The company expected Rodeo to generate "significant free cash flow" which would be used in part to advance its nearby Velardena property, also in Durango state, where it hoped to restart production in about a year.

Golden Minerals had received the final environmental permits for Rodeo in November.

It started trucking material last week 115km to its Velardena oxide mill, which had been leased to Hecla Mining until November 30, and the first pour of gold-silver doré bars was expected within two weeks.

"Despite the COVID-19-related uncertainties of the past year, we've been able to develop this project and put it into production ahead of schedule and on budget," president and CEO Warren Rehn said.

A second ball mill being installed at Velardena was expected to increase throughput from 200tpd to about 450tpd around the end of this quarter.

The company opted to start production without going to the expense of a feasibility study for the small operation, following a positive preliminary economic assessment last year and further testing which improved the projected metrics to a 10-quarter mine-life producing 36,800 ounces of gold and 122,100oz of silver.

"Rodeo's production is the first step toward the company achieving sustainable, long-term profitability," Rehn said.

Golden Minerals has other exploration projects in Mexico and Nevada, and Barrick Gold is earning into its El Quevar silver project in Argentina under an agreement announced last year.

Its shares (TSX: AUMN) have surged from C20c in March to a peak of $1.07 earlier this month.

They closed unchanged at 93c yesterday to value it at $143 million (US$113 million).