Juanicipio plant view. Credit: MAG Silver
Fresnillo (LSE: FRES) has achieved a significant, long-awaited milestone in the commissioning of its Juanicipio project in Mexico.
On Wednesday, the world’s leading silver producer confirmed that the final testing of the downstream power distribution and control systems at Juanicipio is now complete.
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This concludes the additional testing requested by the state-owned power company CFE to verify the compatibility between the new and updated substation equipment installed by Fresnillo as part of the existing older infrastructure.
As such, the entire system has now been energized, and commissioning of the project has formally begun, Fresnillo said in a news release. Ramp-up will now be conducted at pace, with the objective of reaching full nameplate capacity in the second quarter of 2023.
Once commissioning is concluded, ore will be processed at the Juanicipio plant and could also continue to be processed at the nearby Saucito and Fresnillo operations if required, the company added.
The project – located 14 km from the Fresnillo underground mine – was first identified as a silver/gold prospect over 10 years ago and is now being developed as a standalone project in a joint venture with Canada’s MAG Silver (TSX: MAG). Fresnillo is the project operator and has a 56% interest in Juanicipio.
“Connection to the power grid is a long-awaited milestone for the Juanicipio Project, our stakeholders and shareholders alike, and we are thankful for the understanding and patience as the final steps to connect the plant to the national power grid were concluded,” stated George Paspalas, MAG Silver’s president and CEO, in a separate release.
The Juanicipio mine represents Fresnillo’s next major growth project. From 2023 onwards, it is expected to become a major influence in the company’s operations, with total average annual silver and gold production of 11.7 million oz. and 43,500 oz. respectively over the life of mine.