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VANCOUVER, Oct. 16, 2013 /CNW/ - First Majestic Silver Corp. ("First
Majestic" or the "Company") is pleased to announce that total
production at its five operating silver mines in Mexico for the third
quarter ending September 30, 2013, reached a new quarterly record of
3,370,457 equivalent ounces of silver, representing a 38% increase
compared to the same quarter in 2012.
Total silver production for the quarter consisted of 2,689,237 ounces of
silver, representing an increase of 22% compared to the same quarter in
2012. In addition, 8,543,551 pounds of lead and 2,232,881 pounds of
zinc were produced representing an increase of 158% and 164%,
respectively, compared to the same quarter of the previous year. Also,
2,942 ounces of gold were produced, representing an increase of 91%
compared to the third quarter of 2012.
Keith Neumeyer, President & CEO of First Majestic, states, "While the
third quarter was another volatile period for silver prices, we
continue to make progress with our growth strategy in Mexico. The San
Martin mill expansion, which is now complete, marks the third major
project completed by First Majestic in 2013, following the recent
production start-up of Phase 1 at the Del Toro Silver Mine and the
completion of the mill expansion at the La Guitarra Silver Mine. Our
operations team deserves to be recognized for a job well done."
Production Details Table:
Consolidated Production Results
% Change over
Ore processed/tonnes milled
Total production - ounces of silver equivalent
Total silver ounces produced
Silver Grade (g/t)
Silver Recovery (%)
Pounds of lead produced
Equivalent ounces from lead
Pounds of zinc produced
Equivalent ounces from zinc
Gold ounces produced
Equivalent ounces from gold
Tonnes of iron ore produced
Equivalent ounces from iron
The total ore processed during the quarter at the Company's five
operating silver mines, La Encantada, La Parrilla, San Martin, La
Guitarra and Del Toro, amounted to 641,345 tonnes milled, representing
a slight decrease of 4% over the previous quarter primarily due to the
continued optimization at the La Encantada mine in addition to the
effects of two major hurricanes which hit Mexico in the month of
Silver grades in the quarter for the five mines remained relatively
unchanged from the previous quarter at 202 g/t of silver. Combined
silver recoveries averaged 65% in the quarter and remained in line with
the second quarter average of 64%.
The Company's underground development in the third quarter consisted of
10,923 metres, a 19% decrease compared to 13,479 metres completed in
the previous quarter. This decrease is part of a planned reduction of
capital expenditures aimed at reducing costs due to the lower metal
During the quarter, six diamond drill rigs were operating at the
Company's five operations. The Company completed 7,823 metres of
diamond drilling in the quarter, compared to 25,469 metres in the prior
quarter, representing a 69% decrease resulting from the previously
announced exploration budget cuts.
At the Del Toro Silver Mine:
Throughput in the new flotation mill averaged 1,061 tpd in the third
quarter with head grades of 244 g/t silver, 4.3% lead and 2.8% zinc.
Silver recoveries averaged 69% during the quarter compared to 72% from
the previous quarter due to a variation in the ore feed from a
transition zone between oxides and sulfides. Further testing is
underway at the Company's central lab with the objective of improving
overall metallurgical recoveries, however, once the new cyanidation
circuit is operational, some of these ores will be processed through
Phase 2 construction, including the Merrill-Crowe area, the
clarification circuit, and the installation of two precipitate filter
presses and two induction furnaces is nearing completion. Phase 2
includes the addition of a 1,000 tpd cyanidation circuit allowing the
facility to produce silver doré bars. Once completed, which is expected
in November, the facility will have total capacity of 2,000 tpd.
During the quarter, the crushing circuit was expanded to allow for the
capacity increase to 2,000 tpd. In addition, the installation of the
12' by 14' oxide ball mill, pumps, motors and other mechanisms for the
cyanidation circuit were also completed.
During the quarter, tailings filter #3 was successfully installed and
tested. Progress continues in regards to the installation of the final
tailings filter #4, which is now 95% complete and undergoing initial
testing. Filters #1 and #2 are currently in operation. These four
tailing filters will be able to handle up to 4,000 tpd and will recycle
approximately 80% of the water used throughout the milling process.
The construction of the 45 km, 115,000 kW power line from the state of
Durango has experienced several delays due to its length and
complexities. Originally scheduled for completion in July, then
expected by November, the Company's latest estimate for completion is
prior to year end. In order to have sufficient power for Phase 2, the
National power company, CFE, has arranged to increase the current power
levels on the existing 34,000 kW power line by providing up to 6 MW for
the interim period until the new power line is completed. This upgrade
will allow the Company to commission the cyanidation circuit in
November. Once connected to the larger 115,000 kW power line, cost
savings are expected to be achieved resulting from the discontinued use
of diesel powered generators which are currently working together with
the 34,000 kW power line to supply the required power to the operation.
