Fortuna Silver Mines Inc. (NYSE: FSM)
(TSX: FVI) reports solid production results for the third
quarter of 2022 from its four operating mines in the Americas and
West Africa.
Gold and silver production
highlights
- Gold production of 66,344 ounces;
1.4 percent increase over Q3 2021
- Silver production of 1,837,506
ounces; 7.3 percent increase over Q3 2021
- Gold equivalent1 production of
101,840 ounces
The Company delivered another consistent
production quarter with all mines on target to achieve annual
guidance for silver and gold. Gold production of
66,344 ounces, a slight increase of 1.4 percent
year-over-year, was mainly driven by contributions of 30,032 ounces
from the Lindero Mine and 27,130 ounces from the Yaramoko Mine.
Silver production of 1,837,506 ounces, a 7.3 percent increase over
the comparable period in 2021, was primarily driven by higher
tonnage treated at the San Jose Mine. The Company is in a good
position to achieve the upper range of silver annual guidance.
By-product base metal production amounted to 9.1
million pounds of lead and 11.9 million pounds of zinc.
Silver and gold production for the first nine
months of 2022 totaled 5,160,529 ounces and 195,315 ounces,
respectively or 301,649 gold equivalent ounces2. Fortuna reiterates
its 2022 annual production guidance range of 6.2 to 6.9 million
ounces of silver and 244 to 280 thousand ounces of gold or
between 369,000 and 420,000 gold equivalent ounces3, including lead
and zinc by-products (refer to Fortuna news release dated January
18, 2022).
Notes:
- Au Eq includes gold, silver, lead
and zinc and is calculated using the following metal prices:
$1,718/oz Au, $19.16/oz Ag, $1,989/t Pb and $3,268/t Zn or
Au:Ag = 1:89.65, Au:Pb = 1:0.90, Au:Zn = 1:0.53
- Au Eq includes gold, silver, lead
and zinc and is calculated using the following metal prices:
$1,823/oz Au, $21.88/oz Ag, $2,181/t Pb and $3,634/t Zn or Au:Ag =
1:83.33, Au:Pb = 1:0.84, Au:Zn = 1:0.50
- Au Eq includes gold, silver, lead
and zinc and is calculated using the following metal prices:
$1,700/oz Au, $22/oz Ag, $2,100/t Pb and $2,700/t Zn or Au:Ag
= 1:77.27, Au:Pb = 1:0.81, Au:Zn = 1:0.63
Third Quarter 2022 Consolidated Operating
Highlights
|
Third Quarter 2022 |
Third Quarter 2021 |
|
Lindero, Argentina |
San Jose, Mexico |
Yaramoko, Burkina Faso |
Caylloma,Peru |
Consolidated |
Lindero,Argentina |
San Jose, Mexico |
Yaramoko, Burkina Faso |
Caylloma, Peru |
Consolidated |
OPERATIONAL FIGURES |
Tonnes milled |
|
267,198 |
137,202 |
139,143 |
|
|
248,985 |
126,677 |
136,410 |
|
Average tpd milled |
|
3,071 |
1,491 |
1,546 |
|
|
2,862 |
1,377 |
1,516 |
|
Ore placed on pad (t) |
1,365,726 |
|
|
|
|
1,387,134 |
|
|
|
|
SILVER1 |
Grade (g/t) |
|
196 |
|
79 |
|
|
195 |
|
78 |
|
Recovery (%) |
|
91.92 |
|
82.25 |
|
|
91.84 |
|
80.97 |
|
Production (oz) |
|
1,545,410 |
|
292,096 |
1,837,506 |
|
1,436,658 |
|
275,223 |
1,711,881 |
GOLD2 |
Grade (g/t) |
0.83 |
1.16 |
6.21 |
0.11 |
|
1.10 |
1.22 |
7.28 |
0.48 |
|
Recovery (%) |
|
90.97 |
97.36 |
18.95 |
|
|
91.27 |
97.8 |
71.97 |
|
Production (oz) |
30,032 |
9,091 |
27,130 |
91 |
66,344 |
26,235 |
8,910 |
28,751 |
1,529 |
65,425 |
LEAD |
Grade (%) |
|
|
|
3.33 |
|
|
|
|
3.14 |
|
Recovery (%) |
|
|
|
88.97 |
|
|
|
|
87.26 |
|
Production (lbs) |
|
|
|
9,085,250 |
9,085,250 |
|
|
|
8,245,289 |
8,245,289 |
ZINC |
Grade (%) |
|
|
|
4.37 |
|
|
|
|
4.74 |
|
Recovery (%) |
|
|
|
88.63 |
|
|
|
|
87.31 |
|
Production (lbs) |
|
|
|
11,885,121 |
11,885,121 |
|
|
|
12,436,276 |
12,436,276 |
Notes:
- Metallurgical recovery for silver
at the Caylloma Mine is calculated based on silver content in lead
concentrate
- Lindero and Yaramoko production
includes doré only
- Totals may not add due to
rounding
Latin America: Continues delivering
solid operational performance
The Company’s three Latin American mines
delivered another steady production quarter for all metals.
