Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 28, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | McEwen Mining Inc. | ||
Entity Central Index Key | 314,203 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,150,715,238 | ||
Entity Common Stock, Shares Outstanding | 299,569,826 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | |
REVENUE: | |||
Gold and silver sales | $ 60,388 | $ 72,956 | $ 45,303 |
Total Revenue | 60,388 | 72,956 | 45,303 |
COSTS AND EXPENSES: | |||
Production costs applicable to sales | 28,133 | 34,607 | 40,608 |
Mine construction costs | 1,723 | ||
Mine development | 3,866 | 1,169 | 1,829 |
Exploration | 7,959 | 8,798 | 11,332 |
Property holding | 3,536 | 4,336 | 6,365 |
General and administrative | 12,734 | 12,045 | 12,069 |
(Income) loss from investment in Minera Santa Cruz S.A., net of amortization (note 6) | (12,951) | (2,414) | 5,284 |
Depreciation | 1,169 | 942 | 979 |
Revision of estimates and accretion of reclamation obligations (note 9) | 595 | 429 | 407 |
Impairment of investment in Minera Santa Cruz S.A. (note 6) | 11,777 | 21,162 | |
Impairment of mineral property interests and property and equipment (note 5) | 50,600 | 353,736 | |
Total costs and expenses | 45,041 | 122,289 | 455,494 |
Operating income (loss) | 15,347 | (49,333) | (410,191) |
OTHER INCOME (EXPENSE): | |||
Interest and other income | 835 | 2,404 | 259 |
Gain on sale of assets | 24 | 13 | 26 |
Gain on sale of marketable equity securities (note 3) | 22 | ||
Other-than-temporary impairment on marketable equity securities (note 3) | (882) | 0 | |
Unrealized gain on derivatives (note 3) | 1,379 | ||
Registration taxes | (6,788) | ||
Foreign currency gain (loss) | 581 | 1,906 | (2,419) |
Total other income (expense) | 1,959 | 4,323 | (8,922) |
Income (loss) before income taxes | 17,306 | (45,010) | (419,113) |
Income tax recovery (note 10) | (3,749) | (24,560) | (107,170) |
Net income (loss) | 21,055 | (20,450) | (311,943) |
OTHER COMPREHENSIVE INCOME (LOSS): | |||
Other-than-temporary impairment on marketable equity securities (note 3) | 882 | 0 | |
Unrealized gain (loss) on marketable equity securities, net of $0.5 million, $nil and $nil, tax benefit, respectively | 1,609 | (949) | 419 |
Comprehensive income (loss) | $ 23,546 | $ (21,399) | $ (311,524) |
Net income (loss) per share (note 13): | |||
Basic (in dollars per share) | $ / shares | $ 0.07 | $ (0.07) | $ (1.05) |
Diluted (in dollars per share) | $ / shares | $ 0.07 | $ (0.07) | $ (1.05) |
Weighted average common shares outstanding (thousands) (note 13): | |||
Basic (in shares) | shares | 298,772 | 300,341 | 297,763 |
Diluted (in shares) | shares | 300,474 | 300,341 | 297,763 |
Return of capital distribution declared per common share (note 11) | $ / shares | 0.005 | 0.010 |
CONSOLIDATED STATEMENTS OF OPE3
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||
Tax benefit on unrealized gain (loss) on marketable equity securities | $ 0.5 | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 37,440 | $ 25,874 |
Investments (note 3) | 8,543 | 1,032 |
Value added taxes receivable | 4,304 | 10,032 |
Inventories (note 4) | 26,620 | 14,975 |
Other current assets | 1,667 | 2,530 |
Total current assets | 78,574 | 54,443 |
Mineral property interests (note 5) | 242,640 | 237,245 |
Investment in Minera Santa Cruz S.A. (note 6) | 162,320 | 167,107 |
Property and equipment, net (note 7) | 14,252 | 15,759 |
Other assets | 532 | 531 |
TOTAL ASSETS | 498,318 | 475,085 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 20,044 | 18,429 |
Short-term bank indebtedness (note 8) | 3,395 | |
Current portion of asset retirement obligation (note 9) | 537 | 215 |
Total current liabilities | 20,581 | 22,039 |
Asset retirement obligation, less current portion (note 9) | 9,306 | 7,569 |
Deferred income tax liability (note 10) | 23,665 | 26,899 |
Other liabilities | 1,727 | 286 |
Total liabilities | 55,279 | 56,793 |
Shareholders' equity: | ||
Common stock, no par value, 500,000 shares authorized (in thousands);Common: 299,570 and 274,421 shares issued and outstanding as of December 31, 2016 and 2015 (in thousands) (note 11);Exchangeable: nil and 24,213 shares issued and outstanding as of December 31, 2016 and 2015 (in thousands) (note11) | 1,360,345 | 1,359,144 |
Accumulated deficit | (918,972) | (940,027) |
Accumulated other comprehensive income (loss) | 1,666 | (825) |
Total shareholders' equity | 443,039 | 418,292 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 498,318 | $ 475,085 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 500,000 | 500,000 |
Common, shares issued | 299,570 | 274,421 |
Common, shares outstanding | 299,570 | 274,421 |
Exchangeable, shares issued | 0 | 24,213 |
Exchangeable, shares outstanding | 0 | 24,213 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit | Total |
Balance at Dec. 31, 2013 | $ 1,354,696 | $ (295) | $ (607,634) | $ 746,767 |
Balance (in shares) at Dec. 31, 2013 | 297,159 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Stock-based compensation (note 12) | $ 1,324 | 1,324 | ||
Exercise of stock options (note 11) | $ 1,932 | 1,932 | ||
Exercise of stock options (note 11 ) (in shares) | 1,499 | |||
Exercise of stock options assumed from Minera Andes Inc. acquisition | $ 360 | 360 | ||
Exercise of stock options assumed from Minera Andes Inc. acquisition (in shares) | 198 | |||
Shares issued for the settlement of accounts payable | $ 1,004 | 1,004 | ||
Shares issued for settlement of accounts payable (in shares) | 394 | |||
Shares issued to terminate back-in right | $ 1,352 | 1,352 | ||
Shares issued to terminate back-in right (in shares) | 850 | |||
Unrealized gain (loss) on available-for-sale securities, net of taxes (note 3) | 419 | 419 | ||
Net income (loss) | (311,943) | (311,943) | ||
Balance at Dec. 31, 2014 | $ 1,360,668 | 124 | (919,577) | 441,215 |
Balance (in shares) at Dec. 31, 2014 | 300,100 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Stock-based compensation (note 12) | $ 1,305 | 1,305 | ||
Return of capital distribution (note 11) | $ (1,503) | (1,503) | ||
Exercise of stock options (note 11 ) (in shares) | 0 | |||
Shares issued for the settlement of accounts payable | $ 443 | 443 | ||
Shares issued for settlement of accounts payable (in shares) | 430 | |||
Unrealized gain (loss) on available-for-sale securities, net of taxes (note 3) | (949) | (949) | ||
Share repurchase (note 11) | $ (1,769) | $ (1,769) | ||
Share repurchase (note 11) (in shares) | (1,896) | (1,896,442) | ||
Net income (loss) | (20,450) | $ (20,450) | ||
Balance at Dec. 31, 2015 | $ 1,359,144 | (825) | (940,027) | 418,292 |
Balance (in shares) at Dec. 31, 2015 | 298,634 | |||
Increase (Decrease) in Shareholders' Equity | ||||
Stock-based compensation (note 12) | $ 1,039 | 1,039 | ||
Return of capital distribution (note 11) | (2,986) | (2,986) | ||
Exercise of stock options (note 11) | $ 3,730 | $ 3,730 | ||
Exercise of stock options (note 11 ) (in shares) | 1,494 | 1,457,000 | ||
Unrealized gain (loss) on available-for-sale securities, net of taxes (note 3) | 1,609 | $ 1,609 | ||
Share repurchase (note 11) | $ (582) | (582) | ||
Share repurchase (note 11) (in shares) | (558) | |||
Other-than-temporary impairment on marketable equity securities (note 3) | 882 | 882 | ||
Net income (loss) | 21,055 | 21,055 | ||
Balance at Dec. 31, 2016 | $ 1,360,345 | $ 1,666 | $ (918,972) | $ 443,039 |
Balance (in shares) at Dec. 31, 2016 | 299,570 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Cash paid to suppliers and employees | $ (52,340) | $ (55,260) | $ (68,993) |
Cash received from gold and silver sales | 59,517 | 70,178 | 43,812 |
Dividends received from Minera Santa Cruz S.A. (note 6) | 17,738 | 548 | 9,483 |
Lease incentive received | (328) | ||
Interest paid | (5) | (156) | |
Interest received | 276 | 287 | 464 |
Cash provided by (used in) operating activities | 25,186 | 15,597 | (14,906) |
Cash flows from investing activities: | |||
Acquisition of mineral property interests (note 5) | (5,985) | ||
Proceeds from reimbursement of equipment deposit (note 7) | 994 | ||
Additions to property and equipment (note 7) | (1,174) | (777) | (2,788) |
Proceeds from disposal of property and equipment (note 7) | 13 | 38 | |
Acquisition of investments (note 3) | (4,419) | (1,114) | (446) |
Proceeds from sale of investments (note 3) | 470 | ||
Decrease in restricted time deposits for reclamation bonding | 5,183 | ||
Deposits for surety bonds for reclamation bonding | (481) | ||
Cash provided by (used) in investing activities | (10,114) | (1,878) | 1,506 |
Cash flows from financing activities: | |||
Proceeds from short-term bank indebtedness (note 8) | 5,171 | ||
Repayment of short-term bank indebtedness (note 8) | (3,395) | (1,776) | |
Return of capital distribution (note 11) | (2,986) | (1,503) | |
Share repurchase (note 11) | (582) | (1,769) | |
Proceeds from exercise of stock options (note 11) | 3,730 | 2,292 | |
Cash provided by (used in) provided from financing activities | (3,233) | 123 | 2,292 |
Effect of exchange rate change on cash and cash equivalents | (273) | (348) | (833) |
Increase (decrease) in cash and cash equivalents | 11,566 | 13,494 | (11,941) |
Cash and cash equivalents, beginning of period | 25,874 | 12,380 | 24,321 |
Cash and cash equivalents, end of period | 37,440 | 25,874 | 12,380 |
Reconciliation of net income (loss) to cash provided by operating activities: | |||
Net income (loss) | 21,055 | (20,450) | (311,943) |
Adjustments to reconcile net income (loss) from operating activities: | |||
(Income) loss from investment in Minera Santa Cruz S.A., net of amortization (note 6) | (12,951) | (2,414) | 5,284 |
Impairment of investment in Minera Santa Cruz S.A., net of amortization | 11,777 | 21,162 | |
Impairment of mineral property interests and property and equipment (note 5) | 50,600 | 353,736 | |
Other-than-temporary impairment on marketable equity securities (note 3) | 882 | 0 | |
Loss (gain) on disposal of fixed assets (note 7) | (517) | 13 | 26 |
Lease incentive | (328) | ||
Recovery of deferred income taxes (note 10) | (3,749) | (24,560) | (107,170) |
Stock-based compensation | 1,039 | 1,305 | 1,324 |
Depreciation | 1,169 | 942 | 979 |
Revision of estimates and accretion of reclamation obligations (note 9) | 595 | 429 | 407 |
Adjustment to the asset retirement obligation estimate (note 9) | 1,530 | 135 | |
Amortization of mineral property interests and asset retirement obligations | 2,413 | 1,288 | 1,236 |
Foreign exchange loss | 273 | 348 | 833 |
Gain on sale of marketable securities (note 3) | (22) | ||
Unrealized gain on derivative instrument (note 3) | (1,379) | ||
Change in non-cash working capital items: | |||
Shares issued to supplier for settlement of accounts payable | 443 | 1,004 | |
Decrease (increase) in VAT taxes receivable, net of collection of $9,523 (2015 - $6,025 and 2014 - $5,049) | 5,813 | 1,707 | (148) |
Increase in other assets related to operations | (11,156) | (3,003) | (3,638) |
Increase (decrease) in liabilities related to operations | 1,419 | (3,485) | 10,891 |
Shares issued to terminate back-in-right | 1,352 | ||
Dividends received from Minera Santa Cruz S.A. (note 6) | 17,738 | 548 | 9,483 |
Cash provided by (used in) operating activities | $ 25,186 | $ 15,597 | $ (14,906) |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||
Collection of VAT taxes receivable | $ 9,523 | $ 6,025 | $ 5,049 |
THE COMPANY
THE COMPANY | 12 Months Ended |
Dec. 31, 2016 | |
THE COMPANY | |
THE COMPANY | NOTE 1 THE COMPAN McEwen Mining Inc. (the “Company”) 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. On January 24, 2012, the Company changed its name from U.S. Gold Corporation to McEwen Mining Inc. after the completion of the acquisition of Minera Andes Inc. by way of a statutory plan of arrangement under the laws of the Province of Alberta, Canada. The Company operates in Argentina, Mexico, and the United States. It owns a 49% interest in Minera Santa Cruz S.A. (“MSC”), owner of the producing San José silver-gold mine in Santa Cruz, Argentina, which is operated by the majority owner of the joint venture, Hochschild Mining plc. It also owns and operates the El Gallo 1 mine in Sinaloa, Mexico. Finally, the Company owns the Los Azules copper deposit in San Juan, Argentina, the El Gallo 2 project in Sinaloa, Mexico, the Gold Bar project in Nevada in the United States, and a portfolio of exploration properties in Argentina, Mexico and Nevada. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates: The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of the Company’s 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; estimates of fair value of equity investment and asset groups used in impairment testing; estimates of recoverable gold in leach pad inventory; estimates regarding the collectability of value added taxes receivable; valuation allowances for deferred tax assets; and estimate of income 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. 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, below. Cash and Cash Equivalents: 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. 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 – Equity Method and Joint Ventures . Under this method, the Company’s share of earnings and losses is included in the Consolidated Statement of Operations and Comprehensive Income (Loss) and the balance of the investment is adjusted by the same amount. Under the equity method, dividends received from an investee are recorded as decreases in the investment account, not as income. If and when there has been a loss in value that is other than a temporary decline, the carrying value is reduced to its fair value. The Company accounts for its investment in marketable equity securities as available for sale securities and warrants on equity interest in publicly traded securities as held for trading securities in accordance with ASC guidance on accounting for certain investments in debt and equity securities. Unrealized gains and losses on these securities are accounted for through Other Comprehensive Income (“OCI”) except for gain and losses on warrants which are included in Other Income (Expense) in the Statement of Operations and Comprehensive Income (Loss). The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other‑than‑temporary in accordance with ASC guidance. Declines in fair value below the Company’s carrying value deemed to be other‑than‑temporary are charged to operations. Value Added Taxes Receivable: In Mexico, value added taxes (“VAT”) 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. In Argentina, except at the San José mine, 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 are accounted for using weighted average cost method and are carried at the lower of average cost or net realizable value. Net realizable value represents the estimated future sales price of the product based on current and long-term metals prices, less the estimated costs to complete production and bring the product to sale. Write-downs of stockpiles, material on leach pads, in-process inventory, precious metals inventory and materials and supplies, resulting from net realizable value impairments, are reported as a component of production costs applicable to sales. The current portion of stockpiles, material on leach pad, in-process inventory and materials and supplies is determined based on the expected amounts to be processed within the next 12 months. Stockpiles, material on leach pads, in‑process inventory and materials and supplies not expected to be processed within the next 12 months, if any, are classified as long‑term. Stockpiles represent mineralized material that has been extracted from the mine and is available for further 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 ore that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the ore over a period of months. Costs are attributed to the ore 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 ore placed on the leach pads (measured tonnes added to the leach pads), the grade of ore placed on the leach pads (based on assay data) and a recovery percentage. In general, leach pads recover between 50% and 95% of the recoverable ounces in the first year of leaching, declining each year thereafter until the leaching is complete. The cumulative metallurgical recovery rate for gold production at the El Gallo 1 mine from September 2012 (start of production) to December 31, 2016 was approximately 59% (2015 – 56%). Although 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 the ADR process and the projected recoveries of the respective plants. 