TIDMFRES
RNS Number : 8093T
Fresnillo PLC
27 July 2022
Fresnillo plc
21 Upper Brook Street
London W1K 7PY
United Kingdom
www.fresnilloplc.com
27 July 2022
SECOND QUARTER PRODUCTION REPORT
FOR THE THREE MONTHSED 30 JUNE 2022
Octavio Alvídrez, Chief Executive Officer, said:
"I am pleased to report a solid quarter of production, in line
with our expectations. We are making good operational progress,
despite the ongoing impact of the pandemic and global supply chain
bottlenecks, which are likely to persist in the second half. We
continue to address the challenges presented by the Mexico labour
reform which limits the use of contractors. Our recruitment and
training campaigns are proving effective and we should complete
this process by year end in our underground mines, while our open
pit mines are now fully staffed. We expect to achieve the tie-in of
the Juanicipio plant, our next major growth project, to the
national electricity grid over the coming weeks and to start
commissioning and ramp-up of operations soon after. We remain on
track to meet our full year guidance."
TOTAL PRODUCTION
HIGHLIGHTS
Silver
-- Quarterly attributable silver production of 14.4 moz
(including Silverstream), up 8.1% vs. 1Q22 driven by a higher
volume of ore processed and higher ore grades at Fresnillo and
Saucito and a higher ore grade at San Julián Disseminated Ore Body
(DOB).
-- Quarterly attributable silver production (including
Silverstream) decreased 3.6% vs. 2Q21 due to the expected lower ore
grade and decreased volume of ore processed at San Julián DOB. This
was mitigated by the increased contribution of ore from
Juanicipio.
-- First half attributable silver production of 27.6 moz
(including Silverstream), in line with 1H21 as the expected lower
ore grade at San Julián DOB and lower volume of ore processed at
Saucito was offset by the increased contribution of ore from
Juanicipio.
Gold
-- Quarterly attributable gold production of 159.0 koz, up 6.1%
vs. 1Q22, primarily due to the expected higher volume of ore
processed at Herradura and Noche Buena.
-- Quarterly attributable gold production decreased 20.6% vs.
2Q21 mainly due to a lower recovery rate and the expected decrease
in the volume of ore processed at Herradura .
-- First half attributable gold production of 308.8 koz, down
27.9% vs. 1H21 primarily due to a decrease in the volume of ore
processed and lower ore grade at Herradura and Saucito.
Silver Equivalent Basis [1]
Attributable quarterly silver equivalent ounces of 27.1 moz in
2Q22 (2Q21: 30.9 moz) and attributable first half silver equivalent
ounces of 52.3 moz (1H21: 61.8 moz).
OPERATING ENVIRONMENT
The labour reform in Mexico which restricts subcontracting of
labour came into effect from 1st September 2021 resulting in the
requirement to internalise a high proportion of our contractor
workforce. The actions we announced to address this short term
challenge, including recruitment campaigns, training and investment
in new equipment, are on-going. We expect to complete the staffing
process in the Fresnillo District, San Julián and Ci é nega by year
end, and as previously reported, our open pit mines are now fully
staffed. The challenges set out in the first quarter, including a
tight labour market, global supply chain bottlenecks and cost
inflation remain and these will have some impact in the second half
of the year.
COVID-19 UPDATE
As reported during the previous quarter, we saw a drop in
Covid-related absenteeism across our operations from March onwards
and have seen a more limited impact on our operations during 2Q22.
Though we have implemented strict protocols to limit the spread of
the virus, a fifth wave has now reached Mexico and we are seeing a
rise in positive cases in the country. Should this trend continue,
we will see an increase in Covid-related absenteeism in the second
half. The safety and well-being of our people is our priority, and
we continue to closely monitor the spread of the virus and
implement a range of safety measures across our business.
By-Products
-- Quarterly attributable by-product lead and zinc production
increased 18.7% and 13.0% vs. 1Q22 respectively, driven primarily
by higher volumes of ore processed and ore grades at Saucito and
Fresnillo and higher ore grades at San Julián DOB.
-- Quarterly attributable by-product lead and zinc production
decreased 11.3% and 3.2% vs. 2Q21 respectively, due to lower
volumes of ore processed and lower ore grades at Saucito and San
Julián DOB.
-- Similarly, first half attributable by-product lead and zinc
production decreased 15.6% and 5.7% vs. 1H21 respectively,
primarily due to lower volumes of ore processed and ore grades at
Saucito and a decrease in ore grades at San Julián DOB.
