Fortuna reports production of 55,953 gold equivalent ounces for the second quarter and issues updated guidance for 2021
Fortuna reports production of 55,953 gold equivalent ounces for the second
quarter and issues updated guidance for 2021
Vancouver, July 19, 2021 – Fortuna Silver Mines Inc. (NYSE: FSM) (TSX: FVI) reports production results
for the second quarter from its three operating mines in the Americas, the San Jose Mine in Mexico, the
Caylloma Mine in Peru, and the Lindero Mine in Argentina. The company produced 1,892,822 ounces of
silver and 31,048 ounces of gold or 55,953 gold equivalent1 ounces. Silver and gold production for the first
six months of 2021 totaled 3,806,577 ounces and 65,603 ounces, respectively, or 115,690 gold equivalent1
ounces. The company is also providing an updated production and cost guidance for 2021 which also
incorporates gold production for the second half of the year from the Yaramoko Mine in Burkina Faso.
Second Quarter Consolidated Production
• Silver production of 1,892,822 ounces; 49 percent increase over Q2 2020
• Gold production of 31,048 ounces; 337 percent increase over Q2 2020
• Lead production of 8,143,876 pounds; 20 percent increase over Q2 2020
• Zinc production of 11,763,866 pounds; 7 percent increase over Q2 2020
Second Quarter Consolidated Operating Highlights
Second Quarter 2021 Second Quarter 2020
Caylloma,
Peru
San Jose,
Mexico
Lindero,
Argentina Consolidated Caylloma,
Peru
San Jose,
Mexico
Lindero,
Argentina Consolidated
OPERATIONAL FIGURES
Tonnes milled 133,645 269,565 134,172 160,151
Average tpd milled 1,536 3,029 1,525 1,799
Ore placed on pad2 (t) 1,477,000
SILVER3
Grade (g/t) 76 205 72 220
Recovery (%) 82.58 91.51 78.99 90.84
Production (oz) 268,428 1,624,394 1,892,822 244,873 1,029,049 1,273,922
GOLD
Grade (g/t) 0.42 1.30 0.95 0.25 1.42
Gold placed on pad2 (oz) 44,889
Recovery (%) 69.08 91.19 41.93 90.91
Gold in carbon4 (oz) 794
Dore poured (oz) 18,726
Production (oz) 1,261 10,266 19,521 31,048 445 6,654 7,099
LEAD
Grade (%) 3.09 2.77
Recovery (%) 89.53 82.81
Production (lbs) 8,143,876 8,143,876 6,777,010 6,777,010
ZINC
Grade (%) 4.58 4.29
Recovery (%) 87.14 86.58
Production (lbs) 11,763,866 11,763,866 10,976,816 10,976,816
Notes:
1. Gold equivalent production does not include lead or zinc, and is calculated using gold to silver ratio of 1 to 76
2. Lindero tonnes and gold grade are estimated using grade control sampling of blast holes; tonnes are reported to the nearest
thousand
3. Metallurgical recovery for silver at the Caylloma Mine is calculated based on silver content in lead concentrate
4. Lindero production includes gold in carbon columns and electrolytic cement
5. Totals may not add due to rounding
NYSE: FSM | TSX: FVI
www.fortunasilver.com NEWS RELEASE
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Lindero Mine, Argentina
Argentina suffered a surge of COVID-19 during the second quarter of 2021 with the infection rate peaking
at 41,000 cases per day. Extended nationwide COVID -19 related travel restrictions continue d to limit
onsite access to foreign vendor support affecting ramp up activities at Lindero.
The COVID-19 infection rate at Lindero increased during the second quarter and had a significant impact
on the operation´s performance as 160 personnel tested positive, representing 18 percent of the
workforce. During the quarter, the company intermittently voluntarily suspended onsite operations for a
total of 16 days which directly impacted ramp up progress and reduced the amount of ore delivered to
the heap leach pad. Strict government mandated travel restrictions have led to disruptions in the hiring
and movement of skilled personnel and delay s in access to foreign vendor support , which resulted in
higher mechanical downtime leading to lower tonnes of processed ore being delivered to the leach pad.
In the second quarter, a total of 1,477,000 tonnes of ore were placed on the leach pad averaging
0.95 g/t gold containing an estimated 44,889 ounces of gold.
Total gold production for the quarter was 19,521 ounces, 73 percent of the plan, comprised of
18,726 ounces in doré and 794 ounces of gold-in-carbon (GIC) inventory.
