā Lexam ā Ontario ā Canada ā ā 41,595 ā ā 41,595 ā Los Azules Copper Project San Juan Argentina ā ā 191,490 ā ā 191,490 ā Tonkin Properties Nevada United States ā 4,833 ā 4,833 ā Gold Bar Project Nevada United States ā 48,492 ā 44,131 ā Battle Mountain Complex Nevada United States ā 785 ā 785 ā El Gallo Project Sinaloa Mexico ā 3,591 ā 4,139 ā Fenix Project Properties Sinaloa Mexico ā 5,807 ā 5,807 ā Total mineral property interests ā ā ā ā ā $ 311,220 ā $ 309,145 ā |
INVESTMENT IN MINERA SANTA CR_2
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
Summary of MSC's financial information from operations | ā ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā ā 2019 ā 2018 ā 2017 Minera Santa Cruz S.A. ( 100% ) ā ā ā ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 263,887 ā $ 213,096 ā $ 235,650 ā Production costs applicable to sales ā ā (159,915) ā ā (151,779) ā ā (156,347) ā Depreciation and depletion ā ā (69,995) ā ā (52,200) ā ā (48,278) ā Gross profit ā ā 33,977 ā ā 9,117 ā ā 31,025 ā Exploration ā ā (10,635) ā ā (5,884) ā ā (5,198) ā Other expenses (1) ā ā (13,065) ā ā (12,840) ā ā (12,527) ā Net income (loss) before tax ā $ 10,277 ā $ (9,607) ā $ 13,300 ā Current and deferred tax expense ā ā (14,556) ā ā (10,934) ā ā (18,050) ā Net loss ā $ (4,279) ā $ (20,541) ā $ (4,750) ā ā ā ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. ( 49% ) ā ā ā ā ā ā ā ā ā ā Net loss ā $ (2,097) ā $ (10,065) ā $ (2,328) ā Amortization of fair value increments ā (9,448) ā (9,730) ā (9,632) ā Income tax recovery ā ā 2,791 ā ā 7,930 ā ā 11,916 ā Loss from investment in MSC, net of amortization ā $ (8,754) ā $ (11,865) ā $ (44) ā (1) Other expenses include foreign exchange, accretion of asset retirement obligations and other finance related expenses. |
Schedule of change in the entity's investment in MSC | ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Investment in MSC, beginning of period ā $ 127,814 ā $ 150,064 Attributable net loss from MSC ā ā (2,097) ā ā (10,065) Amortization of fair value increments ā (9,448) ā (9,730) Income tax recovery ā ā 2,791 ā ā 7,930 Dividend distribution received ā (8,877) ā (10,385) Investment in MSC, end of period ā $ 110,183 ā $ 127,814 |
Summary of key assets and liabilities, before and after adjustments to fair value | ā ā ā ā ā ā ā ā ā ā ā As at December 31, 2019 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 82,660 ā $ 444 ā $ 83,104 Total assets ā ā 180,832 ā ā 119,707 ā ā 300,539 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (39,381) ā $ ā ā $ (39,381) Total liabilities ā ā (69,438) ā ā (6,238) ā ā (75,676) |
LEASE LIABILITIES (Tables)
LEASE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASE LIABILITIES | |
Schedule of lease liabilities | ā ā ā ā ā ā ā ā ā ā Total discounted lease liabilities ā ā December 31, 2019 ā December 31, 2018 Finance leases ā $ 6,229 ā $ 6,429 Operating lease ā ā 904 ā ā ā Lease liabilities ā $ 7,133 ā $ 6,429 Current portion ā ā (2,115) ā ā (1,511) Long-term portion ā $ 5,018 ā $ 4,918 |
Schedule of lease costs | ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā ā ā ā ā ā 2019 Finance leases: ā ā ā ā ā ā Amortization of ROU assets ā ā ā ā $ 1,123 Interest expense ā ā ā ā ā 517 Total ā ā ā ā $ 1,640 ā ā ā ā ā ā ā Operating lease: ā ā ā ā ā ā Rent expense ā ā ā ā $ 193 |
Schedule of undiscounted lease payment obligations, operating lease | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā 2020 2021 2022 2023 2024 Total Operating lease obligation ā $ 226 ā $ 230 ā $ 232 ā $ 237 ā $ 158 ā $ 1,083 Finance lease obligations ā 2,340 ā 2,385 ā 2,081 ā 105 ā ā ā 6,911 Total future minimum lease payments ā $ 2,566 ā $ 2,615 ā $ 2,313 ā $ 342 ā $ 158 ā $ 7,994 Less: Imputed interest ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (861) Total ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 7,133 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LONG-TERM DEBT. | |
Schedule of Movements In Debt | ā ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 ā Balance, initial recognition ā $ ā ā $ 49,092 ā Balance, beginning of year ā 49,206 ā ā ā Interest expense ā 5,185 ā 2,037 ā Interest payments ā (4,875) ā (1,923) ā Balance, end of year ā $ 49,516 ā $ 49,206 ā Current portion ā ā (10,000) ā ā ā ā Long-term portion ā $ 39,516 ā $ 49,206 ā |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
ASSET RETIREMENT OBLIGATIONS | |
Schedule of reconciliation of asset retirement obligations | ā ā ā ā ā ā ā ā ā December 31, 2019 December 31, 2018 Asset retirement obligation liability, beginning balance ā $ 29,402 ā $ 24,722 Settlements ā (513) ā (392) Accretion of liability ā 1,680 ā 1,205 Adjustment reflecting updated estimates ā 1,012 ā 5,024 Foreign exchange revaluation ā ā 620 ā ā (1,157) Asset retirement obligation liability, ending balance ā $ 32,201 ā $ 29,402 Current portion ā ā (2,610) ā ā (734) Long-term portion ā $ 29,591 ā $ 28,668 |
Schedule of reclamation expense | ā The Companyās reclamation expenses consisted of the following: ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Reclamation adjustment reflecting updated estimates ā $ 1,851 ā $ 2,259 ā $ 1,426 Reclamation accretion ā ā 1,680 ā ā 1,205 ā ā 635 Total ā $ 3,531 ā $ 3,464 ā $ 2,061 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of information about stock options under the Plan | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Weighted ā ā ā ā ā ā Weighted ā Average ā ā ā ā ā ā ā Average ā Remaining ā ā ā ā ā Number of ā Exercise ā Contractual ā Intrinsic ā ā Shares ā Price ā Life (Years) ā Value ā ā (in thousands, except per share and year data) Balance at December 31, 2016 4,720 ā $ 2.41 3.4 ā $ 4,388 ā Granted 338 ā ā 2.99 ā ā ā ā ā ā Exercised (94) ā ā 1.30 ā ā ā ā 87 ā Forfeited ā (37) ā ā 4.28 ā ā ā ā ā ā Expired ā (21) ā ā 5.00 ā ā ā ā ā ā Balance at December 31, 2017 4,906 ā $ 2.45 2.6 ā $ 2,564 ā Granted 375 ā ā 1.90 ā ā ā ā ā ā Exercised (171) ā ā 1.02 ā ā ā ā 195 ā Forfeited (405) ā ā 3.99 ā ā ā ā ā ā Expired (462) ā ā 2.27 ā ā ā ā ā ā Balance at December 31, 2018 4,243 ā $ 2.33 2.0 ā $ 1,475 ā Granted 3,050 ā ā 1.73 ā ā ā ā ā ā Exercised (535) ā ā 1.01 ā ā ā ā 419 ā Forfeited (700) ā ā 2.56 ā ā ā ā ā ā Expired ā (789) ā ā 2.90 ā ā ā ā ā ā Balance at December 31, 2019 5,269 ā $ 2.00 3.0 ā $ 364 ā Exercisable at December 31, 2019 2,234 ā $ 2.27 1.2 ā $ 364 ā |
Schedule of weighted-average assumptions used for estimation of the fair value of the options granted under the Plan at the date of grant, using the Black-Scholes Option Valuation Model | ā ā ā ā ā ā ā ā ā ā ā ā ā 2019 ā ā 2018 ā ā 2017 Risk-free interest rate ā ā 1.45% to 1.87% ā ā 2.67% to 2.89% ā ā 1.46% to 1.60% Dividend yield ā ā 0.00% ā ā 0.36% to 0.53% ā ā 0.31% to 0.36% Volatility factor of the expected market price of common stock ā ā 58% ā ā 63% to 64% ā ā 72% to 74% Weighted-average expected life of option ā ā 3.5 years ā ā 3.5 years ā ā 3.5 years Weighted-average grant date fair value ā $ 1.73 ā $ 1.90 ā $ 2.99 |
Summary of status and activity of non-vested stock options | ā ā ā ā ā ā ā ā ā ā ā Weighted ā ā ā ā Average ā ā Number of ā Grant Date ā Shares Fair Value ā ā (in thousands, except per share amounts) Non-vested, beginning of year ā 691 ā $ 1.28 Granted ā 3,050 ā $ 0.58 Cancelled/Forfeited ā (402) ā $ 0.74 Vested ā (304) ā $ 1.44 Non-vested, end of year ā 3,035 ā $ 0.64 |
November 2019 Offering | |
Schedule of Black-Scholes pricing model to determine the fair value of warrants | ā ā ā ā ā ā ā ā ā ā ā ā ā ā November 20, 2019 ā Risk-free interest rate ā ā ā ā ā 1.55 % Dividend yield ā ā ā ā ā 0.00 % Volatility factor of the expected market price of common stock ā ā ā ā ā 60 % Weighted-average expected life ā ā ā ā ā 5 years ā Weighted-average grant date fair value ā ā ā ā $ 0.52 ā |
March 2019 Offering | |
Schedule of Black-Scholes pricing model to determine the fair value of warrants | ā ā ā ā ā ā ā ā ā Issued on: March 29, 2019 ā ā May 23, 2019 ā Risk-free interest rate ā 2.30 % ā ā 2.14 % Dividend yield ā 0.00 % ā ā 0.00 % Volatility factor of the expected market price of common stock ā 50 % ā ā 45 % Weighted-average expected life ā 3 years ā ā ā 3 years ā Weighted-average grant date fair value $ 0.43 ā ā $ 0.22 ā |
September 2017 Offering | |
