Fresnillo says operational issues at Sabinas mine affecting silver production
Adds share move for Industrias Penoles, updates Fresnillo share move
MEXICO CITY, Nov 12 (Reuters) -Precious metals miner Fresnillo PlcFRES.L said on Tuesday that the Sabinas mine, owned by Mexico's top silver miner Industrias Penoles PEOLES.MX, was experiencing operational difficulties, affecting silver production.
The Sabinas mine is the mineral source as part of the Silverstream agreement between Fresnillo and Penoles, signed in 2007.
The Silverstream contract comprises a series of 12 agreements between Fresnillo and Penoles, following which the London-listed miner has the right to receive all proceeds from the payable silver.
Shares in the FTSE 100 .FTSE miner closed down nearly 8% in London, while shares in Industrias Penoles were trading down over 5% in afternoon trading.
Fresnillo did not disclose the nature of the operational issues at the Mexican mine.
The company also said discussions are ongoing with Penoles to assess the extent of the issues and any associated impact on the contract.
Fresnillo, which primarily produces silver and gold, said there was a reasonable likelihood that the issues might lead to "significant adjustments" to the Silverstream agreement.
Last month, Fresnillo said its 2024 production outlook remained in line with its previous forecast after posting a 1.5% quarter-on-quarter drop in silver output for the third quarter.
Reporting by Aby Jose Koilparambil in Bengaluru; Additional reporting by Noe Torres in Mexico City
Editing by Abinaya Vijayaraghavan and Marguerita Choy
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
