First Majestic Silver Corp. ("First Majestic" or the "Company")
announces total production in the third quarter of 2019 reached 6.6
million silver equivalent ounces, representing a 4% increase
compared to the prior quarter. Total production consisted of 3.4
million ounces of silver, 35,791 ounces of gold, 1.9 million pounds
of lead and 1.0 million pounds of zinc. By the end of the third
quarter, total production in 2019 has reached 19.3 million silver
equivalent ounces, or approximately 77% of the Company’s guidance
midpoint of producing 24.4 to 26.0 million ounces.
THIRD QUARTER OPERATIONAL
HIGHLIGHTS
- Record consolidated average silver recoveries of 88%, the
highest in the Company’s 17-year history
- Record production at Santa Elena of 1,859,170 silver equivalent
ounces, up 27% from the prior quarter
- Five-year production high at La Encantada of 885,627 silver
ounces, up 81% from the prior quarter
- Achieved average silver recoveries of 82% at La Encantada, the
highest recovery rates in recent history at this mine
- Reached steady state production of the new 3,000 tpd
high-intensity grinding (“HIG”) mill at Santa Elena, making it the
only hard rock operating HIG mill in Latin America
- Began initial earthwork activities at Santa Elena’s Ermitaño
project for surface facilities and development of the underground
portal
“Total production increased 4% quarter over
quarter due to higher grades and recoveries at both our Santa Elena
and La Encantada operations,” said Keith Neumeyer, President and
CEO. “At La Encantada, silver recoveries averaged 82%, making it
the highest recovery rate since owning this operation, following
successful plant modifications to optimize ore handling and
processing. In addition to higher recoveries, silver grades at La
Encantada increased 59% pushing silver production to the highest
level since 2014. Production at Santa Elena also reached a new
record as higher gold grades were produced from the Main Vein and
overall higher metallurgical recoveries were achieved following the
start-up of the new HIG mill. This new mill is proving to be a
major asset for this operation and I would like to recognize our
projects and innovations team for a job well done.”
PRODUCTION TABLE
|
Q3 |
Q3 |
Y/Y |
Q2 |
Q/Q |
2019 |
2018 |
Change |
2019 |
Change |
Ore
processed/tonnes milled |
655,967 |
864,056 |
-24 |
% |
736,896 |
-11 |
% |
Total production -
ounces of silver eqv. |
6,636,716 |
6,740,315 |
-2 |
% |
6,410,483 |
4 |
% |
Silver ounces
produced |
3,367,740 |
3,505,344 |
-4 |
% |
3,193,566 |
5 |
% |
Gold ounces
produced |
35,791 |
35,260 |
2 |
% |
33,576 |
7 |
% |
Pounds of lead
produced |
1,907,305 |
4,443,290 |
-57 |
% |
2,452,803 |
-22 |
% |
Pounds of zinc produced |
1,026,739 |
1,234,385 |
-17 |
% |
1,398,922 |
-27 |
% |
QUARTERLY REVIEWTotal ore
processed during the quarter at the Company's mines amounted to
655,967 tonnes, representing an 11% decrease compared to the
previous quarter. The decrease in tonnes processed was primarily
due to the continued inactivity at San Martin and a decrease in
processed ore at La Parrilla following the decision to temporarily
halt milling operations in order to build adequate surface
stockpiles to be used during the commissioning phase of the new
high-recovery microbubble flotation cells in early 2020.
Consolidated silver grades in the quarter
averaged 181 g/t compared to 159 g/t in the previous quarter. This
14% increase was primarily the result of a higher silver grades at
La Encantada, San Dimas, Santa Elena and La Parrilla.
Consolidated gold grades averaged 1.76 g/t compared to 1.48
g/t in the prior quarter representing a 19% increase primarily due
to higher gold grades from the Main Vein at Santa Elena.
Consolidated silver and gold recoveries averaged
88% and 96%, respectively, during the quarter. Higher recoveries
were achieved at Santa Elena following the successful installation
and ramp up of the new 3,000 tpd HIG mill. In addition, La
Encantada achieved average silver recoveries of 82%, representing a
significant 23% increase compared to the prior quarter and the
highest recovery rate in recent history at this mine, following
several plant optimization modifications.
MINE BY MINE PRODUCTION
TABLE
Mine |
Ore Processed |
Tonnes per Day |
Silver Oz Produced |
Gold Oz Produced |
Pounds of Lead |
Pounds of Zinc |
Equivalent Silver Ounces |
San Dimas |
173,679 |
1,888 |
1,639,481 |
21,534 |
- |
- |
3,502,102 |
Santa Elena |
229,094 |
2,490 |
632,216 |
14,154 |
- |
- |
1,859,170 |
La Encantada |
191,926 |
2,086 |
885,627 |
65 |
- |
- |
891,205 |
La Parrilla |
33,439 |
363 |
135,420 |
17 |
1,005,300 |
1,026,739 |
258,683 |
Del Toro |
27,829 |
302 |
74,997 |
22 |
902,005 |
- |
125,557 |
Total |
655,967 |
7,130 |
3,367,740 |
35,791 |
1,907,305 |
1,026,739 |
6,636,716 |
*Certain amounts shown may not add exactly to
the total amount due to rounding differences.*The
following prices were used in the calculation of silver equivalent
ounces: Silver: $16.98 per ounce; Gold: $1,472 per ounce; Lead:
$0.92 per pound; Zinc: $1.07 per pound.
