Following the suspension of high-cost lead and zinc mines, Mexico-focused miner First Majestic Silver is gearing up for a year in which the company will focus on cost reduction and innovation at its most profitable silver and gold mines.

In 2020, First Majestic will produce between 11.8-million to 13.2-million ounces, with total production ranging between 21.5-million and 24-million silver-equivalent ounces.

The guidance only assumes production coming from its three largest mines: San Dimas, Santa Elena and La Encantada, with the San Martin and La Parrilla mines expected to remain suspended throughout 2020 and Del Toro being wound down with no production this year.

“For 2020, our focus remains on adopting new innovation projects to modernise our processing plants to achieve higher recoveries, improve efficiencies and reduce operating costs,” said president and CEO Keith Neumeyer on Tuesday.

“We have witnessed significant benefits from high-intensity grinding at our Santa Elena operation in 2019 and we plan to install the same technology at San Dimas in 2020. In addition, we continue to advance underground development activities at the Ermitaño project near Santa Elena to prepare the mine for initial production in early 2021. Our increased investments in underground development and innovation in 2020 is expected to result in significant production growth in 2021 and beyond.”

The company plans to increase production at San Dimas by restarting mining operations at the past-producing Tayoltita mine by the end of the first quarter and expects to ramp up production to 300 t/d by the end of 2020. The Tayoltita mine was the original mining area at San Dimas and known to contain higher silver grades. In addition, First Majestic plans to install a new 3 000 t/d high-intensity grinding (HIG) mill circuit and an autogenous grinding mill in the second half of 2020 to further improve recoveries and reduce operating costs.

At La Encantada, silver production would increase, owing to continued improvements in metallurgical recoveries and grades from the San Javier and La Prieta sub-level caving areas. Furthermore, the company is preparing to bring the Milagros breccia into production in the fourth quarter of 2020.

At Santa Elena, improved metallurgical recoveries are expected from the recently installed HIG mill. The company also plans to install an autogenous/semi-autogenous grinding mill by the end of 2020 and plans to implement a dual-circuit flowsheet to separate the ultra-fine and coarse particles prior to leaching to further improve metallurgical recoveries and reduce energy costs.

First Majestic said that the San Martin mine is expected to remain in temporary suspension throughout 2020, owing to security concerns. “The company continues to work with authorities to secure the area but there is no indication of when a restart of the operation might occur.”

The miner also announced that the Del Toro operation would be temporarily suspended this year, to improve operating cash flow and profit margins while focusing on an expanded drill programme in the area. This expanded programme will include about 22 450 m of drilling to test near mine targets in an effort to develop new resources necessary to support a potential reopening in the future, subject to a sufficient improvement in economics to justify a restart.

In the meantime, First Majestic said it would continue evaluating mining methods and metallurgical testwork on the San Juan orebody which contained a large zinc mineral resource.

The Del Toro mine produced 493 636 silver equivalent ounces, which accounted for about 2% of the company’s total production in 2019.