New York – AG
Toronto – FR
Frankfurt – FMV
Mexico - AG
VANCOUVER, March 31, 2015 /PRNewswire/ - FIRST MAJESTIC
SILVER CORP. (the "Company" or "First Majestic") is pleased to
provide a new NI 43-101 Technical Report and the initial Mineral
Reserve and Resource estimate for the La Guitarra Silver Mine
located in the State of Mexico.
All amounts are in U.S. dollars unless stated otherwise.
REPORTED HIGHLIGHTS
- Proven and Probable Reserves totalling 11.8 million ounces of
silver equivalent ounces, including 9.4 million ounces of pure
silver
- Measured and Indicated Resources of 15.2 million ounces of
silver equivalent ounces, including 11.7 million ounces of pure
silver
- Inferred Resources totalling 6.3 million silver equivalent
ounces, including 4.7 million ounces of pure silver
- Average Reserve silver grade of 223 g/t; and an average gold
grade of 1.06 g/t
- Life of Mine (LOM) of 7.0 years producing an estimated total of
9.3 million ounce of silver and 45 thousand ounces of gold
- LOM operating cost per tonne estimated at $48.31 per tonne, excluding G&A, sustaining
costs and exploration
Keith Neumeyer, CEO and
President, states: "since purchasing the La Guitarra mine over two years ago, our
geological and technical teams have been working diligently
examining over 900 historical drill holes and drilling several
additional holes in order to create what is now our new base line
Reserve and Resource estimate which now gives us a very good
starting point to build on in the coming years. This large property
has extremely exciting geological potential and this first
Technical Report prepared by our team points to the reason why we
first decided to buy this mine in 2012."
The La Guitarra Silver Mine, located in historical Temascaltepec
mining district in the State of
Mexico, consisting of 43 mining concessions covering 39,714
hectares (98,135 acres). La
Guitarra is comprised of two operating mines, La Guitarra and Coloso, and three past
producing areas, the Nazareno, Mina de
Agua and El Rincón, which are now considered as exploration
areas.
The new Mineral Resource and Mineral Reserve estimates for
La Guitarra are shown below and
are classified in accordance with the CIM Definition Standards for
Mineral Resources and Mineral Reserves (May
10, 2014). Please note, First Majestic is reporting Mineral
Resources inclusive of Mineral Reserves.
LA GUITARRA
MINERAL RESERVES WITH AN EFFECTIVE DATE OF DECEMBER, 31,
2014
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Mine
|
Category
|
Mineral
Type
|
k
tonnes
|
Ag
(g/t)
|
Au(g/t)
|
Ag-Eq
(g/t)
|
Ag (k
Oz)
|
Ag-Eq (k
Oz)
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LA
GUITARRA
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Proven
(UG)
|
Sulphides
|
91
|
153
|
1.84
|
256
|
446
|
745
|
Probable
(UG)
|
Sulphides
|
1,217
|
228
|
1.00
|
284
|
8,911
|
11,098
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Total Proven and
Probable (UG)
|
Sulphides
|
1,308
|
223
|
1.06
|
282
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9,358
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11,843
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(1)
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Mineral Reserves have
been classified in accordance with the CIM Definition Standards on
Mineral Resources and Mineral Reserves, whose definitions are
incorporated by reference into NI 43-101.
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(2)
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Cut-off grade
considered for sulphides was 200 g/t Ag-Eq and is based on actual
and budgeted operating and sustaining costs.
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(3)
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Metallurgical
recovery used was 85% for silver and 79% for gold.
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(4)
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Metal payable used
was 95% for silver and 95% for gold.
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(5)
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Metal prices
considered were $20 USD/oz Ag, $1,200 USD/oz Au.
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(6)
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Silver equivalent
grade is estimated as: Ag-Eq = Ag Grade + (Au Grade x Au Recovery x
Au Payable x Au Price) / (Ag Recovery x Ag Payable x Ag
Price).
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(7)
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Tonnage is expressed
in thousands of tonnes, metal content is expressed in thousands of
ounces.
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(8)
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Totals may not add up
due to rounding.
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LA GUITARRA
MEASURED AND INDICATED MINERAL RESOURCES WITH AN EFFECTIVE DATE OF
DECEMBER 31, 2014
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Mine /
Project
|
Category
|
Mineral
Type
|
k
tonnes
|
Ag
(g/t)
|
Au
(g/t)
|
Ag-Eq
(g/t)
|
Ag (k
Oz)
|
Ag-Eq (k
Oz)
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|
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|
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LA
GUITARRA
|
Measured
(UG)
|
Sulphides
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121
|
170
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2.37
|
305
|
660
|
1,185
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Indicated
(UG)
|
Sulphides
|
1,029
|
335
|
1.56
|
424
|
11,078
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14,029
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Total Measured and
Indicated (UG)
|
Sulphides
|
1,150
|
318
|
1.65
|
412
|
11,738
|
15,214
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LA GUITARRA
INFERRED MINERAL RESOURCES WITH AN EFFECTIVE DATE OF DECEMBER 31,
2014
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|
Mine /
Project
|
Category
|
Mineral
Type
|
k
tonnes
|
Ag
(g/t)
|
Au
(g/t)
|
Ag-Eq
(g/t)
|
Ag (k
Oz)
|
Ag-Eq (k
Oz)
|
|
|
|
|
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LA
GUITARRA
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Inferred Total
(UG)
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Sulphides
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739
|
197
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1.23
|
267
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4,674
|
6,343
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(1)
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Mineral Resources
have been classified in accordance with the CIM Definition
Standards on Mineral Resources and Mineral Reserves, whose
definitions are incorporated by reference into NI
43-101.
