Welcome!

News Feed Item

Fortuna Reports 2013 Record Production of 5.9 Million Silver Equivalent Ounces and Issues Guidance for 2014

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 01/13/14 -- Fortuna Silver Mines, Inc. (NYSE: FSM) (TSX: FVI) (BVLAC: FVI) (FRANKFURT: F4S) is pleased to announce 2013 production figures from its two underground operating silver mines located in Latin America, the San Jose Mine in Mexico and the Caylloma Mine in Peru. The company produced 4.6 million ounces of silver and 21,242 ounces of gold or 5.9 million Ag Eq(i) ounces.

For 2014, silver production is scheduled to grow by 30% to 6 million ounces and gold production by 51% to 32,300 ounces or 8 million Ag Eq ounces, plus base metal by-products, at an estimated all-in sustaining cash cost(ii) of US$17.14 per ounce of silver.

Jorge A. Ganoza, President and CEO, commented: "We continue to successfully source significant organic growth from our assets. At our San Jose Mine, we are expanding throughput to 2,000 tpd in the second quarter of this year." Mr. Ganoza added, "Consolidated silver production grew sixteen percent in 2013 and for 2014, we are forecasting a thirty percent increase driven by the San Jose plant expansion. As a result of lower operating costs and reduced capital requirements, our all-in sustaining cash cost per ounce of silver is forecast to drop approximately nineteen percent to US$17.14."

2013 Consolidated Production Highlights


--  Silver was 5% above and gold 10% below 2013 production guidance
--  Silver production of 4,631,264 ounces; 16% increase over 2012
--  Gold production of 21,242 ounces; 3% increase over 2012
--  Lead production of 17,780,282 pounds; 1% decrease over 2012
--  Zinc production of 25,210,845 pounds; 13% increase over 2012

((i)) Ag Eq calculated using Au = US$1,241/oz and Ag = US$20.25/oz((ii)) All-in sustaining cash cost per ounce of silver is based on the guidelines from the World Gold council.

2013 Consolidated Operating Results


----------------------------------------------------------------------------
                         Q4 2013                          2013
             ---------------------------------------------------------------
                           San
             Caylloma,   Jose,              Caylloma, San Jose,
                  Peru  Mexico Consolidated      Peru    Mexico Consolidated
----------------------------------------------------------------------------
Processed Ore
----------------------------------------------------------------------------
Tonnes milled  116,127 158,218                458,560   456,048
Average tpd
 milled          1,290   1,741                  1,284     1,296
Silver
----------------------------------------------------------------------------
Grade (g/t)        174     202                    173       194
Recovery (%)     83.48   89.17                  82.33     88.94
Production
 (oz)          542,457 917,668    1,460,125 2,104,061 2,527,203    4,631,264
----------------------------------------------------------------------------

----------------------------------------------------------------------------
                          Q4 2013                          2013
              --------------------------------------------------------------
                            San                             San
              Caylloma,   Jose,               Caylloma,   Jose,
                   Peru  Mexico Consolidated       Peru  Mexico Consolidated
----------------------------------------------------------------------------
Gold
----------------------------------------------------------------------------
Grade (g/t)        0.38    1.42                    0.36    1.46
Recovery (%)      43.83   88.84                   41.92   88.61
Production
 (oz)               632   6,420        7,052      2,212  19,031       21,242
----------------------------------------------------------------------------
Lead
----------------------------------------------------------------------------
Grade (%)          1.59                            1.92
Recovery (%)      92.62                           91.45
Production
 (lbs)        3,769,939            3,769,939 17,780,282           17,780,282
----------------------------------------------------------------------------
Zinc
----------------------------------------------------------------------------
Grade (%)          2.88                            2.83
Recovery (%)      90.59                           88.11
Production
 (lbs)        6,675,772            6,675,772 25,210,845           25,210,845
----------------------------------------------------------------------------


San Jose Mine, Mexico

Silver annual production was in accordance with budget. Gold annual production was 9% below budget due to variations in the head grade relative to the resource model. The company is analyzing the reasons for these variations and is taking measures to improve the accuracy of gold grade estimate predicted by the resource model and the mining schedule production plans.

