Production Boost at Zimapan During 3Q21

Santacruz Silver released its 3Q21 operating results from its Zimapan mine in Hidalgo, showing consolidated silver production and a significant increase compared to the previous quarter. The company's Rosario mine in San Luis Potosi showed a significant decrease in production as it was put into care and maintenance during the quarter.

Among the highlights of the quarter was silver equivalent production at 872,913 AgEq oz, which is an increase of more than 9 percent compared to the last quarter. Additionally, Zimapan's silver equivalent production was 867,215 AgEq oz, an increase of 14 percent compared to 2Q21, which was the result of a 20 percent increase in tons milled.

“The production increase during Q3 came mainly from the Carrizal and Monte mines as a result of development of new stopes at Lomo del Toro, setting the stage for a strong year end. All underground equipment from the Rosario project is now working at Lomo de Toro and it is expected that with this additional equipment production will further increase during Q4,” said Carlos Silva, CEO of Santacruz.

In an interview with MBN, Silva said that the Lomo del Toro zone was a very promising mining prospect as “unlike the district, it is an area that has minerals horizontally. Historically, the mineral found in this zone has better grades but lower volume.” Silva said that this year the company already started exploration with diamond drilling to unlock its full potential and thus prepare more stopes. The company’s plan is to continue exploration and drilling and then work directly in the identified higher grade mineralized zones.

The press release shows that the tons milled at the Rosario mine went from 16,917 in 2Q21 to 2,306 in 3Q21, while the production of silver equivalent oz decreased from 41,120 to 45,680 in the same period. The company explained that the operating results are because the Rosario mine was put into care and maintenance during 3Q21, for which it had to suspend operations.

In a previous press release, the company explained that management decided to reallocate capital and resources to the Zimapan mine, while still permitting activities and remediation programs at the Rosario mine to be ready for a restart should the economy allow it. “We have diligently tried to make the Rosario mine a profitable operation but due, to its narrow vein system and varying grades, this is a challenging project. Putting the project in care and maintenance will allow us to better evaluate the alternatives to maximize the return on this asset." The company said it is currently evaluating the possible sale of the project.