Peñoles declares force majeur

RNS Number : 8749O

Fresnillo PLC

16 March 2009

 



Fresnillo Plc

28 Grosvenor Street

London W1K 4QR

United Kingdom

www.fresnilloplc.com

16 March 2009

Peñoles' Lead/Precious Metals Refinery declares force majeure

Limited impact on Fresnillo plc

Fresnillo plc, the world's largest primary silver producer and Mexico's second largest gold producer, has been advised by Peñoles that it has declared force majeure at the Met-Mex metallurgical complex with respect to the precious metals doré and precipitates produced at the Herradura and Ciénega mines as well as on the lead concentrates from the Ciénega and Fresnillo mines. 

On 10 February 2009 we informed the market that Peñoles had advised us of a limited strike and that the stoppage had no impact at that point on Fresnillo's operations.  As a result of the declaration of force majeure we will switch to alternative arrangements that we have begun to put in place with other smelters and refineries. This will include the doré and precipitates produced at the Herradura and Ciénega mines as well as the lead concentrates from the Ciénega and Fresnillo mines. 

The Company does not expect a material adverse economic impact.  Zinc concentrates continue to be received and processed by Met-Mex as the zinc circuit is separate from the lead/precious metals circuit and is unaffected by the strike.

Peñoles has confirmed that it continues to make every effort to resolve the current situation. Fresnillo plc will continue to monitor the situation closely and will provide further information as soon as it is available.

For further information please visit www.fresnilloplc.com or contact:

Fresnillo plc

London Office

Octavio Alvidrez, Head of Investor Relations            Tel: [phone]

Mexico City Office

Gabriela Mayor                                                            Tel: [phone]

JPMorgan Cazenove                                                Tel: [phone]

Andrew Wray

Brunswick                                                                  Tel: [phone]

Patrick Handley

Carole Cable

About Fresnillo plc

Fresnillo Plc is the world's largest primary silver producer and Mexico's second largest gold producer, listed on the London Stock Exchange under the symbol FRES.  

Fresnillo has three producing mines, all of them in Mexico - Fresnillo, Ciénega and Herradura; two advanced development projects - Fresnillo II, Soledad & Dipolos; and three exploration prospects - San Juan, San Julian, Orysivo, as well as a number of other long term exploration prospects and, in total, has mining concessions covering approximately 1.3 million hectares in Mexico.

Fresnillo has a strong and long tradition of mining, a proven track record of mining development and reserves replacement, and a low cost of production, being in the lowest quartile of the cost curve for both silver and gold.

Fresnillo intends to maintain its position as the world's largest primary silver producer with the aim of approximately doubling production, on a silver equivalent ounce basis, within the next ten years and increasing its gold production.

 

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