Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 10, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity File Number | 001-33190 | ||
Entity Registrant Name | MCEWEN MINING INC. | ||
Entity Incorporation, State or Country Code | CO | ||
Entity Tax Identification Number | 84-0796160 | ||
Entity Address, Address Line One | 150 King Street West | ||
Entity Address, Address Line Two | Suite 2800 | ||
Entity Address, City or Town | Toronto | ||
Entity Address, State or Province | ON | ||
Entity Address, Country | CA | ||
Entity Address, Postal Zip Code | M5H 1J9 | ||
City Area Code | 866 | ||
Local Phone Number | 441-0690 | ||
Title of 12(b) Security | Common Stock, no par value | ||
Trading Symbol | MUX | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
ICFR Auditor Attestation Flag | true | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 406,515,026 | ||
Entity Common Stock, Shares Outstanding | 459,187,391 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000314203 | ||
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
REVENUE: | |||
Revenue | $ 104,789 | $ 117,019 | $ 128,175 |
OPERATING EXPENSES: | |||
Depreciation and depletion | (22,910) | (24,753) | (15,079) |
Gross (loss) profit | (26,948) | 8,986 | 32,082 |
OTHER OPERATING EXPENSES: | |||
Advanced projects | (11,681) | (9,520) | (15,063) |
Exploration | (15,861) | (37,744) | (36,576) |
General and administrative | (9,201) | (12,785) | (11,125) |
Loss from investment in Minera Santa Cruz S.A. (Note 10) | (1,517) | (8,754) | (11,865) |
Depreciation | (405) | (566) | (1,178) |
Revision of estimates and accretion of asset retirement obligations (Note 13) | (1,788) | (3,531) | (3,464) |
Impairment of mineral property interests and plant and equipment (Note 9) | (83,805) | ||
Other operating (Note 4) | (1,968) | ||
Total other operating expenses | (126,226) | (72,900) | (79,271) |
Operating loss | (153,174) | (63,914) | (47,189) |
OTHER INCOME (EXPENSE): | |||
Interest and other finance expense, net | (7,434) | (6,817) | (1,619) |
Other income (Note 5) | 6,893 | 7,140 | 1,168 |
Total other (expense) income | (541) | 323 | (451) |
Loss before income and mining taxes | (153,715) | (63,591) | (47,640) |
Income and mining tax recovery | 1,390 | 3,844 | 2,770 |
Net loss and comprehensive loss | $ (152,325) | $ (59,747) | $ (44,870) |
Net loss per share (Note 15): | |||
Basic and Diluted (in dollars per share) | $ (0.38) | $ (0.17) | $ (0.13) |
Weighted average common shares outstanding (thousands) (Note 15): | |||
Basic and Diluted (in shares) | 403,457 | 361,845 | 337,297 |
Gold and silver sales | |||
REVENUE: | |||
Revenue | $ 104,789 | $ 117,019 | $ 128,175 |
Production costs applicable to sales | |||
OPERATING EXPENSES: | |||
Production costs applicable to sales | $ (108,827) | $ (83,280) | $ (81,014) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 20,843 | $ 46,452 |
Investments (Note 6) | 1,885 | |
Receivables, prepaids and other assets (Note 7) | 5,690 | 5,265 |
Inventories (Note 8) | 26,964 | 38,376 |
Total current assets | 53,497 | 91,978 |
Mineral property interests and plant and equipment, net (Note 9) | 329,112 | 418,791 |
Investment in Minera Santa Cruz S.A. (Note 10) | 108,326 | 110,183 |
Inventories, long-term (Note 8) | 4,785 | 9,603 |
Restricted cash (Note 19) | 3,595 | 48 |
Other assets | 621 | 620 |
TOTAL ASSETS | 499,936 | 631,223 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 36,055 | 34,070 |
Flow-through share premium (Note 14) | 3,827 | |
Debt, current portion (Note 12) | 5,000 | |
Debt to related party, current portion (Notes 12 and 16) | 5,000 | |
Lease liabilities, current portion (Note 11) | 2,440 | 2,115 |
Asset retirement obligation, current portion (Note 13) | 3,232 | 2,610 |
Total current liabilities | 45,554 | 48,795 |
Lease liabilities, long-term (Note 11) | 3,056 | 5,018 |
Debt (Note 12) | 24,080 | 19,758 |
Debt to related party (Notes 12 and 16) | 24,080 | 19,758 |
Asset retirement obligation, long-term (Note 13) | 30,768 | 29,591 |
Other liabilities | 3,257 | 3,910 |
Deferred income and mining tax liability | 3,813 | 4,914 |
Total liabilities | 134,608 | 131,744 |
Shareholders' equity: | ||
Common shares: 416,587 as of December 31, 2020 and 400,339 as of December 31, 2019 issued and outstanding (in thousands) (Note 14) | 1,548,876 | 1,530,702 |
Accumulated deficit | (1,183,548) | (1,031,223) |
Total shareholders' equity | 365,328 | 499,479 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 499,936 | $ 631,223 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares shares in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Common, shares issued | 416,587 | 400,339 |
Common, shares outstanding | 416,587 | 400,339 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock and Additional Paid-in CapitalFlow-through common shares | Common Stock and Additional Paid-in CapitalATM offering | Common Stock and Additional Paid-in Capital | Accumulated Deficit | Flow-through common shares | ATM offering | Total |
Balance at Dec. 31, 2017 | $ 1,447,879 | $ (926,606) | $ 521,273 | ||||
Balance (in shares) at Dec. 31, 2017 | 337,051,000 | ||||||
Increase (Decrease) in Shareholders' Equity | |||||||
Stock-based compensation | $ 269 | 269 | |||||
Exercise of stock options | $ 192 | $ 192 | |||||
Exercise of stock options (in shares) | 182,000 | 171,000 | |||||
Shareholder distributions | $ (3,372) | $ (3,372) | |||||
Stock issued during the period | $ 11,145 | $ 918 | $ 11,145 | 918 | |||
Stock issued during the period (in shares) | 6,634,000 | 515,000 | |||||
Shares issued for acquisition of mineral property interests | $ 391 | 391 | |||||
Shares issued for acquisition of mineral property interests (in shares) | 178,000 | ||||||
Net loss | (44,870) | (44,870) | |||||
Balance at Dec. 31, 2018 | $ 1,457,422 | (971,476) | 485,946 | ||||
Balance (in shares) at Dec. 31, 2018 | 344,560,000 | ||||||
Increase (Decrease) in Shareholders' Equity | |||||||
Stock-based compensation | $ 694 | 694 | |||||
Exercise of stock options | $ 544 | $ 544 | |||||
Exercise of stock options (in shares) | 535,000 | 535,000 | |||||
Units Issued for cash, net of share issue costs | $ 69,467 | $ 69,467 | |||||
Units Issued for cash, net of share issue costs (in shares) | 53,880,000 | ||||||
Stock issued during the period | $ 1,851 | $ 1,851 | |||||
Stock issued during the period (in shares) | 1,010,000 | ||||||
Shares issued for acquisition of mineral property interests | $ 724 | $ 724 | |||||
Shares issued for acquisition of mineral property interests (in shares) | 354,000 | 353,570 | |||||
Net loss | (59,747) | $ (59,747) | |||||
Balance at Dec. 31, 2019 | $ 1,530,702 | (1,031,223) | 499,479 | ||||
Balance (in shares) at Dec. 31, 2019 | 400,339,000 | ||||||
Increase (Decrease) in Shareholders' Equity | |||||||
Stock-based compensation | $ 613 | 613 | |||||
Shares issued in connection with acquisitions | $ 70 | 70 | |||||
Shares issued in connection with acquisitions (in shares) | 53,000 | ||||||
Exercise of stock options | $ 138 | $ 138 | |||||
Exercise of stock options (in shares) | 135,000 | 135,000 | |||||
Stock issued during the period | $ 15,478 | $ 15,478 | |||||
Stock issued during the period (in shares) | 13,968,000 | ||||||
Shares issued for debt refinancing | $ 1,875 | $ 1,875 | |||||
Shares issued for debt refinancing (in shares) | 2,092,000 | ||||||
Shares issued for acquisition of mineral property interests (in shares) | 53,600 | ||||||
Net loss | (152,325) | $ (152,325) | |||||
Balance at Dec. 31, 2020 | $ 1,548,876 | $ (1,183,548) | $ 365,328 | ||||
Balance (in shares) at Dec. 31, 2020 | 416,587,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net loss | $ (152,325) | $ (59,747) | $ (44,870) |
Adjustments to reconcile net loss from operating activities: | |||
Impairment of mineral property interests and plant and equipment (Note 9) | 83,805 | ||
Loss from investment in Minera Santa Cruz S.A., net of amortization (Note 10) | 1,517 | 8,754 | 11,865 |
Loss on disposal of fixed assets | 96 | 77 | |
Depreciation and amortization | 23,090 | 25,543 | 16,425 |
Loss (gain) on investments (Note 6) | 619 | (5,259) | 3,324 |
Unrealized foreign exchange loss (gain) and adjustment to estimate (Note 13) | 278 | 919 | (1,903) |
Income and mining tax (recovery) | (1,390) | (3,844) | (2,770) |
Stock-based compensation | 612 | 694 | 269 |
Revision of estimates and accretion of asset retirement obligations (Note 13) | 1,788 | 3,531 | 3,464 |
Change in non-cash working capital items: | |||
Decrease (increase) in other assets related to operations | 12,696 | (17,484) | 20,896 |
Increase (decrease) in liabilities related to operations | 1,437 | 7,270 | (6,290) |
Cash (used in) provided by operating activities | (27,873) | (39,527) | 487 |
Cash flows from investing activities: | |||
Additions to mineral property interests and plant and equipment | (13,373) | (29,707) | (81,321) |
Proceeds from disposal of property and equipment | 84 | ||
Investment in marketable equity securities (Note 5) | (1,384) | ||
Proceeds from sale of investments, net of investments (Note 6) | 1,266 | 6,769 | 2,895 |
Dividends received from Minera Santa Cruz S.A. (Note 10) | 340 | 8,877 | 10,385 |
Cash used in investing activities | (11,767) | (14,061) | (69,341) |
Cash flows from financing activities: | |||
Proceeds from sale of units, net of issuance costs (Note 14) | 69,467 | ||
Sale of flow-through common shares, net of issuance costs (Note 14) | 19,644 | 14,095 | |
Proceeds of loan from related party (Note 12 and Note 16) | 25,000 | ||
Proceeds of loan (Note 12) | 25,000 | ||
Debt issuance costs and lender fees (Note 12) | (908) | ||
Proceeds of at-the-market share sale (Note 14) | 1,851 | 918 | |
Proceeds of exercise of stock options | 138 | 544 | 192 |
Payment of finance lease obligations | (2,204) | (1,855) | (485) |
Shareholders' distribution (Note 14) | (3,372) | ||
Cash provided by financing activities | 17,578 | 70,007 | 60,440 |
Effect of exchange rate change on cash and cash equivalents | (408) | 1,750 | |
(Decrease) increase in cash, cash equivalents and restricted cash | (22,062) | 16,011 | (6,664) |
Cash, cash equivalents and restricted cash, beginning of year | 46,500 | 30,489 | 37,153 |
Cash, cash equivalents and restricted cash, end of year (Note 19) | 24,438 | 46,500 | 30,489 |
Supplemental disclosure of cash flow information: | |||
Interest paid | (5,131) | (5,218) | (1,923) |
Interest received | $ 159 | $ 133 | $ 372 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2020 | |
NATURE OF OPERATIONS | |
NATURE OF OPERATIONS | NOTE 1 NATURE OF OPERATIONS 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 and exploration for copper. The Company operates in the United States, Canada, Mexico and Argentina. The Company owns a 100% interest in the Gold Bar mine in Nevada, the Black Fox gold mine in Ontario, Canada, the El Gallo Project in Sinaloa, Mexico, the Fenix silver-gold project in Sinaloa, Mexico, the Los Azules copper deposit in San Juan, Argentina, and a portfolio of exploration properties in Nevada, Canada, Mexico and Argentina. It also owns a 49% interest in Minera Santa Cruz S.A. (“MSC”), owner of the producing San José silver-gold mine in Santa Cruz, Argentina, which is operated by the joint venture majority owner, Hochschild Mining plc. During the year (Note 14) and subsequent to year end (Note 23) the Company closed on $64.4 million in gross proceeds from equity financings. As a result of this, the Company believes it has sufficient liquidity along with funds generated from ongoing operations, to fund anticipated cash requirements for operations, capital expenditures and working capital purposes. As a result, the previously disclosed going concern note has been removed, as substantial doubt no longer exists regarding the Company’s ability to meet its obligations as they become due within one year after the date that the financial statements are issued. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Use of Estimates: The 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; asset useful lives utilized for depletion, depreciation, amortization and accretion calculations; fair value of equity investment and the impairment test; recoverable gold in leach pad inventory; current and long-term inventory; mine development capitalization costs; the collectability of value added taxes receivable; reserves; valuation allowances for deferred tax assets; income and mining tax provisions; reserves for contingencies and litigation and costs and relief funds related to COVID-19. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ significantly from these estimates. References to “C$” refer to Canadian currency. COVID-19: On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 virus a global pandemic. As a result of the pandemic, many jurisdictions, including the United States, Canada, Mexico and Argentina, instituted restrictions on travel, public gatherings, and certain business operations. Even absent of government-mandated shut downs, the Company was required to temporarily suspend operations at its mines to protect the health and safety of its employees and contractors. This resulted in temporary shutdowns of all or a portion of operations at all of the Company’s mine sites at the start of Q2 2020. Since that date, all of the Company’s operations, have successfully recommenced operations. During the fourth quarter of 2020, operations at the San José mine were briefly suspended as a result of a significant increase in infections in the Santa Cruz region. The temporary shutdowns adversely impacted the Company’s operations, cash flow, and liquidity in the second quarter of 2020 and some of these effects continued into the third and fourth quarters. In addition to the adverse effect on revenue, the Company incurred costs in connection with the shutdowns and subsequent ramp-up. This, in turn, adversely affected the Company’s liquidity. The long-term impact of the COVID-19 outbreak on the Company’s results of operations, financial position and cash flows will depend on future developments, including the duration and spread of the outbreak, the availability and distribution of vaccinations, and government advisories and restrictions. These developments and the impact of COVID-19 on the global financial markets, the overall economy and the Company are highly uncertain and cannot be predicted. Achieving and maintaining normal operating capacity is also dependent on the continued availability of supplies, which is out of the Company’s control. If the financial markets and/or the overall economy continue to be impacted, the Company’s results of operations, financial position and cash flows may be further affected. As the situation continues to evolve, the Company will continue to closely monitor market conditions and respond accordingly. The Company has completed various scenario planning analyses to consider potential impacts of COVID-19 on its business, including volatility in commodity prices, temporary disruptions and/or curtailments of operating activities (voluntary or involuntary). Basis of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated. Investments over which the Company exerts significant influence but does not control through majority ownership are accounted for using the equity method, as described in Investments, Cash and Cash Equivalents and Restricted Cash: The Company considers cash in banks, deposits in transit, and highly liquid term deposits with original maturities of three months or less at the date of acquisition to be cash and cash equivalents. Because of the short maturity of these instruments, the carrying amounts approximate their fair value. The Company classifies Restricted cash between short term and long term based on the restrictions. 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 Consolidated Balance Sheet Consolidated Statements of Operations and Comprehensive (Loss) Statement of Operations Impairment of Long-lived Assets The Company’s investments in marketable equity securities and warrants are measured at fair value at each period end with changes in fair value recognized in net (loss) income in the Statement of Operations Value Added Taxes Receivable: In Mexico, Argentina, and Canada, value added taxes (“VAT” and “HST”, respectively) are assessed on purchases of materials and services and sales of products. Businesses are generally entitled to recover the taxes they have paid related to purchases of materials and services, either as a refund or as a credit against future taxes payable. Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: on current and long-term metals prices, less the estimated costs to complete production and bring the product to a saleable form. Write-downs of Inventories resulting from net realizable value impairments are reported as a component of production costs applicable to sales. The current portion of Inventories is determined based on the expected amounts to be processed and/or recovered within the next twelve months of the balance sheet date, with the remaining portion, if any, classified as long-term. Stockpiles represent mineralized material extracted from the mine and available for processing. Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, an estimate of the contained metals (based on assay data) and the estimated metallurgical recovery rates. Costs are allocated to stockpiles based on current mining costs incurred including applicable overhead relating to mining operations. Material is removed from the stockpile at an average cost per tonne. Mineralized material on leach pads is the material that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the mineralized material over a period of time. Costs are attributed to the mineralized material on leach pads based on current mining costs and processing costs incurred related to the ore on the pad. Costs are removed from the leach pad inventory based on the average cost per estimated recoverable ounce of gold on the leach pad as the gold is recovered. The estimates of recoverable gold on the leach pads are calculated from the quantities of mineralized material placed on the leach pads (measured tonnes added to the leach pads), the grade of mineralized material placed on the leach pads (based on assay data) and a recovery percentage. While the quantities of recoverable gold placed on the leach pads are periodically reconciled by comparing the grades of ore placed on the pads to the quantities of gold actually recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored, and the engineering estimates are refined based on actual results over time. In-process inventories represent materials that are currently in the process of being converted to a saleable product. In-process material is measured based on assays of the material from the various stages of processing. Costs are allocated to in-process inventories based on the costs of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the in-process conversion costs incurred to that point in the process. Precious metal inventories include gold and silver 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, spare parts and consumable parts used in operating and other activities. Cost includes applicable taxes and freight. Proven and Probable Reserves: The definition of proven and probable reserves is set forth in SEC Industry Guide 7 (Guide 7). Proven reserves are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geological character is so well defined that size, shape, depth and mineral content of the reserves are well-established. Probable reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observations. Mineral Property Interests and Plant and Equipment: Mineral property interests: property represents its fair value at the time of acquisition, either as an individual asset purchase or as a part of a business combination. 