The startup of the Juanicipio silver and gold underground mine, in Mexico, has been brought forward to mid-2020, London-listed Fresnillo announced on Monday.
Underground production will now start ahead of schedule in June, at an additional cost of $45-million, the company said in a statement.
Fresnillo is the operator of Juanicipio and holds a 56% majority stake, with Canada’s MAG Silver owning the remaining 44%.
Fresnillo explained that the project’s capital expenditure estimate increased from $395-million to $440-million, reflecting expenditure incurred on underground development, supporting infrastructure, and bringing forward some sustaining capital to facilitate the early underground start.
The timeline for the construction of the flotation plant has also been adjusted and commissioning is now anticipated by mid-2021. The previous guidance was construction completion by the end of 2020 with commissioning early 2021.
In the interim, mineralised material from development and initial production stopes will be processed at the Fresnillo beneficiation plant, which has spare capacity.
“We continue to de-risk and refine the best construction plan that will drive the most value and ensure we capitalise on the opportunity that Juanicipio presents. I am pleased to confirm we are accelerating development of the underground mine and as a result, I expect the mine will be producing silver and gold ahead of schedule in 2020,” said Fresnillo CEO Octavio Alvídrez.
When in full production, Juanicipio will produce an average of 11.7-million ounces a year of silver, 43 500 oz/y of gold, with an initial life-of-mine of 12 years.