In order to conserve capital in 2014, and to better utilize the
abundance of oxide ore being produced from the San Juan area, the
Company is evaluating the earlier ramping up of the cyanidation circuit
to 2,000 tpd and the delay of the construction of the 4,000 tpd shaft
and postponing the installation of the second SAG Mill which would be
for the purpose of reaching 2,000 tpd through the flotation circuit.
The current evaluation underway is determining the capital savings of
bringing on the 2,000 tpd cyanidation circuit in 2014 and delaying the
expansion of production through the flotation circuit until 2015. It is
currently not expected that this modification of the expansion plan at
Del Toro will materially affect 2014 production guidance, however, once
the evaluation is completed, the Company will release full guidance for
the year as it does in normal course in January.
Total exploration metres drilled in the third quarter amounted to 2,856
metres, compared to 6,579 metres drilled in the previous quarter as a
result of the reduction to the exploration budget. In addition, 1,817
metres of development were completed in the third quarter of 2013,
compared to 3,194 metres of development in the previous quarter. During
the quarter, one underground drill rig was active at Del Toro.
At the La Encantada Silver Mine:
The cyanidation mill averaged 2,959 tpd during the quarter consisting of
54% fresh mine ore and 46% of old tailings. Due to a breakdown that
occurred in the gear and motor at ball mill #1, a complete upgrade of
the motor foundation and gear system was required. The ball mill
remained offline for a period of 6 weeks resulting in the reduction of
fresh ore processing and the increase of old tailings sent to the
plant. The reduction of fresh ore and the increase of tailings feed
produced a combined head grade of 228 g/t of silver with a mill
recovery of 49%. Ball mill #1 is now fully operational and silver
grades and recoveries are back to normal levels.
Underground development continues to be focused on new areas within the
mine defined by the latest exploration program. Currently, the primary
areas of focus are the surrounding ore bodies of the Milagros and San
Javier breccia pipes. Additionally, mine development and production
continue from the San Francisco vein and the recently discovered "990"
and "990-2" chimneys. At the newly discovered Regalo vein, a new area
was prepared for long-hole drilling aimed at increasing the production
of fresh ore to a rate of 2,000 tpd by the middle of next year.
A total of 2,928 metres of exploration drilling was completed in the
third quarter, compared to 2,140 metres of drilling in the previous
quarter, representing an increase of 37%. In addition, a total of 3,195
metres of underground development were completed in the third quarter,
compared to 3,597 metres of development in the previous quarter,
representing a decrease of 11%.
Three diamond drill rigs are active underground at La Encantada with the
objective of defining Reserves and Resources in the newly discovered
areas in addition to assisting in mining activities.
A substantial portion of the current drilling and develop is for the
purpose of the planned release of an updated NI 43-101 Technical Report
in the middle of 2014.
At the La Parrilla Silver Mine:
La Parrilla had excellent results during the quarter and continues to
operate above budget. Silver production totaled 866,710 ounces during
the quarter, representing a 22% increase from the previous quarter, due
to improved silver grades and recoveries.
The construction of three new leaching tanks was completed during the
quarter allowing for longer leaching times with the objective of
further increasing recoveries.
Underground development completed in the quarter totaled 2,213 metres
compared with 3,088 metres developed in the previous quarter.
As part of the planned reduction in exploration spending, a total of 177
metres were drilled in the third quarter compared to 4,065 in the
At the San Martin Silver Mine:
Due to a heavy rain fall season caused by hurricanes along the Pacific
Coast, total silver production reached 339,099 ounces of silver in the
quarter representing a decrease of 9% compared to the previous
quarter. Silver grades averaged 165 g/t during the quarter and
continue to show positive improvement as higher grade ore is processed
from the new Rosarios area.
The mill expansion from 900 tpd to 1,300 tpd was completed on October
11, 2013 and increased production is already underway. The production
ramp up will increase from 900 tpd to 1,200 tpd in the fourth quarter
with immediate commercial production. Due to a decision to change out
the older 8.5' x 12' ball mill for a new larger 9.5' x 12' ball mill,
full capacity to 1,300 tpd is now expected to be reached in the first
quarter of 2014. This change does not impact the expected annual
operating results and should result in a more reliable operation in
At full capacity of 1,300 tpd, San Martin's annual silver production is
anticipated to increase by over 50% to approximately 1.4 to 1.6 million
ounces of silver in the form of doré bars plus potential upside
resulting from higher silver grades and higher gold credits over the
life of the mine.
Underground development completed in the third quarter totaled 2,267
metres, compared with 2,276 metres of development in the previous
quarter. The mine development continues to be focused at the new
Rosarios area where seven areas are now in production.
One underground drill rig was active within the San Martin property
during the quarter. Total metres drilled in the third quarter amounted
to 376 metres, compared to 6,133 metres of drilling in the previous
At the La Guitarra Silver Mine:
During the third quarter, the full production of silver-gold
concentrates were sold under the previously announced new smelter
agreement allowing the Company to discontinue concentrate shipments to
the La Parrilla mine for further refining. As a result of this new
agreement, the Company has achieved a significant reduction in
treatment charges and transportation costs.
