Location

Taviche Mining District, Oaxaca, Mexico
Latitude: 16° 41' 40" N, Longitude: 96° 42' 00" W

Commodities

Commodities

Silver, gold

Ownership

Ownership

100%

Land Package

Land Package

64,422 hectares

Operation

Operation

3,000 tpd underground operation

Deposit Type

Deposit Type

High-grade, low sulphidation epithermal vein deposit

Mining Method

Mining Method

Overhand cut-and-fill

Highlights

2018 production: 8.0 million ounces of silver and 53,517 ounces of gold

The San Jose mine was commissioned in July 2011 and began commercial production in September 2011 at a rate of 1,000 tpd. In September of 2013, the mill was expanded from 1,150 tpd to 1,800 tpd and in April 2014, the mill was further expanded to 2,000 tpd without incurring in additional capital investments. Expansion of the mill from 2,000 tpd to 3,000 tpd was initiated in the first quarter of 2015 and successfully commissioned on time and under budget in July 2016.

Location

San Jose is located in the Taviche Mining District (Latitude 16° 41' 40" N, Longitude: 96° 42' 00" W) in the southern portion of the state of Oaxaca, approximately 47 road kilometers (one hour drive) south of the city of Oaxaca. Access to the property is excellent and local infrastructure is good.

Geology and Mineralization

The San Jose deposit is a low sulfidation epithermal vein system characterized by mineralized multiphase quartz-carbonate-sulfide veins, hydrothermal breccias and stockwork veining. The mineralized system is hosted within a sequence of Tertiary andesitic volcanic and volcaniclastic rocks.

2019 Production and Cost Guidance

Silver Production
(Moz)

7.3 - 8.1

Gold Production
(koz)

49 - 54

Cash Cost1
(US$/t)

63.5 - 70.1

AISC2
(US$/oz Ag Eq)

8.3 - 10.2

Notes:

  1. Cash cost per tonne includes all on-site direct and indirect production costs, community relations expenses, concentrate transportation and corporate management fees. It excludes government royalties and workers participation.
  2. All-In Sustaining Cost (AISC) is a non-GAAP financial measure; AISC per ounce of silver equivalent, including by-products, estimated at metal prices of US$1,250/oz Au, US$15.00/oz Ag, US$2,100/t Pb and US$2,700/t

Exploration

Brownfields exploration program budget for 2019 at the San Jose Mine is US$4.3 million, which includes 11,500 meters of diamond drilling and 450 meters of underground development for drilling access and platforms. Exploration drilling will focus on the sub-parallel Victoria mineralization zone.

Reserves and Resources

Mineral Reserves - Proven and Probable

PropertyClassificationTonnes
(000)
Ag
(g/t)
Au
(g/t)
Contained Metal
Ag
(Moz)
Au
(koz)
San Jose, MexicoProven241511.220.11
 Probable5,0132481.6139.9260
 Proven + Probable5,0372471.6140.1261

Mineral Resources - Measured and Indicated

PropertyClassificationTonnes
(000)
Ag
(g/t)
Au
(g/t)
Contained Metal
Ag
(Moz)
Au
(koz)
San Jose, MexicoMeasured34710.550.11
 Indicated287630.470.64
 Measured + Indicated321640.480.75

Mineral Resources - Inferred

PropertyClassificationTonnes
(000)
Ag
(g/t)
Au
(g/t)
Contained Metal
Ag
(Moz)
Au
(koz)
San Jose, MexicoInferred2,5962411.5320.1128

Notes:

  1. Mineral Reserves and Mineral Resources are as defined by CIM Definition Standards on Mineral Resources and Mineral Reserves
  2. Mineral Resources are exclusive of Mineral Reserves
  3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
  4. There are no known legal, political, environmental, or other risks that could materially affect the potential development of the Mineral Resources or Mineral Reserves at San Jose
  5. Mineral Resources and Mineral Reserves are estimated as of June 30, 2017 and reported as of December 31, 2017 taking into account production-related depletion for the period through December 31, 2017
  6. Mineral Reserves for San Jose are estimated using a break-even cut-off grade of 117 Ag Eq g/t based on assumed metal prices of US$19/oz Ag and US$1,250/oz Au; estimated metallurgical recovery rates of 92% for Ag and 91% for Au and and actual operating costs. Mineral Resources are estimated at a 100 g/t Ag Eq cut-off grade with Ag Eq in g/t = Ag (g/t) + Au (g/t) * ((US$1,250/US$19) * (91/92)). Proven + Probable Reserves include 2.74 Mt containing 25.6 Moz of silver and 153 koz of gold reported at a 120 g/t Ag Eq cut-off grade and Inferred Resources totaling 1.36 Mt containing 11.3 Moz of silver and 62 koz of gold reported at a 100 g/t Ag Eq cut-off grade located in the Taviche Oeste concession and subject to a 2.5% royalty
  7. Eric Chapman, P.Geo. (APEGBC #36328) is the Qualified Person for resources and Edwin Gutierrez (SME Registered Member #4119110RM) is the Qualified Person for reserves, both being current or former employees of Fortuna Silver Mines Inc.
  8. Totals may not add due to rounding procedures
Technical Report

Technical Report

Amended Technical Report Date: January 30, 2017

Maps and Sections

Maps and Sections

Photo Gallery

Photo Gallery

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