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Silver (koz) 13,664 12,528 9.1 14,092 (3.0) 26,192 25,931 1.0
-------- -------- --------- -------- --------- -------- -------- ---------
Silverstream
(koz) 692 748 (7.5) 803 (13.8) 1,440 1,599 (9.9)
-------- -------- --------- -------- --------- -------- -------- ---------
Total Silver
(koz) 14,356 13,276 8.1 14,895 (3.6) 27,632 27,530 0.4
-------- -------- --------- -------- --------- -------- -------- ---------
Gold (oz) 158,960 149,792 6.1 200,163 (20.6) 308,752 428,356 (27.9)
-------- -------- --------- -------- --------- -------- -------- ---------
Lead (t) 14,535 12,244 18.7 16,386 (11.3) 26,779 31,726 (15.6)
-------- -------- --------- -------- --------- -------- -------- ---------
Zinc (t) 26,808 23,726 13.0 27,687 (3.2) 50,533 53,568 (5.7)
-------- -------- --------- -------- --------- -------- -------- ---------
DEVELOPMENT PROJECTS
We expect to complete the tie-in of the Juanicipio plant and
Pyrites Plant at Fresnillo to the national electricity grid in the
coming weeks. Commissioning of the Juanicipio plant will follow
soon after with the ramp up of the plant beginning towards the end
of the third quarter.
SAFETY PERFORMANCE
The safety and wellbeing of our people remains our absolute
priority and we continue to nurture a strong safety culture across
all our mines through the reinforcement of our safety training and
the monitoring of the adherence to our safety policies. The 'I
Care, We Care' programme continues to be rolled out across the
business and is a central aspect of all operations and new
development projects.
2022 OUTLOOK
We remain on track to meet our 2022 full year guidance of 50.5
to 56.5 moz of attributable silver (including Silverstream) and 600
to 650 koz of attributable gold production.
INTERIM RESULTS
Fresnillo will announce its 2022 Interim Results on 2(nd) of
August 2022.
For further information, please visit our website
www.fresnilloplc.com or contact:
FRESNILLO PLC Tel: +44 (0)20 7399 2470
London Office
Gabriela Mayor, Head of Investor
Relations
Patrick Chambers
Mexico City Office Tel: +52 55 52 79 3206
Ana Belem Zárate
POWERSCOURT Tel: +44 (0)7793 858 211
Peter Ogden
MINING OPERATIONS
FRESNILLO MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed
(t) 618,860 575,499 7.5 579,863 6.7 1,194,359 1,141,223 4.7
-------- -------- --------- -------- --------- ---------- ---------- ---------
Production
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (koz) 3,595 3,015 19.2 3,348 7.4 6,609 6,608 0.0
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (oz) 9,668 8,480 14.0 8,736 10.7 18,148 17,112 6.1
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (t) 5,644 4,787 17.9 4,875 15.8 10,432 9,367 11.4
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (t) 10,758 9,381 14.7 8,404 28.0 20,139 15,546 29.5
-------- -------- --------- -------- --------- ---------- ---------- ---------
Ore Grades
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (g/t) 197 179 10.1 201 (1.6) 189 202 (6.5)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (g/t) 0.69 0.64 7.0 0.69 (0.5) 0.67 0.69 (3.3)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (%) 1.10 0.99 10.7 0.99 10.7 1.04 0.97 7.8
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (%) 2.46 2.24 9.9 2.07 18.6 2.35 1.95 20.5
-------- -------- --------- -------- --------- ---------- ---------- ---------
Quarterly silver production was up 19.2% vs. 1Q22 due to a
higher ore grade and a higher volume of ore processed having
regained access to some higher grade mining areas during the
previous quarter, helping to increase operational flexibility.
Quarterly silver production increased 7.4% vs. 2Q21 driven by a
higher volume of ore processed in 2Q22 as ore throughput was
affected in 2Q21, when a short circuit of a main power line
occured, limiting the water pumping capacity thereby affecting
access to some mining areas and limiting haulage capabilities. This
was partially offset by the slightly lower ore grade due to limited
access to some areas with higher ore grades as we continued to
experience relatively limited operational flexibility.
First half silver production remained flat vs. 1H21 due to the
expected lower ore grade in line with the mining sequence.
Mine development rates remained at similar levels quarter on
quarter averaging 2,900m per month in 2Q22 (1Q22: 2,866m per
month). We remain confident that we can maintain a rate of 2,900 to
3,100 m per month on average as previously stated over the coming
months.