Schedule of Black-Scholes pricing model to determine the fair value of warrants | ā ā ā ā ā Risk-free interest rate ā 1.56 % Dividend yield ā 0.36 % Volatility factor of the expected market price of common stock ā 71 % Weighted-average expected life ā 53 weeks ā Weighted-average grant date fair value $ 0.40 ā |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
NET LOSS PER SHARE | |
Schedule of reconciliation of the basic weighted average number of common shares and the computations for basic loss per share | ā ā ā ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 ā ā (amounts in thousands, unless otherwise noted) Net loss ā $ (59,747) ā $ (44,870) ā $ (10,634) ā ā ā ā ā ā ā ā ā Weighted average common shares outstanding: ā ā 361,845 ā ā 337,297 ā ā 313,887 Diluted shares outstanding: ā ā 361,845 ā ā 337,297 ā ā 313,887 ā ā ā ā ā ā ā ā ā ā Net loss per share - basic and diluted ā $ (0.17) ā $ (0.13) ā $ (0.03) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party expense (income) and outstanding accounts payable (receivable) | The Company incurred the following expense in respect to the related parties outlined below during the periods presented: ā ā ā ā ā ā ā ā ā ā Year ended December 31, ā 2019 2018 2017 Lexam L.P. $ 133 ā $ 91 ā $ 152 REVlaw ā 188 ā ā 266 ā ā 330 ā The Company has the following outstanding accounts payable (receivable) balance in respect to the related parties outlined below: ā ā ā ā ā ā ā ā December 31, 2019 ā December 31, 2018 REVlaw $ 22 ā $ 32 ā |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE ACCOUNTING | |
Schedule of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at December 31, 2019 Fair value as at December 31, 2018 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 1,885 ā $ ā ā $ 1,885 ā $ 2,718 ā $ ā ā $ 2,718 Warrants ā ā ā ā ā ā ā ā ā ā ā ā ā ā 413 ā ā 413 Total investments ā $ 1,885 ā $ ā ā $ 1,885 ā $ 2,718 ā $ 413 ā $ 3,131 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of minimum amounts under purchase commitments, long term leases covering office space, exploration expenditures, option payments on properties | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā ā 2020 ā 2021 ā 2022 ā 2023 ā 2024 ā Thereafter ā Total Mining and surface rights ā 2,926 ā 465 ā 470 ā 366 ā 335 ā ā ā ā 4,562 Reclamation costs (1) ā ā 2,548 ā ā 4,115 ā ā 4,637 ā ā 2,279 ā ā 549 ā ā 27,637 ā ā 41,765 Other plant and equipment ā ā 1,249 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 1,249 Exploration ā ā 219 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā 219 Total ā $ 6,942 ā $ 4,580 ā $ 5,107 ā $ 2,645 ā $ 884 ā $ 27,637 ā $ 47,795 (1) Amounts presented represent the undiscounted uninflated future payments. |
CASH AND CASH EQUIVALENTS AND_2
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
Reconciliation of cash and cash equivalents and restricted cash | ā ā ā ā ā ā ā ā ā ā December 31, 2019 ā December 31, 2018 Cash and cash equivalents ā $ 46,452 ā $ 15,756 Restricted cash ( note 13 ā ā ā ā ā 14,685 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 46,500 ā $ 30,489 |
INCOME AND MINING TAXES (Tables
INCOME AND MINING TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INCOME AND MINING TAXES. | |
Schedule of deferred income tax recovery (expense) | ā ā ā ā ā ā ā ā ā ā ā ā 2019 2018 2017 United States ā $ 2,420 ā $ 2,185 ā $ 10,349 Foreign ā ā 1,424 ā ā 585 ā ā 5,020 Deferred tax benefit ā $ 3,844 ā $ 2,770 ā $ 15,369 |
Schedule of net income (loss) before tax | ā ā ā ā ā ā ā ā ā ā ā ā ā 2019 2018 ā 2017 United States ā $ (22,319) ā $ (27,001) ā $ (19,913) Foreign ā ā (41,272) ā ā (20,639) ā ā (6,090) Loss before income and mining taxes ā $ (63,591) ā $ (47,640) ā $ (26,003) |
Schedule of reconciliation of the tax provision at statutory U.S. Federal and State income tax rates to the actual tax provision recorded in the financial statement | ā ā ā ā ā ā ā ā ā ā ā Expected tax recovery at 2019 2018 2017 Loss before income and mining taxes ā $ (63,591) ā $ (47,640) ā $ (26,003) Statutory tax rate ā ā 21% ā ā 21% ā ā 35% US Federal and State tax expense at statutory rate ā ā (13,354) ā ā (10,004) ā ā (9,101) Reconciling items: ā ā ā ā ā ā ā ā ā Equity pickup in MSC ā 2,626 ā 2,966 ā (16) Deferred foreign income inclusion ā 598 ā 5,963 ā 21,002 Realized flow-through expenditures ā ā 3,150 ā ā 2,100 ā ā ā Realized flow-through premium ā ā (2,954) ā ā (1,675) ā ā ā Foreign tax credits ā ā ā ā ā ā ā (16,628) Tax rate changes ā ā 976 ā ā ā ā 28,048 Adjustment for foreign tax rates ā (200) ā 40 ā 115 Other permanent differences ā 8,540 ā 4,419 ā (1,761) Unrealized foreign exchange rate (loss)/gain ā (1,095) ā (6,935) ā 2,469 NOL expires and revisions ā 810 ā (120) ā (2,806) Valuation allowance ā (2,941) ā 476 ā (36,691) Income and mining tax recovery ā $ (3,844) ā $ (2,770) ā $ (15,369) |
Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities | ā ā ā ā ā ā ā ā ā ā 2019 2018 Deferred tax assets: ā ā ā ā ā ā ā Net operating loss carryforward ā $ 57,667 ā $ 55,515 ā Mineral Properties ā 60,299 ā 62,345 ā Other temporary differences ā 14,356 ā 15,198 ā Total gross deferred tax assets ā 132,322 ā 133,058 ā Less: valuation allowance ā (121,212) ā (124,153) ā Net deferred tax assets ā $ 11,110 ā $ 8,905 ā Deferred tax liabilities: ā ā ā ā ā ā ā Acquired mineral property interests ā ā (16,024) ā ā (15,331) ā Total deferred tax liabilities ā $ (16,024) ā $ (15,331) ā Deferred income and mining tax liability ā $ (4,914) ā $ (6,426) ā |
Summary of changes in valuation allowance | ā ā ā ā ā ā ā ā ā ā ā ā ā ā For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2019 ā $ 124,153 ā $ 2,104 ā $ (5,045) ā $ 121,212 2018 ā ā 123,648 ā ā 12,232 ā ā (11,727) ā ā 124,153 2017 ā ā 111,621 ā ā 51,220 ā ā (39,193) ā ā 123,648 (a) The additions to valuation allowance mainly results from the Company and its subsidiaries incurring losses and exploration expenses for tax purposes which do not meet the more-likely-than-not criterion for recognition of deferred tax assets. (b) The reductions to valuation allowance mainly results from release of valuation allowance, expiration of the Companyās tax attributes, foreign exchange reductions of tax attributes in Canada, Mexico and Argentina and inflationary adjustments to tax attributes in Argentina. |
Summary of company's non operating losses that can be applied against future taxable profit | ā ā ā ā ā ā ā ā ā Country Type of Loss Amount Expiry Period United States (a) ā Net-operating losses ā $ 129,409 ā 2020-2039 Mexico ā Net-operating losses ā ā 34,876 ā 2020-2029 Canada (a) ā Net-operating losses ā ā 36,692 ā 2020-2039 Argentina (a) ā Net-operating losses ā ā 41,922 ā 2020-2024 (a) The losses in the United States, Canada, and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. ā |
UNAUDITED SUPPLEMENTARY QUART_2
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
Summary of unaudited supplementary quarterly information | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019 ā ā (unaudited) (in thousands, except per share) Revenue from gold and silver sales ā $ 15,583 ā $ 36,383 ā $ 32,691 ā $ 32,362 Gross profit ā ā 1,429 ā ā 4,677 ā ā 1,619 ā ā 1,261 Net (loss) ā ā (10,136) ā ā (13,014) ā ā (11,465) ā ā (25,132) Net (loss) per share: ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā $ (0.02) ā $ (0.04) ā $ (0.03) ā $ (0.07) Weighted average shares outstanding: ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā ā 345,497 ā ā 346,998 ā ā 362,175 ā ā 378,543 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018 ā ā (unaudited) (in thousands, except per share) Revenue from gold and silver sales ā $ 41,041 ā $ 33,806 ā $ 26,896 ā $ 26,432 ā Gross profit ā ā 14,228 ā ā 9,092 ā ā 6,013 ā ā 2,749 ā Net (loss) ā ā (5,211) ā ā (5,380) ā ā (13,290) ā ā (20,989) ā Net (loss) per share: ā ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā $ (0.02) ā $ (0.02) ā $ (0.04) ā $ (0.06) ā Weighted average shares outstanding: ā ā ā ā ā ā ā ā ā ā ā ā ā Basic and diluted ā 337,062 ā ā 337,087 ā ā 337,278 ā 337,936 ā |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Lexam VG Gold | |
Schedule of assets acquired and liabilities assumed | ā ā ā ā ā Total purchase price: ā ā Common shares issued for acquisition ā $ 38,141 Transaction fees incurred ā ā 1,017 ā ā $ 39,158 Fair value of assets acquired and liabilities assumed: ā ā ā Mineral property interests ā $ 41,595 Cash and cash equivalents ā ā 177 Other current assets ā ā 86 Other assets ā ā 312 Accounts payable and accrued liabilities ā ā (288) Reclamation obligations ā ā (570) Deferred income tax liabilities ā ā (2,154) ā ā $ 39,158 |