Consolidated gold production for the third quarter of 2022
reflected a 6.9 percent increase when compared to the same period
of 2021; on track to meet the annual guidance range. The 2022 third
quarter also saw stronger silver and base metals production at the
San Jose and Caylloma mines, favored by higher production and
higher head grades for the period.
Quarterly Highlights
- San Jose delivered its highest
silver production quarter in 2022, placing the operation in a
strong position to achieve the upper range of annual guidance
- Lindero’s consistent gold
production performance, a 14.5 percent production increase when
compared to the third quarter of 2021, is on track to meet the
annual guidance range. The operation continues capturing higher
productivity gains and demonstrating a stable production
performance
- Caylloma continues to deliver
strong production, in line to achieve the upper range of annual
guidance
Lindero Mine, Argentina: Gold production
remains in line to meet annual guidance range
Gold production in the quarter was
30,032 ounces, representing a 14.5 percent increase
year-over-year. Higher gold production is mainly explained by an
increase in performance of the three-stage crushing and stacking
circuits, which delivered 100 percent of the 1.37 million tonnes of
ore placed on the pad in the quarter, compared to 89 percent or 1.2
million tonnes of the 1.39 million tonnes placed during the
comparable period.
During the third quarter of 2022, mine
production was 2.2 million tonnes of mineralized material with a
lower stripping ratio of 0.83:1 when compared to the second quarter
of 2022. The reduction in the stripping ratio was a result of
optimizing the mine plan sequence during the period. A total of
36,501 ounces of gold were placed on the leach pad averaging
0.83 g/t gold.
Construction of Phase-1B of the leach pad was
completed during the quarter as planned, ensuring sufficient
capacity to support the production plan through the second half of
2024. Detail engineering work for the Phase-2 leach pad expansion
was initiated in the third quarter of 2022 and is expected to be
completed by year end. Construction work on Phase-2 is planned to
commence in 2023.
The operation experienced a positive
reconciliation for ore sent to the leach pad during the third
quarter, with grades sampled at the plant being 5.6 percent higher
than estimated from the reserve model.
Gold production for the first nine months of
2022 totaled 89,116 ounces.
San Jose Mine, Mexico: Strong quarterly
performance, on track to achieve annual guidance
In the third quarter of 2022, the San Jose Mine
produced 1.55 million ounces of silver and 9,091 ounces of gold,
7.6 percent and 2.0 percent higher respectively, when compared
to the equivalent period in 2021. The result is primarily due to
higher mill throughput, with grades in line with the mining
sequence and Mineral Reserve estimates. Silver production is
tracking to meet the upper range of annual guidance.
Silver and gold production for the first nine
months of 2022 totaled 4.29 million ounces and 25,625 ounces,
respectively.
Caylloma Mine, Peru: Continued strong
performance, on target to meet the upper range of annual
guidance
The Caylloma Mine produced 292,096 ounces of
silver in the third quarter of 2022. Measured against the
comparable quarter of the previous year, silver was 6.1 percent
higher due to a combination of increased mill throughput, higher
grades and better recoveries.
The operation delivered another strong quarter
of operational performance and is tracking well to deliver total
production in the upper range of guidance. Silver production for
the first nine months of 2022 totaled 871,594 ounces.
In the third quarter of 2022, zinc production
was 11.9 million pounds, a 4.4 percent decrease from the comparable
period in 2021. Production was, mainly impacted by lower head
grades partially offset by higher mill throughput and recovery.
Lead production in the third quarter of 2022 was 9.1 million
pounds, a 10.2 percent increase when compared to the third quarter
of 2021, as a result of higher head grades, recovery, and mill
throughput.
Zinc and lead production for the first nine
months of 2022 totaled 33.6 million pounds and 25.9 million pounds,
respectively. Both metals are in line to achieve the upper range of
guidance.