Quarterly by-product gold production increased 14.0% vs. 1Q22
driven by a higher volume of ore processed and ore grade.
Quarterly and year to date by-product gold production increased
10.7% and 6.1% vs. 2Q21 and 1H21 respectively, due to a higher
volume of ore processed and a higher recovery rate.
The silver ore grade in 2022 is expected to remain in the range
of 190-210 g/t, while the gold ore grade is expected to remain in
the range of 0.55-0.70 g/t.
SAUCITO MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed (t) 512,739 495,419 3.5 660,039 (22.3) 1,008,158 1,310,923 (23.1)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Production
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (koz) 3,043 2,738 11.1 3,454 (11.9) 5,781 6,602 (12.4)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (oz) 16,785 16,388 2.4 24,760 (32.2) 33,172 51,578 (35.7)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (t) 5,180 4,264 21.5 7,650 (32.3) 9,444 15,490 (39.0)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (t) 8,367 7,299 14.6 11,722 (28.6) 15,665 23,570 (33.5)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Ore Grades
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (g/t) 205 193 6.3 190 7.9 199 184 8.4
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (g/t) 1.31 1.29 1.8 1.51 (13.3) 1.30 1.58 (17.9)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (%) 1.19 0.98 20.5 1.35 (12.3) 1.09 1.38 (21.1)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (%) 2.12 1.81 17.0 2.43 (12.7) 1.97 2.45 (19.7)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Quarterly silver production increased 11.1% vs. 1Q22 mainly due
to a higher ore grade and an increased volume of ore processed.
Quarterly silver production decreased 11.9% vs. 2Q21 as a result
of the lower volume of ore processed driven by the residual impact
of the labour reform in Mexico. This was mitigated by the higher
ore grade due to improved dilution control, as well as successfully
regaining access to certain areas of the mine that were impacted by
the localised seismicity in previous quarters, and an improved
recovery rate due to more efficient grinding in the mill
circuit.
First half silver production decreased 12.4% vs. 1H21 due to a
lower volume of ore processed, mitigated by a higher ore grade, for
reasons explained above.
We continued our recruitment and training campaigns with the
target of gradually reducing the shortage of personnel through the
second half of the year. However, as explained in the prior
quarters, we continue to expect some variability in the ore grade
and volumes of ore processed in 2022 driven by the need for
additional development of the mine in order to recapture
operational flexibility following high levels of localised
seismicity and shortages of personnel reported last year.
Quarterly by-product gold production increased 2.4% vs. 1Q22
driven by the higher volume of ore processed, offset by a lower
recovery rate.
Quarterly and first half by-product gold production decreased
32.2% and 35.7% vs. 2Q21 and 1H21, respectively, due to a lower
volume of ore processed for reasons explained above and a lower ore
grade.
Full year 2022 silver ore grade is expected to remain between
175-195 g/t, while the gold ore grade is estimated to remain around
1.10-1.20 g/t.
PYRITES PLANT (PHASE I)
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Pyrite Concentrates
Processed (t) 33,326 32,364 2.8 48,523 (31.3) 65,690 90,283 (27.2)
------- ------- --------- ------- --------- ------- ------- ---------
Production
------- ------- --------- ------- --------- ------- ------- ---------
Silver (koz) 126 150 (16.0) 167 (24.5) 277 304 (9.0)
------- ------- --------- ------- --------- ------- ------- ---------
Gold (oz) 422 510 (17.3) 721 (41.5) 932 1,399 (33.3)
------- ------- --------- ------- --------- ------- ------- ---------
Ore Grades
------- ------- --------- ------- --------- ------- ------- ---------
Silver (g/t) 160 193 (17.2) 147 8.5 176 145 21.4
------- ------- --------- ------- --------- ------- ------- ---------
Gold (g/t) 1.21 1.59 (23.8) 1.56 (22.6) 1.40 1.60 (12.6)
------- ------- --------- ------- --------- ------- ------- ---------
Quarterly silver and gold production decreased 16.0% and 17.3%
vs. 1Q22 due to lower ore grades.
Quarterly silver production decreased 24.5% vs. 2Q21 due to a
lower volume of pyrite concentrates processed which was mitigated
by the higher ore grade.
Quarterly and first half gold production decreased 41.5% and
33.3% vs. 2Q21 and 1H21 respectively, due to a decrease in the
volume of pyrite concentrates processed from Saucito's flotation
plant and a lower ore grade.
First half silver production decreased 9.0% vs. 1H21 primarily
due to a lower volume of pyrite concentrates processed, mitigated
by a higher ore grade and recovery rate.