Black Fox | |
Schedule of assets acquired and liabilities assumed | ā ā ā ā ā Total purchase price: ā ā Purchase price ā $ 35,000 Adjustments to purchase price ā ā (7,500) ā ā $ 27,500 Fair value of assets acquired and liabilities assumed: ā ā ā Cash ā $ 249 Accounts Receivable ā ā 470 Prepaids ā ā 63 Inventory ā ā 4,704 Mineral Property Interests ā ā 8,954 Plant and Equipment ā ā 33,683 Accounts Payable ā ā (5,247) Accrued Liabilities ā ā (3,213) Short term capital lease liability ā ā (557) Asset retirement obligation ā ā (11,233) Long term capital lease liability ā ā (172) Deferred tax liability ā ā (201) Net assets acquired in acquisition ā $ 27,500 |
NATURE OF OPERATIONS (Details)
NATURE OF OPERATIONS (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Ownership interest (as a percent) | 49.00% |
Subsidiary (as a percent) | 100.00% |
MSC | |
Ownership interest (as a percent) | 49.00% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Investments, Stockpiles, Proven and Probable Reserves (Details) $ in Millions | Jan. 01, 2018USD ($) |
Marketable equity securities | Accounting Standards Update 2016-01 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Products, Properties and Production of Minerals (Details) | 12 Months Ended |
Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Option to sell prior to the completion of refining (as a percent) | 90.00% |
Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Period over which concentrates are provisionally priced at the end of a period after delivery to the customer | 30 days |
Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Period over which concentrates are provisionally priced at the end of a period after delivery to the customer | 90 days |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Dec. 31, 2019 | |
NATURE OF OPERATIONS | |
Lease, Practical Expedients, Package | true |
Lease, Practical Expedient, Use of Hindsight | true |
Lease, Practical Expedient, Land Easement | true |
OPERATING SEGMENT REPORTING (De
OPERATING SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Segment Reporting | |||||||||||
Inventory | $ 38,376 | $ 22,039 | $ 38,376 | $ 22,039 | |||||||
Revenue from gold and silver sales | 117,019 | 128,175 | $ 67,465 | ||||||||
Depreciation and depletion | (24,753) | (15,079) | (4,036) | ||||||||
Gross profit | 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | 2,749 | $ 6,013 | $ 9,092 | $ 14,228 | 8,986 | 32,082 | 20,080 |
Advanced projects | (9,520) | (15,063) | (11,129) | ||||||||
Loss from investment in Minera Santa Cruz S.A. | (8,754) | (11,865) | (44) | ||||||||
Impairment of mineral property interests and property and equipment | (711) | ||||||||||
Loss before income and mining taxes | (63,591) | (47,640) | (26,003) | ||||||||
Capital expenditures | 30,270 | 97,468 | 11,511 | ||||||||
El Gallo Project | |||||||||||
Operating Segment Reporting | |||||||||||
Operating expenditures | 11,600 | ||||||||||
Inventory | 3,400 | 3,400 | |||||||||
Cost of goods and services sold | (8,200) | ||||||||||
Sunk costs | 10,300 | ||||||||||
U.S. | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (10,934) | ||||||||||
Gross profit | (701) | ||||||||||
Advanced projects | (649) | (7,959) | (6,686) | ||||||||
Segment (loss) income | (9,904) | (13,133) | (8,818) | ||||||||
Capital expenditures | 18,806 | 84,713 | 6,271 | ||||||||
Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (13,271) | (12,972) | (1,737) | ||||||||
Gross profit | 5,666 | 5,957 | 1,732 | ||||||||
Advanced projects | (1,636) | ||||||||||
Segment (loss) income | (21,749) | (16,075) | 71 | ||||||||
Capital expenditures | 11,464 | 12,584 | 4,301 | ||||||||
Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (548) | (2,107) | (2,299) | ||||||||
Gross profit | 4,021 | 26,125 | 18,348 | ||||||||
Advanced projects | (7,235) | (7,104) | (4,443) | ||||||||
Impairment of mineral property interests and property and equipment | (711) | ||||||||||
Segment (loss) income | (3,214) | 16,780 | 7,584 | ||||||||
Capital expenditures | 171 | 939 | |||||||||
MSC | |||||||||||
Operating Segment Reporting | |||||||||||
Loss from investment in Minera Santa Cruz S.A. | (8,754) | (11,865) | (44) | ||||||||
Segment (loss) income | (8,754) | (11,865) | (44) | ||||||||
Los Azules | |||||||||||
Operating Segment Reporting | |||||||||||
Segment (loss) income | (3,411) | (7,129) | (9,221) | ||||||||
Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (24,753) | (15,079) | (4,036) | ||||||||
Gross profit | 8,986 | 32,082 | 20,080 | ||||||||
Advanced projects | (9,520) | (15,063) | (11,129) | ||||||||
Loss from investment in Minera Santa Cruz S.A. | (8,754) | (11,865) | (44) | ||||||||
Impairment of mineral property interests and property and equipment | (711) | ||||||||||
Segment (loss) income | (47,032) | (31,422) | (10,428) | ||||||||
General and Administrative and other | (16,559) | (16,218) | (15,575) | ||||||||
MSC | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 263,887 | 213,096 | 235,650 | ||||||||
Gross profit | (33,977) | (9,117) | (31,025) | ||||||||
Loss before income and mining taxes | 10,277 | (9,607) | 13,300 | ||||||||
Gold and silver sales | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | $ 32,362 | $ 32,691 | $ 36,383 | $ 15,583 | $ 26,432 | $ 26,896 | $ 33,806 | $ 41,041 | 117,019 | 128,175 | 67,465 |
Gold and silver sales | U.S. | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 43,847 | ||||||||||
Gold and silver sales | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 50,058 | 62,024 | 11,620 | ||||||||
Gold and silver sales | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 23,114 | 66,151 | 55,845 | ||||||||
Gold and silver sales | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 117,019 | 128,175 | 67,465 | ||||||||
Production costs applicable to sales | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (83,280) | (81,014) | (43,349) | ||||||||
Production costs applicable to sales | U.S. | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (33,614) | ||||||||||
Production costs applicable to sales | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (31,121) | (43,095) | (8,151) | ||||||||
Production costs applicable to sales | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (18,545) | (37,919) | (35,198) | ||||||||
Production costs applicable to sales | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (83,280) | (81,014) | (43,349) | ||||||||
Exploration | U.S. | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (8,554) | (5,174) | (2,132) | ||||||||
Exploration | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (25,779) | (22,032) | (1,661) | ||||||||
Exploration | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (2,241) | (5,610) | |||||||||
Exploration | Los Azules | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | (3,411) | (7,129) | (9,221) | ||||||||
Exploration | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Cost of goods and services sold | $ (37,744) | $ (36,576) | $ (18,624) |
OPERATING SEGMENT REPORTING - G
OPERATING SEGMENT REPORTING - Geographic information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Segment Reporting | |||
Revenue | $ 117,019 | $ 128,175 | $ 67,465 |
Long-lived Assets | 539,150 | 557,565 | |
Investment in MSC | 110,183 | 127,814 | |
Operating Lease, Right-of-Use Asset | 1,000 | ||
MSC | |||
Operating Segment Reporting | |||
Revenue | 263,887 | 213,096 | 235,650 |
Investment in MSC | 110,183 | 127,814 | 150,064 |
Bank of Nova Scotia | Sales | Customer | |||
Operating Segment Reporting | |||
Revenue | $ 103,600 | $ 123,500 | $ 65,900 |
Gold and silver sales, percentage | 89.00% | 96.00% | 94.00% |
United States | |||
Operating Segment Reporting | |||
Revenue | $ 43,847 | ||
Long-lived Assets | 135,854 | $ 127,617 | |
Canada | |||
Operating Segment Reporting | |||
Revenue | 50,058 | 62,024 | $ 11,620 |
Long-lived Assets | 77,147 | 84,119 | |
Canada | MSC | |||
Operating Segment Reporting | |||
Investment in MSC | 127,800 | ||
Mexico | |||
Operating Segment Reporting | |||
Revenue | 23,114 | 66,151 | $ 55,845 |
