(Alliance News) - Fresnillo PLC said Monday that it has accelerated the development of the Juanicipio project in Mexico's Zacatecas state and now expects to start producing silver and gold in mid-2020, ahead of schedule.
Juanicipio is 56% owned by Fresnillo and 44% owned by partner MAG Silver Corp.
The Mexican gold and silver miner said that construction is well underway, engineering is complete, and all major process equipment has been purchased and received on site. It added that the mine's pre-operative capital expenditure has increased by 11% to USD440 million from its estimate of USD395 million back in January 2018.
The mine is now expected to reach 85% name plate capacity in the fourth quarter of 2021, and 90% to 95% in 2022. Fresnillo expects a total average annual production of 11.7 million ounces of silver, 43,500 ounces of gold, with an initial mine life of 12 years.
As a result of production commencing in June 2020, the project is expected to see improved cash flow and increased certainty around the geological block model prior to start-up of flotation plant. Additionally, de-risking the metallurgical process will allow for a quicker ramp-up to 4,000 tonnes per day. Fresnillo noted.
"Juanicipio is an outstanding project which will generate strong returns for our shareholders, and significant benefits to the region. We continue to de-risk and refine the best construction plan that will drive the most value and ensure we capitalise on the opportunity that Juanicipio presents," said Fresnillo Chief Executive Octavio Alvidrez.
Fresnillo shares were trading 3.1% higher at 734.00 pence each on Monday morning in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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Fresnillo (FRES)