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 doré and bullion that is unsold and held at the Company’s or the refinery’s 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 and consumable parts used in drilling and other operating activities. Cost includes applicable taxes and freight. Proven and Probable Reserves: The definition of proven and probable reserves is set forth in SEC Industry 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. As of December 31, 2016, except for the Company’s 49% interest in the San José mine, none of the Company’s properties contain resources that satisfy the definition of proven and probable reserves. Property and Equipment: As described in Design, Construction and Development Costs below, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred as the Company has not established proven and probable reserves on any of its properties except for the Company’s 49% interest in the San José mine. Only certain types of equipment which have alternative uses or significant salvage value, may be capitalized without proven and probable reserves. Depreciation is computed using the straight-line method with the exception of mining equipment. Mining equipment is depreciated using the units-of-production method based on tonnes processed over the estimated total mine life. Design, Construction, and Development Costs: Mine 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. When proven and probable reserves as defined by SEC Industry Guide 7 exist, development costs are capitalized. Mine development costs incurred either to develop new ore deposits, expand the capacity of operating mines, or to develop mine areas substantially in advance of current production would be capitalized. Costs of start‑up activities and costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations as incurred. If or when a project is abandoned, costs are charged to operations upon abandonment. All capitalized costs would be amortized using the units of production method over the estimated life of the ore body based on recoverable ounces to be mined from proven and probable reserves. Certain costs to design and construct mining and processing facilities may be incurred prior to establishing proven and probable reserves. As no proven and probable reserves have been established on any of the Company’s properties, except for the Company’s 49% interest in the San José mine, design, construction and development costs are not capitalized at any of the Company’s properties, and accordingly, substantially all costs are expensed as incurred. Additionally, the Company does not have a corresponding depreciation or amortization of these costs going forward since these expenditures were expensed as incurred as opposed to being capitalized. Mineral Property Interests: Mineral property interests include acquired interests in advanced-stage properties and exploration stage properties, which are considered tangible assets. The amount capitalized relating to a mineral property interest represents its fair value at the time of acquisition, either as an individual asset purchase or as a part of a business combination. The value of mineral property interests is primarily driven by the nature and amount of mineralized material believed to be contained in the properties. When proven and probable reserves exist, the relevant capitalized costs and mineral property interests are to be charged to expense based on the units of production method and upon commencement of production. However, when a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs and mineral property interests 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 our internal mine plans. As a result of these and other differences, the Company’s financial statements may not be comparable to the financial statements of mining companies that have established reserves as defined by SEC Industry Guide 7. Impairment of Long-lived Assets: The Company reviews and evaluates its long-lived assets for impairment 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 there are identifiable cash flows. For asset groups where 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 “recoverable mineralized material” refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during processing and treatment of mineralized material. The Company’s estimates of future cash flows are based on numerous assumptions and 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. For asset groups where the Company is unable to determine a reliable estimate of undiscounted 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: The Company records the fair value of a liability for an asset retirement obligation (“ARO”) in the period that it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs 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. Periodic accretion is recorded to ARO and charged to earnings. Since no proven or probable reserves have been established for any of the Company’s properties, other than at the San José mine, incremental asset retirement costs associated with the upward adjustments to the fair value of the ARO at the El Gallo 1 mine or Tonkin property are charged to expense. The fair value of 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 or credit risk. Ongoing environmental and reclamation expenditures are debited against the ARO liability as incurred to the extent they relate to the ARO liability and to expense to the extent they do not. Revenue Recognition: Revenue consists of sales value received for the Company’s principal products, gold and silver. The Company currently does not earn revenue from any products other than 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. Product pricing is determined under the sales agreements at the point revenue is recognized by reference to 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 doré produced from the San José 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 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. The Company entered into a doré sales agreement with a Canadian financial institution in July 2012. Under that agreement, the Company has the option to sell to the institution approximately 90% of the gold and silver contained in doré bars produced at the El Gallo 1 mine prior to the completion of refining by the third party refiner, which normally takes approximately 15 business days. 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 doré or bullion has been made in full by the purchaser. Property Holding Costs: Holding costs to maintain a property are expensed in the period they are incurred. These costs include security and maintenance expenses, lease and claim fees and payments, and environmental monitoring and reporting costs. Exploration Costs: Exploration costs include costs incurred to identify new mineral resources, evaluate potential resources, and convert mineral resources into proven and probable reserves. Exploration costs are expensed as incurred. Foreign Currency: The functional currency for the Company’s 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. 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 Company's estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behavior or estimates of forfeitures. Income Taxes: The Company accounts for income taxes under ASC 740. Using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related income tax basis for such liabilities and assets. This method generates either a net deferred income tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income tax charge or benefit by recording the change in either the net deferred income tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income 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 tax asset will not be realized. Comprehensive Income (Loss): In addition to net loss, comprehensive loss includes all changes in equity during a period, such as cumulative unrecognized changes in fair value of marketable equity securities classified as available‑for‑sale or other investments. Per Share Amounts: Basic earnings or loss per share includes no dilution and is computed by dividing income or loss available to common shareholders by the weighted average number of common and exchangeable shares outstanding during the period. Diluted earnings or loss per share reflect 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. The diluted earnings or loss are calculated using the treasury stock method and only for those instruments that that result in a reduction in income per share are included in the calculation. 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 consolidated statement of operations over the period to maturity using the effective interest method. Fair Value of Financial Instruments: Fair value accounting, as prescribed in ASC Section 825, utilizes 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: 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 Accounting Pronouncements Presentation of Financial Statements – Going Concern In August 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 201415 related to management’s going concern assumption. This update provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related disclosures. The update is effective for the annual period ending after December 15, 2016. Adoption of this guidance, effective December 31, 2016, had no impact on the Consolidated Financial Statements or disclosures. Recently Issued Accounting Pronouncements Business Combinations: Definition of a business: In January 2017 the FASB issued ASU No. 2017-01which changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The update to the standard is effective for the Company beginning after December 15, 2017, with early application permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory: In October 2016 the FASB issued ASU No. 2016-16, to modify the current exception to income tax accounting that required companies to defer the income tax effect of certain intercompany transactions. ASU No. 2016-16 only allows companies to defer the income tax effect of intercompany inventory transactions under an exception to the guidance on income taxes that currently applies to intercompany sales and transfers of all assets. The update to the standard is effective for the Company beginning January 1, 2018, with early application permitted as of the beginning of an annual period. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Compensation – Stock Compensation – Improvements to employee Share-Based Payment Accounting: In March 2016, the FASB issued ASU No. 2016-09, which changes how companies account for certain aspects of share-based payment awards to employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The update to the standard is effective for the Company beginning after December 5, 2016, with early application permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Investments - Equity Method and Joint Ventures - Simplifying the Transition to the Equity Method of Accounting: In March 2016, the FASB issued ASU 2016-07, which affects all entities that have an investment that becomes qualified for the equity method of accounting as a result of an increase in the level of ownership interest or degree of influence. The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities: In January 2016, the FASB issued ASU No. 2016-01, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for the Company beginning in its second quarter of 2019. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Revenue from Contracts with Customers: In 2016, the FASB issued three separate accounting standard updates regarding Topic 606: ASU 2016-08, ASU 2016-10 and ASU 2016-12. These ASUs outline amendments to Topic 606 which is not yet effective, including reporting revenue gross versus net, identifying performance obligations and licensing and narrow-scope improvements and practical expedients. The effective date and transition requirements for the amendments listed in these updates are the same as the effective date and transition requirements for Topic 606 (and any other Topic amended by Update 2014-09) which is January 1, 2018, with earlier application permitted. The Company will not be early adopting the Topic 606. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. We have identified two potential areas of impact including bullion and doré sales from our Mexico Operations and doré and concentrate sales from the San Jose mine which has an impact on the income (loss) from the investment in MSC under the equity method of accounting. We will continue to assess and implement the new revenue recognition policy and any related impact on our internal controls throughout 2017. Leases – Amendments: In February 2016, the FASB issued ASU 2016-02 “leases (Topic 842)” which core principle is that a lessee should recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term. For leases with a term of twelve months or less, the lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from the previous GAAP. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal year, with early adoption permitted. The ASU requires a modified retrospective transition method with the option to elect a package of practical expedients. The Company is evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2016 | |
INVESTMENTS | |
INVESTMENTS | NOTE 3 INVESTMENTS The Company’s investment portfolio consists of marketable equity securities and warrants of certain publicly-traded companies. The Company classifies the marketable equity securities as available-for-sale securities, which are recorded at fair value based upon quoted market prices. The warrants are recorded at fair value using the Black-Scholes option pricing model. The following is a summary of the balances as of December 31, 2016 and December 31, 2015: Other Statement of Opening Additions Disposals Comprehensive Operations Fair Value balance during during Income (Loss) (Loss) end of the As of December 31, 2016 (January 1) year year (pre-tax) Income year Marketable equity securities $ $ $ $ $ $ Warrants — — — Investments $ $ $ $ $ $ Other Statement of Opening Additions Disposals Comprehensive Operations Fair Value balance during during Income (Loss) (Loss) end of the As of December 31, 2015 (January 1) period period (pre-tax) Income period Marketable equity securities $ $ $ — $ $ — $ Warrants — — — — — — Investments $ $ $ — $ $ — $ As of December 31, 2016, the cost of the marketable equity securities and warrants was approximately $4.9 million (December 31, 2015 - $1.9 million). On May 13, 2016, the Company participated in a private placement with Golden Predator Mining Corp. (“Golden Predator”) under which it acquired 3,125,000 units, each unit consisting of one common share and one common share purchase warrant (“warrant”), for a total cost of $0.4 million. Using proportional allocation, the Company allocated $0.2 million as the cost base for each of the common shares and warrants. Subsequently, on July 21, 2016, the Company participated in another private placement with Golden Predator under which it acquired an additional 1,500,000 units, each unit consisting of one common share and one-half of one warrant, for a total cost of $0.9 million. Using proportional allocation, the Company allocated $0.7 million as the cost base to the common shares and $0.2 million to the warrants. The Company’s warrant holdings meet the definition of derivative instruments, and as a result, unrealized gains or losses arising from their revaluation are recorded in the Consolidated Statement of Operations and Comprehensive Income (Loss). During the year ended December 31, 2016, the Company recorded an unrealized gain of $1.4 million (December 31, 2015 and 2014 – $nil, respectively). The gains and losses for available-for-sale securities are not reported in Net Income (Loss) of the Consolidated Statement of Operations and Comprehensive Income (Loss) until the securities are sold or if there is an other-than-temporary decline in fair value below cost. For the year ended December 31, 2016, the Company recorded a gain, net of tax, in other comprehensive income, of $1.6 million. The gain was recorded in accumulated other comprehensive income and is reported as a separate line item in the shareholders' equity section of the balance sheet. In the comparable period ending December 31, 2015, the Company recorded a loss, net of tax, in other comprehensive income, of $0.9 million. During the year ended December 31, 2016, the Company sold marketable equity securities for proceeds of $0.5 million. The Company realized a gain of $0.1 million, which is included in the Consolidated Statement of Operations and Comprehensive Income (Loss). The Company did not sell any marketable equity securities during the years ended December 31, 2015 and December 31, 2014. During the year ended December 31, 2016, the Company reviewed its investment portfolio to determine if any security was other-than-temporarily impaired (“OTTI”). An OTTI security would require the Company to record an impairment charge in the Statement of Operations and Consolidated Income (Loss) in the period any such determination is made. In making this judgment, the Company evaluated, among other things, the duration and extent to which the fair value of a security was less than its cost; the financial condition of the issuer and any changes thereto; and the Company’s intent to sell, or whether it will more likely than not be required to sell, the security before recovery of its amortized cost basis. From this assessment, the Company concluded that the fair value of certain marketable equity securities exhibited a prolonged decline in share price due to deterioration of the issuer’s results; therefore, the decline in these marketable equity securities was considered OTTI. Accordingly, the Company recognized an impairment loss of $0.9 million in the Consolidated Statement of Operations and Comprehensive Income (Loss), for the year ended December 31, 2016. In the comparable periods ending December 31, 2015 and 2014, the Company recorded no impairment loss. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2016 | |
INVENTORIES | |
INVENTORIES | NOTE 4 INVENTORIES Inventories at December 31, 2016 and 2015 consist of the following: December 31, 2016 December 31, 2015 Material on leach pads $ $ In-process inventory Stockpiles Precious metals Materials and supplies Inventories $ $ During the years ended December 31, 2016 and 2015, no write-downs of inventory were recorded by the Company. |
MINERAL PROPERTY INTERESTS
MINERAL PROPERTY INTERESTS | 12 Months Ended |
Dec. 31, 2016 | |
MINERAL PROPERTY INTERESTS | |
