MAG Silver Corp. (TSX:MAG) (NYSE American: MAG) is pleased to report fourth quarter production of underground development and stope material from the Juanicipio Project (56% / 44% Fresnillo plc and MAG Silver, respectively). As reported to MAG by the project operator Fresnillo, 113,950 tonnes of mineralized material from both underground development and from initial stopes were processed during the three months ended December 31, 2021. The mineralized material processed in the quarter represents approximately 45% of all the tonnes processed for the year ended December 31, 2021. Total Juanicipio production for the quarter based on provisional estimates before offtake agreement adjustments totaled 1,632,000 silver ounces and 3,985 gold ounces (MAG’s attributable 44% interest: 718,080 silver ounces and 1,754 gold ounces). For the year ended December 31, 2021 a total of 251,907 tonnes of mineralized material were processed primarily from underground development, resulting in 3,200,000 silver ounces and 6,577 gold ounces (MAG’s attributable 44% interest: 1,408,000 silver ounces and 2,894 gold ounces). The associated lead and zinc production will be reported with MAG’s year end filings.
Until the Juanicipio processing plant is commissioned, mineralized material from Juanicipio is being processed through the nearby Fresnillo beneficiation plant (100% owned by Fresnillo), with the lead (silver rich) and zinc concentrates treated at market terms under off-take agreements with Met-Mex Peñoles, S.A. de C.V. in Torreón, Mexico. Included in 47,220 tonnes processed in December 2021 were 8,725 tonnes processed for the first time at Fresnillo’s Saucito beneficiation plant (also 100% owned by Fresnillo). The Saucito plant flowsheet better resembles that of the Juanicipio plant and will provide further valuable metallurgical benefits as production commences at Juanicipio. The revenue from the current production, net of processing and treatment charges, is being used by the Juanicipio shareholders to offset initial project capital cash requirements.
Construction of the Juanicipio plant was delivered by Fresnillo on schedule during the fourth quarter of 2021. However, as previously disclosed, the mill commissioning timeline was extended by approximately six months until tie-in approval to the national power grid is obtained (see Press Release December 27, 2021). Fresnillo, as operator, continues to engage closely with the authorities and is focusing on complying with new requirements to complete the tie-in to the national grid and do all that it can to expedite these necessary approvals. According to Fresnillo, commissioning of the Juanicipio processing plant is expected to commence in Q2-2022 as previously reported, with the expectation to ramp up the Juanicipio operations to 85-90% of capacity by year end.
“We are encouraged to see the increased throughput at the Fresnillo owned plants in the last quarter,” said George Paspalas, MAG Silver’s President and CEO. “The ability to utilize capacity at their plants when available to process Juanicipio material, helps us minimize any impact on this year’s cashflow while we await the electrical tie-in.”
Qualified Person: Dr. Peter Megaw, Ph.D., C.P.G., has acted as the Qualified Person as defined in National Instrument 43-101 for this disclosure and supervised the preparation of the technical information in this release. Dr. Megaw has a Ph.D. in geology and more than 38 years of relevant experience focused on ore deposit exploration worldwide. He is a Certified Professional Geologist (CPG 10227) by the American Institute of Professional Geologists and an Arizona Registered Geologist (ARG 21613). Dr. Megaw is not independent as he is Chief Exploration Officer and a Shareholder of MAG.
About MAG Silver Corp.
MAG Silver Corp. is a Canadian development and exploration company focused on becoming a top-tier primary silver mining company by exploring and advancing high-grade, district scale, silver-dominant projects in the Americas. Its principal focus and asset is the Juanicipio Project (44%), being developed with Fresnillo Plc (56%), the operator. The Project is located in the Fresnillo Silver Trend in Mexico, the world’s premier silver mining camp, where the operator is currently developing an underground mine and constructing a 4,000 tonnes per day processing plant. Underground mine production of mineralized development material commenced in Q3 2020, and an expanded exploration program is in place targeting multiple highly prospective targets at Juanicipio. MAG is also executing a multi-phase exploration program at the Deer Trail 100% earn-in project in Utah.
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