|
(2)
|
Cut-off grade
considered for sulphides was 180 g/t Ag-Eq and is based on actual
and budgeted operating and sustaining costs.
|
(3)
|
Metallurgical
recovery used was 85% for silver and 79% for gold.
|
(4)
|
Metal payable used
was 95% for silver and 95% for gold.
|
(5)
|
Metal prices
considered were $22 USD/oz Ag, $1,350 USD/oz Au.
|
(6)
|
Silver equivalent
grade is estimated as: Ag-Eq = Ag Grade + (Au Grade x Au Recovery x
Au Payable x Au Price) / (Ag Recovery x Ag Payable x Ag
Price).
|
(7)
|
Tonnage is expressed
in thousands of tonnes, metal content is expressed in thousands of
ounces.
|
(8)
|
Totals may not add up
due to rounding.
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(9)
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Measured an Indicated
Mineral Resources are reported inclusive or Mineral
Reserves.
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Since taking control of the property in July 2012, to the effective date of December 31, 2014 used for the Mineral Resources
and Mineral Reserve estimates, First Majestic has led an aggressive
exploration program at La Guitarra
which has included an extensive 35,575 metres of diamond drilling
over 262 holes. The Company also commenced a plan to expand the
operation from 200 tonnes per day (tpd) to 520 tpd in late 2012.
This expansion was completed in May
2013 following the installation of a spare ball mill from
the La Parrilla Silver Mine and some spare flotation tanks from the
La Encantada Silver Mine.
The LOM plan is based on an annual processing rate of 190,000
tonnes of plant feed, corresponding to approximately 520 tpd.
Considering the Mineral Reserves presented above it represents a
mine life of 7 years producing an estimated 9.3 million ounces of
silver plus 45 thousand ounces of gold.
LIFE OF MINE
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|
LOM
Plan
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|
La Guitarra Silver
Mine
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2015
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2016
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2017
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2018
|
2019
|
2020
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2021
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Total
|
ROM Mine
Production
|
kt
|
187
|
190
|
190
|
190
|
190
|
190
|
171
|
1,308
|
Silver
grade
|
g/t
Ag
|
189
|
185
|
203
|
237
|
265
|
263
|
206
|
223
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Gold
grade
|
g/t
Au
|
0.91
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1.00
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0.97
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1.40
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1.28
|
1.14
|
0.84
|
1.06
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Silver-Equivalent grade
|
g/t
Ag-Eq
|
239
|
241
|
257
|
315
|
336
|
327
|
253
|
282
|
Silver metal
content
|
M oz
Ag
|
1.13
|
1.13
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1.24
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1.45
|
1.62
|
1.61
|
1.14
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9.31
|
Gold metal
content
|
k oz
Au
|
5.46
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6.13
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5.91
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8.53
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7.80
|
6.96
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4.60
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45.40
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Silver-Equivalent metal
content
|
M oz
Ag-Eq
|
1.44
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1.47
|
1.57
|
1.92
|
2.05
|
2.00
|
1.39
|
11.84
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In late 2013, the Company started the development of the Coloso
mine incurring in expansionary capital expenditures in the areas of
mine development, mine infrastructure and a 5 km power line.
Sustaining capital expenditures throughout the projected life of
mine are assumed to average $4.26
million per year, including maintenance of the processing
plant, equipment replacement in the mine, mine development, for
tailings facility expansions and infill exploration.
The sustaining capital budget includes an allocation of an
estimate of $1.0 million for the
development of an 800 metre tunnel to connect the Coloso mine with
the Nazareno area, in addition, an estimate of $1.5 million for mine developing and preparation
in Nazareno to bring this mine into production as a replacement of
the La Guitarra mine production
after the depletion of current reserves in this area.
The Company's Qualified Persons recommend going forward with
infill exploration works required for Nazareno and the permitting
and exploration works required for Mina
de Agua in order to upgrade current resources and generate
additional resources. The Company's Qualified Persons are of the
opinion that La Guitarra property
has the potential for hosting additional resources laterally at the
Guitarra vein, at depth at Coloso and laterally and at depth at,
Nazareno, Mina de Agua and El
Rincón. Further exploration at Nazareno and Coloso areas may result
in a near term increase in the recognized resources from this
area.