Second Quarter 2021
Ore mined1 (t) 1,817,000
Waste mined1 (t) 1,638,000
Total mined1 (t) 3,455,000
Strip ratio (waste to ore) 0.90
Average crushing throughput (tph) 868
Ore placed on leach pad1 (t) 1,477,000
Ore placed grade1 (g/t) 0.95
GIC inventory (oz) 794
Doré poured (oz) 18,726
Gold produced (oz) 19,521
Note:
1. Lindero tonnes and gold grade are estimated using grade control sampling of blast holes; tonnes are reported to the nearest
thousand
Mining
A total of 1 ,817,000 tonnes of ore were mined in the second quarter of 2021 at a strip ratio of 0.9:1 ,
20 percent below plan. M ine waste movement increased 3 4 percent compared to the first quarter of
2021, in line with expectation.
Mine reconciliation and metallurgical performance
Reconciliation of tonnes, grade and gold ounces mined for the second quarter indicate a good correlation
with the reserve model with differences of less than five percent for all parameters.
Gold leaching response as well as reagent consumption was within the expected parameters for the
granulometric composition and metallurgical types of ore placed on the leach pad.
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Processing
In the second quarter of 2021, a total of 1,477,000 tonnes of ore were placed on the leach pad at
0.95 g/t gold, 20 and 1 0 percent below plan , respectively. All processing activities were impacted
negatively by the direct and indirect downtimes related to the surge in C OVID-19 cases and government
restrictions. Lower grade is explained by the extraction of fewer tonnes from the pit than was planned,
resulting in reduced access to higher gr ade ore than was scheduled, and grade dilution as the operation
attempted to selectively mine higher-grade ore from lower -grade ore during th is period to offset
temporary shortfalls in gold stacked.
Trucked ore from the run of mine and coarse stockpiles placed on the leach pad totaled 801,000 tonnes,
32 percent higher than plan. Trucking of coarse ore to the leach pad was a temporary measure during the
first half of the year to offset the lower tonnage of agglomerated ore; resulting in a 15 percent decrease,
in respect to plan and guidance, of recoverable gold ounces on the heap during this period.
Primary and secondary crushing averaged 1 4,870 tonnes per day during the quarter, representing
79 percent of design capacity of 18,750 tonnes per day.
The tertiary-HPGR crusher, agglomeration plant, and stacking system throughput averaged 9,510 tonnes
per day in the quarter representing 51 percent of design capacity and a 25 percent increase compared to
the previous quarter. In June, ore stacking averaged 12,600 tonnes per day, representing 67 percent of
design capacity peaking at 18,390 tonnes per day, 98 percent of design capacity.
The company has worked to address ramp up challenges in the tertiary crushing-agglomeration-stacking
circuit with the in-country arrival of specialist support which was delayed due to COVID-19 travel
restrictions. The operation expects to complete the planned ADR plant expansion and achieve full
production capacity early in the fourth quarter of 2021.
SART plant ramp up work resumed in June at a pregnant solution flow rate of 100 to 150 cubic meters per
hour, 25 percent of design capacity, regarded as sufficient to manage soluble copper levels in the ADR
plant at this time . The SART plant is expected to achieve design capacity of 400 cubic meters per hour
during the second half of the year.
Quality Assurance & Quality Control
Grade control estimates at Lindero are based on blast hole chip samples submitted to Lindero’s on -site
laboratory for preparation and assaying for gold, using fire assay with an atomic absorption finish. The
QA-QC program includes the blind insertion of certified reference standards and assay blanks at a
frequency of approximately 1 per 20 normal samples as well as t he submission of duplicate samples for
verification of sampling and assay precision levels by an ISO 9001:2000 certified umpire laboratory. ALS
Global Laboratory in Mendoza, Argentina prepared the samples for assaying and then forwarded the
samples to ALS Global Laboratory in Lima, Peru for assay by standard fire assay methods.
San Jose Mine, Mexico
The San Jose Mine produced 1,624,394 ounces of silver and 10,266 ounces of gold in the second quarter
of 2021 with average head grades for silver and gold of 205 g/t and 1.30 g/t, respectively; 4 percent above
and in line with plan.
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Caylloma Mine, Peru
In the second quarter of 2021, t he Caylloma Mine produced 268,428 ounces of silver with an a verage
head grade of 76 g/t, in line with plan.