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 (“pre-stripping”) and building of access paths and other infrastructure to gain access to the ore body at underground mines. Development costs are charged to operations in the year incurred as Advanced Projects During the production phase of a mine, costs incurred to provide access to reserves and resources that will be produced in future periods that would not have otherwise been accessible are capitalized and included in the carrying amount of the related mineral property interest. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information, providing greater definition of the ore body or converting non-reserve mineralization to proven and probable reserves and the benefit is expected to be realized over a period beyond one year. All other drilling and related costs are expensed as incurred as Exploration Advanced Projects Mineral property interests are amortized upon commencement of production on a unit-of-production basis over proven and probable reserves, as defined by Guide 7. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs is charged to expense based on the most appropriate method, which includes straight-line method and units-of-production method over the estimated useful life of the mine, as determined by internal mine plans. Plant and Equipment: For properties where the Company did not establish proven and probable reserves as defined by Guide 7, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred, unless the equipment has alternative uses or significant salvage value, in which case the equipment is capitalized at cost. Construction-in-progress (“CIP”) costs: Impairment of Long-Lived Assets: The Company reviews and evaluates its long-lived assets for impairment on a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its estimated fair value. For the purpose of recognition and measurement of impairment, the Company groups its long-lived assets by specific mine or project, as this represents the lowest level for which identifiable cash flows exist. For asset groups where an impairment indicator is identified, an impairment loss is determined if the carrying amount of the asset group exceeds the recoverable amount as determined using the undiscounted future net cash flows. An impairment loss, if any, is the amount by which the carrying amount exceeds the discounted future net cash flows. 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 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 estimated mineralized material based on comparable transactions. Asset Retirement Obligation (“ARO”), Reclamation and Remediation Costs: Provisions for environmental rehabilitation are made in respect of the estimated future costs of closure and restoration and rehabilitation costs (which include the dismantling and demolition of infrastructure, removal of residual materials and remediation of disturbed areas) in the accounting period when the related environmental disturbance occurs. The associated asset retirement costs, including periodic adjustments, if any, are capitalized as part of the carrying amount of the long-lived asset when proven or probable reserves exist or if they relate to an acquired mineral property interest; otherwise, the costs are charged to the operations. Periodic accretion is recorded to ARO and charged to operations. The fair value of an ARO is measured by discounting the expected cash flows adjusted for inflation, using a credit-adjusted risk free rate of interest. The Company prepares estimates of the timing and amounts of expected cash flows when an ARO is incurred, which are updated to reflect changes in facts and circumstances. Estimation of the fair value of AROs requires significant judgment, including amount of cash flows, timing of reclamation, inflation rate and credit risk. Lease Accounting: Contracts are analyzed to identify whether the contract contains an operating or financing lease according to ASC 842, adopted by the Company effective January 1, 2019 using the modified retrospective transition method. If a contract is determined to contain a lease, the Company will include lease payments (the lease liability) and the right-of-use asset (“ROU”) representing the right to the underlying asset for the lease term within the Consolidated Balance Sheets Consolidated Balance Sheets Statement of Operations. Operating and ROU asset balances and lease liabilities are recognized at the commencement date of the lease based on the present value of the future lease payments over the lease term. The Company utilizes the incremental borrowing rate (“IBR”) in determining the present value of the future lease payments. IBR represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Each lease’s IBR is determined by using the average bond yield ratings for comparable companies. Revenue Recognition: Revenue consists of proceeds received and expected to be received for the Company’s principal products, gold and silver. Revenue is recognized when title to gold and silver passes to the buyer and when collectability is reasonably assured. Title passes to the buyer based on terms of the sales contract, usually upon delivery of the product. Product pricing is determined under the sales agreements which are referenced against active and freely traded commodity markets, for example, the London Bullion Market for both gold and silver, in an identical form to the product sold. Gold and silver 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 of the precious metal content at the relevant quotation point stipulated in the contract. Due to the time elapsed between shipment and the final settlement with the buyer, MSC must estimate the prices at which sales of metals will be settled. At the end of each financial reporting period, previously recorded provisional sales are adjusted to estimated settlement metals prices based on relevant forward market prices until final settlement with the buyer. In addition to selling refined bullion at spot, the Company has doré purchase agreements in place with financial institutions and refineries. Under the agreements, the Company has the option to sell approximately 90% of the gold and silver contained in doré bars prior to the completion of refining by the third party refiner. Revenue is recognized when the Company has provided irrevocable instructions to the refiner to transfer to the purchaser the refined ounces sold upon final processing outturn, and when payment of the purchase price for the purchased doré or bullion has been made in full by the purchaser. There is no judgement involved in revenue recognition as revenue is recognized when payment has been made by the purchaser and the product has been delivered. Foreign Currency: 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). Revenues and expenses in foreign currencies are translated at the average monthly exchange rates for the corresponding 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 and estimates of forfeitures. Flow-Through Common Shares: Current Canadian tax legislation permits mining entities to issue flow-through common shares to investors by which the deductions for tax purposes related to resource exploration and evaluation expenditures may be claimed by investors instead of the entity, subject to a renouncement process. Under ASC 740, proceeds from the issuance of flow-through common shares are allocated first to the common stock based on the underlying quoted price of shares and the residual amount is allocated to the sale of tax benefits, which is classified as a liability. In the future, as the Company incurs qualifying exploration and evaluation expenditures to fulfill its obligation, the liability is drawn down and the sale of tax benefits is recognized in the Statement of Operations as a reduction of deferred tax expense. Income and Mining Taxes: The Company accounts for income and mining taxes under ASC 740 using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related tax basis for such liabilities and assets. This method generates either a net deferred income and mining tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income and mining tax charge or benefit by recording the change in either the net deferred income and mining tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income and mining tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income and mining tax asset will not be realized. Comprehensive (Loss) Income: In addition to net income or loss, comprehensive income or loss is included in changes in equity during a period. Per Share Amounts: Basic income or loss per share is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted income per share reflects the potential dilution of securities that could share in the earnings of the Company and is computed in accordance with the treasury stock method based on the average number of common shares and dilutive common share equivalents outstanding. Only those instruments that result in a reduction in income per share are included in the calculation of diluted (loss) income per share. Loans and Borrowings: Borrowings are recognized initially at fair value, net of financing costs incurred, and subsequently measured at amortized cost. Any difference between the amounts originally received and the redemption value of the debt is recognized in the Statements of Operations Fair Value of Financial Instruments: Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Loans and borrowings: Consolidated Statement of Operations and Comprehensive (Loss) Income Fair Value of Financial Instruments: 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 Accounting for Government Assistance: In June 2020, the Company analogized guidance to account for the COVID-19 relief funds received from the United States Small Business Administration (“SBA”) and the Canada Revenue Agency (“CRA”). The ability to analogize standards from other GAAP sources is provisioned under ASC 105-05-2 when guidance is not provided for certain transactions under US GAAP. The adoption of the standard had a material impact on the financial statements as of December 31, 2020 with no impact noted in prior years. Under this policy, the Company has recognized the income from the relief funds in the Statement of Operations, as the criteria for recognition of the funds have been met. Changes to the Disclosure Requirements for Fair Value Measurement: Recently Issued Accounting Pronouncements Income Taxes: |
OPERATING SEGMENT REPORTING
OPERATING SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2020 | |
OPERATING SEGMENT REPORTING | |
OPERATING SEGMENT REPORTING | NOTE 3 OPERATING SEGMENT REPORTING McEwen Mining is a mining and minerals production and exploration company focused on precious metals in the United States, Canada, Mexico, and Argentina. The Company’s chief operating decision 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 within a geographic region 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 are included in General and Administrative and other The CODM reviews segment income or loss, defined as gold and silver sales less production costs applicable to sales, depreciation and depletion, advanced projects, and exploration costs, for all segments except for the MSC segment which is evaluated based on the attributable equity income or loss pickup. Gold and silver sales and production costs applicable to sales for the reportable segments are reported net of intercompany transactions. Production costs applicable to sales for the El Gallo project were $15.7 million for the year ended December 31, 2020 (in the year ended December 31, 2019 - $18.5 million) and included $8.4 million of residual leaching spending in the year, net of $3.0 million capitalized in inventory (in the year ended December 31, 2019 - $8.2 million, net of $3.4 million capitalized in inventory) with the remaining balance of production costs applicable to sales of $7.3 million (in the year ended December 31, 2019 - $10.3 million) corresponds to opening leach pad inventory costs that are included as production costs applicable to sales. Capital expenditures include costs capitalized in mineral property interests and plant and equipment in the respective periods. Significant information relating to the Company’s reportable operating segments for the periods presented is summarized in the tables below: Year ended December 31, 2020 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ 48,884 $ 41,452 $ 14,453 $ — $ — $ 104,789 Production costs applicable to sales (58,465) (34,639) (15,723) — $ — (108,827) Depreciation and depletion (11,785) (10,883) (242) — $ — (22,910) Gross (loss) (21,366) (4,070) (1,512) — — (26,948) Advanced projects (1,071) (6,088) (4,522) — $ — (11,681) Exploration (6,777) (6,450) (513) — $ (2,121) (15,861) Impairment of mineral property interests and plant and equipment (Note 9) (83,805) — — — $ — (83,805) Loss from investment in Minera Santa Cruz S.A. — — — (1,517) $ — (1,517) Other operating (1,390) (578) — — — (1,968) Segment loss $ (114,409) $ (17,186) $ (6,547) $ (1,517) $ (2,121) $ (141,780) General and Administrative and other (11,935) Loss before income and mining taxes $ (153,715) Capital expenditures $ 4,821 $ 9,104 $ — $ — $ — $ 13,925 Year ended December 31, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ 43,847 $ 50,058 $ 23,114 $ — $ — $ 117,019 Production costs applicable to sales (33,614) (31,121) (18,545) — — (83,280) Depreciation and depletion (10,934) (13,271) (548) — — (24,753) Gross (loss) profit (701) 5,666 4,021 — — 8,986 Advanced projects (649) (1,636) (7,235) — — (9,520) Exploration (8,554) (25,779) — — (3,411) (37,744) Loss from investment in Minera Santa Cruz S.A. — — — (8,754) — (8,754) Segment loss $ (9,904) $ (21,749) $ (3,214) $ (8,754) $ (3,411) $ (47,032) General and Administrative and other (16,559) Loss before income and mining taxes $ (63,591) Capital expenditures $ 18,806 $ 11,464 $ — $ — $ — $ 30,270 Year ended December 31, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ — $ 62,024 $ 66,151 $ — $ — $ 128,175 Production costs applicable to sales — (43,095) (37,919) — — (81,014) Depreciation and depletion — (12,972) (2,107) — — (15,079) Gross profit — 5,957 26,125 — — 32,082 Advanced projects (7,959) — (7,104) — — (15,063) Exploration (5,174) (22,032) (2,241) — (7,129) (36,576) Loss from investment in Minera Santa Cruz S.A. — — — (11,865) — (11,865) Segment (loss) income $ (13,133) $ (16,075) $ 16,780 $ (11,865) $ (7,129) $ (31,422) General and Administrative and other (16,218) Loss before income and mining taxes $ (47,640) Capital expenditures $ 84,713 $ 12,584 $ 171 $ — $ — $ 97,468 Geographic information Geographic information includes the following long-lived assets balances and revenues presented for the Company’s operating segments: Long-lived Assets Revenue (1) December 31, December 31, Year ended December 31, 2020 2019 2020 2019 2018 USA $ 46,801 $ 135,854 $ 48,884 $ 43,847 $ — Canada 78,986 77,147 41,452 50,058 62,024 Mexico 20,021 23,551 14,453 23,114 66,151 Argentina (2) 299,816 302,598 — — — Total consolidated (3) $ 445,624 $ 539,150 $ 104,789 $ 117,019 $ 128,175 (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $108.3 million as of December 31, 2020 (December 31, 2019 - $110.2 million). (3) Total excludes $0.8 million related to the Company’s ROU office lease asset as the business activities related to corporate are not considered to be a part of the operating segments. As gold and silver can be sold through numerous gold and silver market traders worldwide, the Company is not economically dependent on a limited number of customers for the sale of its product. In 2020, 2019 and 2018, sales to Bank of Nova Scotia and Asahi Refining Inc. were $33.0 million (32%) and $67.0 million (64%), $103.6 million (89%) and $4.9 million (4%), and $123.5 million (96%) and $nil, respectively, of the total gold and silver sales. |
OTHER OPERATING
OTHER OPERATING | 12 Months Ended |
Dec. 31, 2020 | |
OTHER OPERATING | |
OTHER OPERATING | NOTE 4 OTHER OPERATING During 2020, the Company temporarily suspended operations at its Gold Bar and Black Fox mine sites as measures to combat COVID-19. Costs incurred while operations were suspended total $0.9 million at Gold Bar and $0.6 million at Black Fox during the twelve months ended December 31, 2020. In addition, the Gold Bar operational shutdown was extended while the Company conducted a thorough review of its resource and mine plan during Q2 2020. Upon completion of this review, the Company commenced a controlled and phased ramp up of operations through the remainder of the second quarter. Costs incurred due to the resource review were $0.5 million. |
OTHER INCOME
OTHER INCOME | 12 Months Ended |
Dec. 31, 2020 | |
OTHER INCOME | |
OTHER INCOME | NOTE 5 OTHER INCOME The following is a summary of other income (expense) for the years ended December 31, 2020, 2019, and 2018: Year ended December 31, 2020 2019 2018 COVID-19 Relief $ 6,420 $ — $ — Unrealized and realized (loss) gain on investments (Note 6) (619) 5,259 (3,324) Foreign currency gain 1,078 1,697 3,922 Other income, net 14 184 570 Total other income $ 6,893 $ 7,140 $ 1,168 In response to COVID-19, the United States and Canadian governments enacted significant relief measures to support businesses directly and adversely impacted by the pandemic. During 2020, the Company secured $1.9 million of relief from the US government under the paycheck protection (“PPP”) program. The funds are fully forgivable as long as sufficient eligible expenditures are incurred in a 24 week period. The income from the PPP program is recognized on a systematic basis as eligible forgivable expenditures are incurred. As at December 31, 2020, the full amount has been recognized as other income, as the Company is reasonably assured that it is in compliance with the forgiveness criteria of incurring the eligible expenses for forgiveness within the required time frame. The Company also secured $4.5 million of government relief in Canada through the Canadian Emergency Wage Subsidy program all of which has been recognized in other income. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2020 | |
INVESTMENTS | |
INVESTMENTS | NOTE 6 INVESTMENTS The Company’s investment portfolio consisted of marketable equity securities and warrants of certain publicly-traded companies. The following is a summary of the activity in investments for the years ended December 31, 2020 and 2019: As at Additions/ Disposals/ Unrealized Fair value December 31, transfers during Net (loss) on transfers during (loss) on December 31, 2019 period securities sold year securities held 2020 Marketable equity securities $ 1,885 $ — $ (619) $ (1,266) $ — $ — As at Additions/ Net gain Disposals/ Unrealized Fair value December 31, transfers during (loss) on transfers during gain on December 31, 2018 period securities sold year securities held 2019 Marketable equity securities $ 2,718 $ 2,314 $ 3,396 $ (7,279) $ 736 $ 1,885 Warrants 413 — 1,127 (1,540) — — Investments $ 3,131 $ 2,314 $ 4,523 $ (8,819) $ 736 $ 1,885 During the years ended December 31, 2020, 2019 and 2018, the Company sold marketable equity securities for $1.3 million, $6.8 million and $2.9 million, respectively. As of December 31, 2020, the cost of the marketable equity securities was $nil (December 31, 2019 – $1.3 million). |
RECEIVABLES AND OTHER CURRENT A
RECEIVABLES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
RECEIVABLES AND OTHER CURRENT ASSETS | NOTE 7 RECEIVABLES AND OTHER CURRENT ASSETS Receivables and other current assets as at December 31, 2020 and 2019 consisted of the following: December 31, 2020 December 31, 2019 Government sales tax receivable $ 1,810 $ 2,658 Prepaids and other assets 3,880 2,607 Receivables and other current assets $ 5,690 $ 5,265 Government sales tax receivable includes $0.9 million of Mexican VAT at December 31, 2020 (December 31, 2019 – $0.7 million). The Company collected $1.4 million of VAT during the year ended December 31, 2020 (December 31, 2019 and 2018 – $2.2 million and $8.3 million, respectively). Prepaids and other assets primarily contains $2.2 million in prepaid insurance and $1.1 million property holding and other miscellaneous deposits (December 31, 2019 – $0.7 and $1.4 million respectively). |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES | |
