Fresnillo plc (LON:FRES) and MAG Silver Corp. confirm that their silver / gold Juanicipio project, held through Minera Juanicipio, has received approval from their respective Boards as well as from the Minera Juanicipio shareholders.
Juanicipio Project Highlights
· Fresnillo plc will be the operator of Juanicipio and holds a 56% majority stake in the Joint Venture, with partner MAG Silver Corp. owning the remaining 44%.
· Construction to begin immediately with completion expected late 2020, subject to finalizing detailed engineering and securing remaining permits.
· Total average annual anticipated production of 11.7 moz silver, 43.5 koz gold, with an initial life of mine of 12 years.
· Considerable further exploration opportunities in license area with potential to scale-up operations in future.
· Estimated pre-operative capex of US$395m as of 1st January 2018, which does not reflect expenditures incurred since that date.
· Juanicipio development expected to create approximately 2,750 jobs during construction and 1,720 jobs once at full production.
The Juanicipio site is located within the Fresnillo mining district. Exploration and development at this site has been on-going for several years, de-risking the asset and ensuring full evaluation of its potential. Discussions with contractors are advanced and orders for long lead-time equipment delivery have been placed. All principal permits and licensing have been obtained. Construction is expected to commence immediately with completion expected late 2020 subject to finalizing detailed engineering and securing remaining permits, in line with the project timetable.
At full capacity, Juanicipio is expected to produce on average 11.7 moz of silver and 43.5 koz of gold per year, with robust economics underpinning the project.
Octavio Alvídrez, Chief Executive Officer of Fresnillo plc, said:
“The decision to approve Juanicipio reflects the extensive work the JV partners have done to de-risk the project to meet stringent development criteria. This decision to invest demonstrates our confidence in the long-term outlook for mining in Mexico. The new mine will create significant employment and highlights our commitment to sustainable growth for the benefit of all stakeholders.”
George Paspalas, Chief Executive Officer of MAG Silver, said:
“The joint approval of the project is a landmark milestone for the Juanicipio Joint Venture. We are fortunate to have Fresnillo plc, with over 130 years of experience in the area, managing the construction and operations of Juanicipio. Their insightful experience has resulted in a very efficient upsizing development opportunity for the Joint Venture, which is greatly appreciated by the Board and Management of MAG Silver. We look forward to working together with our partner to realize further value from the joint venture.”