Long-lived Assets | 23,551 | 26,524 | |
Argentina | |||
Operating Segment Reporting | |||
Long-lived Assets | 302,598 | $ 319,305 | |
Argentina | MSC | |||
Operating Segment Reporting | |||
Investment in MSC | $ 110,200 |
OTHER INCOME (Details)
OTHER INCOME (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
OTHER INCOME | |||
Unrealized and realized gain (loss) on investments (note 5) | $ 5,259 | $ (3,324) | $ 257 |
Foreign currency gain | 1,697 | 3,922 | 694 |
Other income | 184 | 570 | 270 |
Total other income | $ 7,140 | $ 1,168 | $ 1,221 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments rollforward | |||
Opening balance | $ 3,131 | $ 7,971 | |
Additions/transfers during the period | 2,314 | 2,083 | |
Net gain (loss) on securities sold | 4,523 | (767) | |
Disposals/transfers during period | (8,819) | (3,599) | |
Unrealized gains (loss) on securities held | 736 | (2,557) | |
Fair Value end of the period | 1,885 | 3,131 | $ 7,971 |
Proceeds from sale of investments | 6,769 | 2,895 | 2,155 |
Cost of purchase of marketable equity securities | 1,300 | 2,900 | |
Other-than-temporary impairment on marketable equity securities | 356 | ||
Marketable equity securities | |||
Investments rollforward | |||
Opening balance | 2,718 | 6,404 | |
Additions/transfers during the period | 2,314 | 1,882 | |
Net gain (loss) on securities sold | 3,396 | (767) | |
Disposals/transfers during period | (7,279) | (2,895) | |
Unrealized gains (loss) on securities held | 736 | (1,906) | |
Fair Value end of the period | 1,885 | 2,718 | 6,404 |
Proceeds from sale of investments | 6,800 | 2,900 | 2,200 |
Warrants | |||
Investments rollforward | |||
Opening balance | 413 | 1,567 | |
Additions/transfers during the period | 201 | ||
Net gain (loss) on securities sold | 1,127 | ||
Disposals/transfers during period | $ (1,540) | (704) | |
Unrealized gains (loss) on securities held | (651) | ||
Fair Value end of the period | $ 413 | $ 1,567 |
RECEIVABLES AND OTHER CURRENT_3
RECEIVABLES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tax Credit Carryforward [Line Items] | |||
Government sales tax receivable | $ 2,658 | $ 2,079 | |
Other current assets | 2,607 | 1,686 | |
Receivables and other current assets | 5,265 | 3,765 | |
VAT collected | 2,200 | 8,300 | $ 5,900 |
Mexican Tax Authority | |||
Tax Credit Carryforward [Line Items] | |||
Government sales tax receivable | $ 700 | $ 1,100 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
INVENTORIES | ||
Material on leach pads | $ 37,328 | $ 14,961 |
In-process inventory | 3,847 | 3,446 |
Stockpiles | 1,384 | 1,272 |
Precious metals | 1,038 | 3,421 |
Materials and supplies | 4,382 | 3,530 |
Inventories | 47,979 | 26,630 |
Current portion | 38,376 | 22,039 |
Long-term portion | 9,603 | 4,591 |
Inventory write-down | $ 1,700 |
MINERAL PROPERTY INTERESTS AN_3
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Subtotal | $ 144,721 | $ 132,920 |
Less: accumulated depreciation | (37,150) | (18,186) |
Net carrying value | 107,571 | 114,734 |
Mineral property interests | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 339,374 | 326,086 |
Less: accumulated depreciation | (28,154) | (16,941) |
Net carrying value | 311,220 | 309,145 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 8,746 | 8,699 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 2,961 | 74,643 |
Plant and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 133,014 | 49,578 |
Mineral property interests and plant and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Net carrying value | $ 418,791 | $ 423,879 |
MINERAL PROPERTY INTERESTS AN_4
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT - Construction in Progress (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Interest expense | |||
Impairment charges | $ 711 | ||
Gold Bar mine | Construction in process | |||
Interest expense | |||
Debt interest expense | $ 1,400 | $ 800 | |
El Gallo 2 project | |||
Interest expense | |||
Impairment charges | $ 700 |
MINERAL PROPERTY INTERESTS AN_5
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT- Mineral Properties (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 25, 2017 | |
Mineral Property Interests | ||||
Mineral property interests | $ 311,220 | $ 309,145 | ||
Amortization of mineral property interests and asset retirement obligations | 25,543 | 16,425 | $ 6,576 | |
Black Fox | ||||
Mineral Property Interests | ||||
Mineral property interests | 14,627 | 16,365 | ||
Lexam VG Gold | ||||
Mineral Property Interests | ||||
Mineral property interests | 41,595 | 41,595 | ||
Los Azules Copper Project | ||||
Mineral Property Interests | ||||
Mineral property interests | 191,490 | 191,490 | ||
Gold Bar Project | ||||
Mineral Property Interests | ||||
Mineral property interests | 48,492 | 44,131 | ||
El Gallo Project | ||||
Mineral Property Interests | ||||
Mineral property interests | 3,591 | 4,139 | ||
Fenix Project Properties | ||||
Mineral Property Interests | ||||
Mineral property interests | 5,807 | 5,807 | ||
Battle Mountain Complex | ||||
Mineral Property Interests | ||||
Mineral property interests | 785 | 785 | ||
Tonkin Properties | ||||
Mineral Property Interests | ||||
Mineral property interests | $ 4,833 | $ 4,833 | ||
Black Fox | ||||
Mineral Property Interests | ||||
Mineral property interests | $ 8,954 |
INVESTMENT IN MINERA SANTA CR_3
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Revenue from gold and silver sales | $ 117,019 | $ 128,175 | $ 67,465 | ||||||||
Gross Profit | $ 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | $ 2,749 | $ 6,013 | $ 9,092 | $ 14,228 | 8,986 | 32,082 | 20,080 |
Net income (loss) before tax | (63,591) | (47,640) | (26,003) | ||||||||
Net loss | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | $ (20,989) | $ (13,290) | $ (5,380) | $ (5,211) | (59,747) | (44,870) | (10,634) |
Income and mining tax recovery (note 19) | $ (3,844) | (2,770) | (15,369) | ||||||||
Subsidiary (as a percent) | 100.00% | ||||||||||
Ownership interest (as a percent) | 49.00% | 49.00% | |||||||||
(Loss) from investment in MSC, net of amortization | $ (8,754) | (11,865) | (44) | ||||||||
MSC | |||||||||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Revenue from gold and silver sales | 263,887 | 213,096 | 235,650 | ||||||||
Production costs applicable to sales | (159,915) | (151,779) | (156,347) | ||||||||
Depreciation and depletion | (69,995) | (52,200) | (48,278) | ||||||||
Gross Profit | (33,977) | (9,117) | (31,025) | ||||||||
Exploration | (10,635) | (5,884) | (5,198) | ||||||||
Other expenses | (13,065) | (12,840) | (12,527) | ||||||||
Net income (loss) before tax | 10,277 | (9,607) | 13,300 | ||||||||
Current and deferred tax expense | (14,556) | (10,934) | (18,050) | ||||||||
Net loss | (4,279) | (20,541) | (4,750) | ||||||||
Net income (loss) | (2,097) | (10,065) | (2,328) | ||||||||
Amortization of fair value increments | (9,448) | (9,730) | (9,632) | ||||||||
Income and mining tax recovery (note 19) | 2,791 | 7,930 | 11,916 | ||||||||
Loss from investment in MSC, net of amortization | $ (8,754) | $ (11,865) | $ (44) | ||||||||
Summarized key financial information (as a percent) | 100.00% | ||||||||||
Ownership interest (as a percent) | 49.00% | 49.00% |
INVESTMENT IN MINERA SANTA CR_4
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Argentinian Tax Reform (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Statutory tax rate (as a percent) | 21.00% | 21.00% | 35.00% | ||
Recovery of income taxes | $ (3,844) | $ (2,770) | $ (15,369) | ||
Argentina | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Statutory tax rate (as a percent) | 30.00% | 35.00% | |||
Recovery of income taxes | $ 5,600 | ||||
Forecast | Argentina | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Statutory tax rate (as a percent) | 25.00% | 25.00% |
INVESTMENT IN MINERA SANTA CR_5
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Changes in Company's Investment in MSC (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Change in the investment in MSC | |||
Investment in MSC, beginning of period | $ 127,814 | ||
Income and mining tax recovery (note 19) | (3,844) | $ (2,770) | $ (15,369) |
Dividend distribution received | (8,877) | (10,385) | (12,212) |
Investment in MSC, end of period | 110,183 | 127,814 | |
MSC | |||