INVENTORIES | NOTE 8 INVENTORIES Inventories at December 31, 2020 and 2019 consist of the following: December 31, 2020 December 31, 2019 Material on leach pads $ 21,003 $ 37,328 In-process inventory 3,922 3,847 Stockpiles 635 1,384 Precious metals 1,344 1,038 Materials and supplies 4,845 4,382 Inventories $ 31,749 $ 47,979 Less current portion 26,964 38,376 Long-term portion $ 4,785 $ 9,603 During the year ended December 31, 2020, the inventory of Black Fox, Gold Bar and El Gallo were written down to their net realizable value by $1.9 million $12.4 million $1.7 million Statement of Operations |
MINERAL PROPERTY INTERESTS AND
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2020 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | NOTE 9 MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT The cost and carrying value of mineral property interests and plant and equipment at December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Mineral property interests, cost $ 314,719 $ 339,374 Less: accumulated depletion (34,601) (28,154) Mineral property interests, carrying value $ 280,118 $ 311,220 Plant and equipment, cost Land $ 8,804 $ 8,746 Construction in progress 2,945 2,961 Plant and equipment 72,188 133,014 Subtotal $ 83,937 $ 144,721 Less: accumulated depreciation (34,943) (37,150) Plant and equipment, carrying value $ 48,994 $ 107,571 Mineral property interests and plant and equipment, carrying value $ 329,112 $ 418,791 Additions to plant and equipment as of December 31, 2020 include $nil of capitalized interest related to the Gold Bar mine (December 31, 2019 – $1.4 million). On February 16, 2019, first production occurred at the Gold Bar mine and related construction-in-progress costs were transferred into the appropriate category of plant and equipment and amortized. Mineral property interest carrying value at December 31, 2020 and 2019 includes the following: Name of Property/Complex State/Province Country 2020 2019 Fox Complex Ontario Canada $ 17,580 $ 14,627 Lexam Ontario Canada 41,595 41,595 Los Azules Copper Project San Juan Argentina 191,490 191,490 Tonkin Properties Nevada United States 4,833 4,833 Gold Bar Project Nevada United States 14,675 48,492 Battle Mountain Complex Nevada United States 785 785 El Gallo Project Sinaloa Mexico 3,353 3,591 Fenix Project Properties Sinaloa Mexico 5,807 5,807 Total mineral property interests $ 280,118 $ 311,220 Black Fox and Gold Bar mineral property interest are depleted based on the units of production method from production commencement date over the estimated proven and probable reserves. The El Gallo Project is depleted and depreciated using the straight line or units-of-production method over the stated mine life, as the project does not have proven and probable reserves compliant with Guide 7 . The definition of proven and probable reserves is set forth in the Guide 7. If proven and probable reserves exist at the Company’s properties, the relevant capitalized mineral property interests and asset retirement costs are charged to expense based on the units of production method upon commencement of production. The Company’s Gold Bar, Black Fox and San José properties have proven and probable reserves estimated in accordance with SEC Industry Guide 7. The Company conducts a review of potential triggering events for impairment for all its mineral projects on a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. As part of the analysis conducted in Q1 2020, the Company determined that indicators of impairment existed for the long-lived assets at the Gold Bar mine and that the long-lived assets at the Gold Bar mine were likely not recoverable on an undiscounted basis. The fair value of the Gold Bar mine was estimated using the discounted cash flow method, coupled with an in-situ resource multiple for mineralized material not included in the life of mine plan. Future cash flows were estimated based on estimated quantities of recoverable mineralized material, expected gold prices, estimated production levels, operating costs, capital requirements and reclamation costs, all based on the life-of-mine plan using the preliminary estimated resources. The in-situ resource multiple applied to the mineralized material not included in the life-of-mine plan was estimated by evaluating observable market transactions. The Company concluded that the carrying value of the long-lived assets at the Gold Bar mine was impaired and recorded a non-cash impairment charge reducing plant and equipment and mineral property interests by the amount of $83.8 million. As of December 31, 2020 no further indicators of impairment have been noted for Gold Bar. The following table sets forth a summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Company’s non-recurring Level 3 fair value measurement of the Gold Bar mine: Date of Fair Value Measurement Valuation Technique Unobservable Input Range/ Weighted Average Gold Bar Mine March 31, 2020 Discounted Cash Flow Discount Rate 9% Long Term Gold Price $1,430/oz United States Inflation Index 2% The estimated future cash flows are based on numerous assumptions and uncertainties. It is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold prices, production levels and costs of capital are each subject to significant risks and uncertainties. |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | 12 Months Ended |
Dec. 31, 2020 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | NOTE 10 INVESTMENT IN MINERA SANTA CRUZ S.A. (“MSC”) - SAN JOSÉ MINE The Company accounts for investments over which it exerts significant influence but does not control through majority ownership using the equity method of accounting. In applying the equity method of accounting to the 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. A summary of the operating results of MSC for the year ended December 31, 2020, 2019, and 2018 is as follows: Year ended December 31, 2020 2019 2018 Minera Santa Cruz S.A. ( 100% ) Revenue from gold and silver sales $ 219,020 $ 263,887 $ 213,096 Production costs applicable to sales (138,182) (159,915) (151,779) Depreciation and depletion (29,809) (69,995) (52,200) Gross profit 51,029 33,977 9,117 Exploration (10,446) (10,635) (5,884) Other expenses (1) (30,515) (13,065) (12,840) Net income (loss) before tax $ 10,068 $ 10,277 $ (9,607) Current and deferred tax expense (4,466) (14,556) (10,934) Net income (loss) $ 5,602 $ (4,279) $ (20,541) Portion attributable to McEwen Mining Inc. ( 49% ) Net income (loss) $ 2,745 $ (2,097) $ (10,065) Amortization of fair value increments (5,390) (9,448) (9,730) Income tax recovery 1,128 2,791 7,930 Loss from investment in MSC, net of amortization $ (1,517) $ (8,754) $ (11,865) (1) Other expenses include foreign exchange, accretion of asset retirement obligations and other finance related expenses. Shutdown costs related to the COVID-19 pandemic for MSC were recognized in other expenses and totaled $11.4 million for the year ended December 31, 2020. The loss from investment in MSC attributable to the Company includes amortization of the fair value increments arising from the initial purchase price allocation and related income tax recovery. The income tax recovery reflects the impact of devaluation of the Argentine peso against the U.S. dollar on the peso-denominated deferred tax liability recognized at the time of acquisition, as well as income tax rate changes over the periods. Changes in the Company’s investment in MSC for the year ended December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Investment in MSC, beginning of year $ 110,183 $ 127,814 Attributable net income (loss) from MSC 2,745 (2,097) Amortization of fair value increments (5,390) (9,448) Income tax recovery 1,128 2,791 Dividend distribution received (340) (8,877) Investment in MSC, end of year $ 108,326 $ 110,183 A summary of the key assets and liabilities of MSC as at December 31, 2020, before and after adjustments for fair value increments arising from the purchase price allocation, are as follows: As at December 31, 2020 Balance excluding FV increments Adjustments Balance including FV increments Current assets $ 94,965 $ 362 $ 95,327 Total assets $ 186,438 $ 107,821 $ 294,259 Current liabilities $ (40,396) $ — $ (40,396) Total liabilities $ (69,255) $ (3,936) $ (73,191) |
LEASE LIABILITIES
LEASE LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
LEASE LIABILITIES | |
LEASE LIABILITIES | NOTE 11 LEASE LIABILITIES The Company’s lease obligations include equipment, vehicles and office space. Leased assets are included in plant and equipment ( Note 9 Lease liabilities as at December 31, 2020 and 2019 are as follows: Total discounted lease liabilities December 31, 2020 December 31, 2019 Finance leases $ 4,735 $ 6,229 Operating lease 761 904 Lease liabilities $ 5,496 $ 7,133 Current portion (2,440) (2,115) Long-term portion $ 3,056 $ 5,018 On January 1, 2019, the Company adopted ASC 842, “Leases,” under a modified retrospective transition method and recorded a nominal cumulative-effect adjustment to the opening accumulated deficit balance. Lease liabilities at December 31, 2020 are recorded using a weighted average discount rate of 6.83% and 8.73%, respectively, for finance and operating leases and have average remaining lease terms of two years and four years, respectively. During the year ended December 31, 2020, the Company recorded $1.3 million (December 31, 2019 – $1.8 million) in interest and other finance costs related to leases. A breakdown of the lease related costs for the year ended December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Finance leases: Amortization of ROU assets $ 878 $ 1,123 Interest expense 392 517 Total $ 1,270 $ 1,640 Operating lease: Rent expense $ 194 $ 193 Future minimum undiscounted lease payments as at December 31, 2020 are as follows: Payments due by period 2021 2022 2023 2024 2025 Total Operating lease obligation $ 228 $ 230 $ 234 $ 156 $ — $ 848 Finance lease obligations 2,467 2,186 274 24 — 4,951 Total future minimum lease payments $ 2,695 $ 2,416 $ 508 $ 180 $ — $ 5,799 Less: Imputed interest (303) Total 5,496 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2020 | |
LONG-TERM DEBT | |
LONG-TERM DEBT | NOTE 12 LONG-TERM DEBT On August 10, 2018, the Company finalized a $50.0 million senior secured three year term loan facility with Royal Capital Management Corp., as administrative agent, and the lenders party thereto. Interest on the loan accrued at the rate of 9.75% per annum with interest due monthly and the loan was collateralized by a lien on certain of the Company’s and its subsidiaries’ assets. On June 25, 2020, the Company entered into an Amended and Restated Credit Agreement (“ARCA”) which refinanced the outstanding $50 million and which terms differed in material respects from the original loan as follows: ● Sprott Private Resource Lending II (Collector), LP replaced Royal Capital Management Corp. as the administrative agent. ● Sprott Private Resource Lending II (Collector), LP replaced certain lenders. An affiliate of Robert McEwen remains as a lender. ● Scheduled repayments of the principal are extended by two years . Monthly repayments of principal in the amount of $2.0 million are due beginning on August 31, 2022 and continuing for 12 months , followed by a final principal payment of $26.0 million plus any accrued interest on August 31, 2023. ● The minimum working capital maintenance requirement was reduced from $10.0 million under the original term loan to $nil at June 30, 2020 to December 31, 2020 and from $10.0 million to $2.5 million at March 31, 2021 to the end of 2021. The working capital requirement increases to $5.0 million for March 31, 2022, $7.0 million for June 30, 2022, and $10 million for September 30, 2022 and thereafter. ● The Company issued 2,091,700 shares valued at $1,875,000 to the lenders as bonus interest, accounted for as a financing cost. The value of the shares plus the unamortized costs of the original term loan will be amortized over the modified term of the loan. The remaining principal terms of the original agreement remain unchanged. A reconciliation of the Company’s long-term debt for the year ended December 31, 2020 and 2019 is as follows: December 31, 2020 December 31, 2019 Balance, beginning of year $ 49,516 $ 49,206 Interest expense 5,394 5,185 Interest payments (4,875) (4,875) Bonus Interest - Equity based financing fee (1,875) — Balance, end of year $ 48,160 $ 49,516 Less current portion — 10,000 Long-term portion $ 48,160 $ 39,516 During the year ended December 31, 2020, $nil of interest was capitalized in plant and equipment (year ended December 31, 2019 – $0.6 million, capitalized to the Gold Bar mine). |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 12 Months Ended |
Dec. 31, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
ASSET RETIREMENT OBLIGATIONS | NOTE 13 ASSET RETIREMENT OBLIGATIONS The Company is responsible for reclamation of certain past and future disturbances at its properties. The most significant properties subject to these obligations are the Gold Bar and Tonkin properties in Nevada, the Timmins properties in Canada, and the El Gallo Project in Mexico. A reconciliation of the Company’s asset retirement obligations for the years ended December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Asset retirement obligation liability, beginning balance $ 32,201 $ 29,402 Settlements (267) (513) Accretion of liability 1,901 1,680 Adjustment reflecting updated estimates (54) 1,012 Foreign exchange revaluation 219 620 Asset retirement obligation liability, ending balance $ 34,000 $ 32,201 Less current portion 3,232 2,610 Long-term portion $ 30,768 $ 29,591 The adjustment reflecting updated estimates during the year ended December 31, 2020 primarily relates to a $0.1 million increase in obligations in Nevada (2019 – included a reduction of $5.3 million in the estimated environmental obligations for the Black Fox mine offset by an increase of $4.3 million for the estimated environmental obligations for the Gold Bar mine). Reclamation expense in the Statement of Operations Year ended December 31, 2020 2019 2018 Reclamation adjustment reflecting updated estimates $ (113) $ 1,851 $ 2,259 Reclamation accretion 1,901 1,680 1,205 Total $ 1,788 3,531 $ 3,464 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 14 SHAREHOLDERS’ EQUITY Equity Issuances Flow-Through Shares Issuance On December 31, 2020, the Company issued an additional 7,669,900 flow-through common shares priced at $1.28 per share for gross proceeds of $9.8 million. The purpose of this offering was to fund exploration activities on the Company’s properties in the Timmins region of Canada. The total proceeds were allocated between the sale of tax benefits and the sale of common shares. No issuance costs were incurred as part of this issuance. Proceeds of $9.8 million were allocated between the sale of tax benefits in the amount of $2.1 million and the sale of common shares in the amount of $7.7 million. On September 10, 2020, the Company issued 6,298,166 flow-through common shares priced at $1.65 per share for gross proceeds of $10.4 million. The purpose of this offering was to fund exploration activities on the Company’s properties in the Timmins region of Canada. The total proceeds were allocated between the sale of tax benefits and the sale of common shares. The total issuance costs related to the issuance of the flow-through shares was $0.6 million, which are accounted for as a reduction to the common shares. The net proceeds of $9.8 million were allocated between the sale of tax benefits in the amount of $2.0 million and the sale of common shares in the amount of $7.8 million. The Company is required to spend flow-through share proceeds on flow-through eligible Canadian exploration expenditures (“CEE”) as defined by subsection 66(15) of the Income Tax Act (Canada). To date, the Company has incurred a total of $1.9 million in eligible CEE. The Company expects to fulfill its CEE commitments by the end of 2022. June 2020 Amended and Restated Credit Agreement Pursuant to the ARCA executed on June 25, 2020, the Company issued 2,091,700 shares of common stock to the lenders as consideration for the maintenance, continuation, and the extension of the maturity date of the loan. The Company valued the shares at $1.9 million. Shares Issued for Acquisition of Mineral Property Interests During the year ended December 31, 2020, the Company issued a total of 53,600 shares of common stock for the acquisition of mineral interests adjacent to Gold Bar, valued at $0.1 million (year ended December 31, 2019 - issued 353,570 shares of common stock for the acquisition of mineral interests adjacent to Gold Bar). November 2019 Offering On November 20, 2019 (the “November Offering”), the Company issued 37,750,000 Units at $1.325 per Unit, for net proceeds of $46.6 million (net of issuance costs of $3.5 million). Each Unit consisted of one share of common stock and one The Company concluded that both common stock and warrants are equity-linked financial instruments and should be accounted for permanently in the shareholders’ equity section in the Consolidated Balance Sheets, with no requirement to subsequently revalue any of the instruments. Of the net proceeds of $46.6 million, $37.3 million was allocated to common stock and $9.3 million was allocated to warrants, based on their relative fair values at issuance. The Company used the Black-Scholes pricing model to determine the fair value of warrants issued in connection with the November Offering using the following assumptions: November 20, 2019 Risk-free interest rate 1.55 % Dividend yield 0.00 % Volatility factor of the expected market price of common stock 60 % Weighted-average expected life 5 years Weighted-average grant date fair value $ 0.52 All 21,706,250 warrants issued under the November Offering remain outstanding and unexercised as at December 31, 2020. March 2019 Offering On March 29, 2019, the Company issued 14,193,548 Units at $1.55 per Unit, for net proceeds of $20.3 million (net of issuance costs of $1.7 million). Each Unit consisted of one share of common stock and one On March 29, 2019, the Company also issued 1,935,484 Subscription Receipts at $1.55 per Subscription Receipt to certain executive officers, directors, employees and consultants. Upon shareholder and NYSE approval on May 23, 2019, the Subscription Receipts were converted into 1,935,484 Units for net proceeds of $2.6 million (net of issuance costs of $0.4 million). All Units issued under the offering have identical terms. At-the-Market (“ATM”) Offering Pursuant to an equity distribution agreement dated November 8, 2018, the Company was permitted to offer and sell from time to time shares of its common stock having an aggregate offering price of up to $90.0 million, with the net proceeds to fund working capital and general corporate purposes. During the three months ended March 31, 2019, the Company issued an aggregate of 1,010,545 shares of common stock for proceeds of $1.9 million. The Company terminated the agreement on March 13, 2019. Stock Options The Company’s Amended and Restated Equity Incentive Plan (“Plan”) allows for equity awards to be granted to employees, consultants, advisors, and directors. The Plan is administered by the Compensation Committee of the Board of Directors (“Committee”), which determines the terms pursuant to which any award is granted. The Committee may delegate to certain officers the authority to grant awards to certain employees (other than such officers), consultants and advisors. During the year ended December 31, 2020, 135,000 shares of common stock (December 31, 2019 – 535,000) were issued upon exercise of stock options under the Plan, at a weighted average exercise price of $1.02 (2019 – $1.02) per share for proceeds of $0.1 million (2019 – $0.5 million). Shareholder Distributions During the year ended December 31, 2020 and December 31, 2019 the Company did not make any shareholder distributions. Pursuant to the ARCA ( Note 12 Stock-Based Compensation The following table summarizes information about stock options outstanding under the Plan at December 31, 2020: 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, 2017 4,906 $ 2.45 2.6 $ 2,564 Granted 375 1.90 — — Exercised (171) 1.02 — 195 Forfeited (405) 3.99 — — Expired (462) 2.27 — — Balance at December 31, 2018 4,243 $ 2.33 2.0 $ 1,475 Granted 3,050 1.73 — — Exercised (535) 1.01 — 419 Forfeited (700) 2.56 — — Expired (789) 2.90 — — Balance at December 31, 2019 5,269 $ 2.00 3.0 $ 364 Granted 5,097 1.22 — — Exercised (135) 1.02 — 10 Forfeited (1,968) 2.18 — 2 Expired (1,251) 1.19 — — Balance at December 31, 2020 7,012 $ 1.55 4.2 $ 53 Exercisable at December 31, 2020 919 $ 3.02 2.6 $ — Stock options have been granted to key employees, directors and consultants under the Plan. Options to purchase shares under the Plan were granted at or above market value of the common stock as of the date of the grant. During the year ended December 31, 2020, the Company granted stock options to certain employees and directors for an aggregate of 5.1 million shares of common stock (2019 – 3.1 million, 2018 – 0.4 million) at a weighted average exercise price of $1.22 per share (2019 – $1.73, 2018 – $1.90). 