In 2022, we continue to estimate silver production from the
Pyrites plant at Saucito to be in the range of 700 to 750 koz while
gold production is estimated to remain in the range of 1.5 to 2.5
koz.
We expect to complete the tie-in of the plant to the national
electricity grid in the coming weeks followed by the ramp up of the
plant soon after.
CIENEGA MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed (t) 280,526 282,568 (0.7) 333,959 (16.0) 563,094 660,123 (14.7)
-------- -------- --------- -------- --------- -------- -------- ---------
Production
-------- -------- --------- -------- --------- -------- -------- ---------
Gold (oz) 8,917 9,990 (10.7) 12,406 (28.1) 18,907 26,696 (29.2)
-------- -------- --------- -------- --------- -------- -------- ---------
Silver (koz) 1,069 1,416 (24.5) 1,425 (24.9) 2,485 2,723 (8.7)
-------- -------- --------- -------- --------- -------- -------- ---------
Lead (t) 758 926 (18.1) 964 (21.4) 1,684 2,191 (23.1)
-------- -------- --------- -------- --------- -------- -------- ---------
Zinc (t) 1,245 1,351 (7.9) 1,669 (25.4) 2,596 3,642 (28.7)
-------- -------- --------- -------- --------- -------- -------- ---------
Ore Grades
-------- -------- --------- -------- --------- -------- -------- ---------
Gold (g/t) 1.08 1.20 (10.1) 1.24 (13.1) 1.14 1.34 (15.4)
-------- -------- --------- -------- --------- -------- -------- ---------
Silver (g/t) 138 179 (23.0) 154 (10.4) 159 150 5.9
-------- -------- --------- -------- --------- -------- -------- ---------
Lead (%) 0.43 0.50 (14.5) 0.49 (11.3) 0.47 0.54 (13.3)
-------- -------- --------- -------- --------- -------- -------- ---------
Zinc (%) 0.79 0.85 (6.6) 0.91 (13.1) 0.82 0.99 (16.9)
-------- -------- --------- -------- --------- -------- -------- ---------
Quarterly gold and silver production decreased 10.7% and 24.5%
vs. 1Q22, respectively, primarily due to a lower ore grade as a
higher proportion of ore from the main Ciénega mine was processed,
as opposed to processing ore from a satellite operation in the
surrounding area with a higher average ore grade.
Quarterly gold and silver production decreased 28.1% and 24.9%
vs. 2Q21, respectively, due to a lower volume of ore processed
given the continued impact of the labour reform in Mexico, in
addition to the lower ore grades.
First half gold production decreased 29.2% vs. 1H21, due to the
lower ore grade year-on-year, and lower volume of ore processed for
reasons explained above. First half silver production decreased
8.7% vs. 1H21 due to a lower volume of ore processed, mitigated by
a higher ore grade.
The gold and silver ore grades for 2022 are expected to remain
in the range of 1.20-1.40 g/t and 145-155 g/t respectively.
SAN JULIÁN MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed Veins
(t) 289,821 294,144 (1.5) 302,475 (4.2) 583,966 591,148 (1.2)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Ore Processed DOB
(t) 535,326 541,030 (1.1) 555,055 (3.6) 1,076,326 1,003,728 7.2
-------- -------- --------- -------- --------- ---------- ---------- ---------
Total production
at San Julián
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (oz) 11,748 11,684 0.5 15,546 (24.4) 23,433 29,346 (20.1)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (koz) 4,328 3,640 18.9 5,219 (17.0) 7,968 8,649 (7.9)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Production Veins
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (oz) 10,865 10,844 0.2 14,320 (24.1) 21,710 27,147 (20.0)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (koz) 1,175 1,060 10.9 1,027 14.5 2,235 1,992 12.2
-------- -------- --------- -------- --------- ---------- ---------- ---------
Production DOB
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (oz) 883 840 5.1 1,226 (28.0) 1,723 2,199 (21.7)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (koz) 3,152 2,580 22.2 4,192 (24.8) 5,733 6,657 (13.9)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (t) 2,325 1,608 44.6 2,813 (17.4) 3,933 4,507 (12.7)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (t) 5,368 4,725 13.6 5,751 (6.7) 10,093 10,533 (4.2)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Ore Grades Veins
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (g/t) 1.22 1.21 0.5 1.56 (21.6) 1.22 1.52 (19.7)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (g/t) 138 123 11.9 115 19.9 131 115 13.7
-------- -------- --------- -------- --------- ---------- ---------- ---------
Ore Grades DOB
-------- -------- --------- -------- --------- ---------- ---------- ---------
Gold (g/t) 0.09 0.08 13.0 0.12 (24.8) 0.08 0.12 (29.2)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Silver (g/t) 213 173 23.4 275 (22.6) 193 240 (19.8)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Lead (%) 0.51 0.39 31.5 0.61 (16.7) 0.45 0.55 (18.4)
-------- -------- --------- -------- --------- ---------- ---------- ---------
Zinc (%) 1.29 1.11 17.1 1.38 (6.0) 1.20 1.38 (13.0)
-------- -------- --------- -------- --------- ---------- ---------- ---------
SAN JULIÁN VEINS
Quarterly silver production increased 10.9% and 14.5% vs. 1Q22
and 2Q21 respectively, due to higher ore grades driven by an
operational decision to adjust the mine plan to prioritise
extraction from wider veins of the mine with higher silver content
but a lower gold ore grade.