Change in the investment in MSC | |||
Investment in MSC, beginning of period | 127,814 | 150,064 | |
Attributable net loss from MSC | (2,097) | (10,065) | (2,328) |
Amortization of fair value increments | (9,448) | (9,730) | (9,632) |
Income and mining tax recovery (note 19) | 2,791 | 7,930 | 11,916 |
Dividend distribution received | (8,877) | (10,385) | |
Investment in MSC, end of period | $ 110,183 | $ 127,814 | $ 150,064 |
INVESTMENT IN MINERA SANTA CR_6
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | $ 91,978 | $ 59,376 |
Total assets | 631,223 | 616,941 |
Current liabilities | (48,795) | (36,012) |
Total liabilities | (131,744) | $ (130,995) |
Balance excluding FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 82,660 | |
Total assets | 180,832 | |
Current liabilities | (39,381) | |
Total liabilities | (69,438) | |
Adjustments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 444 | |
Total assets | 119,707 | |
Total liabilities | (6,238) | |
Balance including FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 83,104 | |
Total assets | 300,539 | |
Current liabilities | (39,381) | |
Total liabilities | $ (75,676) |
LEASE LIABILITIES (Details)
LEASE LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
LEASE LIABILITIES | ||
Finance leases | $ 6,229 | $ 6,429 |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent | |
Operating lease | $ 904 | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent | |
Lease liabilities | $ 7,133 | 6,429 |
Less current portion | (2,115) | (1,511) |
Long-term portion | $ 5,018 | $ 4,918 |
Operating lease, Weighted average discount rate (as a percent) | 8.73% | |
Finance leases, Weighted average discount rate (as a percent) | 7.28% | |
Operating lease, Weighted average remaining lease term | 5 years | |
Finance leases, Weighted average remaining lease term | 3 years | |
Interest and other finance costs related to leases | $ 1,800 |
LEASE LIABILITIES - Lease Cost
LEASE LIABILITIES - Lease Cost (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lease cost | |
Amortization of ROU assets | $ 1,123 |
Interest expense | 517 |
Total | 1,640 |
Rental expense | $ 193 |
LEASE LIABILITIES - Maturity (D
LEASE LIABILITIES - Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Operating lease obligations | ||
2020 | $ 226 | |
2021 | 230 | |
2022 | 232 | |
2023 | 237 | |
2024 | 158 | |
Total | 1,083 | |
Finance lease obligations | ||
2020 | 2,340 | |
2021 | 2,385 | |
2022 | 2,081 | |
2023 | 105 | |
Total | 6,911 | |
Lease obligations | ||
2020 | 2,566 | |
2021 | 2,615 | |
2022 | 2,313 | |
2023 | 342 | |
2024 | 158 | |
Total | 7,994 | |
Less: Imputed interest | (861) | |
Total | $ 7,133 | $ 6,429 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Aug. 10, 2018 | Aug. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Aug. 10, 2021 |
LONG-TERM DEBT | |||||
Long-term debt from related party | $ 19,758 | $ 24,603 | |||
Payment of debt issuance costs | 908 | ||||
Working capital covenant | 10,000 | ||||
Consolidated shareholders' equity covenants | $ 120,000 | ||||
Term Loan | |||||
LONG-TERM DEBT | |||||
Face amount | $ 50,000 | ||||
Term of debt instrument | 3 years | ||||
Term Loan | Gold Bar Complex | |||||
LONG-TERM DEBT | |||||
Stated interest rate (as a percent) | 9.75% | ||||
Principal repayments | $ 2,000 | ||||
Term loan retirement period | 12 months | 2 years | |||
Final payment | $ 26,000 | ||||
Payment of debt issuance costs | 900 | ||||
Payment of debt instrument | 3.00% | ||||
Interest costs capitalized | $ 600 | $ 800 | |||
Term Loan | Robert McEwen | |||||
LONG-TERM DEBT | |||||
Long-term debt from related party | $ 25,000 | ||||
Term Loan | Affiliate of Robert McEwen | |||||
LONG-TERM DEBT | |||||
Percentage of ownership of the Company's common stock | 23.00% | ||||
Long-term debt from related party | $ 25,000 |
LONG-TERM DEBT- Rollforward (De
LONG-TERM DEBT- Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Aug. 10, 2018 | |
Long-term debt | |||
Balance, initial recognition | $ 49,500 | $ 49,200 | |
Long-term portion | 19,758 | 24,603 | |
Term Loan | Gold Bar Complex | |||
Long-term debt | |||
Balance, initial recognition | 49,092 | $ 49,100 | |
Balance, beginning of year | 49,206 | ||
Interest expense | 5,185 | 2,037 | |
Interest payments | (4,875) | (1,923) | |
Balance, end of year | 49,516 | 49,206 | |
Current portion | (10,000) | ||
Long-term portion | $ 39,516 | $ 49,206 |
LONG-TERM DEBT (Details)_2
LONG-TERM DEBT (Details) - Term Loan - Gold Bar Complex $ in Millions | Dec. 31, 2019USD ($) |
Scheduled minimum interest payments | |
2020 | $ 4.7 |
2021 | $ 2 |
ASSET RETIREMENT OBLIGATIONS -
ASSET RETIREMENT OBLIGATIONS - Retirement obligation rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reclamation obligations | |||
Reclamation Adjustment | $ 1,851 | $ 2,259 | $ 1,426 |
Remediation Accretion | 1,680 | 1,205 | 635 |
Reclamation and remediation expense | 3,531 | 3,464 | 2,061 |
Changes in the asset retirement obligations | |||
Asset retirement obligation, beginning of the period | 29,402 | 24,722 | |
Settlements | (513) | (392) | |
Accretion of liability | 1,680 | 1,205 | |
Adjustment reflecting updated estimates | 1,012 | 5,024 | |
Foreign exchange revaluation | 620 | (1,157) | |
Asset retirement obligation, ending balance | 32,201 | 29,402 | $ 24,722 |
Current portion | (2,610) | (734) | |
Long-term portion | 29,591 | 28,668 | |
Black Fox | |||
Reclamation obligations | |||
Reclamation Adjustment | 5,300 | ||
Gold Bar mine | |||
Reclamation obligations | |||
Reclamation Adjustment | $ 4,200 | $ 3,700 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) $ / shares in Units, $ in Millions | Nov. 20, 2019USD ($)$ / sharesshares | Mar. 29, 2019USD ($)$ / sharesshares | Dec. 20, 2018CAD ($)shares | Dec. 20, 2018USD ($)$ / sharesshares | Nov. 08, 2018USD ($) | Dec. 19, 2017CAD ($)shares | Dec. 19, 2017USD ($)$ / sharesshares | Sep. 22, 2017USD ($)item$ / sharesshares | Apr. 26, 2017USD ($)$ / sharesshares | Mar. 31, 2019USD ($)shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Nov. 30, 2019shares |
Shareholders' distributions | $ 3,372,000 | $ 3,059,000 | ||||||||||||
Semi-annual shareholders' distribution | $ / shares | 0.010 | 0.010 | ||||||||||||
Common stock issued | shares | 400,339,000 | 344,560,000 | ||||||||||||
Weighted average exercise price of stock options (in dollars per share) | $ / shares | $ 1.01 | $ 1.02 | $ 1.30 | |||||||||||
Shares of common stock issued upon exercise of stock options | shares | 535,000 | 171,000 | 94,000 | |||||||||||
Exercise of stock options | $ 544,000 | $ 192,000 | $ 122,000 | |||||||||||
Proceeds from exercise of stock options | 544,000 | 192,000 | 121,000 | |||||||||||
Stock-based compensation | $ 694,000 | $ 269,000 | $ 1,311,000 | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | shares | 3,050,000 | 375,000 | 338,000 | |||||||||||
Accounts payable and accrued liabilities | $ 34,070,000 | $ 30,817,000 | ||||||||||||
Number of units issued | shares | 37,750,000 | 16,129,032 | 20,700,000 | |||||||||||
Sale of common stock for cash, net of issuance costs | $ 69,467,000 | $ 43,222,000 | ||||||||||||
Number of common stock reserved for issuance | shares | 17,500,000 | |||||||||||||
Percentage of equity acquired | 49.00% | |||||||||||||
Number of warrants issued | item | 10,350,000 | |||||||||||||
Price per unit | $ / shares | $ 1.325 | $ 1.55 | ||||||||||||
Net proceeds | $ 46,600,000 | $ 22,900,000 | $ 43,200,000 | $ 1,851,000 | 918,000 | 43,220,000 | ||||||||
Income and mining tax recovery | (3,844,000) | (2,770,000) | $ (15,369,000) | |||||||||||
Issuance costs | $ 3,500,000 | $ 2,100,000 | 3,400,000 | |||||||||||
Flow-through share premium received | $ 2,950,000 | |||||||||||||
Number of warrants received for each share of common stock share sold | shares | 0.50 | 0.50 | ||||||||||||
Number of common stock | shares | 1 | 1 | ||||||||||||
Outstanding warrants | $ 21,706,250 | |||||||||||||
Shareholders' distribution declared per common share (note 13) | $ / shares | 0.010 | 0.010 | ||||||||||||
Gold Bar mine | ||||||||||||||
Common stock issued | shares | 353,570 | |||||||||||||
Equity Incentive Plan | ||||||||||||||
Common stock issued | shares | 535,000 | 171,000 | ||||||||||||
Weighted average exercise price of stock options (in dollars per share) | $ / shares | $ 1.02 | $ 1.02 | ||||||||||||
