Fresnillo share price: First-quarter gold production falls

on Apr 16, 2014
Updated: Apr 9, 2020
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iNVEZZ.com, Wednesday, April 16: Fresnillo Plc (LON:FRES) has seen a significant decline in gold production for the first three months of the year, the company’s production report revealed today. According to the Mexican-based precious metals miner, the decrease reflects a ban on the use of explosives at one of its mines.

However, the company said that despite the ban it is still on track to meet its production guidance.
In today’s trading, Fresnillo shares fell 0.9 percent to 893.00p as of 9:25 UTC. The company’s stock has gained 20.4 percent so far this year.
**Q1 production**
Fresnillo’s attributable gold production fell 29.7 percent year-on-year in the first quarter to 82,653 ounces mainly due to “the stoppage of operations at Soledad-Dipolos and the temporary suspension of explosives permits” at Herradura, which continued to affect the mine’s output in the first two months of the year. The ban on the use of explosives was issued last year as a result of a land dispute with the community living in the El Bajio farming region, where some of Fresnillo’s operations are located. The ban was lifted in February, allowing production to be resumed (Fresnillo share price: Miner receives new explosive permit for Herradura mine).

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The company said that the setbacks were partly offset by the ramp-up to expanded production levels at Noche Buena, higher volumes of ore processed at Ciénega and the successful start-up in March of operations at the dynamic leaching plant at Herradura. The plant contributed 4,818 ounces of gold in the short time since its launch.

Meanwhile, Fresnillo’s core silver operations saw a 3.5 percent year-on-year increase in attributable silver production to 10.4 million ounces. The increase was partly driven by increased silverstream production from the Sabinas mine.
Fresnillo’s chief executive officer Octavio Alvídrez commented: “We have started 2014 with conviction in our ability to deliver on our targets for the year. We achieved solid silver production, reflecting the good performance at our Saucito mine and the additional ore processed from the development activities at Saucito II.”
Fresnillo confirmed that it remains on track to achieve its production targets of 43 million silver ounces and 450,000 gold ounces this year.
**As of 11:05 BST buy Fresnillo shares at 894.50 pence**
**As of 11:05 BST sell Fresnillo shares at 893.50 pence**

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