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TABLE OF CONTENTS Oct 29 - Nov 4, 2012 Volume 98 Number 37 - 0 comments

Fortuna's 2012 looking good

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2012-10-29

Fortuna Silver Mines (FVI-T, FSM-N) says it is set to beat its full-year forecast, helped by record third-quarter production. 
The Vancouver-based firm is targeting 3.7 million oz. silver and 17,400 oz. gold this year, and by the end of September had reached 80% of its annual production guidance for silver and 94% for gold.

For the period ended Sept. 30, Fortuna produced 1.03 million oz. silver and 5,348 oz. gold from its San Jose mine in Mexico and Caylloma mine in Peru. This represents a production increase of 53% for silver and 230% for gold compared to a year ago. By-product production of lead and zinc dropped slightly in comparison to 4.4 million lb. and 5.6 million lb. in the third quarter.

For the first nine months of the year, Fortuna generated 2.9 million oz. silver and 16,331 oz. gold, plus significant zinc and lead by-products, putting it well on its way to reach its 2012 forecast as it optimizes its mines.

At San Jose, the firm is expanding the 1,000-tonne-per-day operation to 1,500 tonnes a day by mid-2013.

To support that development, it is building the second stage of the tailings dam to boost its tailings and water storage capacity to treat the extra ore, with construction expected to wrap-up in early 2013. Around this time, it should receive the 800-tonne-per-day ball mill and flotation cells that it has purchased to help with the expansion.

For the year, San Jose is scheduled to churn out 1.7 million oz. silver and 15,000 oz. gold. In the third quarter, it processed 503,000 oz. silver and 4,500 oz. gold, reflecting 19% and 25% more silver and gold ounces than expected owing to higher grades. Average grades of 191 grams silver and 1.73 grams gold were 16% and 26% above plan, Fortuna says. 

Earlier in the year, the company slated US$30.7 million for capital projects at the high-grade San Jose mine, including the mill expansion and a new concentrate leaching facility.

For the quarter ended Sept. 30, its Caylloma mine in Peru delivered roughly 525,000 oz. silver, 850 oz. gold, 4.4 million lb. lead and 5.6 million lb. zinc. Head grades for silver and gold were 181 grams and 0.44 gram gold, or 10% and 21% above expectations, helping the mine produce 5% and 38% more silver and gold than planned. 

For the year, Caylloma should produce 2 million oz. silver with gold, lead and zinc as by-products.

Cash costs were not disclosed, but Fortuna’s consolidated cash cost per payable oz. silver for the second quarter was US$3.75, up from negative US$4.37 last year due to cost pressures and a decrease in by-product credits at Caylloma.
Fortuna is eyeing consolidated annual production of 5 million oz. silver and 26,000 oz. gold, with lead and zinc by-products by 2014.

On the third-quarter production results, the stock gained 6% to close at $5 in Toronto. It has a 52-week range of $3.03 to $7.50.



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Related Press Releases
Fortuna Silver Reports Updated Mineral Resource Estimate for San Jose Mine in Mexico
Fortuna Reports Consolidated Financial Results for the Second Quarter 2014
Fortuna to Release Second Quarter Financial Results on August 12th, 2014; Conference Call at 12 p.m. Eastern on August 13th, 2014
 

Companies in This Story

Fortuna Silver Mines Inc



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