MINERAL PROPERTY INTERESTS | NOTE 5 MINERAL PROPERTY INTERESTS On April 19, 2016, the Company completed the acquisition of the sliding scale net smelter return royalty (the “Royalty”) on the El Gallo 1 mine and El Gallo 2 project, previously requiring payment of 3.5% of gross revenue less allowable deductions, eventually reducing to 1%. The total purchase price was $6.3 million and consisted of a $5.3 million payment at closing and a deferred payment of $1.0 million due on June 30, 2018, conditional that the El Gallo 1 mine and El Gallo 2 project are in operation at that time. The total cost of the Royalty was accounted for as an addition to mineral property interests. The cost was allocated to El Gallo 1 mine and El Gallo 2 project based on the relative fair value of the future royalty payments for each project. The allocation resulted in approximately $5.1 million allocated to the El Gallo 1 mine and $1.2 million allocated to the El Gallo 2 project. The $1.0 million conditional deferred payment has been included under non-current other liabilities as of December 31, 2016. The Royalty ceased accruing at the end of March 2016. The Company conducts a review of potential triggering events for impairment for all its mineral projects on a quarterly basis. When events or changes in circumstances indicate that the related carrying amounts may not be recoverable, the Company carries out a review and evaluation of its long-lived assets. In the year ended December 31, 2016, no such triggering events were identified with respect to the Company’s Nevada, Argentina or Mexico properties. For the year ended December 31, 2015, the Company recognized impairments on its Argentina and Nevada properties and portion of Mexico construction-in-progress, for an aggregate of $50.6 million. For the Nevada properties, an initial $29.7 million impairment was recorded in the second quarter of 2015 when the Company performed a strategic review of its mineral property interests from which a decision was made to allow certain non-essential claims and portions of claims, included within the Gold Bar project and Tonkin property, to lapse on the September 1, 2015 renewal date and therefore reduce property holding costs that otherwise would have been incurred in 2015. Subsequently, during the fourth quarter of 2015 an additional $7.5 million was recorded given the continuous decline in the observed market value of the Nevada properties. The deferred income tax recoveries resulting from the Nevada impairments made in the second quarter and fourth quarter of 2015 were $10.4 million and $2.2 million, respectively. The Company used the market approach to estimate the fair value of the impaired properties. Further, when performing the recoverability test for the Los Azules project and El Gallo 2 project asset groups in the fourth quarter of 2015, the Company noted that the carrying value of each of the asset groups exceeded their estimated fair value, resulting in a total impairment charge for Los Azules project and El Gallo 2 project asset groups of $11.4 million and $2.0 million, respectively, along with a resulting deferred income tax recovery of $1.3 million and $nil million, respectively, being recorded in the Statement of Operations and Comprehensive Loss for the year ended December 31, 2015. The Company used the market approach to estimate the fair value of the impaired properties. For the year ended December 31, 2014, the Company recognized impairments on its Argentina and Nevada properties, for an aggregate of $353.7 million. For the Argentina properties, an initial $120.4 million impairment was recorded in the second quarter of 2014 when the Los Azules project was deemed to have a lower carrying value than the market price determined from a contemporaneous and comparable transaction completed at the time. Subsequently, during the fourth quarter of 2014 an additional $107.9 million was recorded given the continuous decline in the observed market value of the Los Azules project. The Company used the market approach to estimate the fair value of the impaired properties. The deferred income tax recoveries resulting from these impairments were $22.5 million and $19.3 million, respectively. Further, when performing the recoverability test for the Gold Bar, Tonkin and North Battle Mountain properties in Nevada and its other exploration properties in Argentina, the Company noted that the carrying value of each of the properties exceeded their estimated fair value, resulting in a total impairment charge for Nevada and Los Azules properties amounted to $98.4 million and $27.0 million, respectively, along with a resulting deferred income tax recovery of $31.6 million and $3.2 million, respectively, being recorded in the Statement of Operations and Comprehensive Loss for the year ended December 31, 2014. Based on the above, impairment charges were recorded on the following mineral property interests for the years ended December 31, 2016, 2015, and 2014: Name of Property Segment 2016 2015 2014 Los Azules Project Argentina $ — $ $ Other San Juan Properties Argentina — — Cerro Mojon Tenements Argentina — — La Merced Tenements Argentina — — Cabeza de Vaca Tenements Argentina — — El Trumai Tenements Argentina — — Martes 13 Tenements Argentina — — Celestina Tenements Argentina — — Other Santa Cruz Exploration Properties Argentina — — Gold Bar Project Nevada — Tonkin Properties Nevada — Limo Project Nevada — — North Battle Mountain Properties Nevada — East Battle Mountain Properties Nevada — — West Battle Mountain Properties Nevada — — Other United States Properties Nevada — — Property, Plant and Equipment Mexico — — Total impairment $ — $ $ The carrying values for all of the mineral properties held by the Company as at December 31, 2016 and 2015 are noted below: Name of Property State/Province Country 2016 2015 Los Azules Copper Project San Juan Argentina $ $ Tonkin Properties Nevada United States Gold Bar Project Nevada United States North Battle Mountain Properties Nevada United States El Gallo 1 Mine Sinaloa Mexico El Gallo 2 Properties Sinaloa Mexico Total Mineral Property Interests $ $ For the year ended December 31, 2016, the Company recorded $2.4 million (2015 - $1.3 million and 2014 - $1.3 million) of amortization expense related to El Gallo 1 mine, which is included in Production Costs Applicable to Sales in the Statement of Operations and Comprehensive Income (Loss). This included $0.5 million (2015 - $0.5 million and 2014 - $0.5 million) related to the amortization of capitalized asset retirement costs and $1.9 million (2015 - $0.8 million and 2014 - $0.8 million) in amortization expense related to its mineral properties in Mexico and the capitalized royalty costs attributable to El Gallo 1 mine property which were acquired in the second quarter of 2016. |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | 12 Months Ended |
Dec. 31, 2016 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSE MINE | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSE MINE | NOTE 6 INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE As noted in Note 2, Summary of Significant Accounting Policies - Investments , 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 Company’s investment in MSC, MSC’s 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. The Company’s 49% attributable share of operations from its investment in MSC was income of $13.0 million for the year ended December 31, 2016, compared to an income of $2.4 million for the year ended December 31, 2015 and loss of $5.3 million for the year ended December 31, 2014. These amounts are net of the amortization of the fair value increments arising from the Company’s purchase price allocation, net of impairment charges, and related income tax recovery. Included in the income tax recovery is the impact of fluctuations in the exchange rate between the Argentine peso and the U.S. dollar on the peso-denominated deferred tax liability associated with the investment in MSC recorded as part of the acquisition of Minera Andes. As a devaluation of the Argentine peso relative to the U.S. dollar results in a recovery of deferred income taxes, the impact has been a decrease to the Company’s loss, or an increase to the Company’s income, from its investment in MSC. During the year ended December 31, 2016, the Company did not identify any potential triggering events for impairment in relation to its investment in MSC, and consequently the Company did not record any impairment during the year. In 2015, the Company recorded an impairment charge of $11.8 million on its investment in MSC ($21.2 million in 2014), primarily as a result of the significant decline in long-term estimated silver market prices, as well as in the observed market value of comparable transactions in South America, which indicated a likely significant decrease in the value of the exploration properties owned by MSC. These factors caused the Company to assess that there was a decline in fair value of its investment in MSC that was other than temporary. As the loss in value of the investment was considered other than temporary, an impairment of $11.8 million was recorded in the Company’s Consolidated Statement of Operations and Comprehensive Income (Loss) for the year ended December 31, 2015 ($21.2 million in 2014). During the year ended December 31, 2016, the Company received $17.7 million in dividends from MSC, compared to $0.5 million in 2015. Changes in the Company’s investment in MSC for the year ended December 31, 2016 and 2015 are as follows: Year ended December 31, 2016 Year ended December 31, 2015 Investment in MSC, beginning of the period $ $ Attributable net income (loss) from MSC Amortization of fair value increments Income tax benefit Dividend distribution received Impairment of investment in MSC — Investment in MSC, end of the period $ $ A summary of the operating results from MSC for the year ended December 31, 2016, 2015, and 2014 is as follows: Year ended December 31, 2016 2015 2014 Minera Santa Cruz S.A. (100% basis) Net Sales $ $ $ Production costs applicable to sales Net income (loss) Portion attributable to McEwen Mining Inc. (49% basis) Net income (loss) $ $ $ Amortization of fair value increments Income tax benefit Income (loss) from investment in MSC, net of amortization $ $ $ As at December 31, 2016, MSC had current assets of $108.9 million, total assets of $468.3 million, current liabilities of $59.5 million and total liabilities of $137.0 million. These balances include the increase in fair value and amortization of the fair value increments arising from the Company’s purchase price allocation and are net of the impairment charges. Excluding the fair value increments from the purchase price allocation and impairment charges, MSC had current assets of $107.9 million, total assets of $288.9 million, current liabilities of $63.6 million, and total liabilities of $88.6 million as at December 31, 2016. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2016 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | NOTE 7 PROPERTY AND EQUIPMENT As of December 31, 2016 and 2015, property and equipment consisted of the following: December 31, 2016 December 31, 2015 Trucks and trailers $ $ Office furniture and equipment Leasehold improvements Drill rigs Building Land Mining equipment Construction-in-process Subtotal $ $ Less: accumulated depreciation Total $ $ Additions to property and equipment during the year ended December 31, 2016 are mainly in relation to office, furniture and equipment and mining equipment acquired for the El Gallo 1 mine. Depreciation expense for 2016 was $1.2 million (2015 - $0.9 million, 2014 - $1.0 million). Construction-in-process included a deposit with a contractor for the construction of certain equipment pertaining to the El Gallo 2 project. In the second quarter of 2016, the Company reached an agreement with the contractor, whereby the Company was refunded the deposit less costs incurred for the equipment design. The total amount of the deposit was $1.5 million, of which $1.0 million was refunded. The remaining $0.5 million was recorded under development costs in the Consolidated Statement of Operations and Comprehensive Income (Loss). |
SHORT-TERM BANK INDEBTEDNESS
SHORT-TERM BANK INDEBTEDNESS | 12 Months Ended |
Dec. 31, 2016 | |
SHORT-TERM BANK INDEBTEDNESS | |
SHORT-TERM BANK INDEBTEDNESS | NOTE 8 SHORT-TERM BANK INDEBTEDNESS On May 29, 2015, Compañía Minera Pangea S.A. de C.V. (“CMP”), a wholly-owned subsidiary of the Company, finalized a line of credit agreement with Banco Nacional de Comercio Exterior (“Banco Nacional”), for an amount up to 90,000,000 Mexican pesos (approximately $5.9 million as of May 29, 2015), which was secured by CMP’s VAT receivable balance. The applicable interest rate was equal to: (i) two and one-half percent (2.5%) per annum plus (ii) the 91 day Interbank Equilibrium Interest Rate (“TIIE”) rate, as published by the Bank of Mexico, payable quarterly. Upon signing the agreement, CMP paid a 1% commission on the total value of the simple credit agreement to Banco Nacional. On June 1, 2015, CMP drew down the entire 90,000,000 Mexican pesos, equivalent to $5.2 million as of December 31, 2015 from the line of credit, and realized a foreign exchange gain of approximately $0.7 million during the period. During the year ended December 31, 2015, CMP collected 34,654,201 Mexican pesos (equivalent to $2.0 million as of December 31, 2015) of VAT receivable, from which 2,903,100 Mexican pesos were applied against the accrued interest on the line of credit and the remaining 31,751,101 Mexican pesos (approximately $1.8 million as of December 31, 2015) were applied against the principal. On January 13, 2016 CMP paid the remaining balance of 58,248,899 Mexican Pesos (approximately $3.4 million as of December 31, 2015) and fulfilled its obligation to Banco Nacional. As a result, this line of credit was closed. |
RECLAMATION OBLIGATIONS
RECLAMATION OBLIGATIONS | 12 Months Ended |
Dec. 31, 2016 | |
RECLAMATION OBLIGATIONS | |
RECLAMATION OBLIGATIONS | NOTE 9 RECLAMATION OBLIGATIONS The Company is responsible for reclamation of certain past and future disturbances at its properties. The two most significant properties subject to these obligations are the Tonkin property in Nevada and the El Gallo 1 mine in Mexico. The Final Plan for Permanent Closure (“FPPC”) and the Amended Plan of Operations for the Tonkin property was approved by the Nevada Division of Environmental Protection (“NDEP”) and by the Bureau of Land Management (“BLM”) pursuant to the Finding of No Significant Impact in March 2012 and September 2015, respectively. Subsequently, on October 3, 2015 the BLM requested an updated bonding requirement in the amount of $3.6 million, which is covered within the surety bonds that the Company has as of December 31, 2016. Under current Mexican regulations, surety bonding of projected reclamation costs is not required. The Company’s reclamation expenses consisted of the following: Year ended December 31, 2016 2015 2014 Reclamation Adjustment reflecting updated estimates $ $ — $ — Reclamation Accretion Total $ $ $ As outlined in Note 2 Summary of Significant Accounting Policies, except for the Company’s 49% interest in the San José mine, none of the Company’s properties contain resources that satisfy the definition of proven and probable reserves. Therefore, the upward adjustment reflecting updated estimate of reclamation of El Gallo 1 mine is included in the Statement of Operations and Comprehensive Income (Loss) and since El Gallo 1 mine is an operating site, the adjustment is included in the Production Costs Applicable to Sales. The Company’s asset retirement obligations for years ended December 31, 2016 and 2015 are as follows: 2016 2015 Balance at beginning of the period $ $ Settlements — Accretion of liability Adjustment reflecting updated estimates Balance at December 31 $ $ Current portion Non-current portion $ $ The Company utilized the following assumptions in the calculation of its asset retirement obligations for years ended December 31, 2016 and 2015: Year ended December 31, 2016 2015 Undiscounted Cash Flows $ 10.7 million $ 9.5 million Remediation timeline 2017-2025 2016-2022 Inflation rate 1.6-2.4% 1.4-1.7% Credit adjusted risk free rate 4.2-4.6% |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2016 | |
INCOME TAXES. | |
INCOME TAXES | NOTE 10 INCOME TAXES The Company’s deferred income tax benefit (expense) consisted of: 2016 2015 2014 United States $ $ $ Foreign Deferred tax benefit $ $ $ The Company’s net income (loss) before tax consisted of: 2016 2015 2014 United States $ $ $ Foreign Net income (loss) before tax $ $ $ A reconciliation of the tax provision for 2016, 2015 and 2014 at statutory U.S. Federal and State income tax rates to the actual tax provision recorded in the financial statements is computed as follows: Expected tax benefit at 2016 2015 2014 Income (loss) before income taxes $ $ Statutory tax rate US Federal and State tax benefit at statutory rate $ Reconciling items: Equity pickup in MSC Impairment of MSC — Revisions to prior year estimates Adjustment for foreign tax rates Other permanent differences Unrealized foreign exchange rate (loss)/gain NOL expired Valuation allowance Tax benefit $ 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, 2016 and 2015 respectively are presented below: 2016 2015 Deferred tax assets: Net operating loss carryforward Mineral Properties Other temporary differences Total gross deferred tax assets Less: valuation allowance Net deferred tax assets $ — $ — Deferred tax liabilities: Acquired mineral property interests Total deferred tax liabilities $ $ Total net deferred tax liability $ $ The Company reviews the measurement of its deferred tax assets at each balance sheet date. On the basis of available information at December 31, 2016, 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 be realized. The change in valuation allowance of approximately $11.1 million primarily reflects a decrease of net operating loss carryforwards. The table below summarizes changes to the valuation allowance: For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2016 $ $ $ $ 2015 2014 (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 expiration of the Company's tax attributes and foreign exchange reductions of tax attributes in Mexico and Argentina. The deferred tax liability related to the Minera Andes acquisition was $16.3 million as at December 31, 2016 (2015 - $19.8 million). As at December 31, 2016 and 2015, the Company did not have any income-tax related accrued interest and tax penalties. The following table summarizes the Company’s losses that can be applied against future taxable profit: Country Type of Loss Amount Expiry Period United States (a) Non-operating losses $ 2017-2036 Mexico Non-operating losses 2017-2026 Canada Non-operating losses 2017-2036 Argentina Non-operating losses 2017-2021 (a) The losses in the United States and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. The Company or its subsidiaries file income tax returns in Canada, the United States, 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: 2013 to 2016 Canada: 2009 to 2016 Mexico: 2012 to 2016 Argentina: 2012 to 2016 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2016 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 11 SHAREHOLDERS’ EQUITY On June 18, 