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 five years from the date of grant. The fair value of the options granted under the Plan was estimated at the date of grant, using the Black-Scholes option-pricing model, with the following weighted-average assumptions: 2020 2019 2018 Risk-free interest rate .157% to .322% 1.45% to 1.87% 2.67% to 2.89% Dividend yield 0.00% 0.00% 0.36% to 0.53% Volatility factor of the expected market price of common stock 59% 58% 63% to 64% Weighted-average expected life of option 3.5 years 3.5 years 3.5 years Weighted-average grant date fair value $ 1.22 $ 1.73 $ 1.90 During the year ended December 31, 2020, the Company recorded stock option expense of $0.6 million (2019 – $0.7 million, 2018 – $0.3 million) while the corresponding fair value of awards vesting in the period was $0.1 million (2019 – $0.4 million and 2018 – $0.7 million). At December 31, 2020, there was $1.4 million (2019 – $1.0 million, 2018 - $0.4 million) of unrecognized compensation expense related to 6.1 million (2019 – 3.0 million, 2018 – 0.7 million) unvested stock options outstanding. This cost is expected to be recognized over a weighted-average period of approximately 1.6 years (2019 – 1.5 years, 2018 – 1.4 years). The following table summarizes the status and activity of non-vested stock options for the year ended December 31, 2020, for the Company’s Plan and the replacement options from the acquisition of Lexam: Weighted Average Grant Date Number of Fair Value Shares Per Share (in thousands, except per share amounts) Non-vested, beginning of year 3,034 $ 0.64 Granted 5,097 $ 0.40 Cancelled/Forfeited (1,172) $ 0.60 Vested (866) $ 0.71 Non-vested, end of year 6,093 $ 0.44 |
NET LOSS PER SHARE
NET LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
NET LOSS PER SHARE | |
NET LOSS PER SHARE | NOTE 15 NET LOSS PER SHARE Basic net income (loss) per share is computed by dividing the net income or (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed similarly except that the weighted average number of common shares is increased to reflect all dilutive instruments. Diluted net income per share is calculated using the treasury stock method. In applying the treasury stock method, employee stock options with an exercise price greater than the average quoted market price of the common shares for the period outstanding are not included in the calculation of diluted net income per share as the impact is anti-dilutive. Potentially dilutive instruments are not considered in calculating the diluted loss per share, as their effect would be anti-dilutive. Below is a reconciliation of the basic and diluted weighted average number of common shares and the computations for basic and diluted net (loss) per share for the years ended December 31, 2020, 2019 and 2018: Year ended December 31, 2020 2019 2018 (amounts in thousands, unless otherwise noted) Net loss $ (152,325) $ (59,747) $ (44,870) Weighted average common shares outstanding: 403,457 361,845 337,297 Diluted shares outstanding: 403,457 361,845 337,297 Net loss per share - basic and diluted $ (0.38) $ (0.17) $ (0.13) For the years ended December 31, 2020, 2019 and 2018, all outstanding options to purchase shares of common stock and share purchase warrants were excluded from the respective computations of diluted loss per share, as the Company was in a loss position, and all potentially dilutive instruments were anti-dilutive and therefore not included in the calculation of diluted net loss per share. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 16 RELATED PARTY TRANSACTIONS The Company incurred the following expense in respect to the related parties outlined below during the periods presented: Year ended December 31, 2020 2019 2018 Lexam L.P. $ 99 $ 133 $ 91 REVlaw 158 188 266 The Company has the following outstanding accounts payable balance in respect to the related parties outlined below: December 31, 2020 December 31, 2019 Lexam L.P. $ 72 $ — REVlaw 90 22 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. REVlaw is a company owned by Ms. Carmen Diges, General Counsel of the Company. The legal services of Ms. Diges as General Counsel and other support staff, as needed, are provided by REVlaw in the normal course of business and have been recorded at their exchange amount. An affiliate of Mr. McEwen participated as a lender in the $50.0 million term loan by providing $25.0 million of the total $50.0 million funding and continued as such under the ARCA. During the year ended December 31, 2020, the Company paid $2.4 million (year ended December 31, 2019 – $2.4 million) in interest to this affiliate. Note 12 |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 12 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE ACCOUNTING | |
FAIR VALUE ACCOUNTING | NOTE 17 FAIR VALUE ACCOUNTING As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Assets and liabilities measured at fair value on a recurring basis The following tables identify the 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, 2020 and 2019, as reported in the Consolidated Balance Sheets: Fair value as at December 31, 2020 Fair value as at December 31, 2019 Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities $ — $ — $ — $ 1,885 $ — $ 1,885 Total investments $ — $ — $ — $ 1,885 $ — $ 1,885 The Company's investments as at December 31, 2019 mainly consist of marketable equity securities which are exchange-traded and are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the investments is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. 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. Debt is recorded at a carrying value of $48.2 million at December 31, 2020 (December 31, 2019 - $49.5 million) and approximates its fair value, given our recent refinancing. Impairment of Mineral Property During the year ended December 31, 2020, the Company recorded an impairment of long-lived assets at the Gold Bar Mine totaling $83.8 million based on Level 3 inputs. See Note 9 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 18 COMMITMENTS AND CONTINGENCIES Commitments The following are minimum commitments of the Company as at December 31, 2020, and related payments due over the following five years: Payments due by period 2021 2022 2023 2024 Thereafter Total Mining and surface rights $ 2,233 $ 492 $ 488 $ 470 $ 443 $ 4,126 Reclamation costs (1) 2,819 5,363 5,510 564 27,428 41,684 Long-term debt (Note 12) 4,875 14,712 42,139 — — 61,726 Lease obligations (Note 11) 2,695 2,416 508 180 — 5,799 Total $ 12,622 $ 22,983 $ 48,645 $ 1,214 $ 27,871 $ 113,335 (1) Amounts presented represent the undiscounted uninflated future payments. Reclamation Bonds As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations in the United States and Canada. These bonding obligations are satisfied by surety bonds, as discussed below. Pursuant to the requirements imposed by the United States Bureau of Land Management (“BLM”), the Company has Nevada obligations of $20.1 million which primarily pertains to the Tonkin and Gold Bar properties. Under Canadian regulations, the Company has bonding obligations of $11.7 million (C$15.0 million) with respect to the Fox Complex. Furthermore, under Canadian regulations, the Company was required to deposit approximately $0.1 million with respect to its Timmins properties acquired from Lexam; the $0.1 million is recorded as restricted cash ( Note 19 Surety Bonds As at December 31, 2020, the Company has a surety facility in place to cover substantially all of its bonding obligations, which include $20.1 million of bonding in Nevada and $11.7 million (C$15.0 million) of bonding in Canada. The terms of the facility carry an annual financing fee of 2.3% and require a deposit of 12%. The surety bonds are available for draw down by the beneficiary in the event the Company does not perform its reclamation obligations. If the specific reclamation requirements are met, the beneficiary of the surety bonds will release the instrument to the issuing entity. The Company believes it is in compliance with all applicable bonding obligations and will be able to satisfy future bonding requirements, through existing or alternative means, as they arise. As at December 31, 2020, the Company held $3.6 million in restricted cash as deposit against the surety facility ( Note 19 Streaming Agreement As part of the acquisition of the Fox Complex in 2017, the Company assumed a gold purchase agreement (streaming contract) related to production, if any, from certain claims. Under the streaming contract, the Company is obligated to sell 8% of gold production from the Black Fox mine and 6.3% from the adjoining Pike River property (Black Fox Extension) to Sandstorm Gold Ltd. at the lesser of market price or $561 per ounce (with inflation adjustments of up to 2% per year) until 2090. The Company records revenue on these shipments based on the contract price at the time of delivery to the customer. During the year ended December 31, 2020, the Company recorded revenue of $1.2 million (2019 – $1.5 million) related to the gold stream sales. Flow-through Eligible Expenses As of December 31, 2020, the Company completed two rounds of flow-through share issuance’s ( Note 14 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. |
CASH AND CASH EQUIVALENTS AND R
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 12 Months Ended |
Dec. 31, 2020 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | NOTE 19 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash and cash equivalents, and restricted cash reported within the Consolidated Balance Sheets Consolidated Statements of Cash Flows December 31, 2020 December 31, 2019 Cash and cash equivalents $ 20,843 $ 46,452 Restricted cash - non-current (Note 18) 3,595 48 Total cash, cash equivalents, and restricted cash $ 24,438 $ 46,500 Cash and Cash equivalents includes proceeds received from Flow-through financings ( Note 14 Restricted cash – non-current ( Note 18 |
INCOME AND MINING TAXES
INCOME AND MINING TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME AND MINING TAXES. | |
INCOME AND MINING TAXES | NOTE 20 INCOME AND MINING TAXES The Company’s deferred income and mining tax benefit consisted of: 2020 2019 2018 United States $ 817 $ 2,420 $ 2,185 Foreign 573 1,424 585 Deferred tax benefit $ 1,390 $ 3,844 $ 2,770 The Company’s net loss before income and mining tax consisted of: 2020 2019 2018 United States $ (127,524) $ (22,319) $ (27,001) Foreign (26,191) (41,272) (20,639) Loss before income and mining taxes $ (153,715) $ (63,591) $ (47,640) A reconciliation of the tax provision for 2020, 2019 and 2018 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 recovery at 2020 2019 2018 Loss before income and mining taxes $ (153,715) $ (63,591) $ (47,640) Statutory tax rate 21% 21% 21% US Federal and State tax expense at statutory rate (32,280) (13,354) (10,004) Reconciling items: Equity pickup in MSC 374 2,626 2,966 Deferred foreign income inclusion 795 598 5,963 Realized flow-through expenditures 496 3,150 2,100 Realized flow-through premium (338) (2,954) (1,675) Tax rate changes (147) 976 — Adjustment for foreign tax rates (2,043) (200) 40 Other permanent differences (7,062) 8,540 4,419 Unrealized foreign exchange rate (loss)/gain 4,663 (1,095) (6,935) NOL expires and revisions 1,066 810 (120) Valuation allowance 33,086 (2,941) 476 Income and mining tax recovery $ (1,390) $ (3,844) $ (2,770) 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, 2020 and 2019 respectively are presented below: 2020 2019 Deferred tax assets: Net operating loss carryforward $ 66,085 $ 57,667 Mineral Properties 66,038 60,299 Other temporary differences 30,999 14,356 Total gross deferred tax assets 163,122 132,322 Less: valuation allowance (154,298) (121,212) Net deferred tax assets $ 8,824 $ 11,110 Deferred tax liabilities: Acquired mineral property interests (12,637) (16,024) Total deferred tax liabilities $ (12,637) $ (16,024) Deferred income and mining tax liability $ (3,813) $ (4,914) The Company reviews the measurement of its deferred tax assets at each balance sheet date. On the basis of available information at December 31, 2020, the Company has provided a valuation allowance for certain of its deferred assets where the Company believes it is more likely than not that some portion or all of such assets will not be realized. The change in valuation allowance of approximately $33.1 million primarily reflects the impact of losses during the year from impairments and operations. The table below summarizes changes to the valuation allowance: For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2020 $ 121,212 $ 39,794 $ (6,708) $ 154,298 2019 124,153 2,104 (5,045) 121,212 2018 123,648 12,232 (11,727) 124,153 (a) The additions to valuation allowance mainly result 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 result from release of valuation allowance, expiration of the Company’s tax attributes, foreign exchange reductions of tax attributes in Canada, Mexico and Argentina and inflationary adjustments to tax attributes in Argentina. As at December 31, 2020 and 2019, 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) Net-operating losses $ 167,784 2027-Unlimited Mexico Net-operating losses 37,117 2022-2030 Canada (a) Net-operating losses 35,888 2025-2040 Argentina (a) Net-operating losses 41,522 2021-2025 (a) The losses in the United States, Canada, and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. The Company or its subsidiaries file income tax returns in the United States, Canada, Mexico, and Argentina. These tax returns are subject to examination by local taxation authorities provided the tax years remain open to audit under the relevant statute of limitations. The following summarizes the open tax years by major jurisdiction: United States: 2017 to 2020 Canada: 2013 to 2020 Mexico: 2016 to 2020 Argentina: 2016 to 2020 |
UNAUDITED SUPPLEMENTARY QUARTER
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | NOTE 21 UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION The following table summarizes unaudited supplementary quarterly information for the years ended December 31, 2020 and 2019. Three months ended March 31, 2020 June 30, 2020 September 30, 2020 December 31, 2020 (unaudited) (in thousands, except per share) Revenue from gold and silver sales $ 31,400 $ 18,291 $ 27,395 $ 27,703 Gross (loss) (3,685) (8,875) (701) (13,687) Net (loss) (99,191) (19,814) (9,778) (23,542) Net (loss) per share: Basic and diluted $ (0.25) $ (0.05) $ (0.02) $ (0.06) Weighted average shares outstanding: Basic and diluted 400,370 400,513 403,887 408,959 Three months ended March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019 (unaudited) (in thousands, except per share) Revenue from gold and silver sales $ 15,583 $ 36,383 $ 32,691 $ 32,362 Gross profit 1,429 4,677 1,619 1,261 Net (loss) (10,136) (13,014) (11,465) (25,132) Net (loss) per share: Basic and diluted $ (0.02) $ (0.04) $ (0.03) $ (0.07) Weighted average shares outstanding: Basic and diluted 345,497 346,998 362,175 378,543 |
COMPARATIVE FIGURES
COMPARATIVE FIGURES | 12 Months Ended |
Dec. 31, 2020 | |
COMPARATIVE FIGURES | |
COMPARATIVE FIGURES | NOTE 22 COMPARATIVE FIGURES Certain amounts in prior years have been reclassified to conform to the current year’s presentation. Reclassified amounts were not material to the financial statements and relate to the presentation of Other Operating Expenses. Advanced projects Statement of Operations Exploration Statement of Operations General and Administrative Statement of Operations |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS. | |
SUBSEQUENT EVENTS | NOTE 23 SUBSEQUENT EVENTS February 2021 equity financing: On February 9, 2021, the Company completed a registered direct offering with several existing and new institutional investors and issued 30,000,000 shares of common stock priced at $1.05 per share for gross proceeds of $31.5 million. January 2021 flow-through financing: On January 29, 2021, the Company issued 12,600,600 flow-through common shares priced at $1.01 per share for gross proceeds of $12.7 million. Gold Bar Resource and Reserve estimate update: On January 7, 2021, the Company updated the resource and reserve numbers for the Gold Bar Mine. A net reduction of 16% in estimated reserves results in a revised Probable Reserve Estimate of 302,000 recoverable gold ounces. This change in reserve estimate is an update to the analysis in Q1-2020. The potential mine life is in the range of 5 to 7 years based on the currently estimated reserves. MSC Dividend received: On January 28, 2021 we received a dividend of $2.5 million from MSC. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates: The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of the Company’s consolidated financial statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to environmental reclamation and closure obligations; asset useful lives utilized for depletion, depreciation, amortization and accretion calculations; fair value of equity investment and the impairment test; recoverable gold in leach pad inventory; current and long-term inventory; mine development capitalization costs; the collectability of value added taxes receivable; reserves; valuation allowances for deferred tax assets; income and mining tax provisions; reserves for contingencies and litigation and costs and relief funds related to COVID-19. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ significantly from these estimates. References to “C$” refer to Canadian currency. |
