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 24.6% of the Group's total silver in 2020 and generating 16.3% of total adjusted revenue.

Ownership: 100% Fresnillo plc
Location: Zacatecas
Commodity: Silver
Operational since: 1554
Facilities: Underground mine and flotation plant
Workforce: 1,253 employees, 2,315 contractors
Milling Capacity: 8,000 tpd / 2,640,000 tpy
Average ore grade in reserves: 265 Silver (g/t), 0.76 Gold (g/t)
Total Reserves: 131.0 Silver (moz), 378 Gold (oz)
Mine Life: 6.6 years (2019: 8.1)

Quarterly Production

 

1Q21

4Q20

% change

1Q20

Ore processed (t)

561,360

590,449

(4.9)

598,790

         

Production

       

Silver (koz)

3,260

3,213

1.5

3,145

Gold (oz)

8,375

9,485

(11.7)

8,781

Lead (t)

4,492

5,254

(14.5)

4,617

Zinc (t)

7,143

9,051

(21.1)

6,758 

         

Ore grades

       

Silver (g/t)

203

190

6.9

183

Gold (g/t)

0.69

0.71

(3.6)

0.65

Lead %

0.95

1.08

(12.0)

0.95

Zinc %

1.82

2.19

(16.7)

1.69

Annual Production

AR20 Fresnillo Mine Kpis1Fresnillo mine production excludes ore processed and production from the Juanicipio development project. 22020 reserves as of 31 May 2020. 32020 resources as of 31 May 2020.

AR20 Fresnillo Mine Financial Performance4Financial figures for Fresnillo exclude ore sales from Juanicipio. 5Margin 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)

13,055 (FY20) % 0.4 Change

Gold (oz)

38,388 (FY20) % (26.5) Change

Lead (t)

21,319 (FY20) % (0.7) Change

Zinc (t)

34,116 (FY20) % 8.2 Change

Financial Highlights

Adjusted Revenue (US$m, FY20)

407.2 % 12.6 Change

Segment Profit (US$m, FY20)

191.0 % 16.0 Change

Capital Expenditure (US$m, FY20)

92.6 % (46.4) Change

Exploration (US$m, FY20)

9.2 % (30.8) Change

1Q21

  • Quarterly silver production increased 1.5% and 3.7% vs. 4Q20 and 1Q20 respectively due to expected increase in ore grade mainly as a result of enhanced dilution control during the quarter (dilution decreased to an average of 29% during 1Q21). This was partly offset by a decrease in volume of ore processed due to additional rehabilitation and maintenance of certain ramps and delayed access to Eastern areas of the mine.

  • Mine development rates increased quarter on quarter to an average of 3,346m per month in 1Q21 (4Q20: 3,241m per month), driven by improved contractor performance, notwithstanding ongoing absenteeism as a result of our Covid-19 preventive measures. The target remains to develop on average between 3,300 – 3,500m per month in 2021.

  • Quarterly by-product gold production decreased 11.7% vs. 4Q20 driven by a lower volume of ore processed, ore grade and recovery rate.

  • Quarterly by-product gold production decreased 4.6% vs. 1Q20 due to a lower volume of ore processed and lower recovery rates, mitigated by a higher ore grade.

  • The silver ore grade in 2021 is expected to remain in the range of 190-210 g/t, while the gold ore grade is expected to remain in the range of 0.55-0.70 g/t.

2021 Objectives

  • Continue to monitor progress against our action plan targets with special emphasis on dilution control.
  • Increase the development rate to an average of between 3,300–3,500 metres per month for the year.
  • Receive electrical permit approval and ramp up the tailings flotation plant.
  • Improve the use of automatic drilling technology.