REG - Fresnillo Plc - 3rd Quarter Production Report

FresnilloAnnouncement

25/10/2023 07:15

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RNS Number : 2349R  Fresnillo PLC  25 October 2023

 
 

Fresnillo plc

21 Upper Brook Street

London W1K 7PY

United Kingdom

www.fresnilloplc.com (http://www.fresnilloplc.com)

 

25 October 2023

THIRD QUARTER PRODUCTION REPORT

FOR THE THREE MONTHS ENDED 30 SEPTEMBER 2023

 

Octavio Alvídrez, Chief Executive Officer, said:

 

"I am pleased to confirm we have successfully completed the safe ramp-up of
our new Juanicipio mine which is now running at nameplate capacity in line
with our forecast timeline. It is having a positive impact on both silver and
gold production year to date, helping to offset the lower production at Noche
Buena as it nears its end of life, with higher production of both lead and
zinc further supporting our overall performance. We remain on track to meet
our full year production guidance.

 

We continue to address the ongoing impact of inflation and the revaluation of
the Mexican peso, which we expect to remain headwinds going into 2024, through
measures including the greater use of technology, autonomous drilling and
reducing haulage costs.

 

It is with great sadness that I report two contractors' workers recent
fatalities, one in September, and one in October. The safety of our people
remains key and we are thoroughly investigating the circumstances to ensure
that we can learn and adapt our safety protocols to improve the safety culture
across our sites."

 

HIGHLIGHTS

 

Silver

 

·    Quarterly attributable silver production of 14.1 moz (including
Silverstream), down 5.1% vs. 2Q23, mainly driven by the lower ore grade and
volume of ore processed at San Julián Disseminated Ore Body (DOB) and
Saucito, along with the lower volume of ore processed at Juanicipio. These
factors were mitigated by the higher ore grade and volume of ore processed at
San Julián Veins and Ciénega.

 

·    Quarterly attributable silver production (including Silverstream)
increased 3.8% vs. 3Q22, primarily due to the ramp-up of Juanicipio and higher
ore grade at San Julián Veins, partially offset by the lower ore grade at
Saucito and San Julián (DOB).

 

·    Year to date attributable silver production (including Silverstream)
increased 2.2% vs. YTD22, as a result of the ramp-up of Juanicipio and higher
ore grade at San Julián Veins, partly offset by the lower ore grade at San
Julián (DOB) and a decrease in the volume of ore processed and lower ore
grade at Ciénega.

 

 

Gold

 

·    Quarterly attributable gold production of 132.6 koz down 13.0% vs.
2Q23, mainly driven by lower production at Herradura due to an electrical
fault and lower ore grade, the decrease in gold production at Noche Buena as
it approached the end of its mine life and lower ore grade and recovery rate
at Saucito.

 

·    Quarterly attributable gold production down 16.7% vs. 3Q22 primarily
due to the decrease in the volume of ore processed at Herradura, lower gold
production at Noche Buena and lower ore grade and recovery rate at Saucito,
mitigated by the ramp-up of Juanicipio and increased ore processed and ore
grade at Fresnillo.

 

·    Year to date attributable gold production decreased 2.2% vs. YTD22
mainly driven by the decrease in gold production at Noche Buena, mitigated by
the higher ore grade and volume of ore processed at Herradura and the
increased production at Juanicipio.

 

 

By-Products

 

•     Quarterly attributable by-product lead and zinc production up 4.2%
and 13.3% vs. 2Q23 respectively, due to the higher ore grade at Saucito partly
offset by the lower ore grade and volume of ore processed at San Julián
(DOB).

 

•     Quarterly attributable by-product lead production up 8.6% vs. 3Q22
due to the ramp-up at Juanicipio, higher ore grade and recovery rate at
Saucito and higher ore grade at San Julián (DOB). These factors were
partially offset by the lower ore grade at Fresnillo and lower production at
Ciénega.

 

•     Quarterly attributable by-product zinc production increased 13.7%
vs. 3Q22 due to the higher ore grade and recovery rate at Saucito and the
ramp-up of Juanicipio, partially offset by the lower ore grade and recovery
rate at San Julián (DOB) and lower production at Ciénega.

