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Fresnillo reports silver production below guidance in 2021, says gold output exceeds target

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(Kitco News) - Fresnillo, the world's largest primary silver producer, reported today that its full year 2021 attributable silver production was 53.1 million ounces (including Silverstream), which was marginally below guidance and flat compared to 2020.

The company said that the higher ore grade at San Julián Disseminated Ore Body (DOB) and, to a lesser extent, the contribution of development ore from Juanicipio, was offset by a lower ore grade and volume of ore processed at Saucito and Fresnillo.

The company’s full year 2021 attributable gold production of 751.2 thousand ounces was ahead of guidance and down 2.4% over 2020, due to a lower ore grade at Ciénega, and a lower ore grade and volume of ore processed at San Julián Veins, partly mitigated by a higher volume of ore processed and ore grade at Noche Buena.

Full year 2021 attributable by-product lead production of 56,573 tonnes decreased 10.5% over 2020 due to a decrease in volume of ore processed and lower ore grade at Saucito and Fresnillo and a lower ore grade at Ciénega. This was mitigated by a higher ore grade at San Julián DOB.

Full year 2021 attributable by-product zinc production of 99,397 tonnes decreased 6.9% over 2020 primarily due to a lower volume of ore processed and ore grade at Saucito and to a lesser extent, lower ore grade and recovery rate at Ciénega.


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Importantly, the company added that the construction of the Juanicipio plant was delivered on schedule during the quarter. However, as previously disclosed, Fresnillo is focusing on complying with the new requirements from the state-owned electricity company and the energy regulator to complete the tie-in to the national power grid.

As a result, the company said that the mill commissioning timeline was extended by approximately six months. As previously reported, stoping and mineralized mine development will continue. To mitigate potential adverse effects, Fresnillo said it will make available any unused plant capacity at its Fresnillo and Saucito operations to process material produced at Juanicipio.

In 2022, Fresnillo’s attributable silver production expected to be in the range of 50.5 to 56.5 million ounces (including Silverstream), in line with 2021 and below its previous estimate due to a lower volume of ore processed at Saucito driven by a shortage of personnel in conjunction with absenteeism due to Covid-19, and a lower ore grade as a result of the instability caused by increased seismicity in the Jarillas vein limiting access to higher ore grade areas and thereby requiring additional development to recapture operational flexibility.

Further, given the extension to the timeline for the tie-in to the national grid of both the Juanicipio plant and the Pyrites Plant at Fresnillo, the company said it expects lower contributions from both operations.

Fresnillo also added that its attributable gold production expected to be in the range of 600 to 650 thousand ounces in 2022, driven mainly by the Noche Buena mine coming to the end of its mine life.

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.

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