Proceeds from exercise of stock options | $ 500,000 | $ 200,000 | ||||||||||||
Lexam VG Gold | ||||||||||||||
Shares issued in connection with acquisitions (in shares) | shares | 12,687,035 | |||||||||||||
Common stock issued in connection with registered direct offering | $ 38,141,000 | |||||||||||||
Accounts payable and accrued liabilities | $ 288,000 | |||||||||||||
Number of units issued | shares | 12,687,035 | |||||||||||||
Price per unit | $ / shares | $ 3 | |||||||||||||
Black Fox | ||||||||||||||
Shares issued in connection with acquisitions (in shares) | shares | 178,321 | |||||||||||||
Common Stock and Additional Paid-in Capital | ||||||||||||||
Shareholders' distributions | $ 3,372,000 | $ 3,059,000 | ||||||||||||
Annual return of capital declared (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||||||||
Shares of common stock issued upon exercise of stock options | shares | 535,000 | 182,000 | 94,000 | |||||||||||
Exercise of stock options | $ 544,000 | $ 192,000 | $ 122,000 | |||||||||||
Stock-based compensation | $ 694,000 | $ 269,000 | $ 1,311,000 | |||||||||||
Number of units issued | shares | 1,010,000 | 515,000 | 20,700,000 | |||||||||||
Net proceeds | $ 37,300,000 | $ 20,300,000 | 39,400,000 | $ 1,851,000 | $ 918,000 | $ 43,220,000 | ||||||||
Shares of common stock issued as payment for mining concessions in Mexico | shares | 354,000 | 178,000 | ||||||||||||
Common Stock and Additional Paid-in Capital | Lexam VG Gold | ||||||||||||||
Shares issued in connection with acquisitions (in shares) | shares | 12,687,000 | |||||||||||||
Common stock issued in connection with registered direct offering | $ 38,141,000 | |||||||||||||
Warrants | ||||||||||||||
Net proceeds | $ 9,300,000 | $ 2,600,000 | $ 3,800,000 | |||||||||||
Number of common stock | shares | 1 | 1 | 1 | |||||||||||
Price per common share for each warrant | $ / shares | $ 1.7225 | $ 2 | $ 2.70 | |||||||||||
Warrants Expiration Term | 5 years | 3 years | ||||||||||||
Subscription Receipts | ||||||||||||||
Number of units issued | shares | 1,935,484 | |||||||||||||
Outstanding warrants | $ 8,064,516 | |||||||||||||
Flow Through Common Shares | ||||||||||||||
Number of units issued | shares | 6,634,000 | 6,634,000 | 4,000,000 | 4,000,000 | 6,634,000 | 4,000,000 | ||||||||
Price per unit | $ / shares | $ 2.24 | $ 2.50 | ||||||||||||
Net proceeds | $ 20 | $ 14,900,000 | $ 11,145,000 | $ 7,799,000 | ||||||||||
Gross proceeds | $ 12.9 | $ 10,000,000 | ||||||||||||
Flow-through share premium received | 3,000,000 | 1,600,000 | ||||||||||||
Flow Through Common Shares | Flow Through Common Shares | ||||||||||||||
Net proceeds | $ 14,100,000 | $ 9,400,000 | ||||||||||||
At-the-market ("ATM") | ||||||||||||||
Number of units issued | shares | 1,010,545 | 514,897 | ||||||||||||
Sale of common stock for cash, net of issuance costs | $ 1,900,000 | $ 900,000 | ||||||||||||
Aggregate offering price | $ 90,000,000 |
SHAREHOLDERS' EQUITY - Black-Sc
SHAREHOLDERS' EQUITY - Black-Scholes pricing model (Details) - $ / shares | Nov. 20, 2019 | May 23, 2019 | Mar. 29, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | ||||||
Risk-free interest rate (as a percent) | 2.14% | 2.30% | ||||
Dividend yield (as a percent) | 0.00% | 0.00% | ||||
Volatility factor of the expected market price of common stock (as a percent) | 45.00% | 50.00% | ||||
Weighted-average expected life of option | 3 years | 3 years | 3 years 6 months | 3 years 6 months | 3 years 6 months | |
Weighted-average grant date fair value (in dollars per share) | $ 0.22 | $ 0.43 | $ 1.73 | $ 1.90 | $ 2.99 | |
Warrants | ||||||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | ||||||
Risk-free interest rate (as a percent) | 1.55% | 1.56% | ||||
Dividend yield (as a percent) | 0.00% | 0.36% | ||||
Volatility factor of the expected market price of common stock (as a percent) | 60.00% | 71.00% | ||||
Weighted-average expected life of option | 5 years | 371 days | ||||
Weighted-average grant date fair value (in dollars per share) | $ 0.52 | $ 0.40 |
SHAREHOLDERS' EQUITY - Stock Op
SHAREHOLDERS' EQUITY - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 26, 2017 | Feb. 13, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
STOCK BASED COMPENSATION | ||||||
Stock options granted (in shares) | 3,050,000 | 375,000 | 338,000 | |||
Exercise price of options granted (in dollars per share) | $ 1.73 | $ 1.90 | $ 2.99 | |||
Exercisable period of options | 1 year 2 months 12 days | |||||
Number of common stock reserved for issuance | 17,500,000 | |||||
Number of shares of common stock reserved for issuance | 4,221,023 | 5,776,483 | ||||
Common stock issued | 400,339,000 | 344,560,000 | ||||
Maximum number of shares that may be subject to grants of options to an individual in a calendar year | 1,000,000 | |||||
Shares | ||||||
Balance at the beginning of the period (in shares) | 4,243,000 | 4,906,000 | 4,720,000 | |||
Granted (in shares) | 3,050,000 | 375,000 | 338,000 | |||
Exercised (in shares) | (535,000) | (171,000) | (94,000) | |||
Forfeited (in shares) | (700,000) | (405,000) | (37,000) | |||
Expired (in shares) | (789,000) | (462,000) | (21,000) | |||
Balance at the end of the period (in shares) | 5,269,000 | 4,243,000 | 4,906,000 | 4,720,000 | ||
Exercisable at the end of the period (in shares) | 2,234,000 | |||||
Weighted Average Exercise Price | ||||||
Balance at the beginning of the period (in dollars per share) | $ 2.33 | $ 2.45 | $ 2.41 | |||
Granted (in dollars per share) | 1.73 | 1.90 | 2.99 | |||
Exercised (in dollars per share) | $ 1.01 | $ 1.02 | $ 1.30 | |||
Proceeds from exercise of stock options | $ 544 | $ 192 | $ 121 | |||
Forfeited (in dollars per share) | $ 2.56 | $ 3.99 | $ 4.28 | |||
Expired (in dollars per share) | 2.90 | 2.27 | 5 | |||
Balance at the end of the period (in dollars per share) | 2 | $ 2.33 | $ 2.45 | $ 2.41 | ||
Exercisable (in dollars per share) | $ 2.27 | |||||
Weighted Average Remaining Contractual Life | ||||||
Outstanding at the end of the period | 3 years | 2 years | 2 years 7 months 6 days | 3 years 4 months 24 days | ||
Exercisable period of options | 1 year 2 months 12 days | |||||
Intrinsic Value | ||||||
Outstanding at the beginning of the period (in dollars) | $ 1,475 | $ 2,564 | $ 4,388 | |||
Exercised (in dollars) | 419 | 195 | 87 | |||
Outstanding at the end of the period (in dollars) | 364 | $ 1,475 | $ 2,564 | $ 4,388 | ||
Exercisable at the end of the period (in dollars) | $ 364 | |||||
Granted (in shares) | 3,050,000 | 375,000 | 338,000 | |||
Equity Incentive Plan | ||||||
STOCK BASED COMPENSATION | ||||||
Common stock issued | 535,000 | 171,000 | ||||
Weighted Average Exercise Price | ||||||
Exercised (in dollars per share) | $ 1.02 | $ 1.02 | ||||
Proceeds from exercise of stock options | $ 500 | $ 200 | ||||
Lexam VG Gold | ||||||
STOCK BASED COMPENSATION | ||||||
Share replacement awards | $ 100 | |||||
Ratio of Company's share for acquired company's share | 0.056% | |||||
Certain employees and directors | ||||||
STOCK BASED COMPENSATION | ||||||
Stock options granted (in shares) | 3,100,000 | 400,000 | 300,000 | |||
Exercise price of options granted (in dollars per share) | $ 1.73 | $ 1.90 | $ 2.99 | |||
Shares | ||||||
Granted (in shares) | 3,100,000 | 400,000 | 300,000 | |||
Weighted Average Exercise Price | ||||||
Granted (in dollars per share) | $ 1.73 | $ 1.90 | $ 2.99 | |||
Intrinsic Value | ||||||
Granted (in shares) | 3,100,000 | 400,000 | 300,000 | |||
Vesting period of options | 3 years | |||||
Exercise period of options | 5 years |
SHAREHOLDERS' EQUITY - Summary
SHAREHOLDERS' EQUITY - Summary of Assumptions (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | May 23, 2019 | Mar. 29, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||||
Dividend yield (as a percent) | 0.00% | 0.00% | |||
Weighted-average expected life of option | 3 years | 3 years | 3 years 6 months | 3 years 6 months | 3 years 6 months |
Weighted-average grant date fair value (in dollars per share) | $ 0.22 | $ 0.43 | $ 1.73 | $ 1.90 | $ 2.99 |
Risk-free interest rate, low end of range (as a percent) | 1.45% | 2.67% | 1.46% | ||
Risk-free interest rate, high end of range (as a percent) | 1.87% | 2.89% | 1.60% | ||
Volatility factor of the expected market price of common stock, low end of range (as a percent) | 58.00% | 63.00% | 72.00% | ||