 

•     Year to date attributable by-product lead production increased
4.3% vs. YTD22 due to the increased contribution from Juanicipio partly offset
by the lower ore grade and recovery rate at Saucito and lower production at
Ciénega.

 

•     Year to date attributable by-product zinc production increased
3.6% vs. YTD22 due to the contribution of Juanicipio and higher volume of ore
processed at Fresnillo. These factors were partially offset by the lower ore
grade and recovery rate at San Julián (DOB) and lower production at Ciénega.

 

 

                     3Q23     2Q23     % Change  3Q22     % Change  YTD23    YTD22    % Change
 Silver (koz)        13,434   14,135   (5.0)     12,787   5.1       39,905   38,980   2.4
 Silverstream (koz)  670      725      (7.6)     799      (16.1)    2,216    2,238    (1.0)
 Total Silver (koz)  14,104   14,860   (5.1)     13,586   3.8       42,121   41,218   2.2
 Gold (oz)           132,627  152,380  (13.0)    159,205  (16.7)    458,042  467,957  (2.1)
 Lead (t)            14,575   13,994   4.2       13,415   8.6       41,938   40,194   4.3
 Zinc (t)            29,073   25,670   13.3      25,560   13.7      78,861   76,093   3.6

 

SAFETY PERFORMANCE

 

We are extremely saddened to report two contractors fatal incidents, in
September at the Saucito mine and at the beginning of October at the Tajitos
exploration project. The incidents are being fully investigated by Fresnillo
and the authorities. These events highlight the need to reinforce our safety
procedures and programmes with both contractors and employees. Fresnillo plc's
Board and management team will continue monitoring the safety performance
across the Group to ensure the processes in place contribute to improve the
safety culture in all operations.

 

 

2023 OUTLOOK

 

2023 guidance remains unchanged. Attributable silver production is expected to
be in the range of 57.0 to 64.0 moz (including Silverstream) while
attributable gold production is expected to be in the range of 590 to 640 koz.
Expressed in silver equivalent ounces(1), production is expected to be 104
-115 million ounces.

 

Cost inflation and the revaluation of the Mexican peso versus the US dollar
are expected to continue to impact costs for the remainder of the year.

 

For further information, please visit our website www.fresnilloplc.com
(http://www.fresnilloplc.com) or contact:

 FRESNILLO PLC                                                  Tel: +44 (0)20 7399 2470

 London Office

 Gabriela Mayor, Head of Investor Relations

 Mark Mochalski
 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

 

                    3Q23     2Q23     % Change  3Q22     % Change  YTD23      YTD22      % Change
 Ore Processed (t)  673,233  667,776  0.8       643,945  4.5       2,009,374  1,838,304  9.3

 Production
 Silver (koz)       3,201    3,233    (1.0)     3,394    (5.7)     9,990      10,004     (0.1)
 Gold (oz)          9,013    10,997   (18.0)    7,970    13.1      28,760     26,118     10.1
 Lead (t)           5,175    5,321    (2.7)     5,715    (9.4)     16,147     16,147     0.0
 Zinc (t)           12,003   10,696   12.2      12,107   (0.9)     34,793     32,246     7.9

 Ore Grades
 Silver (g/t)       166      170      (2.4)     181      (8.3)     173        186        (7.0)
 Gold (g/t)         0.59     0.72     (18.1)    0.54     9.3       0.62       0.62       0.0
 Lead (%)           0.90     0.93     (3.2)     1.05     (14.3)    0.94       1.05       (10.5)
 Zinc (%)           2.33     2.12     9.9       2.45     (4.9)     2.29       2.38       (3.8)

 

Quarterly silver production decreased 1.0% and 5.7% when compared to 2Q23 and
3Q22 respectively, mainly due to the increased volume of ore extracted from
the Western areas of the mine with lower silver ore grades.

 

Year to date silver production remained at similar levels when compared to
YTD22 mainly as a result of the increase in volume of ore processed, partly
offset by the lower ore grade and recovery rate as a result of the previously
mentioned factors.

 

Mine development rates decreased quarter on quarter to an average of 2,987m
per month in 3Q23 (2Q23: 3,288m per month) mainly due to the rationalisation
of contractors, whereby activities performed by some contractors will be taken
over by unionised personnel. Development rates are expected to return to
levels above 3,000 metres per month in 4Q23.