COVID-19 | COVID-19: On March 11, 2020, the World Health Organization (“WHO”) declared the COVID-19 virus a global pandemic. As a result of the pandemic, many jurisdictions, including the United States, Canada, Mexico and Argentina, instituted restrictions on travel, public gatherings, and certain business operations. Even absent of government-mandated shut downs, the Company was required to temporarily suspend operations at its mines to protect the health and safety of its employees and contractors. This resulted in temporary shutdowns of all or a portion of operations at all of the Company’s mine sites at the start of Q2 2020. Since that date, all of the Company’s operations, have successfully recommenced operations. During the fourth quarter of 2020, operations at the San José mine were briefly suspended as a result of a significant increase in infections in the Santa Cruz region. The temporary shutdowns adversely impacted the Company’s operations, cash flow, and liquidity in the second quarter of 2020 and some of these effects continued into the third and fourth quarters. In addition to the adverse effect on revenue, the Company incurred costs in connection with the shutdowns and subsequent ramp-up. This, in turn, adversely affected the Company’s liquidity. The long-term impact of the COVID-19 outbreak on the Company’s results of operations, financial position and cash flows will depend on future developments, including the duration and spread of the outbreak, the availability and distribution of vaccinations, and government advisories and restrictions. These developments and the impact of COVID-19 on the global financial markets, the overall economy and the Company are highly uncertain and cannot be predicted. Achieving and maintaining normal operating capacity is also dependent on the continued availability of supplies, which is out of the Company’s control. If the financial markets and/or the overall economy continue to be impacted, the Company’s results of operations, financial position and cash flows may be further affected. As the situation continues to evolve, the Company will continue to closely monitor market conditions and respond accordingly. The Company has completed various scenario planning analyses to consider potential impacts of COVID-19 on its business, including volatility in commodity prices, temporary disruptions and/or curtailments of operating activities (voluntary or involuntary). |
Basis of Consolidation | Basis of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated. Investments over which the Company exerts significant influence but does not control through majority ownership are accounted for using the equity method, as described in Investments, |
Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash: The Company considers cash in banks, deposits in transit, and highly liquid term deposits with original maturities of three months or less at the date of acquisition to be cash and cash equivalents. Because of the short maturity of these instruments, the carrying amounts approximate their fair value. The Company classifies Restricted cash between short term and long term based on the restrictions. |
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 Consolidated Balance Sheet Consolidated Statements of Operations and Comprehensive (Loss) Statement of Operations Impairment of Long-lived Assets The Company’s investments in marketable equity securities and warrants are measured at fair value at each period end with changes in fair value recognized in net (loss) income in the Statement of Operations |
Value Added Taxes Receivable | Value Added Taxes Receivable: In Mexico, Argentina, and Canada, value added taxes (“VAT” and “HST”, respectively) are assessed on purchases of materials and services and sales of products. Businesses are generally entitled to recover the taxes they have paid related to purchases of materials and services, either as a refund or as a credit against future taxes payable. |
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: on current and long-term metals prices, less the estimated costs to complete production and bring the product to a saleable form. Write-downs of Inventories resulting from net realizable value impairments are reported as a component of production costs applicable to sales. The current portion of Inventories is determined based on the expected amounts to be processed and/or recovered within the next twelve months of the balance sheet date, with the remaining portion, if any, classified as long-term. Stockpiles represent mineralized material extracted from the mine and available for processing. Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, an estimate of the contained metals (based on assay data) and the estimated metallurgical recovery rates. Costs are allocated to stockpiles based on current mining costs incurred including applicable overhead relating to mining operations. Material is removed from the stockpile at an average cost per tonne. Mineralized material on leach pads is the material that is placed on pads where it is treated with a chemical solution that dissolves the gold contained in the mineralized material over a period of time. Costs are attributed to the mineralized material on leach pads based on current mining costs and processing costs incurred related to the ore on the pad. Costs are removed from the leach pad inventory based on the average cost per estimated recoverable ounce of gold on the leach pad as the gold is recovered. The estimates of recoverable gold on the leach pads are calculated from the quantities of mineralized material placed on the leach pads (measured tonnes added to the leach pads), the grade of mineralized material placed on the leach pads (based on assay data) and a recovery percentage. While the quantities of recoverable gold placed on the leach pads are periodically reconciled by comparing the grades of ore placed on the pads to the quantities of gold actually recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored, and the engineering estimates are refined based on actual results over time. In-process inventories represent materials that are currently in the process of being converted to a saleable product. In-process material is measured based on assays of the material from the various stages of processing. Costs are allocated to in-process inventories based on the costs of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the in-process conversion costs incurred to that point in the process. Precious metal inventories include gold and silver 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, spare parts and consumable parts used in operating and other activities. Cost includes applicable taxes and freight. |
Proven and Probable Reserves | Proven and Probable Reserves: The definition of proven and probable reserves is set forth in SEC Industry Guide 7 (Guide 7). Proven reserves are reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geological character is so well defined that size, shape, depth and mineral content of the reserves are well-established. Probable reserves are reserves for which quantity and grade and/or quality are computed from information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observations. |
Mineral Property Interests and Plant and Equipment | Mineral Property Interests and Plant and Equipment: Mineral property interests: property represents its fair value at the time of acquisition, either as an individual asset purchase or as a part of a business combination. 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 (“pre-stripping”) and building of access paths and other infrastructure to gain access to the ore body at underground mines. Development costs are charged to operations in the year incurred as Advanced Projects During the production phase of a mine, costs incurred to provide access to reserves and resources that will be produced in future periods that would not have otherwise been accessible are capitalized and included in the carrying amount of the related mineral property interest. Drilling and related costs are capitalized for an ore body where proven and probable reserves exist and the activities are directed at obtaining additional information, providing greater definition of the ore body or converting non-reserve mineralization to proven and probable reserves and the benefit is expected to be realized over a period beyond one year. All other drilling and related costs are expensed as incurred as Exploration Advanced Projects Mineral property interests are amortized upon commencement of production on a unit-of-production basis over proven and probable reserves, as defined by Guide 7. When a property does not contain mineralized material that satisfies the definition of proven and probable reserves, the amortization of the capitalized costs is charged to expense based on the most appropriate method, which includes straight-line method and units-of-production method over the estimated useful life of the mine, as determined by internal mine plans. Plant and Equipment: For properties where the Company did not establish proven and probable reserves as defined by Guide 7, substantially all costs, including design, engineering, construction, and installation of equipment are expensed as incurred, unless the equipment has alternative uses or significant salvage value, in which case the equipment is capitalized at cost. Construction-in-progress (“CIP”) costs: |
Impairment of Long-lived Assets | Impairment of Long-Lived Assets: The Company reviews and evaluates its long-lived assets for impairment on a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its estimated fair value. For the purpose of recognition and measurement of impairment, the Company groups its long-lived assets by specific mine or project, as this represents the lowest level for which identifiable cash flows exist. For asset groups where an impairment indicator is identified, an impairment loss is determined if the carrying amount of the asset group exceeds the recoverable amount as determined using the undiscounted future net cash flows. An impairment loss, if any, is the amount by which the carrying amount exceeds the discounted future net cash flows. 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 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 estimated mineralized material based on comparable transactions. |
Asset Retirement Obligation ("ARO"), Reclamation and Remediation Costs | Asset Retirement Obligation (“ARO”), Reclamation and Remediation Costs: Provisions for environmental rehabilitation are made in respect of the estimated future costs of closure and restoration and rehabilitation costs (which include the dismantling and demolition of infrastructure, removal of residual materials and remediation of disturbed areas) in the accounting period when the related environmental disturbance occurs. The associated asset retirement costs, including periodic adjustments, if any, are capitalized as part of the carrying amount of the long-lived asset when proven or probable reserves exist or if they relate to an acquired mineral property interest; otherwise, the costs are charged to the operations. Periodic accretion is recorded to ARO and charged to operations. The fair value of an ARO is measured by discounting the expected cash flows adjusted for inflation, using a credit-adjusted risk free rate of interest. The Company prepares estimates of the timing and amounts of expected cash flows when an ARO is incurred, which are updated to reflect changes in facts and circumstances. Estimation of the fair value of AROs requires significant judgment, including amount of cash flows, timing of reclamation, inflation rate and credit risk. |
Lease Accounting | Lease Accounting: Contracts are analyzed to identify whether the contract contains an operating or financing lease according to ASC 842, adopted by the Company effective January 1, 2019 using the modified retrospective transition method. If a contract is determined to contain a lease, the Company will include lease payments (the lease liability) and the right-of-use asset (“ROU”) representing the right to the underlying asset for the lease term within the Consolidated Balance Sheets Consolidated Balance Sheets Statement of Operations. Operating and ROU asset balances and lease liabilities are recognized at the commencement date of the lease based on the present value of the future lease payments over the lease term. The Company utilizes the incremental borrowing rate (“IBR”) in determining the present value of the future lease payments. IBR represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Each lease’s IBR is determined by using the average bond yield ratings for comparable companies. |
Revenue Recognition | Revenue Recognition: Revenue consists of proceeds received and expected to be received for the Company’s principal products, gold and silver. Revenue is recognized when title to gold and silver passes to the buyer and when collectability is reasonably assured. Title passes to the buyer based on terms of the sales contract, usually upon delivery of the product. Product pricing is determined under the sales agreements which are referenced against active and freely traded commodity markets, for example, the London Bullion Market for both gold and silver, in an identical form to the product sold. Gold and silver 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 of the precious metal content at the relevant quotation point stipulated in the contract. Due to the time elapsed between shipment and the final settlement with the buyer, MSC must estimate the prices at which sales of metals will be settled. At the end of each financial reporting period, previously recorded provisional sales are adjusted to estimated settlement metals prices based on relevant forward market prices until final settlement with the buyer. In addition to selling refined bullion at spot, the Company has doré purchase agreements in place with financial institutions and refineries. Under the agreements, the Company has the option to sell approximately 90% of the gold and silver contained in doré bars prior to the completion of refining by the third party refiner. Revenue is recognized when the Company has provided irrevocable instructions to the refiner to transfer to the purchaser the refined ounces sold upon final processing outturn, and when payment of the purchase price for the purchased doré or bullion has been made in full by the purchaser. There is no judgement involved in revenue recognition as revenue is recognized when payment has been made by the purchaser and the product has been delivered. |
Foreign Currency | 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). Revenues and expenses in foreign currencies are translated at the average monthly exchange rates for the corresponding 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 and estimates of forfeitures. |
Flow-Through Common Shares | Flow-Through Common Shares: Current Canadian tax legislation permits mining entities to issue flow-through common shares to investors by which the deductions for tax purposes related to resource exploration and evaluation expenditures may be claimed by investors instead of the entity, subject to a renouncement process. Under ASC 740, proceeds from the issuance of flow-through common shares are allocated first to the common stock based on the underlying quoted price of shares and the residual amount is allocated to the sale of tax benefits, which is classified as a liability. In the future, as the Company incurs qualifying exploration and evaluation expenditures to fulfill its obligation, the liability is drawn down and the sale of tax benefits is recognized in the Statement of Operations as a reduction of deferred tax expense. |
Income and Mining Taxes | Income and Mining Taxes: The Company accounts for income and mining taxes under ASC 740 using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related tax basis for such liabilities and assets. This method generates either a net deferred income and mining tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income and mining tax charge or benefit by recording the change in either the net deferred income and mining tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income and mining tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income and mining tax asset will not be realized. |
Comprehensive (Loss) Income | Comprehensive (Loss) Income: In addition to net income or loss, comprehensive income or loss is included in changes in equity during a period. |
Per Share Amounts | Per Share Amounts: Basic income or loss per share is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted income per share reflects the potential dilution of securities that could share in the earnings of the Company and is computed in accordance with the treasury stock method based on the average number of common shares and dilutive common share equivalents outstanding. Only those instruments that result in a reduction in income per share are included in the calculation of diluted (loss) income per share. |
Loans and Borrowings | Loans and Borrowings: Borrowings are recognized initially at fair value, net of financing costs incurred, and subsequently measured at amortized cost. Any difference between the amounts originally received and the redemption value of the debt is recognized in the Statements of Operations |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Loans and borrowings: Consolidated Statement of Operations and Comprehensive (Loss) Income Fair Value of Financial Instruments: 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 | Recently Adopted Accounting Pronouncements Accounting for Government Assistance: In June 2020, the Company analogized guidance to account for the COVID-19 relief funds received from the United States Small Business Administration (“SBA”) and the Canada Revenue Agency (“CRA”). The ability to analogize standards from other GAAP sources is provisioned under ASC 105-05-2 when guidance is not provided for certain transactions under US GAAP. The adoption of the standard had a material impact on the financial statements as of December 31, 2020 with no impact noted in prior years. Under this policy, the Company has recognized the income from the relief funds in the Statement of Operations, as the criteria for recognition of the funds have been met. Changes to the Disclosure Requirements for Fair Value Measurement: Recently Issued Accounting Pronouncements Income Taxes: |
OPERATING SEGMENT REPORTING (Ta
OPERATING SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
OPERATING SEGMENT REPORTING | |
Schedule of significant information relating to reportable operating segments | Year ended December 31, 2020 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ 48,884 $ 41,452 $ 14,453 $ — $ — $ 104,789 Production costs applicable to sales (58,465) (34,639) (15,723) — $ — (108,827) Depreciation and depletion (11,785) (10,883) (242) — $ — (22,910) Gross (loss) (21,366) (4,070) (1,512) — — (26,948) Advanced projects (1,071) (6,088) (4,522) — $ — (11,681) Exploration (6,777) (6,450) (513) — $ (2,121) (15,861) Impairment of mineral property interests and plant and equipment (Note 9) (83,805) — — — $ — (83,805) Loss from investment in Minera Santa Cruz S.A. — — — (1,517) $ — (1,517) Other operating (1,390) (578) — — — (1,968) Segment loss $ (114,409) $ (17,186) $ (6,547) $ (1,517) $ (2,121) $ (141,780) General and Administrative and other (11,935) Loss before income and mining taxes $ (153,715) Capital expenditures $ 4,821 $ 9,104 $ — $ — $ — $ 13,925 Year ended December 31, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ 43,847 $ 50,058 $ 23,114 $ — $ — $ 117,019 Production costs applicable to sales (33,614) (31,121) (18,545) — — (83,280) Depreciation and depletion (10,934) (13,271) (548) — — (24,753) Gross (loss) profit (701) 5,666 4,021 — — 8,986 Advanced projects (649) (1,636) (7,235) — — (9,520) Exploration (8,554) (25,779) — — (3,411) (37,744) Loss from investment in Minera Santa Cruz S.A. — — — (8,754) — (8,754) Segment loss $ (9,904) $ (21,749) $ (3,214) $ (8,754) $ (3,411) $ (47,032) General and Administrative and other (16,559) Loss before income and mining taxes $ (63,591) Capital expenditures $ 18,806 $ 11,464 $ — $ — $ — $ 30,270 Year ended December 31, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales $ — $ 62,024 $ 66,151 $ — $ — $ 128,175 Production costs applicable to sales — (43,095) (37,919) — — (81,014) Depreciation and depletion — (12,972) (2,107) — — (15,079) Gross profit — 5,957 26,125 — — 32,082 Advanced projects (7,959) — (7,104) — — (15,063) Exploration (5,174) (22,032) (2,241) — (7,129) (36,576) Loss from investment in Minera Santa Cruz S.A. — — — (11,865) — (11,865) Segment (loss) income $ (13,133) $ (16,075) $ 16,780 $ (11,865) $ (7,129) $ (31,422) General and Administrative and other (16,218) Loss before income and mining taxes $ (47,640) Capital expenditures $ 84,713 $ 12,584 $ 171 $ — $ — $ 97,468 |
