Entrance to an underground mine which is horizontal or nearly horizontal by which the mine can be accessed, drained of water and ventilated

AGM or Annual General Meeting

The annual general meeting of the Company which is scheduled to be held on Wednesday 17 May 2011 at noon at the offices of Linklaters LLP at One Silk Street, London, EC2Y 8HQ

Annual Report

The annual report of Fresnillo plc for the year ended 31 December 2010 and comprising the Chairman’s Letter, Chief Executive’s Statement, Business Review, Directors’ Report, Financial Statements and accompanying notes

Articles of Association

The articles of association of the Company which took effect on 28 May 2010

Audit Committee

The audit committee of the Board

Beneficiation Plant

Facility where extracted ore is reduced to particles that can be separated into mineral that is suitable for further processing or direct use


The board of directors of the Company


Cámara Minera de México, the Mexican Mining Chamber

Cancun Communiqué

Document signed by nearly 1,000 businesses setting out a case for action on climate change


Capital expenditures; expenditures not classified as operating costs

Carbon Disclosure Project

Independent not-for-profit organisation holding the largest database of primary corporate climate change information in the world


Comisión Federal de Electricidad, the Mexican state-owned electric utility


Carbon dioxide

Code of Conduct

The set of principles for ethical behaviour to which all employees of the Company are obliged to adhere

Combined Code

The Combined Code on Corporate Governance published by the Financial Reporting Council dated June 2008 as amended

Company [see also Fresnillo plc]

Fresnillo plc, a company incorporated under the UK Companies Act 1985 and registered in England and Wales with registered number 6344120


A metal-rich product resulting from a mineral enrichment process such as gravity concentration or flotation, in which most of the desired mineral has been separated from the waste material in the ore

Consolidated Financial Statements

The consolidated financial statements of the Company for the year ended 31 December 2010

Diamond Drilling

A drilling method where the rock is cut with a diamond bit attached to hollow rods; it cuts a core of rock, recovered in cylindrical sections for geological analysis


Waste, which is unavoidably mined with ore


The directors of the Company

Disseminated Deposit or Ore Body

A disseminated deposit is that in which the metal is evenly distributed in generally low concentrations throughout large masses of rock.


An impure alloy of gold and silver, generally the final product of mining and processing; the doré bullion will be refined into high purity metal


Gross profit plus depreciation included within cost of sales, less administrative expenses and exploration expenses


In Mexico, the communal farmland of a village, usually assigned in small parcels to villagers to be farmed under a federally supported system of communal land tenure


The amount of attributable profit available to equity shareholders, as calculated by dividing attributable profit for the period by the weighted average number of Ordinary Shares in issue during the period


Exchange Traded Funds, investment funds that are traded on a stock exchange

Executive Committee

The executive committee of the Board

Executive Directors

The executive Directors of the Company

Exploraciones Mineras Parreña, S.A. de C.V.

A wholly-owned Fresnillo plc company that controls a number of exploration prospects

Financial Statements

The consolidated and parent company financial statements of the Company and accompanying notes for the year ended 31 December 2010


A recovery process by which valuable minerals are separated from waste to produce a concentrate; selected minerals are induced to become attached to air bubbles and float

Fresnillo Group [see also Group]

Fresnillo plc and its subsidiary undertakings

Fresnillo plc [see also Company]

A company incorporated under the UK Companies Act 1985 and registered in England and Wales with registered number 6344120


The Financial Services Authority of the United Kingdom

FTSE 100, 250 or 350

Share indices compiled by FTSE International Limited and comprising the top 100, 250 or 350 companies by full market value


Grammes per tonne


Generally Accepted Accounting Principles


Generally Accepted Auditing Standards


Greenhouse gases




Unless otherwise specified the government of the Republic of Mexico


The measure of concentration of metal within mineralised rock

Gravimetric Concentrator

A fluidised centrifuge that separates heavy material such as gold from lighter background material; applied to materials in which the heavy component to be recovered is a very small fraction of the total material, generally less than 500 grammes/tonne or 0.05% by weight


