Production up 72% to 6.53 million oz Ag in 2010;
Exceeds Guidance
First Majestic Silver Corp. ("First Majestic" or the
"Company") is
pleased to announce that production in 2010 reached 7,024,055
equivalent ounces of silver, representing a 62% increase over 2009 from
4,337,103 equivalent ounces of silver.
The equivalent silver production for 2010 consisted of 6,529,325 ounces
of silver, representing a 72% increase from the prior year, 6,404,227
pounds of lead, representing a 3% decrease from the previous year, and
2,152 ounces of gold, representing a decrease of 19% compared to the
previous year. Total silver production as a percentage of total
production amounted to 93% making First Majestic the purest silver
company in the world.
Company guidance released on January 11, 2010 stated, "Production is
expected to exceed 6.0 million ounces of silver in 2010" which was in
fact exceeded by a strong 9%. As a result of the current expansion
underway at the La Parrilla Silver Mine and other
operational
improvements at the La Encantada and San Martin
Silver Mines,
production is anticipated to exceed 7.5 million ounces of silver in
2011.
In addition to further increases in production expected for 2011, the
Company is also expanding its exploration budget. The current 2011
budget calls for 47,800 metres of drilling over the
Company's five core
projects for a total expenditure of US$7,137,500. This exploration
program compares to the total of 17,322 metres
drilled in 2010, and
total expenditures equalling US$1,897,280. It
is further anticipated
that new updated NI 43-101 Technical Reports will be released on each
project in late 2011 or early 2012.
With respect to the fourth quarter, total ore processed at the
Company's three operating silver mines, the La Encantada
Silver Mine,
the La Parrilla Silver Mine and the San Martin Silver
Mine, amounted to
467,175 tonnes milled in the quarter representing an
8% increase over
the previous quarter. The overall average silver head grade in the
quarter for the three mines decreased slightly from the previous
quarter to an overall head grade of 207 g/t of silver. The combined
recoveries of silver also decreased slightly from 58% to 57%. This was
due to the much larger La Encantada operation as it
is primarily
reprocessing old tailings. As the mix of ore from the mine increases
throughout 2011, these recoveries are also expected to improve.
The Company developed 6,288 metres underground in the
fourth quarter,
compared to 6,207 metres of underground development
completed in the
previous quarter. The total annual underground development for 2010
totalled 22,658 metres.
Development has been focused on increasing the
Reserve and Resource preparation ratios at the three operating mines.
Due to the expanding production levels anticipated in 2011 and 2012,
the Company's development budget is being increased to US$21,741,183 in
2011 from $12,335,119 in 2010.
Also, the diamond drilling programs totalled 6,104 metres of definition
drilling in the quarter, for a 2010 annual total of 17,322 metres
of
drilling completed at the Company's three mines. Drilling at the
Company's two development projects, the Del Toro Silver Mine and the
Real de Catorce Silver Project is expected to
commence in early 2011.
As a result of the efforts and work completed in 2010, some of the
improvements and advances made during the year included:
At the La Encantada Silver Mine:
.. The new 3,500 tpd cyanidation
plant, which was inaugurated on
November 19, 2009, reached full capacity at the end of the second
quarter of 2010 and averaged 3,750 tpd in the fourth
quarter.
.. The new Buenos Aires ore body, which is being
developed and prepared
for production will allow the mine ore extraction to increase 1,500 tpd
versus the current 1,000 tpd. This improvement will
have a positive
effect on head grades and recoveries.
.. New areas of reserves and resources had been
discovered and developed
at the San Francisco vein and at the hanging wall of the 660 ore body.
.. Consolidation of the electric generation into a
single larger and
more modern generation plant was completed during the year, allowing
for the suspension of the operation of the much older generation plants
which will result in substantial savings on parts, repairs and fuel
efficiency.
.. Two new induction furnaces began operation in December using the
latest technology in smelting precipitates resulting in a much more
efficient operation, lower costs and better quality silver dor�
bars.
At the La Parrilla Silver Mine:
.. Development of a new ramp system was completed in the La Blanca mine
which has now connected levels 9 and 10 of the Rosarios
mine, improving
logistics and which is expected to reduce costs due to the improved
transportation of ore from the lower levels of the mine to surface.
.. Completion of the engineering
work for the current expansion program
launched in December 2010. This expansion will result in the mill
capacity reaching 1,600 tpd from the current 850 tpd and will
effectively double the current output of the La Parrilla
operation from
approximately 1.5 million ounces to 3.0 million ounces of silver
equivalent annually by the end of 2011.
At the San Martin Silver Mine:
.. The discovery of the new San Pedro area in 2009 led to an extensive
underground drilling program which continues today. This program is
based on drilling systematic short holes into the foot wall of the
Zuloaga vein. The result has been extremely favourable throughout 2010
with several discoveries of minable mineralization. These new
discoveries have allowed for consistent throughput and improved
economics at the operation and are expected to bring improved results
into 2011.
.. The previously announced discovery of a parallel structure to the
main Zuloaga vein, the La Esperanza vein, discovered
through surface
geology was drilled in the last two quarters of 2010. Eight diamond
drill holes were successfully completed, of which six intersected
mineralization. The current program for 2011 is to drive a 500 metre
ramp into the structure to open up and begin the development of a new
potential resource.
At the Del Toro Silver Mine:
.. In December 2009, the Environmental Impact Statement for a new
flotation plant was approved by the SEMARNAT and the Change of Use of
Land Permit was received in the first quarter of 2010.
.. At the end of November 2010, the underground development at the Del
Toro Silver Mine was reinitiated. The current objective is to prepare a
new underground drilling station and to access the No. 3 Ore Body at
depth. Once this is achieved by the middle of 2011, a large bulk sample
can be collected for final metallurgical testing. This testing will
allow for the final design of the new mill operation currently in the
planning stage.
At the Real de Catorce Silver Project:
.. During 2010 the Company evaluated and confirmed the geological data
obtained as a result of the acquisition in late 2009 of this project.
In November 2010, First Majestic successfully completed the purchase of
the land underlying the Santa Ana Hacienda located within the Real de
Catorce property, together with all associated
buildings and
infrastructure, the outstanding royalty and certain historic geological
and proprietary mining information.
.. Construction of a mining museum is planned to
commence in early 2011
which is designed to clean the impressive underground working areas and
restore the above ground buildings to a suitable condition in order to
allow for tourist access. This new mining museum will bring needed
employment to the area.
Mr. Neumeyer stated, "2010 has been an
impressive year for First
Majestic on all counts. Not only did our silver production increase by
over 70%, the silver price performed very well and the Company's shares
became the third best performing stock on the S&P/TSX index registering
a gain of over 240% year over year. We were also successful in listing
our shares on the NYSE. Management is committed to staying focused on
increasing production and we're reviewing plans to continue to grow our
production substantially over the next three years. Congratulations go
out to our entire team in Canada and Mexico."
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 info@firstmajestic.com, visit our
website at www.firstmajestic.com or call our toll free number
1.866.529.2807.
FIRST MAJESTIC SILVER CORP.
"signed"
Keith Neumeyer,
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, 2009, available on www.sedar.com,
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 laws.
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Copyright (c) 2011 FIRST MAJESTIC SILVER CORP. (TSX: FR)
All rights
reserved. For more information visit our website at
http://www.firstmajestic.com/ or send mailto:investor@firstmajestic.com
Message sent on Tue Jan 11, 2011 at 7:49:38 AM Pacific Time
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