Quarterly gold production remained at a similar level to
1Q22.
Quarterly and first half gold production decreased 24.1% and
20.0% vs. 2Q21 and 1H21 respectively, mainly as a result of a lower
ore grade for the reasons explained above.
First half silver production increased 12.2% vs. 1H21 due to a
higher ore grade as explained above.
We continue to expect the 2022 silver and gold ore grades to
average 120-130 g/t and 1.35-1.55 g/t, respectively.
SAN JULIÁN DISSEMINATED ORE BODY (DOB)
Quarterly silver production increased 22.2% vs. 1Q22, due to a
higher ore grade as a result of an updated mining sequence,
increasing the proportion of higher grade ore extracted from the
central area of the ore body.
Quarterly silver production decreased 24.8% vs. 2Q21 due to the
expected lower ore grade following the higher than anticipated ore
grade in 2Q21 as a result of: i) the positive variation with the
geological model in the central area of the ore body; and ii)
access to higher ore grade areas following the mine resequencing in
2019, as set out at the time.
First half silver production decreased 13.9% vs. 1H21 due to the
expected lower ore grade for the reasons explained above, mitigated
by a higher volume of ore processed.
We continue to expect the 2022 silver ore grade to be in the
range of 150-170 g/t as we advance towards the lower grade areas in
the periphery of the ore body.
HERRADURA TOTAL MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed
(t) 5,301,678 4,216,598 25.7 5,482,544 (3.3) 9,518,276 11,494,407 (17.2)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Total Volume
Hauled (t) 31,548,611 32,784,771 (3.8) 33,153,978 (4.8) 64,333,382 66,655,154 (3.5)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Production
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Gold (oz) 83,043 77,602 7.0 108,990 (23.8) 160,644 258,165 (37.8)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Silver (koz) 169 218 (22.3) 227 (25.5) 387 530 (27.0)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Ore Grades
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Gold (g/t) 0.67 0.69 (2.7) 0.68 (1.9) 0.68 0.81 (16.3)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Silver (g/t) 1.49 2.25 (33.6) 1.74 (14.1) 1.83 2.03 (9.9)
----------- ----------- --------- ----------- --------- ----------- ----------- ---------
Quarterly gold production increased 7.0% vs. 1Q22 mainly due to
a higher volume of ore processed due to a higher utilisation rate
of the mining fleet, partially offset by a lower recovery rate.
Quarterly gold production decreased 23.8% vs. 2Q21 due to a
lower recovery rate, as increased volumes of sulphide ore are
processed .
First half gold production decreased 37.8% vs. 1H21 due to an
expected lower volume of ore processed and ore grade, in line with
the mine plan.
The gold ore grade in 2022 is expected to remain in the range of
0.65-0.75 g/t.
NOCHE BUENA TOTAL MINE PRODUCTION
2Q22 1Q22 % Change 2Q21 % Change 1H22 1H21 % Change
Ore Processed
(t) 2,594,599 1,789,478 45.0 2,530,510 2.5 4,384,077 3,703,923 18.4
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Total Volume
Hauled (t) 8,105,466 5,178,188 56.5 6,585,098 23.1 13,283,655 13,248,211 0.3
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Production
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Gold (oz) 25,234 21,869 15.4 28,564 (11.7) 47,103 43,228 9.0
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Silver (koz) 6 8 (22.8) 8 (20.8) 14 12 14.6
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Ore Grades
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Gold (g/t) 0.53 0.62 (14.3) 0.53 (0.2) 0.57 0.52 10.3
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Silver (g/t) 0.22 0.31 (30.1) 0.17 25.8 0.26 0.19 38.6
---------- ---------- --------- ---------- --------- ----------- ----------- ---------
Quarterly gold production increased 15.4% vs. 1Q22 due to an
increase in the volume of ore deposited as a result of a better
team performance, partially offset by a lower ore grade.
