Pan American Silver Corp. (NASDAQ:PAAS) Q2 2020 Earnings Conference Call - Final Transcript
Aug 06, 2020 • 11:00 am ET
divest of other early stage smaller exploration assets within our portfolio as our exploration efforts are focused mainly on reserve replacement at existing mines and large scale projects. While normal operations were significantly disrupted in Q2, we were able to progress some of our key sustaining capital projects. This includes work on underground ventilation system at our La Colorada operation in Mexico. We expect to complete work on the ventilation raise from 345 to 528 level and install an underground booster fan in the third quarter of 2021.
When completed, the mine will be able to increase production from the high grade sulfide veins in the eastern part of the mine in line with our previous rates before facing the ventilation restriction in Q1 2020. We are also advancing well on the long-term surface to 345 level ventilation raise, which we expect to complete by year end. In Argentina, we resumed the underground work at COSE, and Joaquin in early May and expect to begin processing ores from those assets at our Manantial Espejo processing plant during Q3.
We also progressed one of our key catalysts for growing future shareholder value. Exploration drilling at our La Colorada's current discovery has enabled us to increase the estimate for the inferred mineral resource to 100.4 million tons containing 141 million ounces of silver. Please see our news release issued on August 4 and our website for further details.
We are continuing with drilling and environmental and metallurgical studies to advance development of this exciting deposit. We're also investigating alternatives to access the ore body. Options are to decline from the bottom of the existing shaft, decline from surface or develop a new shaft. I'm looking forward to discussing these alternatives in more detail in the coming quarters.
Regarding another catalyst in our portfolio, the Escobal operation in Guatemala, we continue to await progress on the government's ILO 169 consultation process. Obviously, the process has been disrupted given the current COVID restrictions and curfews. Guatemala has been severely impacted by COVID-19. But many other countries in Latin America, Guatemala is working hard to balance the health risks and the economic impact. Our team continues to work closely with our employees and local communities to coordinate numerous requests for support.
Escobal remains in care and maintenance and we currently have no timeline for the consultation process or the reopening of the mine. Yesterday, we also provided the annul corporate reserve and resource update for the last 12 months of exploration and production. As you may remember, we moved our reserve update from year-end to mid-year in order to work with the latest reserve estimate in developing our annual budgets, a process that will begin in September. Over the past year, we replaced 76% of the silver and 107% of the gold mined adding 22.1 million ounces of silver and 719,000 ounces of gold to proven and probable mineral reserves. The detail is provided in our August 5th news release.
With the release of our