At the San Dimas Silver/Gold
Mine:
- During the quarter, San Dimas produced 1,639,481 ounces of
silver and 21,534 ounces of gold for a total production of
3,502,102 silver equivalent ounces, reflecting a 4% decrease
compared to the prior quarter.
- The mill processed a total of 173,679 tonnes with average
silver and gold grades of 315 g/t and 4.00 g/t, respectively.
Silver grades improved by 1% while gold grades decreased by 7% when
compared to the prior quarter to a level consistent with budget
expectations.
- Silver and gold recoveries were consistent during the quarter
averaging 93% and 97%, respectively.
At the Santa Elena Silver/Gold
Mine:
- During the quarter, Santa Elena
produced 632,216 ounces of silver and 14,154 ounces of gold for a
total production of 1,859,170 silver equivalent ounces, reflecting
a 27% increase compared to the prior quarter. This significant
increase was primarily due to higher gold grades from the Main
Vein.
- The mill processed a total of
229,094 tonnes, consisting of 132,437 tonnes (or approximately 58%
of production) of underground ore and 96,657 tonnes (or
approximately 42% of production) from the above ground heap leach
pad.
- Silver and gold grades from
underground ore averaged 141 g/t and 3.02 g/t, respectively. Silver
and gold grades from the above ground heap leach pad averaged 32
g/t and 0.61 g/t, respectively.
- Silver and gold recoveries averaged
91% and 96%, respectively, during the quarter.
- The new 3,000 tpd HIG mill reached
steady state production during the quarter following a successful
ramp up. The total project took less than one year to achieve
commercial production and is currently the only operating HIG mill
processing fresh ore in Latin America. Quarterly average recovery
rates are expected to increase in the fourth quarter with the mill
operating for the full period.
- Four surface drill rigs were active
at the Ermitaño project during the quarter. In addition, above
ground earthwork activities began to prepare the area for the
installation of surface facilities and portal construction.
- The Company is expected to release
a Preliminary Economic Assessment study and updated Resource
estimates on the Ermitaño project by the end of the first quarter
in 2020.
At the La Encantada Silver
Mine:
- During the quarter, La Encantada
produced 885,627 ounces of silver representing an 81% increase from
the previous quarter and the highest quarterly production in over
five years. The increase in silver production was primarily due to
a 59% increase in silver grades and a 23% increase in silver
recoveries.
- Silver recoveries averaged 82% during the quarter, the highest
recovery rate since acquiring the mine in 2006, due to a revised
throughput methodology which included selective stockpiling, focus
on finer grinding and a change in the management reporting
structure of personnel at the processing plant.
- Silver grades during the quarter averaged 176 g/t compared to
110 g/t in the prior quarter. This significant increase was the
driven by higher grades from the San Javier and La Prieta sub-level
caving areas which produced 105,405 tonnes with an average silver
grade of 228 g/t.
- A final redesign report from Hatch, an engineering firm,
related to the roaster materials handling system is expected to be
delivered to the Company in the coming weeks. During this design
analysis, production from the roaster remains suspended until the
necessary modifications can be concluded and have been
completed.
At the La Parrilla Silver
Mine:
- During the quarter, the flotation
circuit processed 33,439 tonnes with an average silver grade of 169
g/t and a 75% recovery for total production of 258,683 silver
equivalent ounces.
- The lead circuit processed an
average lead grade of 2.1% with recoveries of 64% for total lead
production of 1.0 million pounds, representing a 41% decrease
compared to the previous quarter, due to lower throughput rates
related to the temporary suspension of milling activities in
September.
- The zinc circuit processed an
average zinc grade of 2.0% with recoveries of 68% for total zinc
production of 1.0 million pounds, representing a 27% decrease
compared to the previous quarter.
- The Company continues to review
toll milling opportunities from third party suppliers and is
stockpiling fresh ore to be used during the commissioning phase of
the new high-recovery microbubble flotation cells in early 2020.
The Company is also evaluating methods to produce a new bulk
concentrate from Del Toro to be shipped to La Parrilla’s
microbubble flotation cells for further processing.
At the Del Toro Silver
Mine:
- During the quarter, Del Toro
produced a total of 125,557 silver equivalent ounces reflecting a
2% increase compared to the prior quarter primarily due to a 5%
increase in tonnes milled, slightly offset by a 6% decrease in
silver recoveries.
- Silver grades and recoveries during
the quarter averaged 115 g/t and 73%, respectively.
- Lead grades and recoveries averaged
2.3% and 63%, respectively, producing a total of 0.9 million pounds
of lead representing a 21% increase compared to the previous
quarter.
At the San Martin Silver
Mine:
- During the quarter, all mining and processing activities at the
San Martin operation remained suspended. The Company continues to
work with authorities to secure the area in anticipation of
restarting the operation in early 2020.
