Re: News Releases - Tuesday, June 10, 2008
Major Expansion launched at La Encantada Silver Mine
First Majestic Silver Corp. is pleased to announce that ground breaking
and construction of a new 3,500 tpd cyanidation circuit at the La
Encantada Silver Mine, located in Coahuila Mexico will commence next
week. The final permit from the Mexican authorities was received last
week allowing for this expansion to begin immediately.
Construction of the new cyanidation circuit is expected to be completed
by February 2009. The total budget for this major plant expansion is
US$21.6 million and has an undiscounted Internal Rate of Return (IRR)
of 80% representing a payback period of 14 months based on the
assumption of US$15.00 per oz silver.
Historically, the La Encantada mill has had a capacity of 800 tpd and
has been processing oxide ores from the mine through a flotation
circuit to produce a lead/silver concentrate. The construction of the
new 3,500 tpd cyanidation circuit will allow the Company to increase
its recoveries of silver and to produce Dor� bars as a finished product
instead of concentrates. Due to the historically low recoveries yielded
from the past 30 years using flotation at La Encantada, a large
Resource has been created in the form of tailings that was defined in
the Company's NI 43-101 report dated March 19, 2008. That 43-101 report
defines 4,916,085 tonnes of tailings with an average grade of 150 g/t.
Commencing in the first quarter of 2009, silver production will come
from combining ore from the mine with tailings from surface. This
expansion, will allow production to be expanded to 3,500,000 ounces of
silver in 2009 and 4,000,000 ounces of silver in 2010. Production will
be in the form of Silver Dor� rather than concentrates which will
significantly reduce smelting, refining & transportation costs of the
finished product and thereby increasing the profitability of the La
The metallurgical testing for the cyanidation process was executed at
the SGS Metallurgical Laboratory in Durango, Mexico which included the
testing of the different ores present and the tailings to be processed.
This metallurgical testing confirmed historical tests completed by
Pe�oles in 1985.
The mixture of ore and tailings as defined by the Company's expansion
plan will consist of 700 tpd of raw ore from the mine with an average
grade of 350 g/t with a recovery of 78%, plus 2,800 tpd of old
flotation tailings with an average grade of 150 g/t and a recovery of
50%, resulting in combined recoveries of 60%.
This expansion project illustrates First Majestic's commitment to
maintaining its aggressive plans of continuing the growth at each of
its operations, of which management believes will bring substantial
benefits to the Company's shareholders. La Encantada will be doubling
its silver output in the coming year and will produce 100% silver in
the form of Dor� bars, reducing smelting treatment and freight charges
and increasing the Company's leverage to the value of this important
The Company's ongoing aggressive development and exploration program at
La Encantada is continuing with the purpose of increasing both the
oxide and sulphide Resources within the mine. In addition to this mill
expansion, a total of 8,160 metres of underground development is
scheduled for 2008. Presently, three diamond drill rigs are working
underground and are scheduled to complete 7,600 meters of drilling in
2008. Additionally, to compliment this development and exploration
program, a Geophysics team is presently on site at La Encantada
completing a 46 kilometre regional geophysics program.
The exploration potential within La Encantada's 2900 hectare property
boundary is very high as all the operations of the mine and the present
Reserve/Resource are located in a small portion of the property
covering only approximately 100 hectares. The Company's current
development and exploration program is focusing on the definition of
known areas and testing of new targets and is expected to result in
significantly improved Reserves/Resources. The Company anticipates the
next updated NI 43-101 Report on the La Encantada Silver Mine will be
completed by late 2008.
First Majestic is a producing silver company focused in Mexico and is
aggressively pursuing its business plan to become a senior silver
producer through the development of its existing assets and the pursuit
through acquisition of additional assets that contribute to 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
FIRST MAJESTIC SILVER CORP.
President & CEO
This press release includes certain "Forward-Looking Statements" within
the meaning of section 21E of the United States Securities Exchange Act
of 1934, as amended. All statements, other than statements of
historical fact, included herein, including without limitation,
statements regarding potential mineralization and reserves, exploration
results and future plans and objectives of First Majestic Silver Corp.
are forward-looking statements that involve various risks and
uncertainties. There can be no assurance that such statements will
prove to be accurate and actual results and future events could differ
materially from those anticipated in such statements.
Copyright (c) 2008 FIRST MAJESTIC SILVER CORP. (TSXV-FR) All rights
reserved. For more information visit our website at
http://www.firstmajestic.com/ or send mailto:email@example.com
Message sent on Tue Jun 10, 2008 at 8:10:57 AM Pacific Time