Schedule of geographic information | Long-lived Assets Revenue (1) December 31, December 31, Year ended December 31, 2020 2019 2020 2019 2018 USA $ 46,801 $ 135,854 $ 48,884 $ 43,847 $ — Canada 78,986 77,147 41,452 50,058 62,024 Mexico 20,021 23,551 14,453 23,114 66,151 Argentina (2) 299,816 302,598 — — — Total consolidated (3) $ 445,624 $ 539,150 $ 104,789 $ 117,019 $ 128,175 (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $108.3 million as of December 31, 2020 (December 31, 2019 - $110.2 million). (3) Total excludes $0.8 million related to the Company’s ROU office lease asset as the business activities related to corporate are not considered to be a part of the operating segments. |
OTHER INCOME (Tables)
OTHER INCOME (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
OTHER INCOME | |
Schedule of other income (expense) | Year ended December 31, 2020 2019 2018 COVID-19 Relief $ 6,420 $ — $ — Unrealized and realized (loss) gain on investments (Note 6) (619) 5,259 (3,324) Foreign currency gain 1,078 1,697 3,922 Other income, net 14 184 570 Total other income $ 6,893 $ 7,140 $ 1,168 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVESTMENTS | |
Summary of investment portfolio | As at Additions/ Disposals/ Unrealized Fair value December 31, transfers during Net (loss) on transfers during (loss) on December 31, 2019 period securities sold year securities held 2020 Marketable equity securities $ 1,885 $ — $ (619) $ (1,266) $ — $ — As at Additions/ Net gain Disposals/ Unrealized Fair value December 31, transfers during (loss) on transfers during gain on December 31, 2018 period securities sold year securities held 2019 Marketable equity securities $ 2,718 $ 2,314 $ 3,396 $ (7,279) $ 736 $ 1,885 Warrants 413 — 1,127 (1,540) — — Investments $ 3,131 $ 2,314 $ 4,523 $ (8,819) $ 736 $ 1,885 |
RECEIVABLES AND OTHER CURRENT_2
RECEIVABLES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
Schedule of balances in receivables and other current assets | December 31, 2020 December 31, 2019 Government sales tax receivable $ 1,810 $ 2,658 Prepaids and other assets 3,880 2,607 Receivables and other current assets $ 5,690 $ 5,265 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORIES | |
Schedule of inventories | December 31, 2020 December 31, 2019 Material on leach pads $ 21,003 $ 37,328 In-process inventory 3,922 3,847 Stockpiles 635 1,384 Precious metals 1,344 1,038 Materials and supplies 4,845 4,382 Inventories $ 31,749 $ 47,979 Less current portion 26,964 38,376 Long-term portion $ 4,785 $ 9,603 |
MINERAL PROPERTY INTERESTS AN_2
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
Schedule of property and equipment | December 31, 2020 December 31, 2019 Mineral property interests, cost $ 314,719 $ 339,374 Less: accumulated depletion (34,601) (28,154) Mineral property interests, carrying value $ 280,118 $ 311,220 Plant and equipment, cost Land $ 8,804 $ 8,746 Construction in progress 2,945 2,961 Plant and equipment 72,188 133,014 Subtotal $ 83,937 $ 144,721 Less: accumulated depreciation (34,943) (37,150) Plant and equipment, carrying value $ 48,994 $ 107,571 Mineral property interests and plant and equipment, carrying value $ 329,112 $ 418,791 |
Summary of mineral property interests | Name of Property/Complex State/Province Country 2020 2019 Fox Complex Ontario Canada $ 17,580 $ 14,627 Lexam Ontario Canada 41,595 41,595 Los Azules Copper Project San Juan Argentina 191,490 191,490 Tonkin Properties Nevada United States 4,833 4,833 Gold Bar Project Nevada United States 14,675 48,492 Battle Mountain Complex Nevada United States 785 785 El Gallo Project Sinaloa Mexico 3,353 3,591 Fenix Project Properties Sinaloa Mexico 5,807 5,807 Total mineral property interests $ 280,118 $ 311,220 |
Summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Company's non-recurring Level 3 fair value measurements | Date of Fair Value Measurement Valuation Technique Unobservable Input Range/ Weighted Average Gold Bar Mine March 31, 2020 Discounted Cash Flow Discount Rate 9% Long Term Gold Price $1,430/oz United States Inflation Index 2% |
INVESTMENT IN MINERA SANTA CR_2
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
Summary of MSC's financial information from operations | Year ended December 31, 2020 2019 2018 Minera Santa Cruz S.A. ( 100% ) Revenue from gold and silver sales $ 219,020 $ 263,887 $ 213,096 Production costs applicable to sales (138,182) (159,915) (151,779) Depreciation and depletion (29,809) (69,995) (52,200) Gross profit 51,029 33,977 9,117 Exploration (10,446) (10,635) (5,884) Other expenses (1) (30,515) (13,065) (12,840) Net income (loss) before tax $ 10,068 $ 10,277 $ (9,607) Current and deferred tax expense (4,466) (14,556) (10,934) Net income (loss) $ 5,602 $ (4,279) $ (20,541) Portion attributable to McEwen Mining Inc. ( 49% ) Net income (loss) $ 2,745 $ (2,097) $ (10,065) Amortization of fair value increments (5,390) (9,448) (9,730) Income tax recovery 1,128 2,791 7,930 Loss from investment in MSC, net of amortization $ (1,517) $ (8,754) $ (11,865) |
Schedule of change in the entity's investment in MSC | December 31, 2020 December 31, 2019 Investment in MSC, beginning of year $ 110,183 $ 127,814 Attributable net income (loss) from MSC 2,745 (2,097) Amortization of fair value increments (5,390) (9,448) Income tax recovery 1,128 2,791 Dividend distribution received (340) (8,877) Investment in MSC, end of year $ 108,326 $ 110,183 |
Summary of key assets and liabilities, before and after adjustments to fair value | As at December 31, 2020 Balance excluding FV increments Adjustments Balance including FV increments Current assets $ 94,965 $ 362 $ 95,327 Total assets $ 186,438 $ 107,821 $ 294,259 Current liabilities $ (40,396) $ — $ (40,396) Total liabilities $ (69,255) $ (3,936) $ (73,191) |
LEASE LIABILITIES (Tables)
LEASE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASE LIABILITIES | |
Schedule of lease liabilities | Total discounted lease liabilities December 31, 2020 December 31, 2019 Finance leases $ 4,735 $ 6,229 Operating lease 761 904 Lease liabilities $ 5,496 $ 7,133 Current portion (2,440) (2,115) Long-term portion $ 3,056 $ 5,018 |
Schedule of lease costs | December 31, 2020 December 31, 2019 Finance leases: Amortization of ROU assets $ 878 $ 1,123 Interest expense 392 517 Total $ 1,270 $ 1,640 Operating lease: Rent expense $ 194 $ 193 |
Schedule of undiscounted lease payment obligations, finance lease | Payments due by period 2021 2022 2023 2024 2025 Total Operating lease obligation $ 228 $ 230 $ 234 $ 156 $ — $ 848 Finance lease obligations 2,467 2,186 274 24 — 4,951 Total future minimum lease payments $ 2,695 $ 2,416 $ 508 $ 180 $ — $ 5,799 Less: Imputed interest (303) Total 5,496 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LONG-TERM DEBT | |
Schedule of debt activity | December 31, 2020 December 31, 2019 Balance, beginning of year $ 49,516 $ 49,206 Interest expense 5,394 5,185 Interest payments (4,875) (4,875) Bonus Interest - Equity based financing fee (1,875) — Balance, end of year $ 48,160 $ 49,516 Less current portion — 10,000 Long-term portion $ 48,160 $ 39,516 |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
Schedule of reconciliation of asset retirement obligations | December 31, 2020 December 31, 2019 Asset retirement obligation liability, beginning balance $ 32,201 $ 29,402 Settlements (267) (513) Accretion of liability 1,901 1,680 Adjustment reflecting updated estimates (54) 1,012 Foreign exchange revaluation 219 620 Asset retirement obligation liability, ending balance $ 34,000 $ 32,201 Less current portion 3,232 2,610 Long-term portion $ 30,768 $ 29,591 |
Schedule of reclamation expense | Year ended December 31, 2020 2019 2018 Reclamation adjustment reflecting updated estimates $ (113) $ 1,851 $ 2,259 Reclamation accretion 1,901 1,680 1,205 Total $ 1,788 3,531 $ 3,464 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
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, 2017 4,906 $ 2.45 2.6 $ 2,564 Granted 375 1.90 — — Exercised (171) 1.02 — 195 Forfeited (405) 3.99 — — Expired (462) 2.27 — — Balance at December 31, 2018 4,243 $ 2.33 2.0 $ 1,475 Granted 3,050 1.73 — — Exercised (535) 1.01 — 419 Forfeited (700) 2.56 — — Expired (789) 2.90 — — Balance at December 31, 2019 5,269 $ 2.00 3.0 $ 364 Granted 5,097 1.22 — — Exercised (135) 1.02 — 10 Forfeited (1,968) 2.18 — 2 Expired (1,251) 1.19 — — Balance at December 31, 2020 7,012 $ 1.55 4.2 $ 53 Exercisable at December 31, 2020 919 $ 3.02 2.6 $ — |
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 | 2020 2019 2018 Risk-free interest rate .157% to .322% 1.45% to 1.87% 2.67% to 2.89% Dividend yield 0.00% 0.00% 0.36% to 0.53% Volatility factor of the expected market price of common stock 59% 58% 63% to 64% Weighted-average expected life of option 3.5 years 3.5 years 3.5 years Weighted-average grant date fair value $ 1.22 $ 1.73 $ 1.90 |
Summary of status and activity of non-vested stock options | Weighted Average Grant Date Number of Fair Value Shares Per Share (in thousands, except per share amounts) Non-vested, beginning of year 3,034 $ 0.64 Granted 5,097 $ 0.40 Cancelled/Forfeited (1,172) $ 0.60 Vested (866) $ 0.71 Non-vested, end of year 6,093 $ 0.44 |
November 2019 Offering | |
Schedule of Black-Scholes pricing model to determine the fair value of warrants | November 20, 2019 Risk-free interest rate 1.55 % Dividend yield 0.00 % Volatility factor of the expected market price of common stock 60 % Weighted-average expected life 5 years Weighted-average grant date fair value $ 0.52 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
NET LOSS PER SHARE | |
Schedule of reconciliation of the basic and diluted weighted average number of common shares and the computations for basic and diluted net (loss) per share | Year ended December 31, 2020 2019 2018 (amounts in thousands, unless otherwise noted) Net loss $ (152,325) $ (59,747) $ (44,870) Weighted average common shares outstanding: 403,457 361,845 337,297 Diluted shares outstanding: 403,457 361,845 337,297 Net loss per share - basic and diluted $ (0.38) $ (0.17) $ (0.13) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party expense and outstanding accounts payable | The Company incurred the following expense in respect to the related parties outlined below during the periods presented: Year ended December 31, 2020 2019 2018 Lexam L.P. $ 99 $ 133 $ 91 REVlaw 158 188 266 The Company has the following outstanding accounts payable balance in respect to the related parties outlined below: December 31, 2020 December 31, 2019 Lexam L.P. $ 72 $ — REVlaw 90 22 |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
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, 2020 Fair value as at December 31, 2019 Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities $ — $ — $ — $ 1,885 $ — $ 1,885 Total investments $ — $ — $ — $ 1,885 $ — $ 1,885 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of minimum commitments and related payments due | Payments due by period 2021 2022 2023 2024 Thereafter Total Mining and surface rights $ 2,233 $ 492 $ 488 $ 470 $ 443 $ 4,126 Reclamation costs (1) 2,819 5,363 5,510 564 27,428 41,684 Long-term debt (Note 12) 4,875 14,712 42,139 — — 61,726 Lease obligations (Note 11) 2,695 2,416 508 180 — 5,799 Total $ 12,622 $ 22,983 $ 48,645 $ 1,214 $ 27,871 $ 113,335 (1) Amounts presented represent the undiscounted uninflated future payments. |
CASH AND CASH EQUIVALENTS AND_2
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
Schedule of reconciliation of cash and cash equivalents, and restricted cash | December 31, 2020 December 31, 2019 Cash and cash equivalents $ 20,843 $ 46,452 Restricted cash - non-current (Note 18) 3,595 48 Total cash, cash equivalents, and restricted cash $ 24,438 $ 46,500 |
INCOME AND MINING TAXES (Tables
INCOME AND MINING TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME AND MINING TAXES. | |
Schedule of deferred income tax recovery (expense) | 2020 2019 2018 United States $ 817 $ 2,420 $ 2,185 Foreign 573 1,424 585 Deferred tax benefit $ 1,390 $ 3,844 $ 2,770 |
Schedule of net income (loss) before tax | 2020 2019 2018 United States $ (127,524) $ (22,319) $ (27,001) Foreign (26,191) (41,272) (20,639) Loss before income and mining taxes $ (153,715) $ (63,591) $ (47,640) |
Schedule of reconciliation of tax provision at statutory U.S. Federal and State income tax rates to actual tax provision recorded in financial statements | Expected tax recovery at 2020 2019 2018 Loss before income and mining taxes $ (153,715) $ (63,591) $ (47,640) Statutory tax rate 21% 21% 21% US Federal and State tax expense at statutory rate (32,280) (13,354) (10,004) Reconciling items: Equity pickup in MSC 374 2,626 2,966 Deferred foreign income inclusion 795 598 5,963 Realized flow-through expenditures 496 3,150 2,100 Realized flow-through premium (338) (2,954) (1,675) Tax rate changes (147) 976 — Adjustment for foreign tax rates (2,043) (200) 40 Other permanent differences (7,062) 8,540 4,419 Unrealized foreign exchange rate (loss)/gain 4,663 (1,095) (6,935) NOL expires and revisions 1,066 810 (120) Valuation allowance 33,086 (2,941) 476 Income and mining tax recovery $ (1,390) $ (3,844) $ (2,770) |
Schedule of tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities | 2020 2019 Deferred tax assets: Net operating loss carryforward $ 66,085 $ 57,667 Mineral Properties 66,038 60,299 Other temporary differences 30,999 14,356 Total gross deferred tax assets 163,122 132,322 Less: valuation allowance (154,298) (121,212) Net deferred tax assets $ 8,824 $ 11,110 Deferred tax liabilities: Acquired mineral property interests (12,637) (16,024) Total deferred tax liabilities $ (12,637) $ (16,024) Deferred income and mining tax liability $ (3,813) $ (4,914) |
Summary of changes in valuation allowance | For the year ended December 31, Balance at Additions(a) Deductions(b) Balance at 2020 $ 121,212 $ 39,794 $ (6,708) $ 154,298 2019 124,153 2,104 (5,045) 121,212 2018 123,648 12,232 (11,727) 124,153 (a) The additions to valuation allowance mainly result 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 result from release of valuation allowance, expiration of the Company’s tax attributes, foreign exchange reductions of tax attributes in Canada, Mexico and Argentina and inflationary adjustments to tax attributes in Argentina. |
Summary of losses that can be applied against future taxable profit | Country Type of Loss Amount Expiry Period United States (a) Net-operating losses $ 167,784 2027-Unlimited Mexico Net-operating losses 37,117 2022-2030 Canada (a) Net-operating losses 35,888 2025-2040 Argentina (a) Net-operating losses 41,522 2021-2025 (a) The losses in the United States, Canada, and Argentina are part of multiple consolidating groups, and therefore, may be restricted in use to specific projects. |
UNAUDITED SUPPLEMENTARY QUART_2
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION | |
Summary of unaudited supplementary quarterly information | Three months ended March 31, 2020 June 30, 2020 September 30, 2020 December 31, 2020 (unaudited) (in thousands, except per share) Revenue from gold and silver sales $ 31,400 $ 18,291 $ 27,395 $ 27,703 Gross (loss) (3,685) (8,875) (701) (13,687) Net (loss) (99,191) (19,814) (9,778) (23,542) Net (loss) per share: Basic and diluted $ (0.25) $ (0.05) $ (0.02) $ (0.06) Weighted average shares outstanding: Basic and diluted 400,370 400,513 403,887 408,959 Three months ended March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019 (unaudited) (in thousands, except per share) Revenue from gold and silver sales $ 15,583 $ 36,383 $ 32,691 $ 32,362 Gross profit 1,429 4,677 1,619 1,261 Net (loss) (10,136) (13,014) (11,465) (25,132) Net (loss) per share: Basic and diluted $ (0.02) $ (0.04) $ (0.03) $ (0.07) Weighted average shares outstanding: Basic and diluted 345,497 346,998 362,175 378,543 |
NATURE OF OPERATIONS (Details)
NATURE OF OPERATIONS (Details) - USD ($) $ in Thousands | Mar. 10, 2021 | May 23, 2019 | Dec. 31, 2020 | Dec. 31, 2018 |
Ownership interests in various mines | 100.00% | |||
Ownership interest (as a percent) | 49.00% | |||
Proceeds in connection with the equity issuance | $ 2,600 | $ 918 | ||
Equity Issuances | Subsequent Events | ||||
Proceeds in connection with the equity issuance | $ 64,400 | |||
MSC | Equity Method Investment | ||||
Ownership interest (as a percent) | 49.00% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Products, Properties and Production of Minerals (Details) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Option to sell prior to the completion of refining (as a percent) | 90.00% |
Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Period over which concentrates are provisionally priced at the end of a period after delivery to the customer | 30 days |
Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Period over which concentrates are provisionally priced at the end of a period after delivery to the customer | 90 days |
OPERATING SEGMENT REPORTING - E
OPERATING SEGMENT REPORTING - El Gallo Project (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Segment Reporting | ||
Inventory | $ 26,964 | $ 38,376 |
El Gallo Project | ||
Operating Segment Reporting | ||
Production costs applicable to sales | 15,700 | 18,500 |
Residual leaching and other site costs | 8,400 | 8,200 |
Inventory | 3,000 | 3,400 |
Operating expenditures | $ 7,300 | $ 10,300 |
OPERATING SEGMENT REPORTING - S
OPERATING SEGMENT REPORTING - Summary of Reportable Operating Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | $ 104,789 | $ 117,019 | $ 128,175 | ||||||||
Depreciation and depletion | (22,910) | (24,753) | (15,079) | ||||||||
Gross (loss) | $ (13,687) | $ (701) | $ (8,875) | $ (3,685) | $ 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | (26,948) | 8,986 | 32,082 |
Advanced projects | (11,681) | (9,520) | (15,063) | ||||||||
Impairment of mineral property interests and plant and equipment (Note 9) | (83,800) | (83,805) | |||||||||
Loss from investment in Minera Santa Cruz S.A. (Note 10) | (1,517) | (8,754) | (11,865) | ||||||||
Other operating | (1,968) | ||||||||||
Loss before income and mining taxes | (153,715) | (63,591) | (47,640) | ||||||||
Capital expenditures | 13,925 | 30,270 | 97,468 | ||||||||
USA | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (11,785) | (10,934) | |||||||||
Gross (loss) | (21,366) | (701) | |||||||||
Advanced projects | (1,071) | (649) | (7,959) | ||||||||
Impairment of mineral property interests and plant and equipment (Note 9) | (83,805) | ||||||||||
Other operating | (1,390) | ||||||||||
Segment loss | (114,409) | (9,904) | (13,133) | ||||||||
Capital expenditures | 4,821 | 18,806 | 84,713 | ||||||||
Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (10,883) | (13,271) | (12,972) | ||||||||
Gross (loss) | (4,070) | 5,666 | 5,957 | ||||||||
Advanced projects | (6,088) | (1,636) | |||||||||
Other operating | (578) | ||||||||||
Segment loss | (17,186) | (21,749) | (16,075) | ||||||||
Capital expenditures | 9,104 | 11,464 | 12,584 | ||||||||
Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (242) | (548) | (2,107) | ||||||||
Gross (loss) | (1,512) | 4,021 | 26,125 | ||||||||
Advanced projects | (4,522) | (7,235) | (7,104) | ||||||||
Segment loss | (6,547) | (3,214) | 16,780 | ||||||||
Capital expenditures | 171 | ||||||||||
MSC | |||||||||||
Operating Segment Reporting | |||||||||||
Loss from investment in Minera Santa Cruz S.A. (Note 10) | (1,517) | (8,754) | (11,865) | ||||||||
Segment loss | (1,517) | (8,754) | (11,865) | ||||||||
Los Azules | |||||||||||
Operating Segment Reporting | |||||||||||
Segment loss | (2,121) | (3,411) | (7,129) | ||||||||
Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Depreciation and depletion | (22,910) | (24,753) | (15,079) | ||||||||
Gross (loss) | (26,948) | 8,986 | 32,082 | ||||||||
Advanced projects | (11,681) | (9,520) | (15,063) | ||||||||
Loss from investment in Minera Santa Cruz S.A. (Note 10) | (1,517) | (8,754) | (11,865) | ||||||||