Mine development at the Joya Larga structure within the El Coloso area
has now reached 112 metres along the vein. Development continues to
advance towards the target production area located approximately 90
metres away from the current face. Initial production from this new
area is expected to begin in November at an approximate rate of 100
During the third quarter, production ore came from areas within the La
Guitarra vein which contained higher gold grades in conjunction with
lower silver grades. Looking ahead, the average silver grade is
expected to improve in the fourth quarter once production commences at
the new Joya Larga structure. This new area has indicated grades
ranging between 200 g/t to 350 g/t silver.
A total of 1,431 metres of development were completed in the third
quarter, compared to 1,324 metres of development in the previous
One underground drill rig was active in the third quarter within the La
Guitarra property. Total metres drilled in the quarter amounted to
1,486 metres compared to 6,552 metres drilled in the previous quarter.
The La Guitarra exploration program continues to focus on defining
Reserves and Resources to support an updated NI 43-101 Technical Report
scheduled to be released by the middle of 2014.
With San Martin's mill expansion to 1,300 tpd now complete and ramping
up to 1,200 tpd immediately, and with the addition of the new 1,000 tpd
cyanidation circuit at Del Toro, the Company expects silver production
in the fourth quarter to be very robust. Furthermore, with
year-to-date production totaling 9.4 million silver equivalent ounces,
the Company expects to meet or exceed its 2013 guidance of producing
12.3 million to 13.0 million silver equivalent ounces. Silver
production for the first nine months in 2013 has totaled 7.9 million
ounces and remains in line with annual guidance of 11.1 to 11.7 million
ounces of silver.
First Majestic is a mining company focused on silver production in
México and is aggressively pursuing its business plan of becoming a
senior silver producer through the development of its existing mineral
property assets and the pursuit through acquisition of additional
mineral assets which contribute to the Company achieving its aggressive
corporate growth objectives.
FIRST MAJESTIC SILVER CORP.
Keith Neumeyer, President & CEO
Cautionary Note Regarding Forward Looking Statements
This press release contains "forward-looking statements", within the
meaning of the United States Private Securities Litigation Reform Act
of 1995 and applicable Canadian securities legislation, concerning the
business, operations and financial performance and condition of First
Majestic Silver Corp. Forward-looking statements include, but are not
limited to, statements with respect to the future price of silver and
other metals, the estimation of mineral reserves and resources, the
realization of mineral reserve estimates, the timing and amount of
estimated future production, costs of production, capital expenditures,
costs and timing of the development of new deposits, success of
exploration activities, permitting time lines, hedging practices,
currency exchange rate fluctuations, requirements for additional
capital, government regulation of mining operations, environmental
risks, unanticipated reclamation expenses, timing and possible outcome
of pending litigation, title disputes or claims and limitations on
insurance coverage. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as "plans",
"expects" or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variations of such words and phrases or
state that certain actions, events or results "may", "could", "would",
"might" or "will be taken", "occur" or "be achieved". Forward-looking
statements are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of First Majestic Silver Corp. to be
materially different from those expressed or implied by such
forward-looking statements, including but not limited to: risks related
to the integration of acquisitions; risks related to international
operations; risks related to joint venture operations; actual results
of current exploration activities; actual results of current
reclamation activities; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; future prices of
metals; possible variations in ore reserves, grade or recovery rates;
failure of plant, equipment or processes to operate as anticipated;
accidents, labour disputes and other risks of the mining industry;
delays in obtaining governmental approvals or financing or in the
completion of development or construction activities, as well as those
factors discussed in the section entitled "Description of the Business
- Risk Factors" in First Majestic Silver Corp.'s Annual Information
Form for the year ended December 31, 2012, 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 Silver
Corp. 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. There can be
no assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements. First Majestic Silver
Corp. does not undertake to update any forward-looking statements that
are incorporated by reference herein, except in accordance with
applicable securities laws.
Video with caption: "Video: San Martin Silver Mine
". Video available at: http://stream1.newswire.ca/cgi-bin/playback.cgi?file=20131016_C4162_VIDEO_EN_32092.mp4&posterurl=http://photos.newswire.ca/images/20131016_C4162_PHOTO_EN_32092.jpg&clientName=First%20Majestic%20Silver%20Corp%2E&caption=Video%3A%20San%20Martin%20Silver%20Mine%0D%0A&title=FIRST%20MAJESTIC%20SILVER%20CORP%2E%20%2D%20First%20Majestic%20Produces%20a%20New%20Record%20of%203%2E37%20million%20Silver%20Equivalent%20Ounces&headline=First%20Majestic%20Produces%20a%20New%20Record%20of%203%2E37%20million%20Silver%20Equivalent%20Ounces
SOURCE: First Majestic Silver Corp.
For further information:
email@example.com, visit our website at www.firstmajestic.com or call our toll free number 1.866.529.2807.