Penoles exploring new Fresnillo vein

Friday, October 24, 2003

Mexican minerals group Industrias Penoles (BMV: PENOLES) is conducting geological exploration on the San Fernando vein discovered earlier this year at its Fresnillo silver mine in Zacatecas state, spokesperson Emilio Fandino told BNamericas Friday.

Samples "in some parts" of the vein have returned 1,000g/t silver, Fandino said. Penoles is in no rush to define a San Fernando production timeframe, considering Fresnillo's average throughput of 1.3Mt/y is still healthy, he said.

Penoles expects to produce 31.4Moz of silver from Fresnillo this year, which would represent less than a 1% increase over 2002.

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Fresnillo production, which currently involves "numerous veins," is focused primarily on veins San Carlos (2.6Mt), Santo Nino (1.8Mt) and Santa Cruz (1.0Mt), Fandino said.

Penoles is the world's largest producer of refined silver.