Segment loss | (141,780) | (47,032) | (31,422) | ||||||||
General and Administrative and other | (11,935) | (16,559) | (16,218) | ||||||||
Gold and silver sales | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | $ 27,703 | $ 27,395 | $ 18,291 | $ 31,400 | $ 32,362 | $ 32,691 | $ 36,383 | $ 15,583 | 104,789 | 117,019 | 128,175 |
Gold and silver sales | USA | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 48,884 | 43,847 | |||||||||
Gold and silver sales | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 41,452 | 50,058 | 62,024 | ||||||||
Gold and silver sales | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 14,453 | 23,114 | 66,151 | ||||||||
Gold and silver sales | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Revenue from gold and silver sales | 104,789 | 117,019 | 128,175 | ||||||||
Production costs applicable to sales | USA | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (58,465) | (33,614) | |||||||||
Production costs applicable to sales | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (34,639) | (31,121) | (43,095) | ||||||||
Production costs applicable to sales | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (15,723) | (18,545) | (37,919) | ||||||||
Production costs applicable to sales | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (108,827) | (83,280) | (81,014) | ||||||||
Exploration | USA | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (6,777) | (8,554) | (5,174) | ||||||||
Exploration | Canada | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (6,450) | (25,779) | (22,032) | ||||||||
Exploration | Mexico | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (513) | (2,241) | |||||||||
Exploration | Los Azules | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | (2,121) | (3,411) | (7,129) | ||||||||
Exploration | Total Segment | |||||||||||
Operating Segment Reporting | |||||||||||
Production costs applicable to sales | $ (15,861) | $ (37,744) | $ (36,576) |
OPERATING SEGMENT REPORTING - G
OPERATING SEGMENT REPORTING - Geographic information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Segment Reporting | |||
Long-lived Assets | $ 445,624 | $ 539,150 | |
Revenue | 104,789 | 117,019 | $ 128,175 |
Investment in MSC | 108,326 | 110,183 | |
Lease assets | 800 | ||
MSC | |||
Operating Segment Reporting | |||
Investment in MSC | 108,326 | 110,183 | 127,814 |
Bank of Nova Scotia | Customer | |||
Operating Segment Reporting | |||
Revenue | $ 33,000 | $ 67,000 | $ 103,600 |
Gold and silver sales, percentage | 32.00% | 64.00% | 89.00% |
Asahi Refining Inc. | Customer | |||
Operating Segment Reporting | |||
Revenue | $ 4,900 | $ 123,500 | |
Gold and silver sales, percentage | 4.00% | 96.00% | |
USA | |||
Operating Segment Reporting | |||
Long-lived Assets | $ 46,801 | $ 135,854 | |
Revenue | 48,884 | 43,847 | |
Canada | |||
Operating Segment Reporting | |||
Long-lived Assets | 78,986 | 77,147 | |
Revenue | 41,452 | 50,058 | $ 62,024 |
Mexico | |||
Operating Segment Reporting | |||
Long-lived Assets | 20,021 | 23,551 | |
Revenue | 14,453 | 23,114 | $ 66,151 |
Argentina | |||
Operating Segment Reporting | |||
Long-lived Assets | 299,816 | 302,598 | |
Argentina | MSC | |||
Operating Segment Reporting | |||
Investment in MSC | $ 108,300 | $ 110,200 |
OTHER OPERATING (Details)
OTHER OPERATING (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Unusual or Infrequent Item | |
Costs incurred while operations were suspended | $ 1,968 |
Costs incurred in review of resources | 500 |
Gold Bar mine | |
Unusual or Infrequent Item | |
Costs incurred while operations were suspended | 900 |
Black Fox Complex | |
Unusual or Infrequent Item | |
Costs incurred while operations were suspended | $ 600 |
OTHER INCOME - Summary of Other
OTHER INCOME - Summary of Other Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
OTHER INCOME | |||
COVID-19 Relief | $ 6,420 | ||
Unrealized and realized (loss) gain on investments (Note 6) | (619) | $ 5,259 | $ (3,324) |
Foreign currency gain | 1,078 | 1,697 | 3,922 |
Other income, net | 14 | 184 | 570 |
Total other income | $ 6,893 | $ 7,140 | $ 1,168 |
OTHER INCOME (Details)
OTHER INCOME (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Paycheck Protection Program | |
Other Income | |
Amount of relief secured | $ 1.9 |
Period over which paychecks protection ("PPP") program funds are fully forgiven so long eligible expenditures are incurred | 168 days |
Canadian Emergency Wage Subsidy | |
Other Income | |
Amount of relief secured | $ 4.5 |
INVESTMENTS - Activity in Inves
INVESTMENTS - Activity in Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Investments rollforward | ||
Opening balance | $ 1,885 | $ 3,131 |
Additions/transfers during the period | 2,314 | |
Net (loss) on securities sold | 4,523 | |
Disposals/transfers during period | (8,819) | |
Unrealized (loss) on securities held | 736 | |
Fair Value end of the period | 1,885 | |
Marketable equity securities | ||
Investments rollforward | ||
Opening balance | 1,885 | 2,718 |
Additions/transfers during the period | 2,314 | |
Net (loss) on securities sold | (619) | 3,396 |
Disposals/transfers during period | $ (1,266) | (7,279) |
Unrealized (loss) on securities held | 736 | |
Fair Value end of the period | 1,885 | |
Warrants | ||
Investments rollforward | ||
Opening balance | 413 | |
Net (loss) on securities sold | 1,127 | |
Disposals/transfers during period | $ (1,540) |
INVESTMENTS - (Details)
INVESTMENTS - (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments rollforward | |||
Proceeds from sale of investments | $ 1,266 | $ 6,769 | $ 2,895 |
Cost of purchase of marketable equity securities | 1,300 | ||
Marketable equity securities | |||
Investments rollforward | |||
Proceeds from sale of investments | $ 1,300 | $ 6,800 | $ 2,900 |
RECEIVABLES AND OTHER CURRENT_3
RECEIVABLES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Receivables, prepaids and other assets | |||
Government sales tax receivable | $ 1,810 | $ 2,658 | |
Prepaids and other assets | 3,880 | 2,607 | |
Receivables and other current assets | 5,690 | 5,265 | |
VAT collected | 1,400 | 2,200 | $ 8,300 |
Prepaid insurance receivable | 2,200 | 700 | |
Property holding and other miscellaneous deposits | 1,100 | 1,400 | |
Mexican Tax Authority | |||
Receivables, prepaids and other assets | |||
Government sales tax receivable | $ 900 | $ 700 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Inventories | ||
Material on leach pads | $ 21,003 | $ 37,328 |
In-process inventory | 3,922 | 3,847 |
Stockpiles | 635 | 1,384 |
Precious metals | 1,344 | 1,038 |
Materials and supplies | 4,845 | 4,382 |
Inventories | 31,749 | 47,979 |
Less current portion | 26,964 | 38,376 |
Long-term portion | 4,785 | 9,603 |
Production costs applicable to sales | ||
Inventories | ||
Inventory write-down | 13,900 | 1,700 |
Depreciation and depletion | ||
Inventories | ||
Inventory write-down | 2,100 | |
Black Fox Complex | ||
Inventories | ||
Inventory write-down | 1,900 | |
Gold Bar mine | ||
Inventories | ||
Inventory write-down | 12,400 | |
El Gallo Project | ||
Inventories | ||
Inventory write-down | $ 1,700 | $ 1,700 |
MINERAL PROPERTY INTERESTS AN_3
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, gross | $ 83,937 | $ 144,721 |
Less: accumulated depreciation | (34,943) | (37,150) |
Mineral property interests and plant and equipment, carrying value | 48,994 | 107,571 |
Mineral property interests | ||
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, gross | 314,719 | 339,374 |
Less: accumulated depreciation | (34,601) | (28,154) |
Mineral property interests and plant and equipment, carrying value | 280,118 | 311,220 |
Land | ||
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, gross | 8,804 | 8,746 |
Construction in Process | ||
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, gross | 2,945 | 2,961 |
Plant and equipment | ||
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, gross | 72,188 | 133,014 |
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment | ||
Mineral property interests and plant and equipment, carrying value | $ 329,112 | $ 418,791 |
MINERAL PROPERTY INTERESTS AN_4
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT - Construction in Progress (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Construction In Progress [Line Items] | |||
Impairment charges | $ 83,800 | $ 83,805 | |
Gold Bar mine | |||
Construction In Progress [Line Items] | |||
Debt interest expense | $ 1,400 |
MINERAL PROPERTY INTERESTS AN_5
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT- Mineral Properties (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Mineral Property Interests | ||
Mineral property interests | $ 280,118 | $ 311,220 |
Black Fox Complex | ||
Mineral Property Interests | ||
Mineral property interests | 17,580 | 14,627 |
Lexam VG Gold | ||
Mineral Property Interests | ||
Mineral property interests | 41,595 | 41,595 |
Los Azules Copper Project | ||
Mineral Property Interests | ||
Mineral property interests | 191,490 | 191,490 |
Tonkin Properties | ||
Mineral Property Interests | ||
Mineral property interests | 4,833 | 4,833 |
Gold Bar mine | ||
Mineral Property Interests | ||
Mineral property interests | 14,675 | 48,492 |
Battle Mountain Complex | ||
Mineral Property Interests | ||
Mineral property interests | 785 | 785 |
El Gallo Project | ||
Mineral Property Interests | ||
Mineral property interests | 3,353 | 3,591 |
Fenix Project Properties | ||
Mineral Property Interests | ||
Mineral property interests | $ 5,807 | $ 5,807 |
MINERAL PROPERTY INTERESTS AN_6
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT - Quantitative and Qualitative Information (Details) - Nonrecurring - Level 3 - Gold Bar mine | 3 Months Ended |
Mar. 31, 2020$ / oz | |
Mineral property interests and plant and equipment | |
Long term gold price (in dollars per ounce) | 1,430 |
Discounted Cash Flow | Weighted Average | |
Mineral property interests and plant and equipment | |
Discount Rate (as a percent) | 9.00% |
Discounted Cash Flow | Weighted Average | USA | |
Mineral property interests and plant and equipment | |
Inflation index (as a percent) | 2.00% |
INVESTMENT IN MINERA SANTA CR_3
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Revenue from gold and silver sales | $ 104,789 | $ 117,019 | $ 128,175 | ||||||||
Depreciation and depletion | (22,910) | (24,753) | (15,079) | ||||||||
Gross Profit | $ (13,687) | $ (701) | $ (8,875) | $ (3,685) | $ 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | (26,948) | 8,986 | 32,082 |
Net income (loss) before tax | (153,715) | (63,591) | (47,640) | ||||||||
Net (loss) income | $ (23,542) | $ (9,778) | $ (19,814) | $ (99,191) | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | (152,325) | (59,747) | (44,870) |
Income tax recovery | 1,390 | 3,844 | 2,770 | ||||||||
(Loss) from investment in MSC, net of amortization | $ (1,517) | (8,754) | (11,865) | ||||||||
Subsidiary (as a percent) | 100.00% | ||||||||||
Ownership interest (as a percent) | 49.00% | 49.00% | |||||||||
Shutdown Costs | $ 1,968 | ||||||||||
Equity Method Investment | |||||||||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Net income (loss) | 2,745 | (2,097) | (10,065) | ||||||||
Amortization of fair value increments | (5,390) | (9,448) | (9,730) | ||||||||
Income tax recovery | 1,128 | 2,791 | 7,930 | ||||||||
(Loss) from investment in MSC, net of amortization | (1,517) | (8,754) | (11,865) | ||||||||
MSC | |||||||||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Net income (loss) | 2,745 | (2,097) | |||||||||
Amortization of fair value increments | 5,390 | 9,448 | |||||||||
Income tax recovery | (1,128) | (2,791) | |||||||||
Shutdown Costs | 11,400 | ||||||||||
MSC | Equity Method Investment | |||||||||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||||||||
Revenue from gold and silver sales | 219,020 | 263,887 | 213,096 | ||||||||
Production costs applicable to sales | (138,182) | (159,915) | (151,779) | ||||||||
Depreciation and depletion | (29,809) | (69,995) | (52,200) | ||||||||
Gross Profit | 51,029 | 33,977 | 9,117 | ||||||||
Exploration | (10,446) | (10,635) | (5,884) | ||||||||
Other expenses | (30,515) | (13,065) | (12,840) | ||||||||
Net income (loss) before tax | 10,068 | 10,277 | (9,607) | ||||||||
Current and deferred tax expense | (4,466) | (14,556) | (10,934) | ||||||||
Net (loss) income | $ 5,602 | $ (4,279) | $ (20,541) | ||||||||
Ownership interest (as a percent) | 49.00% | 49.00% |
INVESTMENT IN MINERA SANTA CR_4
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Changes in Company's Investment in MSC (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Change in the investment in MSC | |||
Investment in MSC, beginning of period | $ 110,183 | ||
Income tax recovery | 1,390 | $ 3,844 | $ 2,770 |
Dividend distribution received | (340) | (8,877) | (10,385) |
Investment in MSC, end of period | 108,326 | 110,183 | |
MSC | |||
Change in the investment in MSC | |||
Investment in MSC, beginning of period | 110,183 | 127,814 | |
Attributable net income (loss) from MSC | 2,745 | (2,097) | |
Amortization of fair value increments | 5,390 | 9,448 | |
Income tax recovery | (1,128) | (2,791) | |
Dividend distribution received | (340) | (8,877) | |
Investment in MSC, end of period | $ 108,326 | $ 110,183 | $ 127,814 |
INVESTMENT IN MINERA SANTA CR_5
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | $ 53,497 | $ 91,978 |
Total assets | 499,936 | 631,223 |
Current liabilities | (45,554) | (48,795) |
Total liabilities | (134,608) | $ (131,744) |
Balance excluding FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 94,965 | |
Total assets | 186,438 | |
Current liabilities | (40,396) | |
Total liabilities | (69,255) | |
Adjustments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 362 | |
Total assets | 107,821 | |
Total liabilities | (3,936) | |
Balance including FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 95,327 | |
Total assets | 294,259 | |
Current liabilities | (40,396) | |
Total liabilities | $ (73,191) |
LEASE LIABILITIES (Details)
LEASE LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
LEASE LIABILITIES | ||
Finance leases | $ 4,735 | $ 6,229 |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent |
Operating lease | $ 761 | $ 904 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent | mux:LeaseLiabilityCurrent mux:LeaseLiabilityNonCurrent |
Lease liabilities | $ 5,496 | $ 7,133 |
Less current portion | (2,440) | (2,115) |
Long-term portion | $ 3,056 | $ 5,018 |
LEASE LIABILITIES - Weighted Av
LEASE LIABILITIES - Weighted Average Discount Rate and Lease Terms (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LEASE LIABILITIES | ||
Operating lease, Weighted average discount rate (as a percent) | 6.83% | |
Finance leases, Weighted average discount rate (as a percent) | 8.73% | |
Operating lease, Weighted average remaining lease term | 2 years | |
Finance leases, Weighted average remaining lease term | 4 years | |
Interest and other finance costs related to leases | $ 1.3 | $ 1.8 |
LEASE LIABILITIES - Lease Cost
LEASE LIABILITIES - Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Lease cost | ||
Amortization of ROU assets | $ 878 | $ 1,123 |
Interest expense | 392 | 517 |
Total | 1,270 | 1,640 |
Rental expense | $ 194 | $ 193 |
LEASE LIABILITIES - Maturity (D
LEASE LIABILITIES - Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Operating lease obligations | ||
2021 | $ 228 | |
2022 | 230 | |
2023 | 234 | |
2024 | 156 | |
Total | 848 | |
Finance lease obligations | ||
2021 | 2,467 | |
2022 | 2,186 | |
2023 | 274 | |
2024 | 24 | |
Total | 4,951 | |
Lease obligations | ||
2021 | 2,695 | |
2022 | 2,416 | |
2023 | 508 | |
2024 | 180 | |
Total | 5,799 | |
Less: Imputed interest | (303) | |
Total | $ 5,496 | $ 7,133 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | Jun. 25, 2020 | May 23, 2019 | Aug. 10, 2018 | Jun. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
LONG-TERM DEBT | ||||||||||
Shares issued as bonus interest | 1,935,484 | |||||||||
Stock issued during the period | $ 2,600,000 | $ 918,000 | ||||||||
Gold Bar mine | ||||||||||
LONG-TERM DEBT | ||||||||||
Interest costs capitalized | $ 600,000 | |||||||||
Term Loan | ||||||||||
LONG-TERM DEBT | ||||||||||
Working capital covenant | $ 10,000,000 | $ 10,000,000 | ||||||||
Term Loan | Robert McEwen | ||||||||||
LONG-TERM DEBT | ||||||||||
Face amount | $ 50,000,000 | |||||||||
Term of debt instrument | 3 years | |||||||||
Stated interest rate (as a percent) | 9.75% | |||||||||
Amended loan agreement | ||||||||||
LONG-TERM DEBT | ||||||||||
Face amount | $ 50,000,000 | |||||||||
Extension term for repayment of debt | 2 years | |||||||||
Term loan retirement period | 12 months | |||||||||
Principal repayments | $ 2,000,000 | |||||||||
Final payment | $ 26,000,000 | |||||||||
Working capital covenant | $ 10,000,000 | $ 7,000,000 | $ 5,000,000 | $ 2,500,000 | ||||||
Shares issued as bonus interest | 2,091,700 | |||||||||
Stock issued during the period | $ 1,875,000 |
LONG-TERM DEBT - Rollforward (D
LONG-TERM DEBT - Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Long-term debt | ||
Bonus Interest - Equity based financing fee | $ (1,875) | |
Long-term portion | 24,080 | $ 19,758 |
Term Loan | ||
Long-term debt | ||
Balance, beginning of year | 49,516 | 49,206 |
Interest expense | 5,394 | 5,185 |
Interest payments | (4,875) | (4,875) |
Balance, end of year | 48,160 | 49,516 |
Less current portion | 10,000 | |
Long-term portion | $ 48,160 | $ 39,516 |
ASSET RETIREMENT OBLIGATIONS -
ASSET RETIREMENT OBLIGATIONS - Retirement obligation rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in the asset retirement obligations | |||
Asset retirement obligation, beginning of the period | $ 32,201 | $ 29,402 | |
Settlements | (267) | (513) | |
Accretion of liability | 1,901 | 1,680 | |
Adjustment reflecting updated estimates | (54) | 1,012 | |
Foreign exchange revaluation | 219 | 620 | |
Asset retirement obligation, ending balance | 34,000 | 32,201 | $ 29,402 |
Less current portion | 3,232 | 2,610 | |
Long-term portion | 30,768 | 29,591 | |
Reclamation adjustment reflecting updated estimates | (113) | 1,851 | $ 2,259 |
Tonkin and Gold Bar Properties | |||
Changes in the asset retirement obligations | |||
Reclamation adjustment reflecting updated estimates | $ 100 | ||
Black Fox Complex | |||
Changes in the asset retirement obligations | |||
Reclamation adjustment reflecting updated estimates | 5,300 | ||
Gold Bar mine | |||
Changes in the asset retirement obligations | |||
Reclamation adjustment reflecting updated estimates | $ 4,300 |
ASSET RETIREMENT OBLIGATIONS _2
ASSET RETIREMENT OBLIGATIONS - Reclamation and Accretion (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reclamation obligations | |||
Reclamation adjustment reflecting updated estimates | $ (113) | $ 1,851 | $ 2,259 |
Reclamation accretion | 1,901 | 1,680 | 1,205 |
Total | $ 1,788 | $ 3,531 | $ 3,464 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - USD ($) | Sep. 10, 2020 | Jun. 25, 2020 | Nov. 20, 2019 | May 23, 2019 | Mar. 29, 2019 | Nov. 08, 2018 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Number of units issued | 1,935,484 | |||||||||
Net proceeds | $ 2,600,000 | $ 918,000 | ||||||||
Issuance costs | $ 400,000 | |||||||||
Sale of common stock for cash, net of issuance costs | $ 69,467,000 | |||||||||
Shares issued for acquisition of mineral property interests (in shares) | 53,600 | 353,570 | ||||||||
Stock-based compensation | $ 612,000 | $ 694,000 | $ 269,000 | |||||||
Shares issued in connection with acquisitions | 70,000 | |||||||||
November 2019 Offering | ||||||||||
Number of units issued | 37,750,000 | |||||||||
Price per unit | $ 1.325 | |||||||||
Net proceeds | $ 46,600,000 | |||||||||
Warrant expiration term | 5 years | |||||||||
Issuance costs | $ 3,500,000 | |||||||||
Outstanding warrants | $ 21,706,250 | |||||||||
June 2020 Amended and Restated Credit Agreement | ||||||||||
Number of units issued | 2,091,700 | |||||||||
Net proceeds | $ 1,900,000 | |||||||||
March 2019 Offering | ||||||||||