2015, the Board of Directors declared an annual return of capital distribution of $0.01 per share of common stock, payable semi-annually. The first semi-annual return of capital distribution payment of $0.005 was made on August 17, 2015 (declared in July 2015), the second payment of $0.005 was made on February 12, 2016 (declared in July 2015) and the third payment of $0.005 was made on August 29, 2016 (declared in August 2016), each for a total of $1.5 million. The fourth semi-annual return of capital distribution payment was approved by the Board in early January 2017 and was paid on February 14, 2017 to the shareholders of record on February 3, 2017. Return of capital distributions are paid to holders of the Company’s common stock. On October 1, 2015, the Board of Directors approved a share repurchase program authorizing the Company to purchase up to 15,000,000 shares of its common stock over a twelve-month period, with an authorized maximum of $15.0 million to be spent on the repurchases. Under the program, purchases of common stock could be made from time-to-time in the open market, subject to compliance with applicable U.S. and Canadian laws. The timing and amounts of any purchases are based on market conditions and other factors including share price, regulatory requirements and capital availability. Further, the repurchase program could be suspended, discontinued or modified at any time, at the discretion of the Board of Directors. During the twelve months ended December 31, 2016 the Company repurchased 557,991 shares of common stock (December 31, 2015 - 1,896,442), all of which have been cancelled, at a total cost of $0.6 million (December 31, 2015 - $1.8 million). The share repurchase program expired on September 30, 2016. At the Company’s annual meeting held on May 31, 2016, the holders of exchangeable shares of McEwen Mining-Minera Andes Acquisition Corp., a wholly-owned subsidiary of the Company (“MAQ”), voted to amend its Articles of Incorporation to allow early redemption of all outstanding exchangeable shares for common stock of the Company. The purpose of the early redemption was to reduce the administration costs of maintaining two stock listings and simplify the corporate structure. On July 25, 2016, the Company announced that MAQ had established a redemption date of August 23, 2016 in respect of all of its outstanding exchangeable shares and that McEwen Mining (Alberta) ULC ("McEwen (Alberta)") elected to exercise its overriding redemption call right to acquire all of the outstanding exchangeable shares (other than exchangeable shares held by the Company and its subsidiaries) on the business day immediately prior to the redemption date, being August 22, 2016. On August 22, 2016, McEwen (Alberta) acquired all of the exchangeable shares not yet redeemed for purchase consideration of one share of the Company’s common stock per exchangeable share. Following the redemption, MAQ applied to have the exchangeable shares delisted from the Toronto Stock Exchange (“TSX”). During the twelve months ended December 31, 2016, 24.2 million exchangeable shares were converted into common stock (December 31, 2015 – 4.3 million). At December 31, 2016, the Company or its subsidiaries had no outstanding exchangeable shares not exchanged and not owned (December 31, 2015 – 24.2 million). |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2016 | |
STOCK BASED COMPENSATION | |
STOCK BASED COMPENSATION | NOTE 12 STOCK BASED COMPENSATION Stock Options The Plan allows for equity awards to be granted to employees, consultants, advisors, and directors. The Plan is administered by the Board of Directors, which determines the terms pursuant to which any award is granted. The Board of Directors may delegate to certain officers the authority to grant awards to certain employees (other than such officers), consultants and advisors. The number of shares of common stock reserved for issuance thereunder is 17.5 million shares, with no more than 1 million shares subject to grants of options to an individual in a calendar year. The plan also provides for the grant of incentive options under Section 422 of the Internal Revenue Code (the “Code”), which provide potential tax benefits to the recipients compared to non-qualified options. At December 31, 2016, 5,294,563 awards were authorized and available for issuance under the Plan. During the year ended December 31, 2016, 1,494,085 shares of common stock were issued upon exercise of stock options under the Company’s Amended and Restated Equity Incentive Plan (“Plan”), at a weighted average exercise price of $2.51 per share for proceeds of $3.7 million. This compares to no shares of common stock issues during 2015 and 1,499,300 shares of common stock issued during 2014 upon exercise at a weighted average exercise price of $1.29 per share, for proceeds of $1.9 million. The following table summarizes information about stock options under the Plan outstanding at December 31, 2016: Weighted Weighted Average Average Remaining Number of Exercise Contractual Intrinsic Shares Price Life (Years) Value (in thousands, except per share and year data) Balance at December 31, 2014 $ $ — Granted — — Exercised — — — — Forfeited — — Expired — — Balance at December 31, 2015 $ $ Granted — — Exercised — Forfeited — — Expired — — — — Balance at December 31, 2016 $ $ Exercisable at December 31, 2016 $ $ 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 as of the date of the grant. During the year ended December 31, 2016, the Company granted stock options to certain employees and directors for an aggregate of 0.7 million shares of common stock (2015 - 2.7 million, 2014 - 1.7 million) at a weighted average exercise price of $3.99 per share (2015 – $1.03, 2014 - $2.90). 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 5 years from the date of issue. 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: 2016 2015 2014 Risk-free interest rate 1.13% to 1.21% 1.10% to 1.79% 1.10 % Dividend yield 0.24% to 0.27% 0% to 1.15% — % Volatility factor of the expected market price of common stock 74% 73% to 74% % Weighted-average expected life of option 5.0 years 5.0 years 3.5 years Weighted-average grant date fair value $ 2.36 $ 0.49 $ 1.45 During the year ended December 31, 2016, the Company recorded stock option expense of $1.0 million (2015 -$1.3 million, 2014 - $1.3 million) while the corresponding fair value of awards vesting in the period was $1.3 million (2015 - $1.5 million and 2014 - $2.0 million). None of the stock option expense was capitalized as part of the cost of an asset or any other item on the Consolidated Balance Sheet. At December 31, 2016, there was $1.4 million (2015 - $1.6 million, 2014 - $1.8 million) of unrecognized compensation expense related to 2.5 million (2015 - 4.2 million, 2014 - 2.7 million) unvested stock options outstanding. This cost is expected to be recognized over a weighted-average period of approximately 1.6 years (2015 - 1.6 years, 2014 – 1.6 years). The following table summarizes the status and activity of non-vested stock options for the year ended December 31, 2016: Weighted Average Number of Grant Date Shares Fair Value (in thousands, except per share amounts) Non-vested, beginning of year $ 0.74 Granted $ 2.36 Cancelled/Forfeited $ 0.77 Vested $ 0.85 Non-vested, end of year $ 1.08 |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2016 | |
NET INCOME (LOSS) PER SHARE | |
NET INCOME (LOSS) PER SHARE | NOTE 13 NET INCOME (LOSS) PER SHARE Basic net income (loss) per share is computed by dividing the net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed similarly except that the weighted average number of common shares is increased to reflect all dilutive instruments. Diluted net income (loss) 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 (loss) per share as the impact is anti-dilutive. Below is a reconciliation of the basic and diluted weighted average number of common shares and the computations for basic income (loss) per share and diluted income (loss) for the year ended December 31, 2016, 2015 and 2014: 2016 2015 2014 (in thousands, except per share amounts) Net income (loss) $ $ $ Weighted average common shares outstanding: Effect of employee stock-based awards — — Diluted shares outstanding: Net income (loss) per share - basic: $ $ $ Net income (loss) per share - diluted: $ $ $ Options to purchase 2.0 million shares of common stock at an average exercise price of $3.91 at December 31, 2016 were not included in the computation of diluted weighted average shares because their exercise price exceeded the average price of the Company’s common stock for the year ended December 31, 2016 and their effect would have been anti-dilutive. In 2015 and 2014, 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. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 14 COMMITMENTS AND CONTINGENCIES Commitments At December 31, 2016, the Company’s commitments include long-term operating leases covering office space, land and equipment purchase commitments, exploration expenditures, option payments on properties and reclamation costs for the following minimum amounts: Payments due by period 2017 2018 2019 2020 2021 Thereafter Total (in thousands) Operating lease obligations (office rent) $ $ $ $ $ $ $ Operating lease obligations (mining and surface rights) Reclamation costs (1) Total $ $ $ $ $ $ $ (1) Amounts presented represent the undiscounted uninflated future payments. For the year ended December 31, 2016, the Company had rental expense under operating leases of $0.4 million (2015 - $0.5 million; 2014 - $0.5 million). As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations in the United States. These 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. As at December 31, 2016, there were $4.8 million of outstanding surety bonds (2015 - $4.8 million). The annual financing fees are 1.5% of the value of the surety bonds, with an upfront 10% deposit of $0.5 million which is included in Other Assets in the Consolidated Balance Sheet. Other potential contingencies The Company’s 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. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 15 RELATED PARTY TRANSACTIONS The Company incurred the following expense (income) in respect to the related parties outlined below: Year ended December 31, 2016 2015 2014 Lexam L.P. $ $ $ Lexam VG Gold REVlaw — The Company has the following outstanding accounts payable balance in respect to the related parties outlined below: Year ended December 31, 2016 2015 Lexam L.P. $ — $ Lexam VG Gold — REVlaw An aircraft owned by Lexam L.P. (which is controlled by Robert R. McEwen, limited partner and beneficiary of Lexam L.P. and the Company’s 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 Company’s 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. Robert R. McEwen is the Non-Executive Chairman of Lexam VG Gold (“Lexam”) and holds 27% ownership in Lexam. The Company has agreed to share services with Lexam VG Gold Inc. including rent, personnel, office expenses and other administrative services. These transactions are in the normal course of business. Subsequent to the period-end, on February 13, 2017, the Company entered into an agreement pursuant to which the Company would acquire all of the issued and outstanding securities of Lexam. Refer to Note 18 Subsequent Events for further details . REVlaw is a company owned by Ms. Carmen Diges, General Counsel of the Company. The legal services of Ms. Diges as General Counsel are provided by REVlaw in the normal course of business. These legal fees have been recorded at their exchange amount and these transactions are in the normal course of business. |
OPERATING SEGMENT REPORTING
OPERATING SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2016 | |
OPERATING SEGMENT REPORTING | |
OPERATING SEGMENT REPORTING | NOTE 16 OPERATING SEGMENT REPORTING McEwen Mining is a mining and minerals exploration company focused on precious metals in Argentina, Mexico and the United States. The Company’s chief operating decisions maker (“CODM”) 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 Company’s reportable segments. The Company’s business activities that are not considered operating segments and not provided to the CODM for review are included in Corporate and other and are provided in this note for reconciliation purposes. The CODM reviews segment income (loss), defined as gold and silver sales less production costs applicable to sales, mine development costs, exploration costs, property holding costs and general and administrative expenses for all segments except for the MSC segment which is evaluated based on the attributable equity income. Gold and silver sales and production costs applicable to sales for the reportable segments are reported net of intercompany transactions. In the fourth quarter of 2016, the Company changed the measurement methods used to determine segment profit or loss composition of its reportable segments as a result of the change in the way that the CODM assesses performance and allocates resources. As a result, the Company separately reported segment income (loss) attributable to Los Azules and MSC. The updated composition of segments reflects the distinct economic characteristic of each mine/project. Significant information relating to the Company’s reportable operating segments is summarized in the tables below: Total Segment Year ended December 31, 2016 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ $ — $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs — Property holding costs — General and administrative expenses — Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) $ $ $ $ $ Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Interest and other income Gain on sale of assets Gain on sale of marketable equity securities Other-than-temporary impairment on marketable equity securities Unrealized gain on derivatives Foreign currency gain Net income before income taxes $ Total Segment Year ended December 31, 2015 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ $ — $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs — Property holding costs — General and administrative expenses — Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) $ $ $ $ Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Impairment of mineral property interests and property and equipment Impairment of investment in Minera Santa Cruz S.A. Interest and other income Gain on sale of assets Foreign currency gain Net loss before income taxes $ Total Segment Year ended December 31, 2014 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ — $ — $ — $ Production costs applicable to sales — — — Mine construction costs — — — Mine development costs — — — Exploration costs — Property holding costs — General and administrative expenses — Loss from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Impairment of mineral property interests and property and equipment Impairment of investment in Minera Santa Cruz S.A. Interest and other expense Gain on sale of assets Registration taxes Foreign currency loss Net loss before income taxes Geographic information Long-lived Assets Revenue (1) Year ended December 31, Year ended December 31, 2016 2015 2016 2015 2014 Canada $ $ $ — $ — $ — Mexico USA — — — Argentina (2) — — — Total consolidated $ $ $ $ $ (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $162.0 million as of December 31, 2016 (December 31, 2015 - $167.1 million). 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 2016, 2015 and 2014, sales to Bank of Nova Scotia were $58.1 million (96%), $67.2 million (92%) and $43.2 million (95%), respectively, of total gold and silver sales. Capital Expenditures information Capital expenditures includes acquisitions of Property and Equipment and Mineral Property Interests, net of dispositions. Capital Expenditures Year ended December 31, 2016 2015 2014 Mexico $ $ $ Los Azules — Nevada Total segment capital expenditures $ $ $ Corporate and other — — Consolidated total for capital expenditures $ $ $ |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 12 Months Ended |
Dec. 31, 2016 | |
FAIR VALUE ACCOUNTING | |
FAIR VALUE ACCOUNTING | NOTE 17 FAIR VALUE ACCOUNTING Assets and liabilities measured at fair value on a recurring basis The following tables set forth the fair value of the Company’s 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, 2016 and 2015. 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. Fair Value as at December 31, 2016 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ $ — Total $ $ $ $ — Fair Value as at December 31, 2015 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — Total $ $ $ — $ — The Company's investments include 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 2, Investments, the Company’s investments also include warrants to purchase common stock of certain extractive industry companies. Since these warrants are not traded on an active market, they are valued using the Black-Scholes option pricing model, and classified within Level 2 of the fair value hierarchy. The main inputs used in the valuation of the warrants are volatility, interest rate, dividend yield and exercise price of the instruments. 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. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2016 | |
SUBSEQUENT EVENTS. | |