Volatility factor of the expected market price of common stock, high end of range (as a percent) | 64.00% | 74.00% | |||
Additional disclosures | |||||
Fair value of awards vesting in the period | $ 0.4 | $ 0.7 | $ 1.3 | ||
Unrecognized compensation expense on non-vested stock options (in dollars) | $ 1 | $ 0.4 | $ 0.7 | ||
Non-vested stock options outstanding (in shares) | 3 | 0.7 | 1.5 | ||
Weighted-average period of recognition | 1 year 6 months | 1 year 4 months 24 days | 1 year 3 months 18 days | ||
Stock option expense | $ 0.7 | $ 0.3 | $ 1.3 | ||
Minimum | |||||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||||
Dividend yield (as a percent) | 0.00% | 0.36% | 0.31% | ||
Maximum | |||||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||||
Dividend yield (as a percent) | 0.53% | 0.36% |
SHAREHOLDERS' EQUITY - Non-vest
SHAREHOLDERS' EQUITY - Non-vested Options Outstanding and Exercisable (Details) - $ / shares | May 23, 2019 | Mar. 29, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||||
Stock options granted (in shares) | 3,050,000 | 375,000 | 338,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||||
Stock options granted (in dollars per share) | $ 0.22 | $ 0.43 | $ 1.73 | $ 1.90 | $ 2.99 |
Amended and Restated Equity Incentive Plan and Non-related Plan Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||||
Balance at the beginning of the period (in shares) | 691 | ||||
Stock options granted (in shares) | 3,050 | ||||
Stock options cancelled/forfeited (in shares) | (402) | ||||
Stock options vested (in shares) | (304) | ||||
Balance at the end of the period (in shares) | 3,035 | 691 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||||
Balance at the beginning of the period (in dollars per share) | $ 1.28 | ||||
Stock options granted (in dollars per share) | 0.58 | ||||
Stock options cancelled/forfeited (in dollars per share) | 0.74 | ||||
Stock options vested (in dollars per share) | 1.44 | ||||
Balance at the end of the period (in dollars per share) | $ 0.64 | $ 1.28 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||||||||
Net loss | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | $ (20,989) | $ (13,290) | $ (5,380) | $ (5,211) | $ (59,747) | $ (44,870) | $ (10,634) |
Weighted average common shares outstanding: | 361,845,000 | 337,297,000 | 313,887,000 | ||||||||
Diluted shares outstanding: | 361,845,000 | 337,297,000 | 313,887,000 | ||||||||
Net loss per share: | |||||||||||
Basic and Diluted (in dollars per share) | $ (0.07) | $ (0.03) | $ (0.04) | $ (0.02) | $ (0.06) | $ (0.04) | $ (0.02) | $ (0.02) | $ (0.17) | $ (0.13) | $ (0.03) |
Warrants | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||||||||
Options outstanding not included in the computation of diluted weighted average shares because their effect would have been anti-dilutive (in shares) | 29,770,766 | 10,350,000 | |||||||||
Price per common share for each warrant | $ 2.70 | ||||||||||
Warrants | Minimum | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||||||||
Price per common share for each warrant | 1.72 | $ 1.72 | |||||||||
Warrants | Maximum | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||||||||
Price per common share for each warrant | $ 2 | $ 2 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Aug. 10, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
RELATED PARTY TRANSACTIONS | ||||
Long-term debt from related party (note 18) | $ 19,758 | $ 24,603 | ||
Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Face amount | $ 50,000 | |||
Debt Instrument Term | 3 years | |||
Robert McEwen | Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Long-term debt from related party (note 18) | $ 25,000 | |||
Affiliate of Robert McEwen | ||||
RELATED PARTY TRANSACTIONS | ||||
Debt interest expense | 2,400 | 1,000 | ||
Affiliate of Robert McEwen | Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Long-term debt from related party (note 18) | $ 25,000 | |||
Entity Affiliated With Related Party | Lexam L.P. | ||||
RELATED PARTY TRANSACTIONS | ||||
Expense (income) | 133 | 91 | $ 152 | |
Entity Affiliated With Related Party | REVlaw | ||||
RELATED PARTY TRANSACTIONS | ||||
Expense (income) | 188 | 266 | $ 330 | |
Related party outstanding accounts payable | $ 22 | $ 32 |
FAIR VALUE ACCOUNTING (Details)
FAIR VALUE ACCOUNTING (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets: | ||
Long term debt | $ 49,500 | $ 49,200 |
Recurring | ||
Assets: | ||
Investments | 1,885 | 3,131 |
Recurring | Level 1 | ||
Assets: | ||
Investments | 1,885 | 2,718 |
Recurring | Level 2 | ||
Assets: | ||
Investments | 413 | |
Marketable equity securities. | Recurring | ||
Assets: | ||
Investments | 1,885 | 2,718 |
Marketable equity securities. | Recurring | Level 1 | ||
Assets: | ||
Investments | $ 1,885 | 2,718 |
Warrants | Recurring | ||
Assets: | ||
Investments | 413 | |
Warrants | Recurring | Level 2 | ||
Assets: | ||
Investments | $ 413 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Reclamation Bonds, surety bonds (Details) $ in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019CAD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Reclamation Bonds | |||
Other assets | $ 668 | $ 1,281 | |
Timmins | |||
Reclamation Bonds | |||
Restrictive time deposits for reclamation bonding | $ 100 | ||
Surety Bonds | |||
Reclamation Bonds | |||
Percentage of annual fees on surety bonds | 2.00% | 2.00% | |
Surety bonds upfront deposit amount | $ 0 | ||
Surety bonding obligation | 20,100 | ||
Surety Bonds | Canada | |||
Reclamation Bonds | |||
Surety bonding obligation | $ 14.9 | 11,500 | |
Reclamation Bonds | Tonkin and Gold Bar Properties | |||
Reclamation Bonds | |||
Reclamation bonding obligation | 20,100 | ||
Black Fox | Reclamation Bonds | |||
Reclamation Bonds | |||
Reclamation bonding obligation | $ 14.9 | 11,500 | |
Other assets | |||
Reclamation Bonds | |||
Other assets | $ 100 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Lease Obligations and Purchase Commitments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating lease obligations (mining and surface rights) | |
2020 | $ 2,926 |
2021 | 465 |
2022 | 470 |
2023 | 366 |
2024 | 335 |
Total | 4,562 |
Reclamation costs | |
2020 | 2,548 |
2021 | 4,115 |
2022 | 4,637 |
2023 | 2,279 |
2024 | 549 |
Thereafter | 27,637 |
Total | 41,765 |
Construction | |
2020 | 1,249 |
Total | 1,249 |
Exploration | |
2020 | 219 |
Total | 219 |
Total | |
2020 | 6,942 |
2021 | 4,580 |
2022 | 5,107 |
2023 | 2,645 |
2024 | 884 |
Thereafter | 27,637 |
Total | $ 47,795 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Streaming Agreement (Details) - USD ($) | Aug. 25, 2017 | Dec. 31, 2019 | Dec. 31, 2018 |
Black Fox | |||
Other commitments | |||
Obligation to sell (as a percent) | 8.00% | ||
Long term gold price (in dollars per ounce) | $ 551 | ||
Revenue of acquiree since acquisition date and implementation of streaming agreement | $ 1,500,000 | $ 2,200,000 | |
Black Fox | Maximum | |||
Other commitments | |||
Inflation adjustment (as a percent) | 2.00% | ||
Pike River property | |||
Other commitments | |||
Obligation to sell (as a percent) | 6.30% |
CASH AND CASH EQUIVALENTS AND_3
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | ||||
Cash and cash equivalents | $ 46,452 | $ 15,756 | ||
Restricted cash | 14,685 | |||
Restricted cash included in other assets | 48 | 48 | ||
Total cash, cash equivalents, and restricted cash | $ 46,500 | $ 30,489 | $ 37,153 | $ 37,440 |
INCOME AND MINING TAXES - Tax C
INCOME AND MINING TAXES - Tax Cuts and Jobs Act (the "Act") and Tax Reform (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INCOME TAXES | |||||
Statutory tax rate (as a percent) | 21.00% | 21.00% | 35.00% | ||
Tax Cuts and Jobs Act of 2017 measurement period adjustment | $ 28 | ||||
Taxable income offset by non-operating losses | $ 13.6 | ||||
Argentina | |||||
INCOME TAXES | |||||
Statutory tax rate (as a percent) | 30.00% | 35.00% | |||
Forecast | Argentina | |||||
INCOME TAXES | |||||
Statutory tax rate (as a percent) | 25.00% | 25.00% |
INCOME AND MINING TAXES - Defer
INCOME AND MINING TAXES - Deferred Income Tax Recovery (Expense) and Net Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred income tax recovery (expense) | |||
United States | $ 2,420 | $ 2,185 | $ 10,349 |
