Fresnillo
One of the world’s oldest continuously operated mines, the Fresnillo mine has been producing silver for more than five centuries; and recently producing 24% of the Group's total silver in 2019 and generating 15.9% of total adjusted revenue.
Ownership: |
100% Fresnillo plc |
Location: |
Zacatecas |
Commodity: |
Silver |
Operational since: |
1554 |
Facilities: |
Underground mine and flotation plant |
Workforce: |
1,183 employees, 2,274 contractors |
Milling Capacity: |
8,000 tpd / 2,640,000 tpy |
Average ore grade in reserves: |
234 Silver (g/t), 0.76 Gold (g/t) |
Total Reserves: |
149.3 Silver (moz), 483 Gold (oz) |
Mine Life: |
7.5 years (2018: 8.6) |
Quarterly Production
|
3Q20
|
2Q20
|
% change
|
3Q19
|
Ore processed (t)
|
551,589
|
596,115
|
-7.5
|
648.646
|
|
|
|
|
|
Production
|
|
|
|
|
Silver (koz)
|
3,085
|
3,611
|
-14.6
|
3,408
|
Gold (oz)
|
9,295
|
10,828
|
-14.2
|
15,601
|
Lead (t)
|
4,588
|
6,860
|
-33.1
|
7,037
|
Zinc (t)
|
7,328
|
10,978
|
-33.3
|
10,225
|
|
|
|
|
|
Ore grades
|
|
|
|
|
Silver (g/t)
|
193
|
209
|
-7.5
|
183
|
Gold (g/t)
|
0.77
|
0.79
|
-2.8
|
0.99
|
Lead %
|
0.95
|
1.33
|
-28.3
|
1.24
|
Zinc %
|
1.83
|
2.55
|
-28.0
|
2.14
|
Annual Production

12019 reserves as of 31 May 2019, 22019 resources as of 31 May 2019
Financial Performance

3Margin defined as average realised price less cash cost per ounce
History
1961
Peñoles acquires 60% interest in Cia Fresnillo
1996
Peñoles acquires remaining 40% interest in Cia Fresnillo
2004
Mill capacity is increased from 4,500 to 7,000 tpd
Production
Silver
(koz)
13,007
(FY19)
% (14.0) Change
Gold
(oz)
52,259
(FY19)
% 23.6 Change
Lead
(t)
21,472
(FY19)
% 9.4 Change
Zinc
(t)
31,530
(FY19)
% 1.4 Change
Financial Highlights
Adjusted Revenue
(US$m, FY19)
361.7
% (4.4) Change
Segment Profit
(US$m, FY19)
164.6
% (22.2) Change
Capital Expenditure
(US$m, FY19)
172.8
% 42.7 Change
Exploration
(US$m, FY19)
13.3
% (26.9) Change
3Q20
-
Quarterly silver production down 14.6% vs. 2Q20 as a result of a decrease in the volume of ore processed driven by a reduced number of personnel on site following COVID-19 preventive measures, which has affected development rates and equipment availability. Silver production also impacted by expected lower ore grade, in accordance with the mine plan.
-
Quarterly silver production decreased 9.5% vs. 3Q19 driven by a lower volume of ore processed for reasons mentioned above, mitigated by a higher ore grade resulting from a combination of incremental improvements achieved following the implementation of our action plan, as set out at the end of last year and further described below.
-
Year-to-date silver production remained flat vs. YTD19 due to the higher ore grade for reasons mentioned below, offset by a lower volume of ore processed due to COVID-19 preventive measures.
-
Our performance improvement plan, as set out on our Capital Markets Day in Dec-19, continues to be implemented, focusing on controlling dilution and enhancing blasting and drilling techniques to cope with narrower veins.
-
Development rates decreased to an average of 2,878m per month in 3Q20 (2Q20: 3,118m per month), due to absenteeism resulting from COVID-19 preventive measures. Year to date, development rates remained at a similar level vs. YTD19 (3,060m per month vs. 3,071m per month) as the contractor hired at the end of 2019, together with the start-up of the tunnel boring machine, have mitigated the negative impact of the higher absenteeism. We expect an increase in development rates from current levels to approximately 3,300m per month by the end of 2020 as absenteeism decreases but at a slower rate than anticipated.
-
Quarterly by-product gold production decreased 14.2% vs. 2Q20 driven by a lower volume of ore processed and, to a lesser extent, lower recovery rate.
- Quarterly and year-to-date by-product gold production decreased 40.4% and 28.7% vs. 3Q19 and YTD19 respectively due to lower ore grades, lower volumes of ore processed and lower recovery rates.
- Silver ore grade (2020) continues in range of 185-200 g/t, while gold ore grade estimated to remain around 0.7 g/t.
FY19
-
Operational action plan developed and implemented
-
Development rates improved - 3,026m/m
-
Peruvian contractor hired at year end
-
Tunnel Boring Machine (TBM) commissioned at year end
-
126,000 metres of infill drilling carried out
-
Deeping of the San Carlos shaft continued, on track to be concluded end of 2020
2020 Priorities
- Infill drilling programme to continue (84-90 mts).
- Development rates to be improved; target 3,500 - 3,800 m/m by year end
- Dilution expected to decrese to 34%
- Continue implementing initiatives to increase productivity and efficiency
- Ramp up TBM in 1Q20 and targeting and average 300 m/m thereafter
- Conclude the deepening of the San Carlos shaft by year end; access 56% of Fresnillo reserves
- Commission the tailings flotation plant in 2H20 (Pyrites plant project phase II)
- Conclude 2nd stage of beneficiation plant expansion, installation of flotation cells
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