Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) reports production results for the third quarter of 2020 from its two operating mines in Latin America, the San Jose Mine in Mexico and the Caylloma Mine in Peru. The Company produced 2.1 million ounces of silver and 12,791 ounces of gold, plus base metal by-products. Silver and gold production for the first nine months of 2020 totaled 5.2 million ounces and 29,992 ounces, respectively. At the beginning of the second quarter of 2020, the Company withdrew its production and cost guidance for 2020 until further notice, due to the uncertainties related to the impact caused by COVID-19 constraints on the Company’s business and operations (refer to Fortuna news release dated April 2, 2020).
Third Quarter Production Highlights
Consolidated Operating Highlights
|Third Quarter 2020||Third Quarter 2019|
|Average tpd milled||1,189||2,934||–||–||1,493||3,045||–||–|
|Ore placed on pad2 (t)||–||–||675,000||–||–||–||Nil||Nil|
|Gold placed on pad2 (oz)||–||–||17,980||–||–||–||–||–|
1. Preliminary estimates of cash operating costs per tonne are subject to modification on final cost consolidation.
2. Lindero tonnes and gold grade are estimated using grade control sampling of blast holes.
3. Metallurgical recovery for silver and gold at the Caylloma Mine is calculated based on silver and gold content in lead concentrate.
4. Totals may not add due to rounding.
San Jose Mine, Mexico
The San Jose Mine produced 1,917,540 ounces of silver and 11,425 ounces of gold in the third quarter of 2020 with average head grades for silver and gold of 254 g/t and 1.52 g/t, respectively. Silver and gold production for the first nine months of 2020 totaled 4.5 million ounces of silver and 27,710 ounces of gold.
Despite a minor decrease in mined tonnage, silver and gold production increased in the third quarter of 2020 compared to the same period in 2019 due to better grades encountered in the peripheral low-grade areas of the mine.
Caylloma Mine, Peru
In the third quarter of 2020, the Caylloma Mine produced 210,206 ounces of silver with an average head grade of 74 g/t. Silver production for the first nine months of 2020 totaled 704,190 ounces.
Gold production was 1,366 ounces with an average head grade of 0.60 g/t. The increase in production is due to higher head grades encountered in some of the production levels in the Animas vein. Gold production for the first nine months of 2020 totaled 2,282 ounces.
Lead and zinc production was 6,702,053 pounds and 10,313,225 pounds with average head grades for lead and zinc of 3.15% and 4.93%, respectively. Lead and zinc production was impacted in the quarter by a voluntary suspension of operations in July 2020 to disinfect and sanitize the mine site (refer to Fortuna news release dated July 28, 2020) and was partially offset by higher grades encountered in production stopes. Base metal production for the first nine months of 2020 totaled 33,111,227 pounds of zinc and 21,201,856 pounds of lead.
Lindero Project, Argentina
In the third quarter of 2020, a total of 675,000 tonnes of ore have been placed on the leach pad averaging 0.83 g/t gold, containing an estimated 17,980 ounces of gold. Average gold head grade of ore placed on the leach pad is below budget of 1.00 g/t to 1.10 g/t (refer to Fortuna news release dated May 8, 2020). The lower average head grade is due to COVID-19 related restrictions which delayed the start of mining activities and limited the access to high-grade ore from the pit and resulted in the shortfall being sourced from the medium grade stockpile.
The table below details material movements from the pit as estimated from the grade control model versus the Mineral Reserve block model for the third quarter of 2020. Reconciliation of the estimates indicate a good correlation with differences of less than five percent for all parameters. Management considers the result to be very encouraging when considering the variation in data density between the models.
|Material||Parameter||Grade Control Model1, 3||Mineral Reserve Model2, 3||Difference|
1. Grade control model numbers are based on estimates from blast holes.
2. Mineral Reserve model numbers are based on the Mineral Reserve estimates as of March 31, 2019 (refer to Fortuna news release dated April 4, 2019). See also the Technical Report entitled “Fortuna Silver Mines Inc.: Lindero Property, Salta Province, Argentina” with an effective date of October 31, 2017 prepared by Eric Chapman, Edwin Gutierrez, Geoff Allard and Denys Parra Murrugarra. The updated Mineral Reserve estimate does not materially change the information presented in the Technical Report.
3. Based on a gold cut-off grade of 0.27 g/t.
From the commencement of mining operations in September 2019 (see Fortuna news release dated September 13, 2019) to the end of the third quarter 2020, a total of 2.3 million tonnes of mineralized material averaging 0.61 g/t Au, containing 45,700 ounces of gold has been extracted from the pit. Of this amount, 1.6 million tonnes averaging 0.52 g/t Au, containing an estimated 27,500 ounces of gold has been stockpiled, with the remaining 682,000 tonnes averaging 0.83 g/t Au, containing 18,200 ounces sent to the crushers.
Commissioning of the ADR plant was completed according to plan. The carbon columns’ system is performing as per design capacity generating enriched carbon which is ready for the first gold pour in the upcoming days.
Quality Assurance & Quality Control
Grade control estimates are based on blast hole chip samples submitted to Lindero’s on-site laboratory for preparation and assaying for gold, using fire assay with an atomic absorption finish. The QA-QC program includes the blind insertion of certified reference standards and assay blanks at a frequency of approximately 1 per 20 normal samples as well as the submission of duplicate samples for verification of sampling and assay precision levels by an ISO 9001:2000 certified umpire laboratory. ALS Global Laboratory in Mendoza, Argentina prepared the samples for assaying and then forwarded the samples to ALS Global Laboratory in Lima, Peru for assay by standard fire assay methods.
Amri Sinuhaji is the Technical Services Director – Mine Planning for the Company and is a Professional Engineer registered with the Association of Professional Engineers and Geoscientists of the Province of British Columbia (#48305) and a Qualified Person as defined by National Instrument 43-101- Standards of Disclosure for Mineral Projects. Mr. Sinuhaji has reviewed and approved the scientific and technical information contained in this news release and has verified the underlying data.
About Fortuna Silver Mines Inc.
Fortuna Silver Mines Inc. is a Canadian precious metals mining company with operations in Peru, Mexico and Argentina. Sustainability is integral to all our operations and relationships. We produce silver and gold and generate shared value over the long-term for our shareholders and stakeholders through efficient production, environmental protection and social responsibility.
Expansion drill hole AVA20001 cuts 2.0 metres grading 3.41 g/t go... READ MORE
Awalé Resources Limited (TSX-V: ARIC)is pleased to report ... READ MORE
Blue Star Gold Corp. (TSX-V: BAU) (FSE: 5WP) announces additional... READ MORE
Surge Copper Corp. (TSX-V: SURG), announces it has closed the non... READ MORE
Canadian Palladium Resources Inc. (CSE: BULL) (OTCQB: DCNNF) (FSE... READ MORE