Furthermore, the Mina de Agua
and El Rincón areas are highly prospective given the history of
production from these areas. In the 18th century, the Mina de Agua mine and surrounding areas were
one of México's largest silver producers, generating approximately
10% of the country's total mineral wealth. The Company's Qualified
Persons recommend the development of a 2 km tunnel from
Mina de Agua to El Rincón plus a
comprehensive exploration program to develop the resources and
potentially increase the delineation of resources and reserves in
these areas.
In addition, a series of conceptual studies have been conducted
to investigate the potential of increasing the throughput capacity
of the current La Guitarra
processing plant to 1,000 tpd. Preliminary estimates indicate a
potential reduction of the operating costs driven by the economy of
scale, mainly in the processing and general and administration
areas; however, the economics of the mine capacity expansion and
the plant expansion have not been completed. An increase in the
annual throughput could reasonably be expected to increase the
total costs but to reduce unit operating costs. The Company's
Qualified Persons recommend continuing the conceptual studies and
progressing to an internal pre-feasibility level study to assess
the economic viability of this expansion.
Mineral Resources for the Coloso area have been estimated by
Amec Foster Wheeler Americas Ltd. under the supervision of
Greg Kulla, P.Geo. Mineral Resources
for La Guitarra, Nazareno and
Mina de Agua areas have been
estimated by First Majestic. Mineral Reserves for La Guitarra, Coloso and Nazareno areas have
been estimated by First Majestic under the supervision of
Jesus M. Velador Beltran, PhD
Geology. Mineral Reserves for La
Guitarra, Coloso and Nazareno areas have been estimated by
First Majestic under the supervision of Ramon Mendoza Reyes, P.Eng. Mr. Ramon Mendoza Reyes, Vice President Technical
Services for First Majestic, is a "qualified person" as such term
is defined under National Instrument 43-101, and has reviewed and
approved the technical information disclosed in this news
release.
First Majestic is a mining company focused on silver production
in México 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.
FIRST MAJESTIC SILVER CORP.
"signed"
Keith Neumeyer,
President & CEO
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
This news release includes certain "Forward-Looking Statements"
within the meaning of the United States Private Securities
Litigation Reform Act of 1995 and applicable Canadian securities
laws. When used in this news release, the words "anticipate",
"believe", "estimate", "expect", "target", "plan", "forecast",
"may", "schedule" and similar words or expressions, identify
forward-looking statements or information. These forward-looking
statements or information relate to, among other things: the price
of silver and other metals; the accuracy of mineral reserve and
resource estimates and estimates of future production and costs of
production at our properties; estimated production rates for silver
and other payable metals produced by us, the estimated cost of
development of our development projects; the effects of laws,
regulations and government policies on our operations, including,
without limitation, the laws in Mexico which currently have significant
restrictions related to mining; obtaining or maintaining necessary
permits, licences and approvals from government authorities; and
continued access to necessary infrastructure, including, without
limitation, access to power, land, water and roads to carry on
activities as planned.
These statements reflect the Company's current views with
respect to future events and are necessarily based upon a number of
assumptions and estimates that, while considered reasonable by the
Company, are inherently subject to significant business, economic,
competitive, political and social uncertainties and contingencies.
Many factors, both known and unknown, could cause actual results,
performance or achievements to be materially different from the
results, performance or achievements that are or may be expressed
or implied by such forward-looking statements or information and
the Company has made assumptions and estimates based on or related
to many of these factors. Such factors include, without limitation:
fluctuations in the spot and forward price of silver, gold, base
metals or certain other commodities (such as natural gas, fuel oil
and electricity); fluctuations in the currency markets (such as the
Canadian dollar and Mexican peso versus the U.S. dollar); changes
in national and local government, legislation, taxation, controls,
regulations and political or economic developments in Canada, Mexico; operating or technical difficulties in
connection with mining or development activities; risks and hazards
associated with the business of mineral exploration, development
and mining (including environmental hazards, industrial accidents,
unusual or unexpected formations, pressures, cave-ins and
flooding); risks relating to the credit worthiness or financial
condition of suppliers, refiners and other parties with whom the
Company does business; inability to obtain adequate insurance to
cover risks and hazards; and the presence of laws and regulations
that may impose restrictions on mining, including those currently
enacted in Mexico; employee
relations; relationships with and claims by local communities and
indigenous populations; availability and increasing costs
associated with mining inputs and labour; the speculative nature of
mineral exploration and development, including the risks of
obtaining necessary licenses, permits and approvals from government
authorities; diminishing quantities or grades of mineral reserves
as properties are mined; the Company's title to properties; and the
factors identified under the caption "Risk Factors" in the
Company's Annual Information Form, under the caption "Risks
Relating to First Majestic's Business".
Investors are cautioned against attributing undue certainty to
forward-looking statements or information. Although the Company has
attempted to identify important factors that could cause actual
results to differ materially, there may be other factors that cause
results not to be anticipated, estimated or intended. The Company
does not intend, and does not assume any obligation, to update
these forward-looking statements or information to reflect changes
in assumptions or changes in circumstances or any other events
affecting such statements or information, other than as required by
applicable law.
SOURCE First Majestic Silver Corp.