Gold production was 1,261 ounces, an increase of 183 percent with respect to the second quarter of 2020.
Caylloma’s gold production continues to exceed plan with average grades experienced in the second
quarter expected to continue throughout the year. The mine geology team has confirmed the continuity
of this higher-grade zone as related to the intersection of the Animas NE and Nancy veins with modeling
work to define this ore shoot completed.
Lead and zinc production for the second quarter of 2021 was 8,143,876 pounds and 11,763,866 pounds
with average head grades for lead and zinc of 3.09% and 4.58%, respectively; 8 percent and 9 percent
above plan.
Full Year 2021 Updated Consolidated Production and AISC Guidance
Following the completion of the business combination with Roxgold Inc. on July 2, 2021 (refer to news
release dated July 2, 2021, “Fortuna and Roxgold complete combination to create a global premier growth-
oriented intermediate gold and silver producer ”), the company has updated its consolidated silver and
gold production and cost guidance for 2021 (refer to news release dated January 19, 2021, “ Fortuna
reports 2020 full year production of 11.3 million silver equivalent ounces and issues 2021 guidance”) .
Updated Guidance Highlights
• Consolidated silver and gold production of 6.8 to 7.6 million ounces and 19 4 to 223 thousand
ounces, respectively for 2021, or 2 83 to 323 thousand gold equivalent 1 ounces, representing a
year over year increase of 90 to 116 percent
• Gold production at the Yaramoko Mine in Burkina Faso for the second half 2021 contributes to
the company´s full year guidance, representing 30 to 32 percent of the updated guidance
• Séguéla gold Project construction decision expected during the third quarter of 2021
• Due to direct and indirect COVID -19 related disruptions experienced in Argentina, Lindero has
reduced its gold production guidance by 31 to 36 percent
Silver and gold production guidance
The company’s updated production and cost guidance set out below for 2021 assumes that operations
will continue for the remainder of the year without any major interruptions related to COVID-19.
Mine
Silver Gold
Original Guidance Updated Guidance Original Guidance Updated Guidance
(Moz) (Moz) (koz) (koz)
Lindero, Argentina - - 140 - 160 90 - 110
San Jose, Mexico 5.8 - 6.5 5.8 - 6.5 38 - 42 38 - 42
Caylloma, Peru 1.0 - 1.1 1.0 - 1.1 - 4 - 5
Yaramoko2, Burkina Faso - - - 62 - 66
Consolidated Total 6.8 - 7.6 6.8 - 7.6 178 - 202 194 - 223
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AISC3,4 guidance
Mine
Silver Gold
AISC Original
Guidance
AISC Updated
Guidance
AISC Original
Guidance
AISC Updated
Guidance
(US$/oz Ag Eq) (US$/oz Ag Eq) (US$/oz Au) (US$/oz Au)
Lindero5, Argentina - - 730 - 860 1,010 - 1,190
San Jose, Mexico 12.2 - 14.5 12.2 - 14.5 - -
Caylloma, Peru 19.4 - 23.0 19.4 - 23.0 - -
Yaramoko, Burkina Faso - - - 990 - 1,150
Notes:
1. Silver and gold equivalent production does not include lead or zinc, and is calculated using gold to silver ratio of 1 to 76
2. The Yaramoko Mine gold production and AISC guidance is for the second half of 2021
3. All-in sustaining cost (AISC) is a non-IFRS financial measure, refer to Forward-looking Statements regarding non-IFRS financial
measures at the end of this news release; AISC includes production cash cost, commercial and government royalties, mining
tax, export duties (as applicable), worker’s participation (as applicable), subsidiary G&A, sustaining capital expenditures, and
Brownfields exploration and is estimated at metal prices of US$1,800/oz Au, US$22/oz Ag, US$1,900/t Pb, and US$2,300/t Zn
4. AISC excludes government mining royalty recognized as income tax within the scope of IAS-12
5. Refer to Lindero Mine AISC Guidance section in 2021 Guidance Outlook below
2021 Guidance Outlook
Lindero Mine, Argentina
Production guidance
Lindero´s updated gold production guidance range of between 90 and 110 thousand ounces reflects a
decrease of 50,000 ounces with respect to both the lower and upper range of the production guidance
disclosed on January 19, 2021 . The decrease in production is a consequence of the direct and indirect
impacts of the increase in COVID-19 positive cases in Argentina and in the workforce at Lindero, stricter
government mandated trave l restrictions which have caused delays in the ramp up of activities , and
challenges related to attempting to selectively mine and se parate higher-grade material, as discussed
above for the second quarter results. Operational impacts caused by these factors have been evaluated
and their effect considered for the second half of the year.