 

Quarterly by-product gold production decreased 18.0% vs. 2Q23 mainly driven by
the lower ore grade and to a lesser extent, lower recovery rate.

 

Quarterly by-product gold production increased 13.1% vs. 3Q22 mainly due to
the higher ore grade and the increased volume of ore processed.

 

Year to date by-product gold production increased 10.1% vs. YTD22 primarily as
a result of the higher volume of ore processed.

 

The silver ore grade in 2023 is expected to be in the range of 170-180 g/t,
while the gold ore grade is expected to remain in the range of 0.50-0.70 g/t.

 

Recovery rates at the Pyrites Plant have yet to reach anticipated levels.
Technical work is ongoing to improve performance with the aim of increasing
recovery rates and moving the plant to full operational capacity by 1Q24.

 

SAUCITO MINE PRODUCTION

 

                    3Q23     2Q23     % Change  3Q22     % Change  YTD23      YTD22      % Change
 Ore Processed (t)  552,872  562,962  (1.8)     556,199  (0.6)     1,587,793  1,564,357  1.5

 Production
 Silver (koz)       2,892    3,006    (3.8)     3,171    (8.8)     8,703      8,952      (2.8)
 Gold (oz)          15,427   18,702   (17.5)    22,249   (30.7)    55,508     55,422     0.2
 Lead (t)           4,973    3,950    25.9      4,513    10.2      13,224     13,958     (5.3)
 Zinc (t)           9,663    7,001    38.0      6,882    40.4      22,656     22,547     0.5

 Ore Grades
 Silver (g/t)       183      188      (2.7)     199      (8.0)     192        199        (3.5)
 Gold (g/t)         1.14     1.31     (13.0)    1.58     (27.8)    1.39       1.40       (0.7)
 Lead (%)           1.06     0.84     26.2      0.96     10.4      0.99       1.04       (4.8)
 Zinc (%)           2.22     1.62     37.0      1.64     35.4      1.85       1.85       0.0

 

Quarterly silver production decreased 3.8% vs. 2Q23 mainly driven by the lower
ore grade as a result of the increased dilution in narrower veins, and the
lower volume of ore processed caused by: i) a decrease in mine preparation due
to the ongoing lower availability of scalers and ii) a slower mine cycle in
some areas with higher silver ore grade which are mined through the long hole
drilling method as additional ground support was required due to poor rock
quality.

 

Quarterly silver production decreased 8.8% vs. 3Q22 mainly due to lower ore
grade as a result of increased dilution in narrower veins and a decrease in
mine preparation as previously mentioned.

 

Year to date silver production slightly decreased 2.8% due to lower ore grade
as explained above, partially offset by the higher volume of ore processed
from the Saucito and Alamito areas.

 

Quarterly by-product gold production decreased 17.5% vs. 2Q23 mainly driven by
the lower ore grade, recovery rate and lower volume of ore processed.

 

Quarterly by-product gold production decreased 30.7% vs. 3Q22 primarily driven
by the lower ore grade and recovery rate.

 

Year to date by-product gold production remained at similar levels when
compared to YTD22 as a result of the higher volume of ore processed which
offset the lower ore grade and recovery rate.

 

Mine development rates decreased quarter on quarter to an average of 2,840m
per month in 3Q23 (2Q23: 3,069m per month), primarily due to the previously
mentioned decreased availability of scalers. However, additional equipment is
due to arrive in 4Q23 and development rates are expected to return to 3,000 m
per month by the end of the year.

 

Full year 2023 silver ore grade is estimated to remain between 190-210 g/t,
while the gold ore grade is estimated to continue to be around 1.20-1.40 g/t.

 

PYRITES PLANT

 

                                    3Q23    2Q23    % Change  3Q22    % Change  YTD23   YTD22    % Change
 Pyrite Concentrates Processed (t)  24,749  27,892  (11.3)    37,142  (33.4)    80,593  102,832  (21.6)

 Production
 Silver (koz)                       118     127     (7.1)     142     (16.9)    356     418      (14.8)
 Gold (oz)                          333     331     0.6       653     (49.0)    934     1,585    (41.1)

 Ore Grades
 Silver (g/t)                       219     207     5.8       159     37.7      200     170      17.6
 Gold (g/t)                         1.46    1.58    (7.6)     1.71    (14.6)    1.45    1.51     (4.0)

 

 

Quarterly and year to date silver production decreased against all comparative
periods mainly driven by the lower volume of iron concentrates processed from
Saucito, partially mitigated by the higher ore grade.