SUBSEQUENT EVENTS | NOTE 18 SUBSEQUENT EVENTS Proposed Acquisition of Lexam VG Gold Inc. On February 13, 2017, the Company entered into an Arrangement Agreement with Lexam VG Gold Inc., a corporation existing under the laws of the Province of Ontario, Canada (“Lexam”), pursuant to which the Company has agreed to acquire all of the issued and outstanding common shares of Lexam (the “Arrangement”). The Arrangement will be implemented by way of a plan of arrangement and is subject to approval by the shareholders of Lexam and the Ontario Superior Court of Justice (Commercial List). Completion of the Arrangement will result in Lexam becoming a wholly-owned subsidiary of the Company. Pursuant to, and subject to the terms and conditions of, the Arrangement Agreement and the plan of arrangement, the Company will acquire all of the issued and outstanding shares of Lexam (the “Lexam Shares”) in exchange for shares of common stock of the Company at a ratio of 0.056 of a share of the Company’s common stock for each Lexam Share. If consummated, the Company expects to issue approximately 12,689,709 shares of common stock, or approximately 4% of the outstanding shares of the Company’s common stock, to Lexam shareholders. In addition, all issued and outstanding options to acquire Lexam Shares will be converted into options to purchase shares of common stock of the Company at a ratio of 0.056 of a share of the Company’s common stock for each Lexam Share underlying each such Lexam option. The exchange ratio of 0.056 will not be adjusted for any subsequent changes in market prices of the Lexam Shares or the Company’s common stock prior to the closing of the Arrangement. Consummation of the Arrangement is subject to various conditions, including, among others: (i) the approval of Lexam’s shareholders of the Arrangement and any other necessary actions related thereto; (ii) approval of the Court; (iii) approval of the listing of the shares of the Company’s common stock issuable to holders of Lexam Shares on the NYSE and the TSX; (iv) holders of not more than five percent of the issued and outstanding Lexam Shares exercising rights of dissent in respect of the Arrangement; (v) the accuracy of each party’s representations and warranties (subject to certain materiality qualifiers); and (vi) the absence of a material adverse effect in respect of each party. The Arrangement Agreement includes customary representations, warranties, and covenants by the parties, including, among others, a covenant of Lexam not to solicit competing or alternative transactions, subject to certain exceptions to permit Lexam’s Board of Directors to comply with its fiduciary duties, including the right of Lexam to enter into a “Superior Proposal” (as defined in the Arrangement Agreement). The Arrangement agreement also includes customary deal protection and non-solicitation provisions in favour of the Company, including a break fee of $2.1 million payable to the Company in certain circumstances, and fiduciary out provisions for the benefit of Lexam. Lexam is entitled to a reverse break fee of the same amount payable in certain other circumstances. Our Chairman and Chief Executive Officer, Mr. Robert R. McEwen, our Chairman and Chief Executive Officer, is also a principal shareholder of Lexam. In order to comply with NYSE rules, Mr. McEwen will not be entitled to receive shares of the Company’s common stock in exchange for his Lexam Shares in an amount representing more than 1% of the issued and outstanding shares of the Company without obtaining the prior approval of the Company’s shareholders. The Company expects to seek such shareholder approval at its 2017 Annual Meeting of Shareholders. If such shareholder approval is not obtained, the Company will pay for such excess shares in cash. Closing of the transaction is expected to occur by May 23, 2017. |
UNAUDITED SUPPLEMENTARY QUARTER
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | 12 Months Ended |
Dec. 31, 2016 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | NOTE 19 UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION The following table summarizes unaudited supplementary quarterly information for the years ended December 31, 2016, 2015, and 2014. Three months ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted Three months ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted Three months ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted |
COMPARATIVE FIGURES
COMPARATIVE FIGURES | 12 Months Ended |
Dec. 31, 2016 | |
COMPARATIVE FIGURES | |
COMPARATIVE FIGURES | NOTE 20 COMPARATIVE FIGURES Certain prior year information has been reclassified to conform with the current year’s presentation. |
SUMMARY OF SIGNIFICANT ACCOUN29
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
Use of Estimates | Use of Estimates: The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of the Company’s 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; estimates of fair value of equity investment and asset groups used in impairment testing; estimates of recoverable gold in leach pad inventory; estimates regarding the collectability of value added taxes receivable; valuation allowances for deferred tax assets; and estimate of income 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. |
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, below. |
Cash and Cash Equivalents | Cash and Cash Equivalents: 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. |
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 – Equity Method and Joint Ventures . Under this method, the Company’s share of earnings and losses is included in the Consolidated Statement of Operations and Comprehensive Income (Loss) and the balance of the investment is adjusted by the same amount. Under the equity method, dividends received from an investee are recorded as decreases in the investment account, not as income. If and when there has been a loss in value that is other than a temporary decline, the carrying value is reduced to its fair value. The Company accounts for its investment in marketable equity securities as available for sale securities and warrants on equity interest in publicly traded securities as held for trading securities in accordance with ASC guidance on accounting for certain investments in debt and equity securities. Unrealized gains and losses on these securities are accounted for through Other Comprehensive Income (“OCI”) except for gain and losses on warrants which are included in Other Income (Expense) in the Statement of Operations and Comprehensive Income (Loss). The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other‑than‑temporary in accordance with ASC guidance. Declines in fair value below the Company’s carrying value deemed to be other‑than‑temporary are charged to operations. |
Value Added Taxes Receivable | Value Added Taxes Receivable: In Mexico, value added taxes (“VAT”) 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. In Argentina, except at the San José mine, 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, material on leach pads, in-process inventory, precious metals inventory and materials and supplies are accounted for using weighted average cost method and are carried at the lower of average cost or net realizable value. Net realizable value represents the estimated future sales price of the product based on current and long-term metals prices, less the estimated costs to complete production and bring the product to sale. Write-downs of stockpiles, material on leach pads, in-process inventory, precious metals inventory and materials and supplies, resulting from net realizable value impairments, are reported as a component of production costs applicable to sales. The current portion of stockpiles, material on leach pad, in-process inventory and materials and supplies is determined based on the expected amounts to be processed within the next 12 months. Stockpiles, material on leach pads, in‑process inventory and materials and supplies not expected to be processed within the next 12 months, if any, are classified as long‑term. Stockpiles represent mineralized material that has been extracted from the mine and is available for further 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 ore that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the ore over a period of months. Costs are attributed to the ore 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 ore placed on the leach pads (measured tonnes added to the leach pads), the grade of ore placed on the leach pads (based on assay data) and a recovery percentage. In general, leach pads recover between 50% and 95% of the recoverable ounces in the first year of leaching, declining each year thereafter until the leaching is complete. The cumulative metallurgical recovery rate for gold production at the El Gallo 1 mine from September 2012 (start of production) to December 31, 2016 was approximately 59% (2015 – 56%). Although 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 the ADR process and the projected recoveries of the respective plants. 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 doré and bullion that is unsold and held at the Company’s or the refinery’s 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 and consumable parts used in drilling and other operating 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 SEC Industry 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. As of December 31, 2016, except for the Company’s 49% interest in the San José mine, none of the Company’s properties contain resources that satisfy the definition of proven and probable reserves. |
Property and Equipment | Property and Equipment: As described in Design, Construction and Development Costs below, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred as the Company has not established proven and probable reserves on any of its properties except for the Company’s 49% interest in the San José mine. Only certain types of equipment which have alternative uses or significant salvage value, may be capitalized without proven and probable reserves. Depreciation is computed using the straight-line method with the exception of mining equipment. Mining equipment is depreciated using the units-of-production method based on tonnes processed over the estimated total mine life. |
Design, Construction, and Development Costs | Design, Construction, and Development Costs: Mine 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. When proven and probable reserves as defined by SEC Industry Guide 7 exist, development costs are capitalized. Mine development costs incurred either to develop new ore deposits, expand the capacity of operating mines, or to develop mine areas substantially in advance of current production would be capitalized. Costs of start‑up activities and costs incurred to maintain current production or to maintain assets on a standby basis are charged to operations as incurred. If or when a project is abandoned, costs are charged to operations upon abandonment. All capitalized costs would be amortized using the units of production method over the estimated life of the ore body based on recoverable ounces to be mined from proven and probable reserves. Certain costs to design and construct mining and processing facilities may be incurred prior to establishing proven and probable reserves. As no proven and probable reserves have been established on any of the Company’s properties, except for the Company’s 49% interest in the San José mine, design, construction and development costs are not capitalized at any of the Company’s properties, and accordingly, substantially all costs are expensed as incurred. Additionally, the Company does not have a corresponding depreciation or amortization of these costs going forward since these expenditures were expensed as incurred as opposed to being capitalized. |
Mineral Property Interests | Mineral Property Interests: Mineral property interests include acquired interests in advanced-stage properties and exploration stage properties, which are considered tangible assets. The amount capitalized relating to a mineral property interest represents its fair value at the time of acquisition, either as an individual asset purchase or as a part of a business combination. The value of mineral property interests is primarily driven by the nature and amount of mineralized material believed to be contained in the properties. When proven and probable reserves exist, the relevant capitalized costs and mineral property interests are to be charged to expense based on the units of production method and upon commencement of production. However, when a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs and mineral property interests 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 our internal mine plans. As a result of these and other differences, the Company’s financial statements may not be comparable to the financial statements of mining companies that have established reserves as defined by SEC Industry Guide 7. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets: The Company reviews and evaluates its long-lived assets for impairment 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 there are identifiable cash flows. For asset groups where 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 “recoverable mineralized material” refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during processing and treatment of mineralized material. The Company’s estimates of future cash flows are based on numerous assumptions and 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. For asset groups where the Company is unable to determine a reliable estimate of undiscounted 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, reclamation and remediation costs: The Company records the fair value of a liability for an asset retirement obligation (“ARO”) in the period that it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs 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. Periodic accretion is recorded to ARO and charged to earnings. Since no proven or probable reserves have been established for any of the Company’s properties, other than at the San José mine, incremental asset retirement costs associated with the upward adjustments to the fair value of the ARO at the El Gallo 1 mine or Tonkin property are charged to expense. The fair value of 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 or credit risk. Ongoing environmental and reclamation expenditures are debited against the ARO liability as incurred to the extent they relate to the ARO liability and to expense to the extent they do not. |
Revenue Recognition | Revenue Recognition: Revenue consists of sales value received for the Company’s principal products, gold and silver. The Company currently does not earn revenue from any products other than 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. Product pricing is determined under the sales agreements at the point revenue is recognized by reference to 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 doré produced from the San José 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 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. The Company entered into a doré sales agreement with a Canadian financial institution in July 2012. Under that agreement, the Company has the option to sell to the institution approximately 90% of the gold and silver contained in doré bars produced at the El Gallo 1 mine prior to the completion of refining by the third party refiner, which normally takes approximately 15 business days. 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 doré or bullion has been made in full by the purchaser. |
Property Holding Costs | Property Holding Costs: Holding costs to maintain a property are expensed in the period they are incurred. These costs include security and maintenance expenses, lease and claim fees and payments, and environmental monitoring and reporting costs. |
Exploration Costs | Exploration Costs: Exploration costs include costs incurred to identify new mineral resources, evaluate potential resources, and convert mineral resources into proven and probable reserves. Exploration costs are expensed as incurred. |
Foreign Currency | Foreign Currency: The functional currency for the Company’s 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. |
Stock-Based Compensation | 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 Company's estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behavior or estimates of forfeitures. |
Income Taxes | Income Taxes: The Company accounts for income taxes under ASC 740. Using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related income tax basis for such liabilities and assets. This method generates either a net deferred income tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income tax charge or benefit by recording the change in either the net deferred income tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income 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 tax asset will not be realized. |
Comprehensive Income (Loss) | Comprehensive Income (Loss): In addition to net loss, comprehensive loss includes all changes in equity during a period, such as cumulative unrecognized changes in fair value of marketable equity securities classified as available‑for‑sale or other investments. |
Per Share Amounts | Per Share Amounts: Basic earnings or loss per share includes no dilution and is computed by dividing income or loss available to common shareholders by the weighted average number of common and exchangeable shares outstanding during the period. Diluted earnings or loss per share reflect 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. The diluted earnings or loss are calculated using the treasury stock method and only for those instruments that that result in a reduction in income per share are included in the calculation. |