During the third quarter of 2022, an assessment
study for a potential expansion of the mine and processing plant
was commenced, with tradeoff results expected to be delivered in
the first quarter of 2023.
West Africa
In the third quarter of 2022, the West African
operations continued their steady performance. Gold production at
the Yaramoko Mine in Burkina Faso is on track to meet the annual
guidance range.
At the Séguéla gold Project in Côte d’Ivoire,
despite some delays incurred in the manufacture and delivery of
certain SAG mill components, construction activities are
progressing in line with schedule and budget. As of September 30th,
overall project progress was 78 percent complete. Many equipment
packages have arrived at site, earthworks and civil works are well
advanced, and work has commenced on structural, mechanical and
piping (SMP) critical path activities at the processing plant.
First gold pour continues to be projected for mid-2023.
Fortuna is advancing its preparedness for
operations at Séguéla, which included the hiring of the Operations
General Manager and other key leadership positions in the
quarter.
Yaramoko Mine, Burkina Faso: Gold
production on target to meet the upper range of annual
guidance
The Yaramoko Mine produced 27,130 ounces of gold
in the third quarter of 2022 with an average gold head grade of
6.21 g/t, which is in line with the mining sequence and Mineral
Reserve estimate. The operation benefitted from higher mill
throughput and operating time during the quarter offset by lower
head grades when compared to the third quarter in 2021.
The operational focus remains on advancing
development of the decline to maintain stope sequencing flexibility
in the mine for the remainder of 2022 and into 2023.
Gold production for the first nine months of
2022 totaled 79,918 ounces, in line with the annual guidance
range.
Qualified Person
Eric Chapman, Senior Vice President of Technical
Services of Fortuna, is a Professional Geoscientist of the
Association of Professional Engineers and Geoscientists of the
Province of British Columbia (Registration Number 36328) and a
Qualified Person as defined by National Instrument 43-101-
Standards of Disclosure for Mineral Projects. Mr. Chapman has
reviewed and approved the scientific and technical information
contained in this news release and has verified the underlying
data.
About Fortuna Silver Mines
Inc.
Fortuna Silver Mines Inc. is a Canadian precious
metals mining company with four operating mines in Argentina,
Burkina Faso, Mexico and Peru, and a fifth mine under construction
in Côte d'Ivoire. Sustainability is integral to all our operations
and relationships. We produce gold and silver and generate shared
value over the long-term for our stakeholders through efficient
production, environmental protection, and social responsibility.
For more information, please visit our website.
ON BEHALF OF THE BOARD
Jorge A. Ganoza President, CEO,
and DirectorFortuna Silver Mines Inc.
Investor Relations: Carlos Baca
| info@fortunasilver.com | Twitter:
@Fortuna_Silver | LinkedIn: fortunasilvermines
Forward-looking Statements
This news release contains forward-looking
statements which constitute “forward-looking information” within
the meaning of applicable Canadian securities legislation and
“forward-looking statements” within the meaning of the “safe
harbor” provisions of the Private Securities Litigation Reform Act
of 1995 (collectively, “Forward-looking Statements”). All
statements included herein, other than statements of historical
fact, are Forward-looking Statements and are subject to a variety
of known and unknown risks and uncertainties which could cause
actual events or results to differ materially from those reflected
in the Forward-looking Statements. The Forward-looking Statements
in this news release may include, without limitation, statements
about the Company’s plans for its mines and mineral properties;
changes in general economic conditions and financial markets; the
impact of inflationary pressures on the Company’s business and
operations; the Company’s anticipated operational performance in
2022; estimated production forecasts for 2022; expectations with
respect to metal grade estimates and the impact of any variations
relative to metals grades experienced; metal price estimates in
2022, initiatives in place at the Company’s mines to reduce
inflationary pressures on consumables; operational initiatives
implemented at the Company’s mines to improve production and reduce
mining costs; undisclosed risks and liabilities relating to the
Roxgold business combination; risks that the anticipated benefits
of the Roxgold business combination will not be realized or fully
realized; the timing of construction and development of the mine at
the Séguéla Project, and the capital expenditures related to same;
the timing for the first gold pour at Séguéla; the duration and
impacts of COVID-19 on the Company’s production, workforce,
business, operations and financial condition; assumptions related
to the supply and effectiveness of COVID-19 vaccines and the
distribution of the vaccines in the countries in which we operate,
and the decrease or increase in COVID-19 related restrictions; the
Company’s business strategy, plans and outlook; the merit of the
Company’s mines and mineral properties; mineral resource and
reserve estimates; production costs; timelines; the future
financial or operating performance of the Company; capital and
operating expenditures; approvals and other matters. Often, but not
always, these Forward-looking Statements can be identified by the
use of words such as “estimated”, “potential”, “open”, “future”,
“assumed”, “projected”, “used”, “detailed”, “has been”, “gain”,
“planned”, “reflecting”, “will”, “anticipated”, “estimated”
“containing”, “remaining”, “to be”, or statements that events,
“could” or “should” occur or be achieved and similar expressions,
including negative variations.