Foreign | 1,424 | 585 | 5,020 |
Deferred tax benefit | 3,844 | 2,770 | 15,369 |
Net income (loss) before tax: | |||
United States | (22,319) | (27,001) | (19,913) |
Foreign | (41,272) | (20,639) | (6,090) |
Loss before income and mining taxes | $ (63,591) | $ (47,640) | $ (26,003) |
INCOME AND MINING TAXES - Recon
INCOME AND MINING TAXES - Reconciliation of Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
INCOME AND MINING TAXES. | |||
Loss before income and mining taxes | $ (63,591) | $ (47,640) | $ (26,003) |
Statutory tax rate (as a percent) | 21.00% | 21.00% | 35.00% |
US Federal and State tax recovery (expense) at statutory rate | $ (13,354) | $ (10,004) | $ (9,101) |
Reconciling items: | |||
Equity pickup in MSC | 2,626 | 2,966 | (16) |
Deferred foreign income inclusion | 598 | 5,963 | 21,002 |
Realized flow-through expenditures | 3,150 | 2,100 | |
Realized flow-through premium | (2,954) | (1,675) | |
Foreign tax credits | (16,628) | ||
Tax rate changes | 976 | 28,048 | |
Adjustment for foreign tax rates | (200) | 40 | 115 |
Other permanent differences | 8,540 | 4,419 | (1,761) |
Unrealized foreign exchange rate (loss)/gain | (1,095) | (6,935) | 2,469 |
NOL expires and revisions | 810 | (120) | (2,806) |
Valuation allowance | (2,941) | 476 | (36,691) |
Tax benefit | $ (3,844) | $ (2,770) | $ (15,369) |
INCOME AND MINING TAXES - Tax E
INCOME AND MINING TAXES - Tax Effects of Temporary Differences (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets: | ||||
Net operating loss carryforward | $ 57,667 | $ 55,515 | ||
Mineral properties | 60,299 | 62,345 | ||
Other temporary differences | 14,356 | 15,198 | ||
Total gross deferred tax assets | 132,322 | 133,058 | ||
Less: valuation allowance | (121,212) | (124,153) | $ (123,648) | $ (111,621) |
Net deferred tax assets | 11,110 | 8,905 | ||
Deferred tax liabilities: | ||||
Acquired mineral property interests | (16,024) | (15,331) | ||
Total deferred tax liabilities | (16,024) | (15,331) | ||
Total net deferred tax liability | (4,914) | $ (6,426) | ||
Valuation allowances | $ 2,900 |
INCOME AND MINING TAXES - Chang
INCOME AND MINING TAXES - Changes to Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Valuation allowance | |||
Balance at Beginning of Period | $ 124,153 | $ 123,648 | $ 111,621 |
Additions | 2,104 | 12,232 | 51,220 |
Deductions | (5,045) | (11,727) | (39,193) |
Balance at End of Period | $ 121,212 | $ 124,153 | $ 123,648 |
INCOME AND MINING TAXES - Non O
INCOME AND MINING TAXES - Non Operating Losses (Details) $ in Thousands | Dec. 31, 2019USD ($) |
United States | |
INCOME TAXES | |
Net-operating losses | $ 129,409 |
Mexico | |
INCOME TAXES | |
Net-operating losses | 34,876 |
Canada | |
INCOME TAXES | |
Net-operating losses | 36,692 |
Argentina | |
INCOME TAXES | |
Net-operating losses | $ 41,922 |
UNAUDITED SUPPLEMENTARY QUART_3
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Unaudited supplementary quarterly information | |||||||||||
Revenues | $ 117,019 | $ 128,175 | $ 67,465 | ||||||||
Gross profit | $ 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | $ 2,749 | $ 6,013 | $ 9,092 | $ 14,228 | 8,986 | 32,082 | 20,080 |
Net loss | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | $ (20,989) | $ (13,290) | $ (5,380) | $ (5,211) | $ (59,747) | $ (44,870) | $ (10,634) |
Net (loss) per share: | |||||||||||
Basic and diluted (in dollars per share) | $ (0.07) | $ (0.03) | $ (0.04) | $ (0.02) | $ (0.06) | $ (0.04) | $ (0.02) | $ (0.02) | $ (0.17) | $ (0.13) | $ (0.03) |
Weighted average shares outstanding: | |||||||||||
Basic and diluted (in shares) | 378,543 | 362,175 | 346,998 | 345,497 | 337,936 | 337,278 | 337,087 | 337,062 | 361,845 | 337,297 | 313,887 |
MSC | |||||||||||
Unaudited supplementary quarterly information | |||||||||||
Revenues | $ 263,887 | $ 213,096 | $ 235,650 | ||||||||
Gross profit | (33,977) | (9,117) | (31,025) | ||||||||
Net loss | (4,279) | (20,541) | (4,750) | ||||||||
Gold and silver sales | |||||||||||
Unaudited supplementary quarterly information | |||||||||||
Revenues | $ 32,362 | $ 32,691 | $ 36,383 | $ 15,583 | $ 26,432 | $ 26,896 | $ 33,806 | $ 41,041 | $ 117,019 | $ 128,175 | $ 67,465 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 25, 2017 | Apr. 26, 2017 | Feb. 13, 2017 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2019 | Nov. 20, 2019 | Mar. 29, 2019 |
ACQUISITIONS | ||||||||
Share price | $ 1.325 | $ 1.55 | ||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Mineral property interests | $ 309,145 | $ 311,220 | ||||||
Other current assets | 1,686 | 2,607 | ||||||
Other assets | 1,281 | 668 | ||||||
Accounts payable and accrued liabilities | (30,817) | (34,070) | ||||||
Asset retirement obligation | $ (734) | $ (2,610) | ||||||
Lexam VG Gold | ||||||||
ACQUISITIONS | ||||||||
Common shares issued (in shares) | 12,687,035 | |||||||
Share price | $ 3 | |||||||
Share replacement awards | $ 100 | |||||||
Common shares issued for acquisition | 38,141 | |||||||
Adjustments to purchase price | 1,017 | |||||||
Total fair value of assets acquired and liabilities assumed | 39,158 | |||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Mineral property interests | 41,595 | |||||||
Cash and cash equivalents | 177 | |||||||
Other current assets | 86 | |||||||
Other assets | 312 | |||||||
Accounts payable and accrued liabilities | (288) | |||||||
Asset retirement obligation | (570) | |||||||
Deferred tax liability | (2,154) | |||||||
Total fair value of assets acquired and liabilities assumed | $ 39,158 | |||||||
Ratio of Company's share for acquired company's share | 0.056% | |||||||
Lexam VG Gold | Maximum | ||||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Percentage of interest in the deposit | 20.00% | |||||||
Lexam VG Gold | Minimum | ||||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Percentage of interest in the deposit | 10.00% | |||||||
Black Fox | ||||||||
ACQUISITIONS | ||||||||
Payments to Acquire Businesses, Gross | $ 35,000 | |||||||
Common shares issued (in shares) | 178,321 | |||||||
Common shares issued for acquisition | 35,000 | |||||||
Adjustments to purchase price | (7,500) | |||||||
Total fair value of assets acquired and liabilities assumed | 27,500 | $ 0 | ||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Mineral property interests | 8,954 | |||||||
Cash and cash equivalents | 249 | |||||||
Asset retirement obligation | (11,233) | |||||||
Deferred tax liability | (201) | |||||||
Total fair value of assets acquired and liabilities assumed | $ 27,500 | $ 0 | ||||||
Buffalo Ankerite, Fuller and Davidson Tisdale | ||||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Percentage of interest in the deposit | 100.00% | |||||||
Paymaster | Lexam VG Gold | ||||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Percentage of interest in the deposit | 61.00% | |||||||
Goldcorp Inc | Lexam VG Gold | ||||||||
Fair value of assets acquired and liabilities assumed: | ||||||||
Percentage of interest in the deposit | 39.00% |
ACQUISITIONS - Assets acquired
ACQUISITIONS - Assets acquired and liabilities (Details) - USD ($) $ in Thousands | Aug. 25, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair value of assets acquired and liabilities assumed: | |||||
Inventory | $ 38,376 | $ 22,039 | |||
Mineral Property Interests | 311,220 | 309,145 | |||
Plant and Equipment | 107,571 | 114,734 | |||
Asset retirement obligation | $ (2,610) | $ (734) | |||
General and administrative expenses | |||||
ACQUISITIONS | |||||
Adjustments to purchase price | $ 1,300 | ||||
Black Fox | |||||
ACQUISITIONS | |||||
Purchase price | $ 35,000 | ||||
Adjustments to purchase price | (7,500) | ||||
Total fair value of assets acquired and liabilities assumed | 27,500 | $ 0 | |||
Fair value of assets acquired and liabilities assumed: | |||||
Cash | 249 | ||||
Accounts Receivable | 470 | ||||
Prepaids | 63 | ||||
Inventory | 4,704 | ||||
Mineral Property Interests | 8,954 | ||||
Plant and Equipment | 33,683 | ||||
Accounts Payable | (5,247) | ||||
Accrued Liabilities | (3,213) | ||||
Short term capital lease liability | (557) | ||||
Asset retirement obligation | (11,233) | ||||
Long term capital lease liability | (172) | ||||
Deferred tax liability | (201) | ||||
Total fair value of assets acquired and liabilities assumed | $ 27,500 | $ 0 |