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 consolidated statement of operations over the period to maturity using the effective interest method. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: Fair value accounting, as prescribed in ASC Section 825, utilizes 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: 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 Presentation of Financial Statements – Going Concern In August 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 201415 related to management’s going concern assumption. This update provides guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related disclosures. The update is effective for the annual period ending after December 15, 2016. Adoption of this guidance, effective December 31, 2016, had no impact on the Consolidated Financial Statements or disclosures. Recently Issued Accounting Pronouncements Business Combinations: Definition of a business: In January 2017 the FASB issued ASU No. 2017-01which changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The update to the standard is effective for the Company beginning after December 15, 2017, with early application permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory: In October 2016 the FASB issued ASU No. 2016-16, to modify the current exception to income tax accounting that required companies to defer the income tax effect of certain intercompany transactions. ASU No. 2016-16 only allows companies to defer the income tax effect of intercompany inventory transactions under an exception to the guidance on income taxes that currently applies to intercompany sales and transfers of all assets. The update to the standard is effective for the Company beginning January 1, 2018, with early application permitted as of the beginning of an annual period. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Compensation – Stock Compensation – Improvements to employee Share-Based Payment Accounting: In March 2016, the FASB issued ASU No. 2016-09, which changes how companies account for certain aspects of share-based payment awards to employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The update to the standard is effective for the Company beginning after December 5, 2016, with early application permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Investments - Equity Method and Joint Ventures - Simplifying the Transition to the Equity Method of Accounting: In March 2016, the FASB issued ASU 2016-07, which affects all entities that have an investment that becomes qualified for the equity method of accounting as a result of an increase in the level of ownership interest or degree of influence. The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Financial Instruments - Recognition and Measurement of Financial Assets and Financial Liabilities: In January 2016, the FASB issued ASU No. 2016-01, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01 will be effective for the Company beginning in its second quarter of 2019. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. Revenue from Contracts with Customers: In 2016, the FASB issued three separate accounting standard updates regarding Topic 606: ASU 2016-08, ASU 2016-10 and ASU 2016-12. These ASUs outline amendments to Topic 606 which is not yet effective, including reporting revenue gross versus net, identifying performance obligations and licensing and narrow-scope improvements and practical expedients. The effective date and transition requirements for the amendments listed in these updates are the same as the effective date and transition requirements for Topic 606 (and any other Topic amended by Update 2014-09) which is January 1, 2018, with earlier application permitted. The Company will not be early adopting the Topic 606. The Company is currently evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. We have identified two potential areas of impact including bullion and doré sales from our Mexico Operations and doré and concentrate sales from the San Jose mine which has an impact on the income (loss) from the investment in MSC under the equity method of accounting. We will continue to assess and implement the new revenue recognition policy and any related impact on our internal controls throughout 2017. Leases – Amendments: In February 2016, the FASB issued ASU 2016-02 “leases (Topic 842)” which core principle is that a lessee should recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term. For leases with a term of twelve months or less, the lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from the previous GAAP. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal year, with early adoption permitted. The ASU requires a modified retrospective transition method with the option to elect a package of practical expedients. The Company is evaluating the effect of this amendment and the impact it will have on the Company’s consolidated financial statements. |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
INVESTMENTS | |
Summary of investment portfolio | Other Statement of Opening Additions Disposals Comprehensive Operations Fair Value balance during during Income (Loss) (Loss) end of the As of December 31, 2016 (January 1) year year (pre-tax) Income year Marketable equity securities $ $ $ $ $ $ Warrants — — — Investments $ $ $ $ $ $ Other Statement of Opening Additions Disposals Comprehensive Operations Fair Value balance during during Income (Loss) (Loss) end of the As of December 31, 2015 (January 1) period period (pre-tax) Income period Marketable equity securities $ $ $ — $ $ — $ Warrants — — — — — — Investments $ $ $ — $ $ — $ |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
INVENTORIES | |
Schedule of inventories | December 31, 2016 December 31, 2015 Material on leach pads $ $ In-process inventory Stockpiles Precious metals Materials and supplies Inventories $ $ |
MINERAL PROPERTY INTERESTS (Tab
MINERAL PROPERTY INTERESTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
MINERAL PROPERTY INTERESTS AND ASSET RETIREMENT OBLIGATIONS | |
Schedule of impairment changes on mineral property | Name of Property Segment 2016 2015 2014 Los Azules Project Argentina $ — $ $ Other San Juan Properties Argentina — — Cerro Mojon Tenements Argentina — — La Merced Tenements Argentina — — Cabeza de Vaca Tenements Argentina — — El Trumai Tenements Argentina — — Martes 13 Tenements Argentina — — Celestina Tenements Argentina — — Other Santa Cruz Exploration Properties Argentina — — Gold Bar Project Nevada — Tonkin Properties Nevada — Limo Project Nevada — — North Battle Mountain Properties Nevada — East Battle Mountain Properties Nevada — — West Battle Mountain Properties Nevada — — Other United States Properties Nevada — — Property, Plant and Equipment Mexico — — Total impairment $ — $ $ |
Summary of mineral property interests | Name of Property State/Province Country 2016 2015 Los Azules Copper Project San Juan Argentina $ $ Tonkin Properties Nevada United States Gold Bar Project Nevada United States North Battle Mountain Properties Nevada United States El Gallo 1 Mine Sinaloa Mexico El Gallo 2 Properties Sinaloa Mexico Total Mineral Property Interests $ $ |
INVESTMENT IN MINERA SANTA CR33
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSE MINE | |
Schedule of change in the entity's investment in MSC | Year ended December 31, 2016 Year ended December 31, 2015 Investment in MSC, beginning of the period $ $ Attributable net income (loss) from MSC Amortization of fair value increments Income tax benefit Dividend distribution received Impairment of investment in MSC — Investment in MSC, end of the period $ $ |
Summary of MSC's financial information from operations | Year ended December 31, 2016 2015 2014 Minera Santa Cruz S.A. (100% basis) Net Sales $ $ $ Production costs applicable to sales Net income (loss) Portion attributable to McEwen Mining Inc. (49% basis) Net income (loss) $ $ $ Amortization of fair value increments Income tax benefit Income (loss) from investment in MSC, net of amortization $ $ $ |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
PROPERTY AND EQUIPMENT | |
Schedule of property and equipment | December 31, 2016 December 31, 2015 Trucks and trailers $ $ Office furniture and equipment Leasehold improvements Drill rigs Building Land Mining equipment Construction-in-process Subtotal $ $ Less: accumulated depreciation Total $ $ |
RECLAMATION OBLIGATIONS (Tables
RECLAMATION OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
RECLAMATION OBLIGATIONS | |
Schedule of reclamation expense | Year ended December 31, 2016 2015 2014 Reclamation Adjustment reflecting updated estimates $ $ — $ — Reclamation Accretion Total $ $ $ |
Schedule of reconciliation of asset retirement obligations | 2016 2015 Balance at beginning of the period $ $ Settlements — Accretion of liability Adjustment reflecting updated estimates Balance at December 31 $ $ Current portion Non-current portion $ $ |
Schedule of assumptions in the calculation of asset retirement obligations | Year ended December 31, 2016 2015 Undiscounted Cash Flows $ 10.7 million $ 9.5 million Remediation timeline 2017-2025 2016-2022 Inflation rate 1.6-2.4% 1.4-1.7% Credit adjusted risk free rate 4.2-4.6% |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
INCOME TAXES. | |
Schedule of deferred income tax recovery (expense) | 2016 2015 2014 United States $ $ $ Foreign Deferred tax benefit $ $ $ |
Schedule of net income (loss) before tax | 2016 2015 2014 United States $ $ $ Foreign Net income (loss) before tax $ $ $ |
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 | Expected tax benefit at 2016 2015 2014 Income (loss) before income taxes $ $ Statutory tax rate US Federal and State tax benefit at statutory rate $ Reconciling items: Equity pickup in MSC Impairment of MSC — Revisions to prior year estimates Adjustment for foreign tax rates Other permanent differences Unrealized foreign exchange rate (loss)/gain NOL expired Valuation allowance Tax benefit $ |
Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities | 2016 2015 Deferred tax assets: Net operating loss carryforward Mineral Properties Other temporary differences Total gross deferred tax assets Less: valuation allowance Net deferred tax assets $ — $ — Deferred tax liabilities: Acquired mineral property interests Total deferred tax liabilities $ $ Total net deferred tax liability $ $ |
Summary of changes in valuation allowance | For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2016 $ $ $ $ 2015 2014 (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 expiration of the Company's tax attributes and foreign exchange reductions of tax attributes in Mexico and Argentina. |
Summary of company’s non operating losses that can be applied against future taxable profit | Country Type of Loss Amount Expiry Period United States (a) Non-operating losses $ 2017-2036 Mexico Non-operating losses 2017-2026 Canada Non-operating losses 2017-2036 Argentina Non-operating losses 2017-2021 (a) The losses in the United States and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. |
STOCK BASED COMPENSATION (Table
STOCK BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
STOCK BASED COMPENSATION | |
Summary of information about stock options under the Plan | Weighted Weighted Average Average Remaining Number of Exercise Contractual Intrinsic Shares Price Life (Years) Value (in thousands, except per share and year data) Balance at December 31, 2014 $ $ — Granted — — Exercised — — — — Forfeited — — Expired — — Balance at December 31, 2015 $ $ Granted — — Exercised — Forfeited — — Expired — — — — Balance at December 31, 2016 $ $ Exercisable at December 31, 2016 $ $ |
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 | 2016 2015 2014 Risk-free interest rate 1.13% to 1.21% 1.10% to 1.79% 1.10 % Dividend yield 0.24% to 0.27% 0% to 1.15% — % Volatility factor of the expected market price of common stock 74% 73% to 74% % Weighted-average expected life of option 5.0 years 5.0 years 3.5 years Weighted-average grant date fair value $ 2.36 $ 0.49 $ 1.45 |
Summary of status and activity of non-vested stock options | The following table summarizes the status and activity of non-vested stock options for the year ended December 31, 2016: Weighted Average Number of Grant Date Shares Fair Value (in thousands, except per share amounts) Non-vested, beginning of year $ 0.74 Granted $ 2.36 Cancelled/Forfeited $ 0.77 Vested $ 0.85 Non-vested, end of year $ 1.08 |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
NET INCOME (LOSS) PER SHARE | |
Schedule of reconciliation of the basic weighted average number of common shares and the computations for basic loss per share | 2016 2015 2014 (in thousands, except per share amounts) Net income (loss) $ $ $ Weighted average common shares outstanding: Effect of employee stock-based awards — — Diluted shares outstanding: Net income (loss) per share - basic: $ $ $ Net income (loss) per share - diluted: $ $ $ |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
RENTAL EXPENSE, COMMITMENTS AND CONTINGENCIES | |
Schedule of minimum amounts under purchase commitments, long term leases covering office space, exploration expenditures, option payments on properties | Payments due by period 2017 2018 2019 2020 2021 Thereafter Total (in thousands) Operating lease obligations (office rent) $ $ $ $ $ $ $ Operating lease obligations (mining and surface rights) Reclamation costs (1) Total $ $ $ $ $ $ $ (1) Amounts presented represent the undiscounted uninflated future payments. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party expense (income) and outstanding accounts payable (receivable) | The Company incurred the following expense (income) in respect to the related parties outlined below: Year ended December 31, 2016 2015 2014 Lexam L.P. $ $ $ Lexam VG Gold REVlaw — The Company has the following outstanding accounts payable balance in respect to the related parties outlined below: Year ended December 31, 2016 2015 Lexam L.P. $ — $ Lexam VG Gold — REVlaw |
OPERATING SEGMENT REPORTING (Ta
OPERATING SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
OPERATING SEGMENT REPORTING | |
Schedule of the financial information relating to the Company's segments | Total Segment Year ended December 31, 2016 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ $ — $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs — Property holding costs — General and administrative expenses — Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) $ $ $ $ $ Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Interest and other income Gain on sale of assets Gain on sale of marketable equity securities Other-than-temporary impairment on marketable equity securities Unrealized gain on derivatives Foreign currency gain Net income before income taxes $ Total Segment Year ended December 31, 2015 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ $ — $ — $ — $ Production costs applicable to sales — — — Mine development costs — — Exploration costs — Property holding costs — General and administrative expenses — Income from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) $ $ $ $ Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Impairment of mineral property interests and property and equipment Impairment of investment in Minera Santa Cruz S.A. Interest and other income Gain on sale of assets Foreign currency gain Net loss before income taxes $ Total Segment Year ended December 31, 2014 Mexico MSC Los Azules Nevada Income (loss) Gold and silver sales $ — $ — $ — $ Production costs applicable to sales — — — Mine construction costs — — — Mine development costs — — — Exploration costs — Property holding costs — General and administrative expenses — Loss from investment in Minera Santa Cruz S.A. (net of amortization) — — — Segment income (loss) Corporate and other Other exploration General and administrative expenses Depreciation Revision of estimates and accretion of reclamation obligations Impairment of mineral property interests and property and equipment Impairment of investment in Minera Santa Cruz S.A. Interest and other expense Gain on sale of assets Registration taxes Foreign currency loss Net loss before income taxes |
Schedule Of Geographic Information | Geographic information Long-lived Assets Revenue (1) Year ended December 31, Year ended December 31, 2016 2015 2016 2015 2014 Canada $ $ $ — $ — $ — Mexico USA — — — Argentina (2) — — — Total consolidated $ $ $ $ $ (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $162.0 million as of December 31, 2016 (December 31, 2015 - $167.1 million). |
Schedule Of Property and Equipment and Mineral Property Interests, net of dispositions | Capital Expenditures Year ended December 31, 2016 2015 2014 Mexico $ $ $ Los Azules — Nevada Total segment capital expenditures $ $ $ Corporate and other — — Consolidated total for capital expenditures $ $ $ |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
FAIR VALUE ACCOUNTING | |
Schedule of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy | Fair Value as at December 31, 2016 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ $ — Total $ $ $ $ — Fair Value as at December 31, 2015 Total Level 1 Level 2 Level 3 Assets: Investments $ $ $ — $ — Total $ $ $ — $ — |
UNAUDITED SUPPLEMENTARY QUART43
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
Summary of unaudited supplementary quarterly information | Three months ended March 31, 2016 June 30, 2016 September 30, 2016 December 31, 2016 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted Three months ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted Three months ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 (unaudited) (in thousands, except per share) Net income (loss) $ $ $ $ Net income (loss) per share: Basic $ $ $ $ Diluted $ $ $ $ Weighted average shares outstanding: Basic Diluted |
SUMMARY OF SIGNIFICANT ACCOUN44
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Ore Stockpile Inventory (Details) | 12 Months Ended | 40 Months Ended | 52 Months Ended |
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2016 | |
El Gallo 1 mine | |||
Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies | |||
Cumulative metallurgical recovery rate for gold production (as a percent) | 56.00% | 59.00% | |
Minimum | |||
Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies | |||
Recovery percentage of leach pads of the recoverable ounces in the first year of leaching | 50.00% | ||
Maximum | |||
Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies | |||
Recovery percentage of leach pads of the recoverable ounces in the first year of leaching | 95.00% |
SUMMARY OF SIGNIFICANT ACCOUN45
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Stockpiles, Proven and Probable Reserves (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Stockpiles, Ore on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: | |
Period for determining current portion of stockpiles, ore on leach pad, in-process inventory and materials and supplies | 12 months |
Period within which Stockpiles, ore on leach pads, in-process inventory and materials and supplies are not expected to be processed, classified as long-term | 12 months |
San Jose mine | |
Stockpiles, Ore on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: | |
Ownership interest (as a percent) | 49.00% |
SUMMARY OF SIGNIFICANT ACCOUN46
