First Majestic's Q1 Production Reaches New Record of 3.63 million Silver Equivalent Ounces
April 8, 2014
Majestic Silver Corp. (“First Majestic” or the “Company”) is pleased to
announce that total production at its five operating silver mines in
Mexico for the first quarter ending March 31, 2014 reached a new
quarterly record of 3,631,672 equivalent ounces of silver, representing a
33% increase compared to the same quarter in 2013.
Total silver production for the quarter consisted of 2,895,497 ounces of
silver, representing an increase of 19% compared to the same quarter in
2013. In addition, 8,593,807 pounds of lead and 2,689,274 pounds of
zinc were produced, representing an increase of 112% and 60%,
respectively, compared to the same quarter of the previous year. Also
produced were 3,375 ounces of gold, representing an increase of 113%
compared to the first quarter of 2013.
Keith Neumeyer, President & CEO of First Majestic, states, “Our
first quarter results show a great start to the new year. Even though
some challenges existed in the quarter, other improvements that were
implemented in 2013 are taking hold. With many exciting initiatives
underway in the areas of automation, processes and metallurgy, we are
setting ourselves up for another record year of production”.
Production Details Table:
The total ore processed during the quarter at the Company’s five
operating silver mines: La Encantada, La Parrilla, Del Toro, San Martin
and La Guitarra, amounted to 637,663 tonnes milled, representing a 9%
decrease over the previous quarter primarily due to the elimination of
old tailings in the ore blend at La Encantada.
Silver grades in the quarter for the five mines increased by 12% to 214
g/t compared to the previous quarter. Combined silver recoveries
averaged 66% in the quarter, an improvement over the fourth quarter
average of 64%. These improvements were primarily the result of the
changes occurring at the La Encantada Silver Mine.
The Company’s underground development in the first quarter consisted of
12,215 metres, an 8% decrease compared to 13,280 metres completed in the
previous quarter. This decrease is part of a planned reduction of
capital expenditures aimed at reducing costs due to the lower metal
During the quarter, nine diamond drill rigs were operating at the
Company’s five operations. The Company completed 7,190 metres of diamond
drilling in the quarter, compared to 8,324 metres in the prior quarter,
representing a 13% decrease.
The table below represents the operating parameters at each of the
Company’s five producing silver mines. Starting in 2014, the Company
has adopted the use of calendar days versus operating days for its
average throughput calculations.
Mine by Mine Quarterly Production Table:
The following prices were used in the calculation of silver
equivalent ounces: Silver: $20.48 per ounce; Gold: $1,297 per ounce;
Lead: $0.95 per pound; Zinc $0.92 per pound and Iron $148 per tonne.
At the La Encantada Silver Mine:
At the La Parrilla Silver Mine:
- The cyanidation mill averaged 2,021 tpd during the quarter, all
from underground mine ore. As previously announced, the reprocessing of
old tailings has been removed from the current mine plan awaiting
higher silver prices. As a result, the silver grade has increased by
37% to 312 g/t, a considerable improvement over the previous quarter.
- Underground mining continues from the San Francisco vein and the
“990” and “990-2” chimneys. Additional production from level 1850 at
the Buenos Aires extension and the recently discovered Regalo Vein and
Breccia are now active. These new areas, along with the Milagros Breccia
which is currently undergoing mine preparation, will support the
planned increase in fresh mine ore production to reach 3,000 tpd by year
- Four drill rigs were active underground at La Encantada during
the quarter. A total of 5,923 metres of exploration and definition
drilling was completed in the first quarter, compared to 6,611 metres of
drilling in the previous quarter. In addition, a total of 2,842 metres
of underground development were completed in the first quarter,
compared to 3,210 metres of development in the previous quarter.
