LONDON (ShareCast) - (ShareCast News) - Quarterly silver production at Fresnillo was up 11.7% year-on-year in the second quarter to 14.5 Moz including Silverstream, the company reported on Wednesday, with first half production up 11.2% year-on-year.
The FTSE 100 firm said the improvements were primarily due to the start of operations at San Julián's first phase, higher ore processed at Fresnillo and higher ore grade at Ciénega.

"I am pleased to report strong first half production results, with 28 million ounces of silver and over 445 thousand ounces of gold produced across our operating mines and from the Silverstream," said chief executive Octavio Alvídrez.

"The increase in silver production was primarily driven by the contribution of San Julián phase I and the higher ore processed at Fresnillo following the measures taken to increase production at the mine."

Quarterly gold production was ahead 223 koz, up 2.7% year-on-year, which the board put down to the contribution of San Julián's first phase.

"Quarterly gold production also benefitted from the operations at San Julián phase I, more than offsetting the expected lower production at Herradura and Noche Buena, and the lower gold ore grade at Saucito," Alvidrez added.

Fresnillo said construction of the second phase of San Julián was completed on time and on budget, with commercial production delivered mid-July.

"We continue to advance our development projects.

"I am pleased to announce that the construction of San Julián phase II was concluded on time and on budget, and following tests with load in the second quarter, commercial production commenced in mid-July," said Alvidrez.

The company's turnaround plan at the Fresnillo mine continued to show positive signs, the company claimed, as volumes of ore processed increased for the fourth consecutive quarter.

Fresnillo said it was also on track to achieve 2017 production guidance of between 58 and 61 moz of silver, including Silverstream, and between 870 and 900 joz of gold.

"Our short-term focus will be on ramping-up San Julián phase II to full capacity within the next two months and operating the Fresnillo mine once again at full capacity by year-end, whilst continuing to develop the infrastructure in order to prepare the mine for the future expansion.

"With this progress, we remain on course to meet our 2017 production guidance of 58-61 million ounces of silver and 870-900 thousand ounces of gold," Alvidrez said.

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