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11 Apr 2019 | 07:42

Fresnillo output 'slightly' undershoots its expectations; Juanicipio project gets approval

Fresnillo said its first-quarter production came in 'slightly' below its expectations, but kept its full-year guidance unchanged as output was expected to improve in the second half.

For the first quarter, silver production fell 14.8% to 13.1m from a year earlier mainly due to the lower ore grade and throughput at Fresnillo, the miner said.

Quarterly gold production year-on-year was down 8% to 211,100 ounces for the first quarter , which the miner blamed on lower volume of ore processed at Noche Buena and a slower overall speed of recovery on the leaching pads at Herradura.

The company kept its outlook unchanged, remaining on track to achieve 2019 production guidance of 58-61m ounces of silver, (including Silverstream) and 910-930 koz gold.

The company said the construction of the tailings flotation plant at the Fresnillo mine was on track for completion in 2020.

In a separate statement, Fresnillo and MAG Silver confirmed that their silver / gold Juanicipio project had received approval from their respective Boards as well as from the Minera Juanicipio shareholders.

At full capacity, Juanicipio was expected to produce on average 11.7m ounces of silver and 43,500 ounces of gold per year, with robust economics underpinning the project, the miner said.

'First quarter production is down as expected on the same period last year, though slightly weaker than anticipated. Full year guidance however remains unchanged as we expect to realise the benefits from the investments we have made into infrastructure, equipment and an extensive infill drilling programme, which will all have a positive impact on production in the second half,' said Octavio AlvĂ­drez, Chief Executive Officer.

'I am also pleased to confirm we announced final Board approval of the Juanicipio development project today. We are confident Juanicipio will be a key project for Fresnillo. It is a high quality asset which we expect will make a meaningful contribution to production from late 2020, maintaining our long track record of high growth and returns.'

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