- A substantial portion of the current drilling and development is
for the purpose of the planned release of an updated NI 43-101
At the Del Toro Silver Mine:
- During the quarter, La Parrilla continued to operate above
budget having processed 186,216 tonnes of ore (82,318 tonnes of oxides
and 103,898 tonnes of sulphides) with an average silver grade of 174
g/t. Silver production totaled 808,196 ounces during the quarter and
remained consistent with the previous quarter.
- A new lime feed automation system was installed at La Parrilla
during the quarter. The new system is part of the Company’s mandate to
invest in automation technologies to increase milling efficiencies.
This new installation is designed to help optimize and stabilize cyanide
consumption levels as well as increase visibility of the pH levels in
each of the leaching tanks.
- In order to increase the recovery and grade of the zinc
concentrates, a new zinc flotation cell was successfully installed in
late February. As a result, total zinc production during the quarter
increased by 45% to 2,319,225 pounds compared to the previous quarter.
- Average production at the Vacas mine has now reached 500 tpd,
and preparation for long-hole mining is being prepared for initial
start-up in the second quarter.
- Underground development completed in the quarter totaled 2,255
metres compared with 2,989 metres developed in the previous quarter.
- One underground drill rig was active within the La Parrilla
property during the quarter. A total of 448 metres were drilled in the
first quarter compared to 249 metres in the previous quarter.
At the San Martin Silver Mine:
- Effective January 1, 2014, the new cyanidation circuit was
deemed commercial having reached commercial operating levels. However,
due to a mechanical issue at one of the oxide thickener tanks, the
treatment of oxide ore was suspended for a period of two weeks during
the quarter. As a result, the flotation circuit was temporarily ramped
up to offset the reduced throughput in the cyanidation circuit.
- Total mill throughput increased by 18% during the quarter to
average 1,609 tpd (735 tpd in cyanidation and 874 in flotation)
containing an average silver grade of 210 g/t. This resulted in an 18%
increase in silver production to 646,669 ounces compared with the
previous quarter. Average silver recoveries were 66% and remained
in-line with the previous quarter. Metallurgical testing continues
on-site aimed at improving recoveries to levels indicated in the
Pre-Feasibility Study (PFS) dated August 20, 2012.
- Throughout most of the first quarter, electrical power was
supplied to the mill by seven diesel generators. On March 11, the
Company successfully connected to the Mexican national power grid with a
34kV power line which has allowed five of the seven generators to come
offline at the end of March. With only two diesel generators remaining
active, the Company now anticipates a substantial reduction in cash
costs for the remainder of the year as a result of lower electrical
costs per kilowatt.
- The construction of the larger 115kV power line is now more than
90% complete and is expected to be completed by the end of the second
quarter following a route change. Once complete, the Del Toro operation
will be fully connected to the Mexican power grid allowing for further
power cost reductions.
- During the quarter, one underground drill rig was active at Del
Toro. Total exploration metres drilled in the first quarter amounted to
297 metres, compared to 799 metres drilled in the previous quarter. In
addition, 2,322 metres of development were completed in the first
quarter, compared to 2,612 metres of development in the previous
At the La Guitarra Silver Mine:
- During the quarter, San Martin processed 78,524 tonnes of ore
with an average silver grade of 162 g/t. Silver production totaled
282,829 ounces during the quarter and remained consistent with the
- Due to a mechanical breakdown in the main gear of the 10’ X 10’
ball mill, production was suspended for a period of nine days while
maintenance work occurred. The ball mill was successfully fixed and
milling has since resumed to normal operating levels.
- The ramp up to 1,300 tpd has been slower than expected due to
some unexpected issues with piping capacity, ball mill mechanical
interruptions and clarifying filter capacity. The projected ramp up to
mill capacity is now expected to be achieved in the second quarter.
- Underground development completed in the first quarter totaled
3,219 metres, compared with 2,858 metres of development in the previous
quarter. The mine development continues to be focused at the Rosarios
mine where six areas are now in production.