 

Quarterly gold production remained at similar levels when compared to the 2Q23
as a result of the higher recovery rate which compensated for the lower volume
of iron concentrates processed and lower ore grade.

 

Quarterly gold production decreased 49.0% vs. 3Q22 due to lower volume of iron
concentrates processed, ore grade and recovery rate.

 

Year to date gold production decreased 41.1% vs. YTD22 driven by the lower
volume of iron concentrates processed, lower recovery rate and ore grade.

 

 

CIÉNEGA MINE PRODUCTION

 

                    3Q23     2Q23     % Change  3Q22     % Change  YTD23    YTD22    % Change
 Ore Processed (t)  270,531  261,253  3.5       294,210  (8.0)     771,931  857,304  (10.0)

 Production
 Gold (oz)          9,314    8,132    14.5      9,437    (1.3)     26,748   28,344   (5.6)
 Silver (koz)       1,131    1,010    12.0      1,242    (8.9)     3,122    3,727    (16.2)
 Lead (t)           683      756      (9.7)     904      (24.4)    2,187    2,588    (15.5)
 Zinc (t)           906      919      (1.4)     1,419    (36.2)    2,827    4,015    (29.6)

 Ore Grades
 Gold (g/t)         1.16     1.06     9.4       1.09     6.4       1.17     1.12     4.5
 Silver (g/t)       151      141      7.1       152      (0.7)     146      156      (6.4)
 Lead (%)           0.42     0.47     (10.6)    0.48     (12.5)    0.45     0.47     (4.3)
 Zinc (%)           0.64     0.67     (4.5)     0.87     (26.4)    0.69     0.84     (17.9)

 

Quarterly gold production increased 14.5% vs. 2Q23 mainly due to higher ore
grade from the Jessica Transversal and Taspana Sur areas and higher volume of
ore processed due to the timely preparation of stopes and an increase in
development rate.

Quarterly gold production decreased 1.3% vs. 3Q22 mainly due to the expected
lower volume of ore processed for 2023, partly offset by the higher ore grade
driven by the aforementioned factors.

Year to date gold production decreased 5.6% vs. YTD22 mainly due to the
decreased volume of ore processed in accordance with the mine plan.

Quarterly silver production increased 12.0 vs. 2Q23 as a result of the higher
ore grade, volume of ore processed and to a lesser extent, the higher recovery
rate.

Quarterly silver production decreased 8.9% vs. 3Q22 mainly as a result of the
decrease in volume of ore processed in accordance with the mine plan.

Year to date silver production decreased 16.2% vs. YTD22 mainly due to the
decrease in volume of ore processed and lower ore grade.

The gold and silver ore grades for 2023 are estimated to remain in the ranges
of 1.0-1.1 g/t and 150-160 g/t respectively.

 

SAN JULIÁN MINE PRODUCTION

 

                                  3Q23     2Q23     % Change  3Q22     % Change  YTD23      YTD22      % Change
 Ore Processed Veins (t)          292,391  274,505  6.5       297,216  (1.6)     850,648    881,182    (3.5)
 Ore Processed DOB (t)            498,607  527,898  (5.5)     498,882  (0.1)     1,548,765  1,575,237  (1.7)

 Total production at San Julián
 Gold (oz)                        11,161   10,259   8.8       11,387   (2.0)     33,453     34,820     (3.9)
 Silver (koz)                     3,185    3,596    (11.4)    3,171    0.4       10,193     11,139     (8.5)

 Production Veins
 Gold (oz)                        10,428   9,325    11.8      10,625   (1.9)     30,892     32,335     (4.5)
 Silver (koz)                     1,359    1,168    16.4      1,115    21.9      3,839      3,350      14.6

 Production DOB
 Gold (oz)                        733      934      (21.5)    762      (3.8)     2,561      2,485      3.1
 Silver (koz)                     1,826    2,428    (24.8)    2,056    (11.2)    6,354      7,789      (18.4)
 Lead (t)                         1,595    2,062    (22.6)    1,461    9.2       5,511      5,394      2.2
 Zinc (t)                         3,273    4,020    (18.6)    3,790    (13.6)    11,049     13,883     (20.4)

 Ore Grades Veins
 Gold (g/t)                       1.18     1.11     6.3       1.17     0.9       1.19       1.20       (0.8)
 Silver (g/t)                     158      146      8.2       128      23.4      154        130        18.5

 Ore Grades DOB
 Gold (g/t)                       0.08     0.09     (11.1)    0.08     0.0       0.08       0.08       0.0
 Silver (g/t)                     134      165      (18.8)    153      (12.4)    148        180        (17.8)
 Lead (%)                         0.42     0.50     (16.0)    0.39     7.7       0.46       0.43       7.0
 Zinc (%)                         0.90     1.03     (12.6)    1.01     (10.9)    0.96       1.14       (15.8)

 

SAN JULIÁN VEINS

Quarterly silver and gold production increased 16.4% and 11.8% respectively
vs. 2Q23, mainly due to the higher volume of ore processed as a result of the
availability of additional bolting and shotcreting equipment and higher ore
grades as access to the San Atanasio vein with higher ore grade was gained.

Quarterly silver production increased 21.9% vs. 3Q22 mainly due to higher ore
grade driven by the previously mentioned factors which was partly offset by
the decrease in volume of ore processed due to the lower availability of
trucks to haul ore to the beneficiation plant.

Quarterly gold production slightly decreased 1.9% vs. 3Q22 mainly due to the
lower volume of ore processed as explained above.

Year to date silver production increased 14.6% vs. YTD22 mainly due to the
higher ore grade at the San Antonio, Ultima Tierra and Elisa stopes, mitigated
by the lower volume of ore processed.

Year to date gold production decreased 4.5% vs. YTD22 mainly due to the
decrease in volume of ore processed and lower ore grade.

We expect the 2023 silver and gold ore grades to average c.150 g/t and
1.20-1.30 g/t, respectively.

 

SAN JULIÁN DISSEMINATED ORE BODY (DOB)

Quarterly silver production decreased 24.8% vs. 2Q23 as a result of the lower
ore grade in the periphery of the ore body, lower volume of ore processed
driven by the lower availability of trucks to haul ore to the beneficiation
plant while they undergo maintenance and to a lesser extent, lower recovery
rate.

Quarterly and year to date silver production decreased 11.2% and 18.4% vs.
3Q22 and YTD22 respectively, mainly due to the expected lower ore grade in the
areas in the periphery of the ore body and structural geological features
which slowed down the long hole drilling cycles.

We continue to expect the 2023 silver ore grade to be in the range of 140-150
g/t.

 

HERRADURA TOTAL MINE PRODUCTION

 

                          3Q23        2Q23        % Change  3Q22        % Change  YTD23       YTD22       % Change
 Ore Processed (t)        3,983,615   5,219,844   (23.7)    5,592,474   (28.8)    15,689,168  15,110,750  3.8
 Total Volume Hauled (t)  24,462,202  21,445,659  14.1      28,590,141  (14.4)    75,131,727  92,923,523  (19.1)

 Production
 Gold (oz)                72,184      83,037      (13.1)    85,245      (15.3)    262,053     245,889     6.6
 Silver (koz)             120         136         (11.8)    199         (39.7)    464         585         (20.7)

 Ore Grades
 Gold (g/t)               0.73        0.76        (3.9)     0.71        2.8       0.74        0.69        7.2
 Silver (g/t)             1.51        1.33        13.5      1.71        (11.7)    1.54        1.78        (13.5)

 

Quarterly gold production decreased 13.1% vs. 2Q23 mainly driven by the lower
volume of ore processed due to an electrical fault. This was mitigated by the
higher recovery rate as the cycle in the leaching pads was normalised
following the temporary illegal stoppage in 2Q23.

Quarterly gold production decreased 15.3% vs. 3Q22 mainly due to the lower
volume of ore processed driven by the factors mentioned above, mitigated by
the higher ore grade and the improved recovery rate.

