Fresnillo: Silver output in line, gold beats view

Mexican precious metals miner Fresnillo PLC FRES.LN Wednesday said first quarter silver production was in line with expectations, while gold production was above expectations, as it commissioned its new Noche Buena gold mine.

Fresnillo, the world’s largest primary silver producer and Mexico’s second largest gold producer, said attributable silver output, including silver from its Silverstream contract, decreased 2.9% to 9.8 million troy ounces as anticipated lower grades at Fresnillo were only partially offset by higher output from its Saucito mine.

Meanwhile, attributable gold output rose 26% to 121,792 ounces on year in the first quarter due to increased throughput at Saucito, Cienega and Herradura.

“We have delivered another strong quarter of production with gold beating our expectations, up more than 26%, and silver production in line,” said Fresnillo’s Chief Executive Jaime Lomelin. “The highlight of the quarter has been the completion and commissioning of our new gold mine at Noche Buena,” which is expected to produce around 42,000 attributable ounces of gold a year at full capacity. The mine is forecast to reach full capacity sometime by the end of the year.

The London-listed miner said in March it plans to produce 41 million ounces of silver in 2012, broadly flat on year once the 3 million troy ounces from the Silverstream contract is taken into account, and 448,866 oz of gold in 2012.

Fresnillo’s shares closed up 0.8% at 1,573 pence a share Tuesday and are up 3% since the beginning of the year.

(In “Fresnillo Says Silver Output In Line, Gold Output Beats Expectations,” published at 0629 GMT and also in “2nd UPDATE: Fresnillo Sticks To Dividend Policy As It Boosts Capex,” published Mar 6 at 1313 GMT, the full year gold output was misstated. The correct version follows.)

LONDON (MarketWatch) — Mexican precious metals miner Fresnillo PLC Wednesday said first quarter silver production was in line with expectations, while gold production was above expectations, as it commissioned its new Noche Buena gold mine.

Fresnillo, the world’s largest primary silver producer and Mexico’s second largest gold producer, said attributable silver output, including silver from its Silverstream contract, decreased 2.9% to 9.8 million troy ounces as anticipated lower grades at Fresnillo were only partially offset by higher output from its Saucito mine.

Meanwhile, attributable gold output rose 26% to 121,792 ounces on year in the first quarter due to increased throughput at Saucito, Cienega and Herradura.

“We have delivered another strong quarter of production with gold beating our expectations, up more than 26%, and silver production in line,” said Fresnillo’s Chief Executive Jaime Lomelin. “The highlight of the quarter has been the completion and commissioning of our new gold mine at Noche Buena,” which is expected to produce around 42,000 attributable ounces of gold a year at full capacity. The mine is forecast to reach full capacity sometime by the end of the year.

The London-listed miner said in March it plans to produce 41 million ounces of silver in 2012, broadly flat on year once the 3 million troy ounces from the Silverstream contract is taken into account, and 460,000 oz of gold in 2012.

Fresnillo’s shares closed up 0.8% at 1,573 pence a share Tuesday and are up 3% since the beginning of the year.  - MarketWatch

Tags: Fresnillo, Silver, Silver Mines, silver mining industry

Posted by Silver Guru on Apr 18 2012. Filed under Silver mining. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry