www.fresnilloplc.com
The Fresnillo Group is a leading precious metals company, and is the world's largest primary silver producer and Mexico's second largest gold producer.
Fresnillo's mining assets are comprised of three operating mines (Fresnillo, Ciénega and Herradura), two development projects (Fresnillo II and Soledad and Dipolos at Herradura), three advanced exploration prospects (San Juan, San Julian and Orysivo) and multiple exploration projects.
Fresnillo sees 2009 gold silver production at 2008 levels
Fresnillo PLC expects the global economic slowdown to represent a challenge to the mining industry in 2009 and forecasts gold and silver production levels in line with those achieved in 2008.
In a production and operations update, it said total silver production for the full year 2008 reached an all time high for the group at 34.8 million ounces, however only slightly above the 2007 figure of 34.68 million.
The decrease in quarterly silver production to 8.49 million ounces when compared with the fourth quarter 2007 figure of 8.7 million was due to an expected decrease in ore grade at Ciénega and lower ore milled at Fresnillo caused by a one day illegal stoppage by the mineworkers union and holidays in December.
Total gold production decreased by 5.9 percent in 2008 compared to the previous year. Production at Ciénega was affected by the declining lower ore grades, although the company believes these have now stabilised during the fourth quarter.
Fourth quarter gold production increased by 4.2 percent to 63,000 ounces compared to the third quarter of 2008 due to higher recovery and ore deposited at Herradura, as well as higher ore grades and recovery at Fresnillo. With respect to lead and zinc production, increases of 3.6 percent and 2.7 percent respectively were achieved in 2008 when compared to 2007 as a result of the higher ore grades and recoveries at Ciénega.
Construction at Soledad and Dipolos will conclude by end-2009 and production remains on track to commence in early 2010.
The first stage of the Fresnillo II pre-feasibility study is expected to be concluded at the end of March 2009 and the exploration and development activities will continue as planned, the company said.
Chief executive Jaime Lomelín said: “Despite the impact of the global financial crisis, Fresnillo PLC benefits from a solid financial structure that will support ongoing exploration, investment in cost control initiatives and operating efficiencies. However, in light of the difficult market conditions in 2009, we will focus on critical capex and intermediate and advanced exploration projects only. We are in a strong position to pursue acquisition opportunities of high quality assets to boost our rate of growth.”