The Global Reporting Initiative, a network-based organisation that pioneered the world’s most widely used sustainability reporting framework

Group [see also Fresnillo Group]

Fresnillo plc and its subsidiary undertakings


A horizontal underground excavation which is used to transport mined ore


A unit of area equal to 10,000 square metres, or 2.47 acres


Equipment used in underground mining to raise and lower conveyances within the mine shaft


The Fresnillo Group Health, Safety, Environment and Community Relations System (Sistema de Salud, Seguridad, Medio Ambiente y Relaciones con la Comunidad), headed by the HSECR Committee of the Board

HSECR Committee

Health, safety, environment and community relations committee of the Board


International Accounting Standards


International Council on Mining and Metals, founded in 2001 to advocate performance improvement in the mining and metals industry


Impuesto Empresarial a Tasa Unica, a business tax in Mexico


International Financial Reporting Standards

Independent Non-executive Directors

The Non-executive Directors of the Company who are independent of Peñoles as defined by the Relationship Agreement and by reference to Provision A.3.1 of the Combined Code


Instituto Nacional de Investigaciones Forestales, Agrícolas y Pecuarias, a national R&D institute for forestry, agriculture and livestock

International Cyanide Management Code

Voluntary industry and audit-based programme for the gold mining industry to promote responsible management of cyanide used in gold mining

IPO [also Listing]

Initial Public Offering; the admission of the Company’s Ordinary Shares both to the UKLA Official List and to trading on the Main Market of the London Stock Exchange on 14 May 2008

ISO 14001

An international environmental management system standard published by the International Organisation for Standardisation


Instituto Tecnológico Autónomo de México, a private research university in Mexico City


Joint Ore Reserves Committee


Joint venture


Thousand troy ounces


Key Performance Indicator


The process by which soluble constituents are dissolved and carried down through the soil by a percolating fluid

Listing [also IPO]

The admission of the Company’s Ordinary Shares both to the UKLA Official List and to trading on the Main Market of the London Stock Exchange on 14 May 2008

Listing Rules

Rules relating to the admission to the Official List maintained by the UKLA in accordance with the Financial Services and Markets Act 2000


Cubic metres


Met-Mex Peñoles, S.A. de C.V., the operator of a refining and smelting facility in Torréon (a 100% subsidiary of Peñoles)

Met-Mex Arrangements

A series of contracts between the Company and Met-Mex for the sale of the primary products from the Group’s mines, silver and gold-rich lead and zinc concentrates

Milling or Milled Ore

A general term used to describe the process in which the ore is crushed and ground and subjected to physical or chemical treatment to extract the valuable metals to a concentrate or finished product

Minera Juanicipio, S.A. de C.V.

A joint venture company with MAG Silver Corporation in which Fresnillo plc has a 56% interest

Minera Penmont S. de R.L. de C.V.

A joint venture company with Newmont USA Limited in which Fresnillo plc has a 56% interest


Any mass of host rock in which minerals of potential commercial value occur


Million tonnes


Mexican peso

New Services Agreement [also NSA]

New Services Agreement dated 28 October 2009 between Fresnillo and SAPSA for the provision of administrative and non-administrative services to the Fresnillo Group


Non-governmental organisation

Nominations Committee

The nominations committee of the Board

Non-Executive Directors

The Non-Executive Directors of the Company

OHSAS 18001

An international occupational health and safety management system specification created by a number of leading national standards bodies, certification bodies, and specialist consultancies

Ordinary Shares

Ordinary shares of US$0.50 each in the Company


Material that contains one or more minerals, at least one of which can be mined and treated profitably under economic conditions deemed to be reasonable

Ore Body

A continuous well-defined mass of material of sufficient mineral content to make extraction economically feasible

Ore Grade

The classification or value of ore


Troy ounce


Troy ounce

Payable Silver

The amount of silver in ounces contained in concentrates from Peñoles’ Sabinas mine


Industrias Peñoles, S.A.B. de C.V.