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Products, Properties and Production of Minerals (Details) - Gold and Silver - El Gallo 1 mine | 12 Months Ended |
Dec. 31, 2016 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Option to sell prior to the completion of refining (as a percent) | 90.00% |
Period of completion of refining | 15 days |
INVESTMENTS (Details)
INVESTMENTS (Details) $ in Thousands | Jul. 21, 2016USD ($)item | May 13, 2016USD ($)item | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Investments rollforward | |||||
Opening balance | $ 1,032 | $ 1,082 | |||
Additions during the year | 4,419 | 1,114 | |||
Disposals during the period | (470) | ||||
Other Comprehensive Income (Loss) (pre -tax) | 3,043 | (1,164) | |||
Statement of Operations (Loss) Income | 519 | ||||
Fair Value end of the year | 8,543 | 1,032 | $ 1,082 | ||
Fair value Available for Sale | |||||
Opening balance | 1,032 | ||||
Additions during the period | 4,419 | 1,114 | 446 | ||
Disposals during the period | (470) | ||||
Fair Value end of the period | 8,543 | 1,032 | |||
Fair value of warrants | |||||
Cost of purchase of marketable equity securities | 4,900 | 1,900 | |||
Unrealized gain on available-for-sale securities | 1,600 | ||||
Unrealized loss on available-for-sale securities | 900 | ||||
Sale of marketable securities | 500 | ||||
Gain on available-for-sale securities | 100 | ||||
Other-than-temporary impairment on marketable equity securities | 882 | 0 | |||
Golden Predator Mining Corporation | |||||
Fair value of warrants | |||||
Number of units acquired | item | 1,500,000 | 3,125,000 | |||
Common shares per unit | item | 1 | 1 | |||
Warrants per unit | item | 0.50 | 1 | |||
Payments For Purchase Of Private Placement | $ 900 | $ 400 | |||
Common Stock | Golden Predator Mining Corporation | |||||
Fair value of warrants | |||||
Payments For Purchase Of Private Placement | 700 | $ 200 | |||
Warrants | Golden Predator Mining Corporation | |||||
Fair value of warrants | |||||
Payments For Purchase Of Private Placement | $ 200 | ||||
Marketable equity securities | |||||
Fair value Available for Sale | |||||
Opening balance | 1,032 | 1,082 | |||
Additions during the period | 4,004 | 1,114 | |||
Disposals during the period | (470) | ||||
Other Comprehensive Income (Loss) (pre -tax) | 3,043 | (1,164) | |||
Statement of Operations (Loss) Income | (860) | ||||
Fair Value end of the period | 6,749 | $ 1,032 | $ 1,082 | ||
Warrants | |||||
Fair value Available for Sale | |||||
Additions during the period | 415 | ||||
Fair value of warrants | |||||
Statement of Operations (Loss) Income | 1,379 | ||||
Fair Value end of the year | $ 1,794 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
INVENTORIES | ||
Ore on leach pads | $ 14,267 | $ 7,150 |
In-process inventory | 4,953 | 2,830 |
Stockpiles | 1,102 | 1,923 |
Precious metals | 5,035 | 1,820 |
Materials and supplies | 1,263 | 1,252 |
Inventories | 26,620 | 14,975 |
Inventory write-down | $ 0 | $ 0 |
MINERAL PROPERTY INTEREST - Min
MINERAL PROPERTY INTEREST - Mineral Property Interests (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Apr. 19, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Mineral Property Interests | ||||||||||
Purchase price | $ 5,985 | |||||||||
Mineral property interests | $ 237,245 | 242,640 | $ 237,245 | |||||||
Impairment charges | 50,600 | $ 353,736 | ||||||||
Amortization of mineral property interests and asset retirement obligations | 2,413 | 1,288 | 1,236 | |||||||
Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 7,500 | $ 29,700 | $ 98,400 | |||||||
Recovery of deferred income tax | $ 10,400 | 2,200 | 31,600 | 31,600 | ||||||
Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 27,000 | |||||||||
Recovery of deferred income tax | 3,200 | |||||||||
Los Azules Copper Project | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | 191,490 | 191,490 | 191,490 | |||||||
Impairment charges | 11,400 | 107,900 | $ 120,400 | |||||||
Recovery of deferred income tax | 1,300 | $ 19,300 | $ 22,500 | |||||||
Gold Bar Complex | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 20,847 | 31,391 | ||||||||
Tonkin Properties | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | 4,833 | 4,833 | 4,833 | |||||||
Tonkin Properties | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 14,939 | 25,435 | ||||||||
Other United States Properties | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 9,611 | |||||||||
El Gallo 1 mine | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | 5,925 | 8,545 | 5,925 | |||||||
Amortization of mineral property interests and asset retirement obligations | 2,400 | 1,300 | 1,300 | |||||||
El Gallo 2 Properties | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | 3,482 | 5,807 | 3,482 | |||||||
Impairment charges | 2,000 | |||||||||
Limo Project | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 23,438 | |||||||||
North Battle Mountain Complex Located in Nevada, United States | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,921 | |||||||||
North Battle Mountain Properties Located In Nevada United States | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | 785 | 785 | 785 | |||||||
North Battle Mountain Properties Located In Nevada United States | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,443 | |||||||||
East Battle Mountain Properties Located In Nevada United States | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 4,060 | |||||||||
West Battle Mountain Properties Located In Nevada United States | Nevada | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 2,567 | |||||||||
Mexico property interests | ||||||||||
Mineral Property Interests | ||||||||||
Amortization of mineral property interests | 1,900 | 800 | 800 | |||||||
Amortization of capitalized asset retirement costs | 500 | 500 | ||||||||
Gold Bar Project | ||||||||||
Mineral Property Interests | ||||||||||
Mineral property interests | $ 30,730 | 31,180 | 30,730 | |||||||
Royalty | ||||||||||
Mineral Property Interests | ||||||||||
Required payment of gross revenue less allowable deductions to the tiered net smelter return royalty on the El Gallo 1 Mine (as a percent) | 3.50% | |||||||||
Eventually reduced percentage of required payment | 1 | |||||||||
Purchase price | $ 1,000 | $ 5,300 | ||||||||
Total purchase price at closing | 6,300 | |||||||||
Royalty | Non-current other liabilities | ||||||||||
Mineral Property Interests | ||||||||||
Purchase price | 1,000 | |||||||||
Royalty | El Gallo 1 mine | ||||||||||
Mineral Property Interests | ||||||||||
Additional to mineral properties | 5,100 | |||||||||
Royalty | El Gallo 2 Properties | ||||||||||
Mineral Property Interests | ||||||||||
Additional to mineral properties | $ 1,200 | |||||||||
Argentina | Los Azules Copper Project | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 11,399 | 228,301 | ||||||||
Argentina | Other Argentina exploration properties in San Juan, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 7,817 | |||||||||
Argentina | Cerro Mojon Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,971 | |||||||||
Argentina | La Merced Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,891 | |||||||||
Argentina | Cabeza de Vaca Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 877 | |||||||||
Argentina | El Trumai Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,534 | |||||||||
Argentina | Martes 13 Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 3,568 | |||||||||
Argentina | Celestina Tenements in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,753 | |||||||||
Argentina | Other Argentina exploration properties in Santa Cruz, Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | $ 7,601 | |||||||||
Mexico | ||||||||||
Mineral Property Interests | ||||||||||
Amortization of capitalized asset retirement costs | $ 500 | |||||||||
Mexico | Property, Plant and Equipment | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | 1,972 | |||||||||
Mexico | Nevada And Argentina | ||||||||||
Mineral Property Interests | ||||||||||
Impairment charges | $ 50,600 |
INVESTMENT IN MINERA SANTA CR50
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Equity Method Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Jan. 24, 2012 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Dividends received from Minera Santa Cruz S.A | $ 17,738 | $ 548 | $ 9,483 | ||
Corporate Venture | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Ownership interest (as a percent) | 100.00% | 100.00% | 100.00% | ||
MSC | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Ownership interest (as a percent) | 49.00% | 49.00% | 49.00% | 49.00% | 49.00% |
Results of operations | $ 13,000 | $ 2,400 | $ 5,300 | ||
Dividends received from Minera Santa Cruz S.A | $ 17,700 | $ 500 |
INVESTMENT IN MINERA SANTA CR51
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, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Change in the investment in MSC | |||
Investment in MSC, beginning balance | $ 167,107 | ||
Income tax recovery (note 10) | (3,749) | $ (24,560) | $ (107,170) |
Impairment of investment in Minera Santa Cruz S.A., net of amortization | 11,777 | 21,162 | |
Investment in MSC, ending balance | 162,320 | 167,107 | |
MSC | |||
Change in the investment in MSC | |||
Investment in MSC, beginning balance | 167,107 | 177,018 | |
Attributable net (loss) income from MSC | 15,961 | (2,859) | (2,597) |
Amortization of fair value increments | (12,274) | (10,669) | (13,190) |
Income tax recovery (note 10) | 9,264 | 15,942 | 10,503 |
Dividends received | (17,738) | (548) | |
Impairment of investment in Minera Santa Cruz S.A., net of amortization | 11,777 | 21,200 | |
Investment in MSC, ending balance | $ 162,320 | $ 167,107 | $ 177,018 |
INVESTMENT IN MINERA SANTA CR52
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Jan. 24, 2012 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Income taxes recovery | $ 3,749 | $ 24,560 | $ 107,170 | ||
Income (loss) from investment in MSC, net of amortization | $ 12,951 | $ 2,414 | $ (5,284) | ||
Corporate Venture | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Ownership interest (as a percent) | 100.00% | 100.00% | 100.00% | ||
MSC | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Net sales | $ 235,961 | $ 186,095 | $ 213,013 | ||
Production costs applicable to sales | (173,679) | (158,615) | (173,274) | ||
Net income (loss) | $ 31,976 | $ (5,835) | $ (5,300) | ||
Ownership interest (as a percent) | 49.00% | 49.00% | 49.00% | 49.00% | 49.00% |
Net income (loss) | $ 15,961 | $ (2,859) | $ (2,597) | ||
Amortization of fair value increments | 12,274 | 10,669 | 13,190 | ||
Income taxes recovery | (9,264) | (15,942) | (10,503) | ||
Income (loss) from investment in MSC, net of amortization | $ 12,951 | $ 2,414 | $ (5,284) |
INVESTMENT IN MINERA SANTA CR53
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | $ 78,574 | $ 54,443 |
Total assets | 498,318 | 475,085 |
Current liabilities | 20,581 | 22,039 |
Total liabilities | 55,279 | $ 56,793 |
MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 108,900 | |
Total assets | 468,300 | |
Current liabilities | 59,500 | |
Total liabilities | 137,000 | |
MSC | Current Period Values Excluding Fair Value Increments And Impairment Charge | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 107,900 | |
Total assets | 288,900 | |
Current liabilities | 63,600 | |
Total liabilities | $ 88,600 |
PROPERTY AND EQUIPMENT - By Typ
PROPERTY AND EQUIPMENT - By Type (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
PROPERTY AND EQUIPMENT | |||
Subtotal | $ 20,016 | $ 20,482 | |
Less: accumulated depreciation | (5,764) | (4,723) | |
Total | 14,252 | 15,759 | |
Mine development costs | 3,866 | 1,169 | $ 1,829 |
El Gallo 2 Properties | |||
PROPERTY AND EQUIPMENT | |||
Total cost of deposit | 1,500 | ||
Refund of deposits | 1,000 | ||
El Gallo 2 Properties | Mine development costs | |||
PROPERTY AND EQUIPMENT | |||
Mine development costs | 500 | ||
Trucks and trailers | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 1,233 | 1,065 | |
Office furniture and equipment | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 1,891 | 1,543 | |
Leasehold Improvements | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 661 | 661 | |
Drill rigs | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 1,198 | 1,061 | |
Building | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 1,514 | 1,514 | |
Land | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 8,699 | 8,699 | |
Mining equipment | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | 2,008 | 1,625 | |
Construction in process | |||
PROPERTY AND EQUIPMENT | |||
Subtotal | $ 2,812 | $ 4,314 |
SHORT-TERM BANK INDEBTEDNESS (D
SHORT-TERM BANK INDEBTEDNESS (Details) $ in Millions | Jan. 13, 2016MXN | May 29, 2015MXN | Dec. 31, 2015MXN | Dec. 31, 2015USD ($) | Jun. 01, 2015MXN | May 29, 2015USD ($) |
SHORT TERM BANK INDEBTEDNESS | ||||||
VAT collected | $ | $ 2 | |||||
Principal payment | MXN 31,751,101 | 1.8 | ||||
Line of Credit. | ||||||
SHORT TERM BANK INDEBTEDNESS | ||||||
Interest payment | MXN | 2,903,100 | |||||
Line of Credit. | Secured Debt | ||||||
SHORT TERM BANK INDEBTEDNESS | ||||||
Maximum borrowing amount | MXN 90,000,000 | $ 5.9 | ||||
Amount withdrawn from line of credit | 5.2 | MXN 90,000,000 | ||||
Foreign exchange gain | $ | 0.7 | |||||
Applicable interest rate (as a percent) | 2.50% | |||||
Commission fee (as a percent) | 1.00% | |||||
VAT collected | MXN | MXN 34,654,201 | |||||
Extinguishment of debt | MXN | MXN 58,248,899 | |||||
Repayment of debt | $ | $ 3.4 | |||||
Line of Credit. | Interbank Equilibrium Interest Rate ("TIIE") | Secured Debt | ||||||
SHORT TERM BANK INDEBTEDNESS | ||||||
Interest rate basis | 91 day Interbank Equilibrium Interest Rate ("TIIE") |
RECLAMATION OBLIGATIONS (Detail
RECLAMATION OBLIGATIONS (Details) $ in Thousands | Oct. 03, 2015USD ($) | Dec. 31, 2016USD ($)property | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Mineral Property Interests | ||||
Number of most significant properties subject to reclamation obligations | property | 2 | |||
Surety bonds upfront deposit amount | $ 500 | |||
Reclamation obligations | ||||
Reclamation Adjustment | 89 | |||
Reclamation Accretion | 506 | $ 429 | $ 407 | |
Reclamation and remediation expense | 595 | 429 | 407 | |
Changes in the asset retirement obligations | ||||
Asset retirement obligation liability, beginning balance | 7,784 | 7,471 | ||
Settlements | (66) | |||
Accretion of liability | 506 | 429 | 407 | |
Adjustment reflecting updated estimates | 1,619 | (116) | ||
Asset retirement obligation liability, ending balance | 9,843 | 7,784 | $ 7,471 | |
Current portion | (537) | (215) | ||
Non-current portion | 9,306 | 7,569 | ||
Asset Retirement Obligation Assumptions | ||||
Undiscounted Cash Flows | $ 10,700 | $ 9,500 | ||
Minimum | ||||
Asset Retirement Obligation Assumptions | ||||
Remediation timeline | 2,017 | 2,016 | ||
Inflation rate (as a percent) | 1.60% | 1.40% | ||
Tonkin Complex | ||||
Mineral Property Interests | ||||
Surety bonds upfront deposit amount | $ 3,600 |
INCOME TAXES - Deferred Income
INCOME TAXES - Deferred Income Tax Recovery (Expense) and Net Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Deferred income tax recovery (expense) | |||
United States | $ 515 | $ (442) | $ 215 |
Foreign | 3,234 | 25,002 | 106,955 |
Deferred tax recovery | 3,749 | 24,560 | 107,170 |
Net income (loss) before tax: | |||
United States | (13,959) | (19,935) | (21,436) |
Foreign | 31,265 | (25,075) | (397,677) |
Income (loss) before income taxes | $ 17,306 | $ (45,010) | $ (419,113) |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
INCOME TAXES. | |||
Income (loss) before income taxes | $ 17,306 | $ (45,010) | $ (419,113) |
Statutory tax rate (as a percent) | 34.00% | 34.00% | 34.00% |
US Federal and State tax recovery at statutory rate | $ 5,884 | $ (15,303) | $ (142,498) |
Reconciling items: | |||
Equity pickup in MSC | (4,533) | (821) | 1,850 |
Impairment of MSC | 4,004 | 7,407 | |
Revisions to prior year estimates | (828) | 906 | 8,330 |
Adjustment for foreign tax rates | (501) | (1,230) | (1,803) |
Other permanent differences | 818 | (15,694) | (14,760) |
Unrealized foreign exchange rate (loss)/gain | 5,972 | 9,389 | 19,444 |
NOL expired | 586 | 1,215 | 10,268 |
Valuation allowance | (11,147) | (7,026) | 4,592 |
Tax Recovery | $ (3,749) | $ (24,560) | $ (107,170) |
INCOME TAXES - Tax Effects of T
INCOME TAXES - Tax Effects of Temporary Differences (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred tax assets: | ||||
Net operating loss carryforward | $ 96,312 | $ 105,555 | ||
Mineral properties | 14,195 | 11,842 | ||
Other temporary differences | 1,114 | 5,371 | ||
Total gross deferred tax assets | 111,621 | 122,768 | ||
Less: valuation allowance | (111,621) | (122,768) | $ (129,794) | $ (125,202) |
Deferred tax liabilities: | ||||
Acquisition mineral property interests | (23,655) | (26,899) | ||
Total deferred tax liabilities | (23,655) | (26,899) | ||
Total net deferred tax liability | (23,655) | (26,899) | ||
Minera Andes | ||||
Deferred tax liabilities: | ||||
Acquisition mineral property interests | $ (16,300) | $ (19,800) |
INCOME TAXES - Changes to Valua
INCOME TAXES - Changes to Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation allowance | |||
Change in valuation allowance | $ 11,100 | ||
Balance at Beginning of Period | 122,768 | $ 129,794 | $ 125,202 |
Additions | 1,430 | 6,873 | 11,514 |
Deductions | (12,577) | (13,899) | (6,922) |
Balance at End of Period | $ 111,621 | $ 122,768 | $ 129,794 |
INCOME TAXES - Non Operating Lo
INCOME TAXES - Non Operating Losses (Details) $ in Thousands | Dec. 31, 2016USD ($) |
United States | |
Income Taxes | |
Non operating losses | $ 160,900 |
Mexico | |
Income Taxes | |
Non operating losses | 31,810 |
Canada | |
Income Taxes | |
Non operating losses | 19,055 |
Argentina | |
Income Taxes | |
Non operating losses | $ 79,807 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) $ / shares in Units, $ in Thousands | Aug. 29, 2016$ / shares | Aug. 22, 2016shares | May 31, 2016item | Feb. 12, 2016$ / shares | Oct. 01, 2015USD ($)shares | Aug. 17, 2015$ / shares | Jun. 18, 2015$ / shares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($)shares |