- One underground drill rig was active within the San Martin
property during the quarter. Total metres drilled in the first quarter
amounted to 276 metres, compared to 387 metres of drilling in the
- During the quarter, La Guitarra averaged 513 tpd with an average
silver grade of 94 g/t and an average gold grade of 1.8 g/t. Total
production during the quarter consisted of 114,230 silver ounces and
2,244 gold ounces. This represents a 20% decrease in silver production
over the previous quarter primarily due to a 20% decrease in the silver
- During the quarter, production ore continued to come from areas
within the La Guitarra vein which contained higher gold grades in
conjunction with lower silver grades. Dilution, grade control and
laboratory procedures are being reviewed in order to increase the silver
grade at the mine.
- Mine development at the Joya Larga structure within the El
Coloso area has now reached 300 metres along the vein. Drifting
continues along the Joya Larga structure in an effort to reach the
higher silver grade areas.
- A total of 1,577 metres of development were completed in the
first quarter, compared to 1,611 metres of development in the previous
- Two underground drill rigs were active in the first quarter
within the La Guitarra property. Total metres drilled in the quarter
amounted to 246 metres compared to 278 metres drilled in the previous
First Majestic is a mining company focused on silver production in
Mexico and is aggressively pursuing the development of its existing
mineral property assets and the pursuit through acquisition of
additional mineral assets which contribute to the Company achieving its
corporate growth objectives.
FOR FURTHER INFORMATION contact firstname.lastname@example.org
, visit our website at www.firstmajestic.com
or call our toll free number 1.866.529.2807.
FIRST MAJESTIC SILVER CORP.
President & CEO
Cautionary Note Regarding Forward Looking Statements
This press release contains “forward-looking statements”, within the
meaning of the United States Private Securities Litigation Reform Act of
1995 and applicable Canadian securities legislation, concerning the
business, operations and financial performance and condition of First
Majestic Silver Corp. Forward-looking statements include, but are not
limited to, statements with respect to the future price of silver and
other metals, the estimation of mineral reserves and resources, the
realization of mineral reserve estimates, the timing and amount of
estimated future production, costs of production, capital expenditures,
costs and timing of the development of new deposits, success of
exploration activities, permitting time lines, hedging practices,
currency exchange rate fluctuations, requirements for additional
capital, government regulation of mining operations, environmental
risks, unanticipated reclamation expenses, timing and possible outcome
of pending litigation, title disputes or claims and limitations on
insurance coverage. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as “plans”,
“expects” or “does not expect”, “is expected”, “budget”, “scheduled”,
“estimates”, “forecasts”, “intends”, “anticipates” or “does not
anticipate”, or “believes”, or variations of such words and phrases or
state that certain actions, events or results “may”, “could”, “would”,
“might” or “will be taken”, “occur” or “be achieved”. Forward-looking
statements are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of First Majestic Silver Corp. to be
materially different from those expressed or implied by such
forward-looking statements, including but not limited to: risks related
to the integration of acquisitions; risks related to international
operations; risks related to joint venture operations; actual results of
current exploration activities; actual results of current reclamation
activities; conclusions of economic evaluations; changes in project
parameters as plans continue to be refined; future prices of metals;
possible variations in ore reserves, grade or recovery rates; failure of
plant, equipment or processes to operate as anticipated; accidents,
labour disputes and other risks of the mining industry; delays in
obtaining governmental approvals or financing or in the completion of
development or construction activities, as well as those factors
discussed in the section entitled “Description of the Business - Risk
Factors” in First Majestic Silver Corp.’s Annual Information Form for
the year ended December 31, 2013, available on
and Form 40-F on file with the United States Securities and Exchange
Commission in Washington, D.C. Although First Majestic Silver Corp. has
attempted to identify important factors that could cause actual results
to differ materially from those contained in forward-looking
statements, there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that such
statements will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Accordingly, readers should not place undue reliance on
forward-looking statements. First Majestic Silver Corp. does not
undertake to update any forward-looking statements that are incorporated
by reference herein, except in accordance with applicable securities