Forward-looking Statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to be
materially different from any results, performance or achievements
expressed or implied by the Forward-looking Statements. Such
uncertainties and factors include, among others, changes in general
economic conditions and financial markets; the impact of inflation
and related disruptions to the global and local supply chains and
changes in the prices of key supplies; the impact of the COVID-19
pandemic on the Company’s mining operations and construction
activities; the risks relating to a global pandemic, including the
COVID-19 pandemic, as well as risks associated with war or other
geo-political hostilities, such as the Ukrainian – Russian
conflict, any of which could continue to cause a disruption in
global economic activity; the risks associated with the completion
of the Roxgold Acquisition, including the ability of the Company to
successfully consolidate functions, integrate operations,
procedures and personnel; adverse changes in prices for gold,
silver and other metals; fluctuation in currencies and foreign
exchange rates; the imposition of capital controls in countries in
which the Company operates; any extension of the currency controls
in Argentina; technological and operational hazards in Fortuna’s
mining and mine development activities; risks inherent in mineral
exploration; uncertainties inherent in the estimation of mineral
reserves, mineral resources, and metal recoveries; changes to
current estimates of mineral reserves and resources; changes to
production and cost estimates; the ability of the Company to
successfully challenge an alleged typographical error in the San
Jose EIA received by the Company in December 2021; changes in the
position of regulatory authorities with respect to the granting of
approvals or permits; governmental and other approvals; changes in
government, political unrest or instability in countries where
Fortuna is active; labor relations issues; as well as those factors
discussed under “Risk Factors” in the Company's Annual Information
Form. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in Forward-looking
Statements, there may be other factors that cause actions, events
or results to differ from those anticipated, estimated or
intended.
Forward-looking Statements contained herein are
based on the assumptions, beliefs, expectations and opinions of
management, including but not limited to the accuracy of the
Company’s current mineral resource and reserve estimates; that the
Company’s activities will be conducted in accordance with the
Company’s public statements and stated goals; that there will be no
material adverse change affecting the Company, its properties or
its production estimates (which assume accuracy of projected ore
grade, mining rates, recovery timing, and recovery rate estimates
and may be impacted by unscheduled maintenance, labour and
contractor availability and other operating or technical
difficulties); the duration and effect of global and local
inflation; the duration and impacts of COVID-19 and geo-political
uncertainties on the Company’s production, workforce, business,
operations and financial condition; the expected trends in mineral
prices, inflation and currency exchange rates; that the Company
will be successful in challenging the alleged typographical error
in the December 2021 extension to the San Jose EIA; that all
required approvals and permits will be obtained for the Company’s
business and operations on acceptable terms; that there will be no
significant disruptions affecting the Company's operations and such
other assumptions as set out herein. Forward-looking Statements are
made as of the date hereof and the Company disclaims any obligation
to update any Forward-looking Statements, whether as a result of
new information, future events or results or otherwise, except as
required by law. There can be no assurance that these
Forward-looking Statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, investors should not
place undue reliance on Forward-looking Statements.
Cautionary Note to United States Investors
Concerning Estimates of Reserves and Resources
Reserve and resource estimates included in this
news release have been prepared in accordance with National
Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI
43-101") and the Canadian Institute of Mining, Metallurgy, and
Petroleum Definition Standards on Mineral Resources and Mineral
Reserves. NI 43-101 is a rule developed by the Canadian Securities
Administrators that establishes standards for public disclosure by
a Canadian company of scientific and technical information
concerning mineral projects. Unless otherwise indicated, all
mineral reserve and mineral resource estimates contained in the
technical disclosure have been prepared in accordance with NI
43-101 and the Canadian Institute of Mining, Metallurgy and
Petroleum Definition Standards on Mineral Resources and
Reserves.
Canadian standards, including NI 43-101, differ
significantly from the requirements of the Securities and Exchange
Commission, and mineral reserve and resource information included
in this news release may not be comparable to similar information
disclosed by U.S. companies.
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