Common stock issued | 299,570,000 | 274,421,000 | ||||||||
Shares of common stock issued upon exercise of stock options | 1,457,000 | |||||||||
Weighted average exercise price of stock options (in dollars per share) | $ / shares | $ 2.51 | $ 1.29 | ||||||||
Proceeds from exercise of stock options | $ | $ 3,730 | $ 2,292 | ||||||||
Exercise of stock options | $ | $ 3,730 | 1,932 | ||||||||
Semi-annual return of capital payable (in dollars per share) | $ / shares | 0.005 | 0.010 | ||||||||
Return of capital distribution paid | $ | $ 2,986 | $ 1,503 | ||||||||
Period of time over which common stock can be repurchased | 12 months | |||||||||
Share repurchase program (in shares) | 1,896,442 | |||||||||
Share repurchase program | $ | $ 582 | $ 1,769 | ||||||||
Former number of stock listings maintained | item | 2 | |||||||||
Number Of Common Stock Shares Per Exchangeable Share | 1 | |||||||||
Exchangeable shares converted into common stock | 24,200,000 | 4,300,000 | ||||||||
Exchangeable, shares outstanding | 0 | 24,213,000 | ||||||||
Shares issued for settlement of accounts payable | $ | $ 443 | 1,004 | ||||||||
Exploration costs | $ | $ 7,959 | $ 8,798 | $ 11,332 | |||||||
Maximum | ||||||||||
Number of shares authorized to be repurchased | 15,000,000 | |||||||||
Authorized maximum to be spent on repurchases | $ | $ 15,000 | |||||||||
Equity Incentive Plan | ||||||||||
Common stock issued | 1,494,085 | |||||||||
Common Stock | ||||||||||
Shares of common stock issued upon exercise of stock options | 1,494 | 0 | 1,499 | |||||||
Exercise of stock options | $ | $ 3,730 | $ 1,932 | ||||||||
Annual return of capital declared (in dollars per share) | $ / shares | $ 0.01 | |||||||||
Semi-annual return of capital payable (in dollars per share) | $ / shares | 0.005 | 0.005 | 0.005 | |||||||
Share repurchase program (in shares) | 558 | 1,896 | ||||||||
Share repurchase program | $ | $ 582 | $ 1,769 | ||||||||
Shares issued for settlement of accounts payable (in shares) | 430 | 394 | ||||||||
Shares issued to terminate back-in right (in shares) | 850 |
STOCK BASED COMPENSATION - Stoc
STOCK BASED COMPENSATION - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
STOCK BASED COMPENSATION | ||||
Stock options granted (in shares) | 645,000 | 2,733,000 | ||
Exercise price of options granted (in dollars per share) | $ 3.99 | $ 1.03 | ||
Exercisable period of options | 2 years 10 months 24 days | |||
Number of common stock reserved for issuance | 17,500,000 | |||
Number of shares of common stock reserved for issuance | 5,294,563 | |||
Shares | ||||
Balance at the beginning of the period (in shares) | 6,954,000 | 4,651,000 | ||
Granted (in shares) | 645,000 | 2,733,000 | ||
Exercised (in shares) | (1,457,000) | |||
Forfeited (in shares) | (1,422,000) | (272,000) | ||
Expired (in shares) | (158,000) | |||
Balance at the end of the period (in shares) | 4,720,000 | 6,954,000 | 4,651,000 | |
Exercisable at the end of the period (in shares) | 2,257,000 | |||
Weighted Average Exercise Price | ||||
Balance at the beginning of the period (in dollars per share) | $ 2.49 | $ 3.35 | ||
Granted (in dollars per share) | 3.99 | 1.03 | ||
Exercised (in dollars per share) | 2.51 | 1.29 | ||
Forfeited (in dollars per share) | 2.48 | 2.82 | ||
Expired (in dollars per share) | 3.45 | 2.12 | ||
Balance at the end of the period (in dollars per share) | 2.41 | $ 2.49 | $ 3.35 | |
Exercisable (in dollars per share) | $ 2.74 | |||
Weighted Average Remaining Contractual Life | ||||
Outstanding at the end of the period | 3 years 4 months 24 days | 4 years 1 month 6 days | 4 years 4 months 24 days | |
Exercisable period of options | 2 years 10 months 24 days | |||
Intrinsic Value | ||||
Exercised (in dollars) | $ 1,601 | |||
Outstanding at the end of the period (in dollars) | 4,388 | $ 98 | ||
Exercisable at the end of the period (in dollars) | $ 1,697 | |||
Granted (in shares) | 645,000 | 2,733,000 | ||
Maximum | ||||
STOCK BASED COMPENSATION | ||||
Maximum number of shares that may be subject to grants of options to an individual in a calendar year | 1,000,000 | |||
Certain employees and directors | ||||
STOCK BASED COMPENSATION | ||||
Stock options granted (in shares) | 700,000 | 2,700,000 | 1,700,000 | |
Exercise price of options granted (in dollars per share) | $ 3.99 | $ 1 | $ 2.90 | $ 3 |
Shares | ||||
Granted (in shares) | 700,000 | 2,700,000 | 1,700,000 | |
Weighted Average Exercise Price | ||||
Granted (in dollars per share) | $ 3.99 | $ 1 | $ 2.90 | $ 3 |
Intrinsic Value | ||||
Granted (in shares) | 700,000 | 2,700,000 | 1,700,000 | |
Vesting period of options | 3 years | |||
Exercise period of options | 5 years |
STOCK BASED COMPENSATION - Summ
STOCK BASED COMPENSATION - Summary of Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Risk-free interest rate (as a percent) | 1.10% | ||
Volatility factor of the expected market price of common stock (as a percent) | 74.00% | 70.00% | |
Weighted-average expected life of option | 5 years | 5 years | 3 years 6 months |
Weighted-average grant date fair value (in dollars per share) | $ 2.36 | $ 0.49 | $ 1.45 |
Risk-free interest rate, low end of range (as a percent) | 1.13% | 1.10% | |
Risk-free interest rate, high end of range (as a percent) | 1.21% | 1.79% | |
Additional disclosures | |||
Stock option expense | $ 1,000 | $ 1,300 | $ 1,300 |
Fair value of awards vesting in the period | 1,300 | 1,500 | 2,000 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount | 0 | 0 | 0 |
Unrecognized compensation expense on non-vested stock options (in dollars) | $ 1,400 | $ 1,600 | $ 1,800 |
Non-vested stock options outstanding (in shares) | 2.5 | 4.2 | 2.7 |
Weighted-average period of recognition | 1 year 7 months 6 days | 1 year 7 months 6 days | 1 year 7 months 6 days |
Minimum | |||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Dividend yield (as a percent) | 0.24% | 0.00% | |
Volatility factor of the expected market price of common stock, low end of range (as a percent) | 73.00% | ||
Maximum | |||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Dividend yield (as a percent) | 0.27% | 1.15% | |
Volatility factor of the expected market price of common stock, high end of range (as a percent) | 74.00% |
STOCK BASED COMPENSATION - Non-
STOCK BASED COMPENSATION - Non-vested Options Outstanding and Exercisable (Details) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | |||
Balance at the beginning of the period (in shares) | 4,182 | ||
Stock options granted (in shares) | 645 | 2,733 | |
Stock options cancelled/forfeited (in shares) | (826) | ||
Stock options vested (in shares) | (1,538) | ||
Balance at the end of the period (in shares) | 2,463 | 4,182 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Balance at the beginning of the period (in dollars per share) | $ 0.74 | ||
Stock options granted (in dollars per share) | 2.36 | $ 0.49 | $ 1.45 |
Stock options cancelled/forfeited (in dollars per share) | 0.77 | ||
Stock options vested (in dollars per share) | 0.85 | ||
Balance at the end of the period (in dollars per share) | $ 1.08 | $ 0.74 |
NET INCOME (LOSS) PER SHARE (De
NET INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||||||||||||
Net income (loss) | $ (4,491) | $ 4,208 | $ 8,353 | $ 12,985 | $ (14,988) | $ 2,633 | $ (14,116) | $ 6,021 | $ (212,775) | $ (13,033) | $ (104,022) | $ 17,887 | $ 21,055 | $ (20,450) | $ (311,943) |
Weighted average number of common shares | 299,518 | 298,510 | 298,237 | 298,242 | 300,107 | 300,530 | 300,530 | 297,255 | 299,009 | 297,164 | 297,164 | 297,159 | 298,772 | 300,341 | 297,763 |
Effect of employee stock-based awards | 1,701 | ||||||||||||||
Diluted shares outstanding | 301,102 | 301,045 | 299,791 | 298,554 | 300,107 | 300,530 | 300,530 | 297,266 | 299,009 | 297,164 | 297,164 | 298,410 | 300,474 | 300,341 | 297,763 |
Net income (loss) per share: | |||||||||||||||
Net income (loss) per share | $ (0.01) | $ 0.01 | $ 0.03 | $ 0.04 | $ (0.05) | $ 0.01 | $ (0.05) | $ 0.02 | $ (0.71) | $ (0.04) | $ (0.35) | $ 0.06 | $ 0.07 | $ (0.07) | $ (1.05) |
Diluted (in dollars per share) | $ (0.01) | $ 0.01 | $ 0.03 | $ 0.04 | $ (0.05) | $ 0.01 | $ (0.05) | $ 0.02 | $ (0.71) | $ (0.04) | $ (0.35) | $ 0.06 | $ 0.07 | $ (0.07) | $ (1.05) |
Options | |||||||||||||||
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) | 2,000 | ||||||||||||||
Average exercise price of options outstanding (in dollars per share) | $ 3.91 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Lease Obligations and Purchase Commitments (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Lease Obligations | |
2,017 | $ 494 |
2,018 | 309 |
2,019 | 315 |
2,020 | 318 |
2,021 | 257 |
Thereafter | 512 |
Total | 2,205 |
Operating Leases Future Minimum Payments Due Mining And Surface Rights [Abstract] | |
2,017 | 2,044 |
2,018 | 2,337 |
2,019 | 2,332 |
2,020 | 2,291 |
2,021 | 2,261 |
Thereafter | 2,466 |
Total | 13,731 |
Reclamation Costs | |
2,017 | 751 |
2,018 | 415 |
2,019 | 690 |
2,020 | 3,540 |
2,021 | 2,709 |
Thereafter | 2,810 |
Total | 10,915 |
Total | |
2,017 | 3,289 |
More than 5 years | 5,788 |
2,018 | 3,061 |
2,019 | 3,337 |
2,020 | 6,149 |
2,021 | 5,227 |
Thereafter | 5,788 |
Total | $ 26,851 |
COMMITMENTS AND CONTINGENCIES68
COMMITMENTS AND CONTINGENCIES - Rental Expense and Surety Bonds (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
COMMITMENTS AND CONTINGENCIES | |||
Rental expense | $ 0.4 | $ 0.5 | $ 0.5 |
Outstanding surety bonds | $ 4.8 | $ 4.8 | |
Percentage of annual fees on surety bonds | 1.50% | ||
Percentage of upfront deposit on surety bonds | 10.00% | ||
Surety bonds upfront deposit amount | $ 0.5 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
RELATED PARTY TRANSACTIONS | |||
Accounts payable | $ 20,044 | $ 18,429 | |
Lexam L.P. | |||
RELATED PARTY TRANSACTIONS | |||
Expense (income) | 187 | 104 | $ 93 |
Outstanding accounts payable (receivable) | 66 | ||
Lexam VG Gold | |||
RELATED PARTY TRANSACTIONS | |||
Expense (income) | 85 | (1) | $ (72) |
Outstanding accounts payable (receivable) | $ 27 | ||
Ownership percentage of individual | 27.00% | ||
REVlaw | |||
RELATED PARTY TRANSACTIONS | |||
Expense (income) | $ 124 | 59 | |
Outstanding accounts payable (receivable) | $ 148 | $ 59 |
OPERATING SEGMENT REPORTING (De
OPERATING SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Segment Reporting | ||||||
Gold and silver sales | $ 60,388 | $ 72,956 | $ 45,303 | |||
Production costs applicable to sales | (28,133) | (34,607) | (40,608) | |||
Mine development costs | (3,866) | (1,169) | (1,829) | |||
Exploration costs | (7,959) | (8,798) | (11,332) | |||
Property holding costs | (3,536) | (4,336) | (6,365) | |||
General and administrative expenses | (12,734) | (12,045) | (12,069) | |||
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | 12,951 | 2,414 | (5,284) | |||
Depreciation | 1,169 | 942 | 979 | |||
Reclamation and Remediation | 506 | 429 | 407 | |||
Revision of estimates and accretion of reclamation obligations | (595) | (429) | (407) | |||
Impairment of mineral property interests and property and equipment | (50,600) | (353,736) | ||||
Impairment of investment in MSC | (11,777) | (21,162) | ||||
Gain on sale of assets | 24 | 13 | 26 | |||
Gain on sale of marketable securities (note 3) | (22) | |||||
Other-than-temporary impairment on marketable equity securities | 882 | 0 | ||||
Foreign currency gain (loss) | 581 | 1,906 | (2,419) | |||
Net Income before income taxes | 17,306 | (45,010) | (419,113) | |||
Registration Taxes | 6,788 | |||||
Revenues | 60,388 | 72,956 | 45,303 | |||
Long-Lived Assets | $ 420,642 | 419,744 | 420,642 | |||
Investment in MSC | 167,107 | 162,320 | 167,107 | |||
Mexico | ||||||
Operating Segment Reporting | ||||||
Gold and silver sales | 60,388 | 72,956 | 45,303 | |||
Production costs applicable to sales | (28,133) | (34,607) | (40,608) | |||
Mine development costs | (1,174) | (761) | (1,829) | |||
Mine construction costs | (1,723) | |||||
Exploration costs | (4,100) | (4,526) | (5,468) | |||
Property holding costs | (1,642) | (2,471) | (1,829) | |||
General and administrative expenses | (2,688) | (3,953) | (3,194) | |||
Segment income (loss) | 22,651 | 26,638 | (9,348) | |||
Capital Expenditures | 2 | (3) | ||||
MSC | ||||||
Operating Segment Reporting | ||||||
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | 12,951 | 2,414 | (5,284) | |||
Segment income (loss) | 12,951 | 2,414 | (5,284) | |||
Los Azules | ||||||
Operating Segment Reporting | ||||||
Exploration costs | (1,649) | (1,481) | (2,453) | |||
Property holding costs | (405) | (356) | (610) | |||
General and administrative expenses | (646) | (647) | (969) | |||
Segment income (loss) | (2,700) | (2,484) | (4,032) | |||
Nevada | ||||||
Operating Segment Reporting | ||||||
Mine development costs | (2,692) | (408) | ||||
Exploration costs | (1,973) | (2,517) | (3,060) | |||
Property holding costs | (1,489) | (1,509) | (3,926) | |||
General and administrative expenses | (228) | (203) | (211) | |||
Segment income (loss) | (6,382) | (4,637) | (7,197) | |||
Capital Expenditures | 6,165 | 764 | 1,842 | |||
Total Segment | ||||||
Operating Segment Reporting | ||||||
Gold and silver sales | 60,388 | 72,956 | 45,303 | |||
Production costs applicable to sales | (28,133) | (34,607) | (40,608) | |||
Mine development costs | (3,866) | (1,169) | (1,829) | |||
Mine construction costs | (1,723) | |||||
Exploration costs | (7,722) | (8,524) | (10,981) | |||
Property holding costs | (3,536) | (4,336) | (6,365) | |||
General and administrative expenses | (3,562) | (4,803) | (4,374) | |||
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | 12,951 | 2,414 | (5,284) | |||
Segment income (loss) | 26,520 | 21,931 | (25,861) | |||
Net Income before income taxes | 17,306 | (45,010) | (419,113) | |||
Capital Expenditures | 908 | |||||
Corporate & Other | ||||||
Operating Segment Reporting | ||||||
Exploration costs | (237) | (274) | (351) | |||
General and administrative expenses | (9,172) | (7,242) | (7,695) | |||
Depreciation | (1,169) | 942 | (979) | |||
Revision of estimates and accretion of reclamation obligations | (595) | (429) | (407) | |||
Impairment of mineral property interests and property and equipment | (50,600) | (353,736) | ||||
Impairment of investment in MSC | (11,777) | (21,162) | ||||
Interest income and other income | 835 | 2,404 | (259) | |||
Gain on sale of assets | (24) | 13 | 26 | |||
Gain on sale of marketable securities (note 3) | 22 | |||||
Other-than-temporary impairment on marketable equity securities | (882) | |||||
Unrealized gain on derivative instrument (note 2) | (1,379) | |||||
Foreign currency gain (loss) | 581 | 1,906 | (2,419) | |||
Registration Taxes | 6,788 | |||||
Capital Expenditures | 6,165 | 764 | 2,750 | |||
Bank of Nova Scotia | Sales | Customer | ||||||
Operating Segment Reporting | ||||||
Gold and silver sales | $ 58,100 | $ 67,200 | $ 43,200 | |||
Gold and silver sales, percentage | 96.00% | 92.00% | 95.00% | |||
MSC | ||||||
Operating Segment Reporting | ||||||
Income (loss) on investment in Minera Santa Cruz S.A. (net of amortization) | $ 12,951 | $ 2,414 | $ (5,284) | |||
Impairment of investment in MSC | (11,777) | (21,200) | ||||
Investment in MSC | 167,107 | $ 177,018 | 162,320 | 167,107 | 177,018 | |
Los Azules Copper Project | ||||||
Operating Segment Reporting | ||||||
Impairment of mineral property interests and property and equipment | (11,400) | $ (107,900) | $ (120,400) | |||
Capital Expenditures | 764 | 62 | 2 | |||
Los Azules Copper Project | Argentina | ||||||
Operating Segment Reporting | ||||||
Impairment of mineral property interests and property and equipment | (11,399) | (228,301) | ||||
Canada | ||||||
Operating Segment Reporting | ||||||
Long-Lived Assets | 763 | 663 | 763 | |||
Mexico | ||||||
Operating Segment Reporting | ||||||
Revenues | 60,388 | 72,956 | $ 45,303 | |||
Long-Lived Assets | 24,067 | 27,582 | 24,067 | |||
United States | ||||||
Operating Segment Reporting | ||||||
Long-Lived Assets | 36,967 | 37,620 | 36,967 | |||
Argentina | ||||||
Operating Segment Reporting | ||||||
Long-Lived Assets | $ 358,845 | $ 353,879 | $ 358,845 |
FAIR VALUE ACCOUNTING (Details)
FAIR VALUE ACCOUNTING (Details) - Recurring - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Investments | $ 8,543 | $ 1,032 |
Assets | 8,543 | 1,032 |
Level 1 | ||
Assets: | ||
Investments | 6,749 | 1,032 |
Assets | 6,749 | $ 1,032 |
Level 2 | ||
Assets: | ||
Investments | 1,794 | |
Assets | $ 1,794 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - shares | Feb. 13, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Subsequent Event | |||
Common stock issued | 299,570,000 | 274,421,000 | |
Subsequent Event | Lexam VG Gold | |||
Subsequent Event | |||
Ratio of Company's share for acquired company's share | 0.056% | ||
Common stock issued | 12,689,709 | ||
Shares owned (as a percent) | 4.00% | ||
Maximum percentage holders of issued and outstanding aquiree shares who may exercise the right of dissent | 5.00% | ||
Percentage of currently issued and outstanding shares exchangable for acquiree's shares in order to comply with NYSE rules | 1.00% |
UNAUDITED SUPPLEMENTARY QUART73
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |||||||||||||||
Net income (loss) | $ (4,491) | $ 4,208 | $ 8,353 | $ 12,985 | $ (14,988) | $ 2,633 | $ (14,116) | $ 6,021 | $ (212,775) | $ (13,033) | $ (104,022) | $ 17,887 | $ 21,055 | $ (20,450) | $ (311,943) |
Net (loss) income per share: | |||||||||||||||
Basic (in dollars per share) | $ (0.01) | $ 0.01 | $ 0.03 | $ 0.04 | $ (0.05) | $ 0.01 | $ (0.05) | $ 0.02 | $ (0.71) | $ (0.04) | $ (0.35) | $ 0.06 | $ 0.07 | $ (0.07) | $ (1.05) |
Diluted (in dollars per share) | $ (0.01) | $ 0.01 | $ 0.03 | $ 0.04 | $ (0.05) | $ 0.01 | $ (0.05) | $ 0.02 | $ (0.71) | $ (0.04) | $ (0.35) | $ 0.06 | $ 0.07 | $ (0.07) | $ (1.05) |
Weighted average common shares outstanding (thousands) (note 13): | |||||||||||||||
Basic (in shares) | 299,518 | 298,510 | 298,237 | 298,242 | 300,107 | 300,530 | 300,530 | 297,255 | 299,009 | 297,164 | 297,164 | 297,159 | 298,772 | 300,341 | 297,763 |
Diluted (in shares) | 301,102 | 301,045 | 299,791 | 298,554 | 300,107 | 300,530 | 300,530 | 297,266 | 299,009 | 297,164 | 297,164 | 298,410 | 300,474 | 300,341 | 297,763 |