The mill expansion to 1,800 tpd was successfully completed and commissioned in September of last year on-time and on-budget.

Caylloma Mine, Peru

Silver annual production was 6% over budget mainly due to the improvement in metallurgical recovery which is 6% above budget.

2014 Production and Cash Cost Guidance


----------------------------------------------------------------------------
Mine             Silver  Gold   Investments   Cash Cost     All-in
                 (Moz)   (koz)  (US$ million) ((i))         Sustaining Cash
                                              (US$/t)       Cost
                                                            (US$/ oz Ag)
----------------------------------------------------------------------------
San Jose, Mexico 4.0     30.4   29.4          67.1          14.43
Caylloma, Peru   2.0     1.9    10.7          88.3          17.01
----------------------------------------------------------------------------
Total            6.0     32.3   40.1          --            --
----------------------------------------------------------------------------

--  Caylloma Mine zinc and lead production forecast of 22.6 million pounds
    and 16.6 million pounds respectively
--  Consolidated all-in sustaining cash cost per ounce of silver of
    US$17.14. Please refer to the appendix for detail.

2014 Outlook

San Jose Mine, Mexico

San Jose plans to process 683,000 tonnes of ore averaging 203 g/t Ag and 1.56 g/t Au. Investments for 2014 are estimated to be US$29.4 million.

The company has captured opportunities in spare capacity of major equipment allowing for an additional processing plant expansion to 2,000 tpd by the beginning of the second quarter. The mill and mine will increase production without incurring in additional capital investments. The company will be conducting engineering studies to assess a further expansion beyond 2,000 tpd.

Major investments include:


--  Mine development: US$7.0 million
--  Tailings dam expansion: US$11.7 million
--  Water evaporation control project: US$2.2 million
--  Brownfields exploration: US$5.3 million

Caylloma Mine, Peru

Caylloma plans to process 464,100 tonnes of ore averaging 167 g/t Ag. Capital expenditures for 2014 are estimated to be US$10.7 million.

Major investments include:


--  Mine development: US$4.7 million
--  Maintenance and energy: US$1.9 million
--  Brownfields exploration: US$1.1 million

Brownfields Exploration

The 2014 Brownfields exploration program at the San Jose property is focused on testing the potential for extensions of the high-grade silver-gold resources identified at Trinidad North (see Fortuna Silver news release dated Oct. 17, 2013). Step-out and delineation drilling totaling over 16,000 meters will explore the Trinidad North structure over a further 550 meter strike extension and to depths between 1300 and 900 meters in elevation. Underground workings will be advanced a further 300 meters to the north to provide access for drill stations.

At the Caylloma property, Brownfields exploration drilling will focus on testing the Don Luis I and Cailloma 6 vein systems where exploration completed-to-date has identified potential for high-grade silver mineralization.

Qualified Person

Boris G. Caro, Technical Services Corporate Manager, is a Qualified Person for Fortuna Silver Mines Inc. as defined by National Instrument 43-101. Mr. Caro is a Member of Australasian Institute of Mining and Metallurgy (Membership Number 305462) and a Registered Member of the Chilean Mining Commission (Registered Member Number 0229) and is responsible for ensuring that the information contained in this news release is an accurate summary of the original reports and data provided to or developed by Fortuna Silver Mines.

Fortuna Silver Mines Inc.

Fortuna is a growth oriented, silver and base metal producer focused on mining opportunities in Latin America. Our primary assets are the Caylloma silver mine in southern Peru and the San Jose silver-gold mine in Mexico. The company is selectively pursuing additional acquisition opportunities throughout the Americas. For more information, please visit our website at www.fortunasilver.com.

ON BEHALF OF THE BOARD

Jorge A. Ganoza, President, CEO and Director

Fortuna Silver Mines Inc.