Peñoles Group

Peñoles and its subsidiary undertakings


A variety of igneous rock consisting of crystals embedded in a finer groundmass of minerals

Pre-feasibility Study

A preliminary study undertaken to determine if it would be worthwhile to proceed to the feasibility study stage, which defines the technical and economic viability of a project to support the search for project financing

Pre-IPO Reorganisation

A reorganisation conducted by Peñoles in preparation for the Global Offer which completed on 18 April 2008, whereby the companies comprising the precious metals mining business of Peñoles were reorganised under the Company

Premium Listing

That category of Listing Rules applying conditions for Listing over and above those required under European law

Primary silver producer

A company generating over 50% of its revenue from silver production


Procuraduría Federal de Protección al Ambiente, the Mexican Federal Environmental Protection Agency


A mineral deposit with insufficient data available on the mineralisation to determine if it is economically recoverable, but warranting further investigation

Relationship Agreement

The relationship agreement between Peñoles and the Company dated 8 May 2008 , the purpose of which is to ensure that the Company and its subsidiaries are capable of carrying on business independently of the Peñoles Group

Remuneration Committee

The remuneration committee of the Board


The economically mineable portions of mineral resources, which are sub-divided into two categories of increasing confidence: probable reserves relate to indicated mineral resources; and proven reserves relate to measured mineral resources


A concentration or occurrence of material of intrinsic economic interest in or on the Earth’s crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction; mineral resources are sub-divided, in order of increasing geological confidence, into inferred, indicated and measured categories


Servicios Administrativos Peñoles, S.A. de C.V.

Scoping Study

A preliminary assessment based on measured, indicated, or inferred mineral resources, or a combination of any of these; includes disclosure of forecasted mine production rates that may contain capital costs required to develop and sustain the mining operation, as well as operating costs and projected cash flows


Secretaría de Desarrollo Social, Secretariat of Social Development


Secretaría de Medio Ambiente y Recursos Naturales, Secretariat of the Environment and Natural Resources


An opening cut downwards from the surface for transporting personnel, equipment, supplies, ore and waste


Concrete or mortar conveyed through a hose and pneumatically projected at high velocity onto any type or shape of surface, including vertical or overhead areas; shotcrete undergoes placement and compaction at the same time due to the force with which it is projected from the nozzle

Silverstream Contract

A series of the 12 agreements between Comercializadora de Metales Fresnillo, S.A. de C.V. and Peñoles pursuant to which the Fresnillo Group has the right to receive all proceeds for the Payable Silver

Six Sigma

A statistics-driven approach to quality control developed originally by Motorola; the methodology aims to improve operational performance, practices and systems by eliminating variability and waste and reducing defects in manufacturing processes to 3.4 defects per million


A high temperature pyrometallurgical operation conducted in a furnace, in which the valuable metal is collected to a molten matte or doré phase and separated from the gangue components that accumulate in a less dense molten slag phase

Sterling Deferred Shares

Deferred shares of £1.00 each in the share capital of the Company


Underground void created by mining


Secretaría del Trabajo y Previsión Social, Secretariat of Labour and Social Welfare


Direction of line formed by the intersection of strata surfaces with the horizontal plane, always perpendicular to the dip direction

Tailings Dam

A dammed reservoir to which the slurry is transported, where the solids settle and the supernatant liquid may be withdrawn

The Wild Foundation

International organisation dedicated to wilderness protection and wilderness conservation around the world

Tonne [or t]

Metric tonne = 1,000 kilograms


Tonnes per day


Tonnes per year

Treatment Charges

Fees payable by mines to smelters for processing concentrates

Turnbull Guidance

Guidance administered by the UK Financial Reporting Council setting out best practice on internal control for UK listed companies to assist them in applying section C.2 of the UK Combined Code


United Kingdom pounds sterling


The United Kingdom Listing Authority; that section of the FSA acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services & Markets Act 2000 (Official Listing)


Universidad Nacional Autónoma de México, a public university in Mexico City

United Nations Global Compact

A strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption


United States dollar