Quarterly gold production decreased 11.7% vs. 2Q21 due to a
lower recovery rate .
First half gold production increased 9.0% vs. 1H21 due to a
higher volume of ore deposited as a result of a lower stripping
ratio, decreasing the waste material moved, in addition to a higher
ore grade, partially offset by a lower recovery rate.
The expected gold ore grade in 2022 is expected to remain in the
range of 0.40-0.50 g/t.
JUANICIPIO
Development ore from Juanicipio continued to be processed
through the Fresnillo and Saucito flotation plants during the
quarter. On an attributable basis, 1,328 koz of silver and 3,143 oz
of gold were produced in 2Q22.
As reported in previous quarters, the construction of the
Juanicipio plant was delivered on schedule in 4Q21. The tie-in of
the plant to the national electricity grid at Juanicipio is
expected in the coming weeks. Commissioning of the plant and
ramp-up of operations will follow soon after.
SILVERSTREAM
Quarterly Silverstream production decreased 7.5% vs. 1Q22 and
13.8% vs. 2Q21 mainly due to a lower ore grade. Similarly, year to
date Silverstream production decreased 9.9% vs. 1H21 due to a lower
ore grade and lower volume of ore processed.
Expected silver production in 2022 remains in the range of
2.5-3.5 moz.
ABOUT FRESNILLO PLC
Fresnillo plc is the world's largest primary silver producer and
Mexico's largest gold producer, listed on the London and Mexican
Stock Exchanges under the symbol FRES.
Fresnillo plc has seven operating mines, all of them in Mexico -
Fresnillo, Saucito, Ciénega (including Las Casas Rosario &
Cluster Cebollitas), Herradura, Soledad-Dipolos(1) , Noche Buena
and San Julián (Veins and Disseminated Ore Body), two development
projects - the Pyrites Plant at Fresnillo and Juanicipio, both of
which have been completed and are awaiting tie-ins of the plants to
the national electricity grid in the coming weeks, and three
advanced exploration projects - Orisyvo, Rodeo and Guanajuato, as
well as a number of other long term exploration prospects.
Fresnillo plc has mining concessions and exploration projects in
Mexico, Peru and Chile.
Fresnillo plc has a strong and long tradition of exploring,
mining, a proven track record of mine development, reserve
replacement, and production costs in the lowest quartile of the
cost curve for silver.
Fresnillo plc's goal is to maintain the Group's position as the
world's largest primary silver company and Mexico's largest gold
producer.
(1) Operations at Soledad-Dipolos are currently suspended.
FORWARD-LOOKING STATEMENTS
Information contained in this announcement may include
'forward-looking statements'. All statements other than statements
of historical facts included herein, including, without limitation,
those regarding the Fresnillo Group's intentions, beliefs or
current expectations concerning, amongst other things, the
Fresnillo Group's results of operations, financial position,
liquidity, prospects, growth, strategies and the silver and gold
industries are forward-looking statements. Such forward-looking
statements involve risk and uncertainty because they relate to
future events and circumstances. Forward-looking statements are not
guarantees of future performance and the actual results of the
Fresnillo Group's operations, financial position and liquidity, and
the development of the markets and the industry in which the
Fresnillo Group operates, may differ materially from those
described in, or suggested by, the forward-looking statements
contained in this document. In addition, even if the results of
operations, financial position and liquidity, and the development
of the markets and the industry in which the Fresnillo Group
operates are consistent with the forward-looking statements
contained in this document, those results or developments may not
be indicative of results or developments in subsequent periods. A
number of factors could cause results and developments to differ
materially from those expressed or implied by the forward-looking
statements including, without limitation, general economic and
business conditions, industry trends, competition, commodity
prices, changes in regulation, currency fluctuations (including the
US dollar and Mexican Peso exchanges rates), the Fresnillo Group's
ability to recover its reserves or develop new reserves, including
its ability to convert its resources into reserves and its mineral
potential into resources or reserves, changes in its business
strategy and political and economic uncertainty.
[1] Au:Ag ratio of 80:1
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END
DRLXQLFLLDLEBBX
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July 27, 2022 02:00 ET (06:00 GMT)
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