Trading symbols: (NYSE: FSM) (TSX: FVI) (BVLAC: FVI) (FRANKFURT: F4S.F)

Forward-Looking Statements

This news release contains forward-looking statements which constitute "forward-looking information" within the meaning of applicable Canadian securities legislation and "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts and that are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. When used in this document, the words such as "anticipates", "believes", "plans", "estimates", "expects", "forecasts", "targets", "intends", "advance", "projects", "calculates" and similar expressions are forward-looking statements.

The forward-looking statements are based on an assumed set of economic conditions and courses of actions, including estimates of future production levels, expectations regarding mine production costs, expected trends in mineral prices and statements that describe Fortuna's future plans, objectives or goals. There is a significant risk that actual results will vary, perhaps materially, from results projected depending on such factors as changes in general economic conditions and financial markets, changes in prices for silver and other metals, technological and operational hazards in Fortuna's mining and mine development activities, risks inherent in mineral exploration, uncertainties inherent in the estimation of mineral reserves, mineral resources, and metal recoveries, the timing and availability of financing, governmental and other approvals, political unrest or instability in countries where Fortuna is active, labor relations and other risk factors.

Although Fortuna has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or information, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended. There can be no assurance that any forward-looking statements or information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements or information. Accordingly, readers should not place undue reliance on forward-looking statements or information.

Appendix - All-in sustaining cash cost per ounce of Ag, net of by-product credits

San Jose Mine all-in sustaining cash cost/ oz Ag:


----------------------------------------------------------------------------
Item                                                          2014 Guidance
                                                                 (US$/oz)
----------------------------------------------------------------------------
Cash cost net of by-product credits                                4.97
----------------------------------------------------------------------------
  Government royalty & mining tax                                  0.14
----------------------------------------------------------------------------
  Worker's participation                                           1.03
----------------------------------------------------------------------------
  G&A (subsidiary)                                                 0.84
----------------------------------------------------------------------------
Adjusted operating cash cost                                       6.98
----------------------------------------------------------------------------
  Corporate G&A                                                    0.00
----------------------------------------------------------------------------
  Sustaining capex                                                 6.06
----------------------------------------------------------------------------
  Brownfields exploration                                          1.39
----------------------------------------------------------------------------
All-in sustaining cash cost                                       14.43
----------------------------------------------------------------------------

Caylloma Mine all-in sustaining cash cost/oz Ag:


----------------------------------------------------------------------------
Item                                                          2014 Guidance
                                                                 (US$/oz)
----------------------------------------------------------------------------
Cash cost net of by-product credits                                9.36
----------------------------------------------------------------------------
  Government royalty & mining tax                                  0.34
----------------------------------------------------------------------------
  Worker's participation                                           0.33
----------------------------------------------------------------------------
  G&A (subsidiary)                                                 1.65
----------------------------------------------------------------------------
Adjusted operating cash cost                                      11.68
----------------------------------------------------------------------------
  Corporate G&A                                                    0.00
----------------------------------------------------------------------------
  Sustaining capex                                                 4.76
----------------------------------------------------------------------------
  Brownfields exploration                                          0.57
----------------------------------------------------------------------------
All-in sustaining cash cost                                       17.01
----------------------------------------------------------------------------

Consolidated all-in sustaining cash cost/oz Ag:


----------------------------------------------------------------------------
Item                                                          2014 Guidance
                                                                 (US$/oz)
----------------------------------------------------------------------------
Cash cost net of by-product credits                                6.44
----------------------------------------------------------------------------
  Government royalty & mining tax                                  0.21
----------------------------------------------------------------------------
  Worker's participation                                           0.80
----------------------------------------------------------------------------
  G&A (subsidiary)                                                 1.11
----------------------------------------------------------------------------
Adjusted operating cash cost                                       8.56
----------------------------------------------------------------------------
  Corporate G&A                                                    1.84
----------------------------------------------------------------------------
  Sustaining capex                                                 5.62
----------------------------------------------------------------------------
  Brownfields exploration                                          1.11
----------------------------------------------------------------------------
All-in sustaining cash cost                                       17.14
----------------------------------------------------------------------------