Number of units issued | 14,193,548 | |||||||||
Price per unit | $ 1.55 | |||||||||
Net proceeds | $ 20,300,000 | |||||||||
Number of shares of common stock | 1 | |||||||||
Number of warrants received for each share of common stock share sold | 0.50 | |||||||||
Issuance costs | $ 1,700,000 | |||||||||
Subscription Receipts | Officers Directors And Certain Employees | ||||||||||
Number of units issued | 1,935,484 | |||||||||
Price per unit | $ 1.55 | |||||||||
Common Stock and Additional Paid-in Capital | ||||||||||
Number of units issued | 515,000 | |||||||||
Net proceeds | $ 918,000 | |||||||||
Shares issued for acquisition of mineral property interests (in shares) | 354,000 | 178,000 | ||||||||
Shares issued in connection with acquisitions (in shares) | 53,000 | |||||||||
Shares issued in connection with acquisitions | $ 70,000 | |||||||||
Common Stock and Additional Paid-in Capital | November 2019 Offering | ||||||||||
Net proceeds | 37,300,000 | |||||||||
Warrant at First Stock Price | November 2019 Offering | ||||||||||
Net proceeds | $ 9,300,000 | |||||||||
Number of shares of common stock | 1 | |||||||||
Number of warrants received for each share of common stock share sold | 0.50 | |||||||||
Warrant at First Stock Price | March 2019 Offering | ||||||||||
Price per common share for each warrant | $ 2 | |||||||||
Warrant expiration term | 3 years | |||||||||
Warrant at Second Stock Price | November 2019 Offering | ||||||||||
Number of shares of common stock | 1 | |||||||||
Price per common share for each warrant | $ 1.7225 | |||||||||
Flow Through Common Shares | ||||||||||
Number of units issued | 6,298,166 | 7,669,900 | ||||||||
Price per unit | $ 1.65 | $ 1.28 | ||||||||
Gross proceeds | $ 10,400,000 | |||||||||
Net proceeds | 9,800,000 | $ 9,800,000 | ||||||||
Issuance costs | 600,000 | 0 | ||||||||
Net proceeds allocated to the sale of tax benefits | 2,000,000 | 2,100,000 | ||||||||
Sale of common stock for cash, net of issuance costs | $ 7,800,000 | 7,700,000 | ||||||||
Exploration expenditures | $ 1,900,000 | |||||||||
At-the-market ("ATM") | ||||||||||
Number of units issued | 1,010,545 | |||||||||
Sale of common stock for cash, net of issuance costs | $ 1,900,000 | |||||||||
Aggregate offering price | $ 90,000,000 |
SHAREHOLDERS' EQUITY - Black-Sc
SHAREHOLDERS' EQUITY - Black-Scholes pricing model (Details) - $ / shares | Nov. 20, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | ||||
Volatility factor of the expected market price of common stock (as a percent) | 58.00% | |||
Weighted-average expected life of option | 3 years 6 months | 3 years 6 months | 3 years 6 months | |
Weighted-average grant date fair value (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 | |
November 2019 Offering | Warrant at First Stock Price | ||||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | ||||
Risk-free interest rate (as a percent) | 1.55% | |||
Dividend yield (as a percent) | 0.00% | |||
Volatility factor of the expected market price of common stock (as a percent) | 60.00% | |||
Weighted-average expected life of option | 5 years | |||
Weighted-average grant date fair value (in dollars per share) | $ 0.52 |
SHAREHOLDERS' EQUITY - Stock Op
SHAREHOLDERS' EQUITY - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
STOCK BASED COMPENSATION | ||||
Stock options granted (in shares) | 5,097,000 | 3,050,000 | 375,000 | |
Exercise price of options granted (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 | |
Exercisable period of options | 2 years 7 months 6 days | |||
Number of common stock reserved for issuance | 17,500,000 | |||
Number of shares of common stock reserved for issuance | 2,308,550 | 4,221,023 | ||
Common stock issued | 416,587,000 | 400,339,000 | ||
Maximum number of shares that may be subject to grants of options to an individual in a calendar year | 1,000,000 | |||
Shares | ||||
Balance at the beginning of the period (in shares) | 5,269,000 | 4,243,000 | 4,906,000 | |
Granted (in shares) | 5,097,000 | 3,050,000 | 375,000 | |
Exercised (in shares) | (135,000) | (535,000) | (171,000) | |
Forfeited (in shares) | (1,968,000) | (700,000) | (405,000) | |
Expired (in shares) | (1,251,000) | (789,000) | (462,000) | |
Balance at the end of the period (in shares) | 7,012,000 | 5,269,000 | 4,243,000 | 4,906,000 |
Exercisable at the end of the period (in shares) | 919,000 | |||
Weighted Average Exercise Price | ||||
Balance at the beginning of the period (in dollars per share) | $ 2 | $ 2.33 | $ 2.45 | |
Granted (in dollars per share) | 1.22 | 1.73 | 1.90 | |
Exercised (in dollars per share) | $ 1.02 | $ 1.01 | $ 1.02 | |
Proceeds from exercise of stock options | $ 138 | $ 544 | $ 192 | |
Forfeited (in dollars per share) | $ 2.18 | $ 2.56 | $ 3.99 | |
Expired (in dollars per share) | 1.19 | 2.90 | 2.27 | |
Balance at the end of the period (in dollars per share) | 1.55 | $ 2 | $ 2.33 | $ 2.45 |
Exercisable (in dollars per share) | $ 3.02 | |||
Weighted Average Remaining Contractual Life | ||||
Outstanding at the end of the period | 4 years 2 months 12 days | 3 years | 2 years | 2 years 7 months 6 days |
Exercisable period of options | 2 years 7 months 6 days | |||
Intrinsic Value | ||||
Outstanding at the beginning of the period (in dollars) | $ 364 | $ 1,475 | $ 2,564 | |
Exercised (in dollars) | 10 | 419 | 195 | |
Forfeited (in dollars) | 2 | |||
Outstanding at the end of the period (in dollars) | $ 53 | $ 364 | $ 1,475 | $ 2,564 |
Granted (in shares) | 5,097,000 | 3,050,000 | 375,000 | |
Equity Incentive Plan | ||||
STOCK BASED COMPENSATION | ||||
Common stock issued | 135,000 | 535,000 | ||
Weighted Average Exercise Price | ||||
Exercised (in dollars per share) | $ 1.02 | $ 1.02 | ||
Proceeds from exercise of stock options | $ 100 | $ 500 | ||
Employees and Directors | ||||
STOCK BASED COMPENSATION | ||||
Stock options granted (in shares) | 5,100,000 | 3,100,000 | 400,000 | |
Exercise price of options granted (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 | |
Shares | ||||
Granted (in shares) | 5,100,000 | 3,100,000 | 400,000 | |
Weighted Average Exercise Price | ||||
Granted (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 | |
Intrinsic Value | ||||
Granted (in shares) | 5,100,000 | 3,100,000 | 400,000 | |
Vesting period of options | 3 years | |||
Exercise period of options | 5 years | |||
Common Stock and Additional Paid-in Capital | ||||
Shares | ||||
Exercised (in shares) | (135,000) | (535,000) | (182,000) |
SHAREHOLDERS' EQUITY - Summary
SHAREHOLDERS' EQUITY - Summary of Assumptions (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Weighted-average expected life of option | 3 years 6 months | 3 years 6 months | 3 years 6 months |
Weighted-average grant date fair value (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 |
Risk-free interest rate, low end of range (as a percent) | 0.157% | 1.45% | 2.67% |
Risk-free interest rate, high end of range (as a percent) | 0.322% | 1.87% | 2.89% |
Volatility factor of the expected market price of common stock, low end of range (as a percent) | 59.00% | 58.00% | 63.00% |
Volatility factor of the expected market price of common stock, high end of range (as a percent) | 64.00% | ||
Additional disclosures | |||
Fair value of awards vesting in the period | $ 0.1 | $ 0.4 | $ 0.7 |
Unrecognized compensation expense on non-vested stock options (in dollars) | $ 1.4 | $ 1 | $ 0.4 |
Non-vested stock options outstanding (in shares) | 6.1 | 3 | 0.7 |
Weighted-average period of recognition | 1 year 7 months 6 days | 1 year 6 months | 1 year 4 months 24 days |
Stock option expense | $ 0.6 | $ 0.7 | $ 0.3 |
Minimum | |||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Dividend yield (as a percent) | 0.00% | 0.00% | 0.36% |
Maximum | |||
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | |||
Dividend yield (as a percent) | 0.53% |
SHAREHOLDERS' EQUITY - Non-vest
SHAREHOLDERS' EQUITY - Non-vested Options Outstanding and Exercisable (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||
Stock options granted (in shares) | 5,097,000 | 3,050,000 | 375,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||
Stock options granted (in dollars per share) | $ 1.22 | $ 1.73 | $ 1.90 |
Amended and Restated Equity Incentive Plan and Non-related Plan Options | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | |||
Balance at the beginning of the period (in shares) | 3,034 | ||
Stock options granted (in shares) | 5,097 | ||
Stock options cancelled/forfeited (in shares) | (1,172) | ||
Stock options vested (in shares) | (866) | ||
Balance at the end of the period (in shares) | 6,093 | 3,034 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value | |||
Balance at the beginning of the period (in dollars per share) | $ 0.64 | ||
Stock options granted (in dollars per share) | 0.40 | ||
Stock options cancelled/forfeited (in dollars per share) | 0.60 | ||
Stock options vested (in dollars per share) | 0.71 | ||
Balance at the end of the period (in dollars per share) | $ 0.44 | $ 0.64 |
NET LOSS PER SHARE - Reconcilia
NET LOSS PER SHARE - Reconciliation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
NET LOSS PER SHARE | |||||||||||
Net loss | $ (23,542) | $ (9,778) | $ (19,814) | $ (99,191) | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | $ (152,325) | $ (59,747) | $ (44,870) |
Weighted average common shares outstanding: | 403,457 | 361,845 | 337,297 | ||||||||
Diluted shares outstanding: | 403,457 | 361,845 | 337,297 | ||||||||
Net loss per share: | |||||||||||
Basic and Diluted (in dollars per share) | $ (0.06) | $ (0.02) | $ (0.05) | $ (0.25) | $ (0.07) | $ (0.03) | $ (0.04) | $ (0.02) | $ (0.38) | $ (0.17) | $ (0.13) |
RELATED PARTY TRANSACTIONS - Ex
RELATED PARTY TRANSACTIONS - Expense and Payable (Details) - Entity Affiliated With Related Party - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lexam L.P. | |||
RELATED PARTY TRANSACTIONS | |||
Expense | $ 99 | $ 133 | $ 91 |
Related party outstanding accounts payable (receivable) | 72 | ||
REVlaw | |||
RELATED PARTY TRANSACTIONS | |||
Expense | 158 | 188 | $ 266 |
Related party outstanding accounts payable (receivable) | $ 90 | $ 22 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | May 23, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Aug. 10, 2018 |
RELATED PARTY TRANSACTIONS | |||||
Long-term debt from related party (note 18) | $ 24,080 | $ 19,758 | |||
Number of units issued | 1,935,484 | ||||
Net proceeds | $ 2,600 | $ 918 | |||
Robert McEwen | Term Loan | |||||
RELATED PARTY TRANSACTIONS | |||||
Face amount | $ 50,000 | ||||
Long-term debt from related party (note 18) | $ 25,000 | ||||
Affiliate of Robert McEwen | |||||
RELATED PARTY TRANSACTIONS | |||||
Debt interest expense | $ 2,400 | $ 2,400 | |||
Number of units issued | 1,045,850 | ||||
Net proceeds | $ 900 |
FAIR VALUE ACCOUNTING (Details)
FAIR VALUE ACCOUNTING (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Liabilities: | ||
Long term debt | $ 48,200 | $ 49,500 |
Gold Bar mine | ||
Liabilities: | ||
Impairment of long-lived assets | $ 83,800 | |
Recurring | ||
Assets: | ||
Investments | 1,885 | |
Recurring | Level 1 | ||
Assets: | ||
Investments | 1,885 | |
Marketable equity securities. | Recurring | ||
Assets: | ||
Investments | 1,885 | |
Marketable equity securities. | Recurring | Level 1 | ||
Assets: | ||
Investments | $ 1,885 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Lease Obligations and Purchase Commitments (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Mining and surface rights | |
2021 | $ 2,233 |
2022 | 492 |
2023 | 488 |
2024 | 470 |
Thereafter | 443 |
Total | 4,126 |
Reclamation costs | |
2021 | 2,819 |
2022 | 5,363 |
2023 | 5,510 |
2024 | 564 |
Thereafter | 27,428 |
Total | 41,684 |
Long-term debt | |
2021 | 4,875 |
2022 | 14,712 |
2023 | 42,139 |
Total | 61,726 |
Lease obligations | |
2021 | 2,695 |
2022 | 2,416 |
2023 | 508 |
2024 | 180 |
Total | 5,799 |
Total | |
2021 | 12,622 |
2022 | 22,983 |
2023 | 48,645 |
2024 | 1,214 |
Thereafter | 27,871 |
Total | $ 113,335 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Reclamation Bonds, surety bonds (Details) $ in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020USD ($) | Dec. 31, 2020CAD ($) | Dec. 31, 2019USD ($) | |
Reclamation Bonds | |||
Other Assets, Noncurrent | $ 621 | $ 620 | |
Surety Bonds | |||
Reclamation Bonds | |||
Percentage of annual fees on surety bonds | 2.30% | 2.30% | |
Percentage of required deposit on value of surety bonds | 12.00% | 12.00% | |
Surety bonding obligation | $ 20,100 | ||
Restricted cash | 3,600 | ||
Surety Bonds | Canada | |||
Reclamation Bonds | |||
Surety bonding obligation | 11,700 | $ 15 | |
Reclamation Bonds | Tonkin and Gold Bar Properties | |||
Reclamation Bonds | |||
Reclamation bonding obligation | 20,100 | ||
Black Fox Complex | Reclamation Bonds | |||
Reclamation Bonds | |||
Reclamation bonding obligation | 11,700 | $ 15 | |
Other assets | Timmins | |||
Reclamation Bonds | |||
Restrictive time deposits for reclamation bonding | 100 | ||
Flow Through Common Shares | |||
Reclamation Bonds | |||
Restricted cash | $ 19,900 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Streaming Agreement (Details) $ in Millions | Aug. 25, 2017$ / oz | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Black Fox Complex | |||
Other commitments | |||
Obligation to sell (as a percent) | 8.00% | ||
Long term gold price (in dollars per ounce) | $ / oz | 561 | ||
Revenue of acquiree since acquisition date and implementation of streaming agreement | $ | $ 1.2 | $ 1.5 | |
Black Fox Complex | Maximum | |||
Other commitments | |||
Inflation adjustment (as a percent) | 2.00% | ||
Pike River property | |||
Other commitments | |||
Obligation to sell (as a percent) | 6.30% |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES - Flow through Eligible Expenses (Details) - Flow through Eligible Expenses $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($)item | |
Other commitments | |
Number of flow through share issuance during period | item | 2 |
Commitment amount | $ 18.3 |
Exploration expenditures | $ 1.9 |
CASH AND CASH EQUIVALENTS AND_3
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Cash and cash equivalents | $ 20,843 | $ 46,452 | ||
Restricted cash - non-current (Note 18) | 3,595 | 48 | ||
Total cash, cash equivalents, and restricted cash | 24,438 | $ 46,500 | $ 30,489 | $ 37,153 |
Flow Through Common Shares | ||||
Restricted cash | 19,900 | |||
Surety Bonds | ||||
Restricted cash | $ 3,600 |
INCOME AND MINING TAXES - Tax C
INCOME AND MINING TAXES - Tax Cuts and Jobs Act (the "Act") and Argentinian Tax Reform (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME AND MINING TAXES. | |||
Statutory tax rate (as a percent) | 21.00% | 21.00% | 21.00% |
INCOME AND MINING TAXES - Defer
INCOME AND MINING TAXES - Deferred Income Tax Recovery (Expense) and Net Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred income tax recovery (expense) | |||
United States | $ 817 | $ 2,420 | $ 2,185 |
Foreign | 573 | 1,424 | 585 |
Deferred tax benefit | 1,390 | 3,844 | 2,770 |
Net income (loss) before tax: | |||
United States | (127,524) | (22,319) | (27,001) |
Foreign | (26,191) | (41,272) | (20,639) |
Loss before income and mining taxes | $ (153,715) | $ (63,591) | $ (47,640) |
INCOME AND MINING TAXES - Recon
INCOME AND MINING TAXES - Reconciliation of Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INCOME AND MINING TAXES. | |||
Loss before income and mining taxes | $ (153,715) | $ (63,591) | $ (47,640) |
Statutory tax rate (as a percent) | 21.00% | 21.00% | 21.00% |
US Federal and State tax recovery (expense) at statutory rate | $ (32,280) | $ (13,354) | $ (10,004) |
Reconciling items: | |||
Equity pickup in MSC | 374 | 2,626 | 2,966 |
Deferred foreign income inclusion | 795 | 598 | 5,963 |
Realized flow-through expenditures | 496 | 3,150 | 2,100 |
Realized flow-through premium | (338) | (2,954) | (1,675) |
Tax rate changes | (147) | 976 | |
Adjustment for foreign tax rates | (2,043) | (200) | 40 |
Other permanent differences | (7,062) | 8,540 | 4,419 |
Unrealized foreign exchange rate (loss)/gain | 4,663 | (1,095) | (6,935) |
NOL expires and revisions | 1,066 | 810 | (120) |
Valuation allowance | 33,086 | (2,941) | 476 |
Tax benefit | $ (1,390) | $ (3,844) | $ (2,770) |
INCOME AND MINING TAXES - Tax E
INCOME AND MINING TAXES - Tax Effects of Temporary Differences (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred tax assets: | ||||
Net operating loss carryforward | $ 66,085 | $ 57,667 | ||
Mineral properties | 66,038 | 60,299 | ||
Other temporary differences | 30,999 | 14,356 | ||
Total gross deferred tax assets | 163,122 | 132,322 | ||
Less: valuation allowance | (154,298) | (121,212) | $ (124,153) | $ (123,648) |
Net deferred tax assets | 8,824 | 11,110 | ||
Deferred tax liabilities: | ||||
Acquired mineral property interests | (12,637) | (16,024) | ||
Total deferred tax liabilities | (12,637) | (16,024) | ||
Total net deferred tax liability | (3,813) | $ (4,914) | ||
Valuation allowances | $ 33,100 |
INCOME AND MINING TAXES - Chang
INCOME AND MINING TAXES - Changes to Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Valuation allowance | |||
Balance at Beginning of Period | $ 121,212 | $ 124,153 | $ 123,648 |
Additions | 39,794 | 2,104 | 12,232 |
Deductions | (6,708) | (5,045) | (11,727) |
Balance at End of Period | $ 154,298 | $ 121,212 | $ 124,153 |
INCOME AND MINING TAXES - Non O
INCOME AND MINING TAXES - Non Operating Losses (Details) $ in Thousands | Dec. 31, 2020USD ($) |
USA | |
INCOME TAXES | |
Net-operating losses | $ 167,784 |
Mexico | |
INCOME TAXES | |
Net-operating losses | 37,117 |
Canada | |
INCOME TAXES | |
Net-operating losses | 35,888 |
Argentina | |
INCOME TAXES | |
Net-operating losses | $ 41,522 |
UNAUDITED SUPPLEMENTARY QUART_3
UNAUDITED SUPPLEMENTARY QUARTERLY INFORMATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Unaudited supplementary quarterly information | |||||||||||
Revenues | $ 104,789 | $ 117,019 | $ 128,175 | ||||||||
Gross (loss) profit | $ (13,687) | $ (701) | $ (8,875) | $ (3,685) | $ 1,261 | $ 1,619 | $ 4,677 | $ 1,429 | (26,948) | 8,986 | 32,082 |
Net loss | $ (23,542) | $ (9,778) | $ (19,814) | $ (99,191) | $ (25,132) | $ (11,465) | $ (13,014) | $ (10,136) | $ (152,325) | $ (59,747) | $ (44,870) |
Net (loss) per share: | |||||||||||
Basic and diluted (in dollars per share) | $ (0.06) | $ (0.02) | $ (0.05) | $ (0.25) | $ (0.07) | $ (0.03) | $ (0.04) | $ (0.02) | $ (0.38) | $ (0.17) | $ (0.13) |
Weighted average shares outstanding: | |||||||||||
Basic and diluted (in shares) | 408,959 | 403,887 | 400,513 | 400,370 | 378,543 | 362,175 | 346,998 | 345,497 | 403,457 | 361,845 | 337,297 |
Gold and silver sales | |||||||||||
Unaudited supplementary quarterly information | |||||||||||
Revenues | $ 27,703 | $ 27,395 | $ 18,291 | $ 31,400 | $ 32,362 | $ 32,691 | $ 36,383 | $ 15,583 | $ 104,789 | $ 117,019 | $ 128,175 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Millions | Feb. 09, 2021USD ($)$ / sharesshares | Jan. 28, 2021USD ($) | Jan. 07, 2021USD ($)oz$ / sharesshares | May 23, 2019shares |
Subsequent Event | ||||
Number of units issued | shares | 1,935,484 | |||
Subsequent Events | ||||
Subsequent Event | ||||
Dividends received | $ | $ 2.5 | |||
Subsequent Events | Gold Bar mine | ||||
Subsequent Event | ||||
Percentage of net reduction reserve | 16.00% | |||
Estimated recoverable ounces | oz | 302,000 | |||
Subsequent Events | Gold Bar mine | Minimum | ||||
Subsequent Event | ||||
Estimated economic life | 5 years | |||
Subsequent Events | Gold Bar mine | Maximum | ||||
Subsequent Event | ||||
Estimated economic life | 7 years | |||
Subsequent Events | Equity Financing In February 2021 | ||||
Subsequent Event | ||||
Number of units issued | shares | 30,000,000 | |||
Price per unit | $ / shares | $ 1.05 | |||
Gross proceeds | $ | $ 31.5 | |||
Subsequent Events | Flow Through Financing In January 2021 | ||||
Subsequent Event | ||||
Number of units issued | shares | 12,600,600 | |||
Price per unit | $ / shares | $ 1.01 | |||
Gross proceeds | $ | $ 12.7 |