However, year to date gold production increased 6.6% vs. YTD22 mainly driven
by the increased volume of ore processed and higher ore grade in the sulphides
and positive variations with the geological model. These factors were partly
offset by the lower recovery rate driven by the temporary illegal stoppage and
the slower pace of irrigation.

The gold ore grade in 2023 is estimated to be in the range of 0.65-0.75 g/t.

 

NOCHE BUENA TOTAL MINE PRODUCTION

 

                          3Q23   2Q23       % Change  3Q22       % Change  YTD23      YTD22       % Change
 Ore Processed (t)        0      799,290    N/A       1,811,987  N/A       2,510,639  6,196,064   (59.5)
 Total Volume Hauled (t)  0      1,829,412  N/A       6,274,060  N/A       8,424,676  19,557,715  (56.9)

 Production
 Gold (oz)                9,642  14,801     (34.9)    19,235     (49.9)    35,520     66,338      (46.5)
 Silver (koz)             2      4          (50.0)    3          (33.3)    10         17          (41.2)

 Ore Grades
 Gold (g/t)               0.00   0.45       (100.0)   0.44       (100.0)   0.47       0.53        (11.3)
 Silver (g/t)             0.00   0.20       (100.0)   0.16       (100.0)   0.17       0.23        (26.1)

 

Gold production decreased against all comparable periods as the mine closure
process, which started in May 2023, continued as planned.

 

JUANICIPIO - ATTRIBUTABLE

 

                    3Q23*    2Q23*    % Change  3Q22**   % Change  YTD23*   YTD22**  % Change
 Ore Processed (t)  180,460  211,522  (14.7)    101,252  78.2      516,315  269,003  91.9

 Production
 Silver (koz)       2,678    2,954    (9.3)     1,466    82.7      6,892    4,138    66.6
 Gold (oz)          5,289    5,958    (11.2)    3,029    74.6      14,640   9,441    55.1
 Lead (t)           2,150    1,905    12.9      822      161.6     4,868    2,108    130.9
 Zinc (t)           3,227    3,034    6.4       1,361    137.1     7,536    3,402    121.5

 Ore Grades
 Silver (g/t)       523      498      5.0       513      1.9       474      556      (14.7)
 Gold (g/t)         1.32     1.25     5.6       1.22     8.2       1.23     1.42     (13.4)
 Lead (%)           1.33     1.05     26.7      0.93     43.0      1.07     0.93     15.1
 Zinc (%)           2.25     1.92     17.2      1.81     24.3      1.92     1.76     9.1

* Includes ore processed as part of the initial tests during the commissioning
of the Juanicipio plant and ore processed at the Fresnillo and Saucito
beneficiation plants.

** Ore processed at the Fresnillo and Saucito beneficiation plants.

 

Attributable quarterly silver and gold production decreased 9.3% and 11.2% vs.
2Q23 respectively, due to the lower volume of ore processed as a result of
adjustments to the mill operations. Notwithstanding, full nameplate capacity
was reached in 3Q23.

Quarterly silver and gold ore grades increased vs. 2Q23 and 3Q22 driven
primarily by the extraction of ore from an area with higher silver and gold
grades. However, these stopes are expected to be depleted in October and areas
with lower silver and gold grades will be mined from November onwards.

 

SILVERSTREAM

Quarterly Silverstream production decreased 7.6% vs. 2Q23 mainly due to the
lower ore grade partly offset by the higher volume of ore processed and
recovery rate.

Quarterly Silverstream production decreased 16.1% vs. 3Q22 mainly due to a
lower ore grade and lower volume of ore processed partly compensated by the
higher recovery rate.

Year to date Silverstream production remained flat -1.0% vs. YTD22 as a result
of the lower recovery rate partly offset by the higher ore grade and volume of
ore processed.

Silver production in 2023 is estimated to be 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 eight operating mines, all of them in Mexico - Fresnillo,
Saucito, Juanicipio, Ciénega, Herradura, Soledad-Dipolos(2), Noche Buena and
San Julián (Veins and Disseminated Ore Body) and four advanced exploration
projects - Orisyvo, Rodeo, Guanajuato and Tajitos 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 ) Au:Ag ratio of 80:1

(2) 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.

 

 - pg

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