Contacts:
Fortuna Silver Mines Inc.
Investor Relations:
Carlos Baca
T (Peru): +51.1.616.6060, ext. 0
www.fortunasilver.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution and join Akvelon expert and IoT industry leader, Sergey Grebnov, in his session at @ThingsExpo, for an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
Because IoT devices are deployed in mission-critical environments more than ever before, it’s increasingly imperative they be truly smart. IoT sensors simply stockpiling data isn’t useful. IoT must be artificially and naturally intelligent in order to provide more value In his session at @ThingsExpo, John Crupi, Vice President and Engineering System Architect at Greenwave Systems, will discuss how IoT artificial intelligence (AI) can be carried out via edge analytics and machine learning techn...
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
"Cloud computing is certainly changing how people consume storage, how they use it, and what they use it for. It's also making people rethink how they architect their environment," stated Brad Winett, Senior Technologist for DDN Storage, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
As many know, the first generation of Cloud Management Platform (CMP) solutions were designed for managing virtual infrastructure (IaaS) and traditional applications. But that’s no longer enough to satisfy evolving and complex business requirements. In his session at 21st Cloud Expo, Scott Davis, Embotics CTO, will explore how next-generation CMPs ensure organizations can manage cloud-native and microservice-based application architectures, while also facilitating agile DevOps methodology. He wi...
When you focus on a journey from up-close, you look at your own technical and cultural history and how you changed it for the benefit of the customer. This was our starting point: too many integration issues, 13 SWP days and very long cycles. It was evident that in this fast-paced industry we could no longer afford this reality. We needed something that would take us beyond reducing the development lifecycles, CI and Agile methodologies. We made a fundamental difference, even changed our culture...
Most companies are adopting or evaluating container technology - Docker in particular - to speed up application deployment, drive down cost, ease management and make application delivery more flexible overall. As with most new architectures, this dream takes a lot of work to become a reality. Even when you do get your application componentized enough and packaged properly, there are still challenges for DevOps teams to making the shift to continuous delivery and achieving that reduction in cost ...
In the enterprise today, connected IoT devices are everywhere – both inside and outside corporate environments. The need to identify, manage, control and secure a quickly growing web of connections and outside devices is making the already challenging task of security even more important, and onerous. In his session at @ThingsExpo, Rich Boyer, CISO and Chief Architect for Security at NTT i3, discussed new ways of thinking and the approaches needed to address the emerging challenges of security i...
SYS-CON Events announced today that Datera, that offers a radically new data management architecture, has been named "Exhibitor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera is transforming the traditional datacenter model through modern cloud simplicity. The technology industry is at another major inflection point. The rise of mobile, the Internet of Things, data storage and Big...
Blockchain is a shared, secure record of exchange that establishes trust, accountability and transparency across business networks. Supported by the Linux Foundation's open source, open-standards based Hyperledger Project, Blockchain has the potential to improve regulatory compliance, reduce cost as well as advance trade. Are you curious about how Blockchain is built for business? In her session at 21st Cloud Expo, René Bostic, Technical VP of the IBM Cloud Unit in North America, will discuss th...
“Why didn’t testing catch this” must become “How did this make it to testing?” Traditional quality teams are the crutch and excuse keeping organizations from making the necessary investment in people, process, and technology to accelerate test automation. Just like societies that did not build waterways because the labor to keep carrying the water was so cheap, we have created disincentives to automate. In her session at @DevOpsSummit at 20th Cloud Expo, Anne Hungate, President of Daring System...
SYS-CON Events announced today that GrapeUp, the leading provider of rapid product development at the speed of business, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market acr...
From 2013, NTT Communications has been providing cPaaS service, SkyWay. Its customer’s expectations for leveraging WebRTC technology are not only typical real-time communication use cases such as Web conference, remote education, but also IoT use cases such as remote camera monitoring, smart-glass, and robotic. Because of this, NTT Communications has numerous IoT business use-cases that its customers are developing on top of PaaS. WebRTC will lead IoT businesses to be more innovative and address...
SYS-CON Events announced today that CA Technologies has been named "Platinum Sponsor" of SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business - from apparel to energy - is being rewritten by software. From planning to development to management to security, CA creates software that fuels transformation for companies in the applic...