Q3 EARNINGS ANNOUNCEMENT
The Company is planning to release its third
quarter 2019 unaudited financial results on Thursday, November 7,
2019.
ABOUT THE COMPANY
First Majestic is a publicly traded mining
company focused on silver production in Mexico and is aggressively
pursuing the development of its existing mineral property assets.
The Company presently owns and operates the San Dimas Silver/Gold
Mine, the Santa Elena Silver/Gold Mine, the La Encantada Silver
Mine, the La Parrilla Silver Mine, the San Martin Silver Mine and
the Del Toro Silver Mine. Production from these mines are projected
to be between 12.8 to 13.5 million silver ounces or 24.4 to 26.0
million silver equivalent ounces in 2019.
FOR FURTHER INFORMATION contact
info@firstmajestic.com, visit our website at www.firstmajestic.com
or call our toll-free number 1.866.529.2807.
FIRST MAJESTIC SILVER CORP."signed"Keith
Neumeyer, President & CEO
Cautionary Note Regarding Forward Looking
Statements
This press release contains “forward‐looking
information” and "forward-looking statements” under applicable
Canadian and U.S. securities laws (collectively, “forward‐looking
statements”). These statements relate to future events or the
Company's future performance, business prospects or opportunities
that are based on forecasts of future results, estimates of amounts
not yet determinable and assumptions of management made in light of
management's experience and perception of historical trends,
current conditions and expected future developments.
Forward-looking statements include, but are not limited to,
statements with respect to: that overall metallurgical recoveries
will improve in the fourth quarter of 2019 following the adoption
of fine grinding technology; expectations that development
activities will commence in the fourth quarter of 2019 with portal
excavation for underground access; expectations that the Company
will receive a formal recommendation report from Hatch in the
fourth quarter of 2019 regarding potential design improvements to
resolve the cooling and material handling issues encountered with
the La Encantada roasters material handling system; expectations
that the temporary suspension of the San Martin mine will restart
in early 2020; ongoing evaluation of methods to produce a new bulk
concentrate at Del Toro to be shipped to La Parrilla and further
processed through the microbubble flotation cells to create
separate concentrates of lead and zinc from Del Toro; the Company’s
business strategy; future planning processes; commercial mining
operations; cash flow; budgets; the timing and amount of estimated
future production; recovery rates; mine plans and mine life; the
future price of silver and other metals; costs of production; costs
and timing of the development of new deposits; capital projects and
exploration activities and the possible results
thereof. Assumptions may prove to be incorrect and actual
results may differ materially from those anticipated. Consequently,
guidance cannot be guaranteed. As such, investors are cautioned not
to place undue reliance upon guidance and forward-looking
statements as there can be no assurance that the plans, assumptions
or expectations upon which they are placed will occur. All
statements other than statements of historical fact may be
forward‐looking statements. Statements concerning proven and
probable mineral reserves and mineral resource estimates may also
be deemed to constitute forward‐looking statements to the extent
that they involve estimates of the mineralization that will be
encountered as and if the property is developed, and in the case of
measured and indicated mineral resources or proven and probable
mineral reserves, such statements reflect the conclusion based on
certain assumptions that the mineral deposit can be economically
exploited. Any statements that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives or future events or performance (often, but not always,
using words or phrases such as “seek”, “anticipate”, “plan”,
“continue”, “estimate”, “expect”, “may”, “will”, “project”,
“predict”, “forecast”, “potential”, “target”, “intend”, “could”,
“might”, “should”, “believe” and similar expressions) are not
statements of historical fact and may be “forward‐looking
statements”.
Actual results may vary from forward-looking
statements. Forward-looking statements are subject to known and
unknown risks, uncertainties and other factors that may cause
actual results to materially differ from those expressed or implied
by such forward-looking statements, including but not limited to:
risks related to the integration of acquisitions; actual results of
exploration activities; conclusions of economic evaluations;
changes in project parameters as plans continue to be refined;
commodity prices; variations in ore reserves, grade or recovery
rates; actual performance of plant, equipment or processes relative
to specifications and expectations; accidents; labour relations;
relations with local communities; changes in national or local
governments; changes in applicable legislation or application
thereof; delays in obtaining approvals or financing or in the
completion of development or construction activities; exchange rate
fluctuations; requirements for additional capital; government
regulation; environmental risks; reclamation expenses; outcomes of
pending litigation; limitations on insurance coverage as well as
those factors discussed in the section entitled "Description of the
Business - Risk Factors" in the Company's most recent Annual
Information Form, available on www.sedar.com, and Form 40-F on file
with the United States Securities and Exchange Commission in
Washington, D.C. Although First Majestic has attempted
to identify important factors that could cause actual results to
differ materially from those contained in forward-looking
statements, there may be other factors that cause results not to be
as anticipated, estimated or intended.
The Company believes that the expectations
reflected in these forward‐looking statements are reasonable, but
no assurance can be given that these expectations will prove to be
correct and such forward‐looking statements included herein should
not be unduly relied upon. These statements speak only as of the
date hereof. The Company does not intend, and does not assume any
obligation, to update these forward-looking statements, except as
required by applicable laws.
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