AISC guidance
Lindero´s updated AISC per ounce of gold between US$1,010 and US$1,190 reflects an increase of
38 percent with respect to both the lower and upper range of the AISC guidance disclosed at the beginning
of the year. The increase is a consequence of projected lower gold production and higher sustaining capex
related to the expansion of the ADR plant.
San Jose Mine, Mexico
At San Jose, the company reiterates the mine´s production and AISC guidance disclosed on January 19,
2021. COVID-19 related protocols set in place h ave been reviewed and adjusted to continue mitigating
the impacts of positive cases in the workforce. The ongoing vaccination campaign in the state of Oaxaca
in addition to the company´s strengthened health procedures are anticipated to contribute to containing
the COVID-19 infection rate at the operation.
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Caylloma Mine, Peru
At Caylloma, despite registering COVID-19 positive cases in the workforce during the first half of the year,
the mine´s performance has exceeded expectations as a result of an efficient allocation of the operation´s
resources and coarse ore stockpile management. The company reiterates the mine´s production and AISC
guidance disclosed on January 19, 2021, including lead and zinc production of 29 to 32 million pounds and
44 to 49 million pounds, respectively. In addition, gold production of 4 to 5 thousand ounces for the year
has been included in the annual consolidated production guidance to take into account the higher-grade
zone related to the intersection of the Animas NE and Nancy veins.
Yaramoko Mine, Burkina Faso
There were no major COVID-19 related impacts at the Yaramoko Mine during the second quarter of 2021.
Gold production guidance for the second half of the year assumes there will be no significant disruptions
of operations associated with COVID-19.
Annual planned m ine d evelopment meters are projected to increase , driven by a stoping sequence
rescheduling associated with lower grades encountered during the second quarter of the year . The
increase in development meters is expected to contribute to achieving second half of the year gold
production guidance at an estimated AISC per ounce of gold of US$990 to US$1,150.
Séguéla Gold Project, Côte d’Ivoire
At the Séguéla Project, the company expects to commence negotiations on the Project Mining Convention
with the government early in the third quarter. At the project site, the accommodation village is projected
to be ready for occupancy in the fourth quarter of 2021. Key contracts with plant EPC and bulk earthworks
contractors are close to being finalized. In order to not affect the critical path of the project, the Board of
Directors of the company has approved an early works budget of US$11.5 million to commence detailed
engineering work and procure long lead items such as the SAG mill. The company expects to make a
construction decision during the third quarter.
Exploration Outlook
Fortuna continues to advance its robust pipeline of Brownfield and Greenfield exploration projects in
West Africa and the Americas. The company will be providing a comprehensive exploration update in the
third quarter.
West Africa
Exploration in Côte d’Ivoire during the second half of the year will focus on infilling and extending the new
Sunbird discovery at Séguéla, where mineralization has now been delineated over a strike length of more
than 1,000 meters . Drilling will also continue the delineation of the high -grade Koula underground
inventory, while also following up on the recent high grades intersected in scout reverse circulation drilling
at Gabbro North. Further afield, several extensive soil and termite geochemistry anomalies will be tested
with aircore drilling at Fortuna’s Kadyoha and Dianra Nord prospects, some 140 kilometers to the north-
east of Séguéla.
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In Burkina Faso, delineation and step out drilling will continue in the second half of the year at Boussoura
after the conclusion of the annual rainy season in August . Drilling will focus on defining the Fofora Main
and VC2 deposits, and delineating additional mineralization at VC3 and VC5. Similarly, definition drilling
in the second half of the year at Galgouli and exploration drilling of mineralization identified at several
nearby prospects will continue. At Yaramoko, activities will continue to support advancing the 109 Zone
surface prospect, as well as target testing and delineation across the wider Yaramoko property.
Americas
Fortuna budgeted US$21 million for its 2021 exploration program, consisting of 69,000 meters of surface
and underground diamond drilling, supporting ground geophysical programs, and underground
development. As of the end of June, the exploration teams had completed a total of 23,400 meters of
drilling, 34 percent of plan. The remainder of the planned meters and budget at the mines and two
additional Greenfields projects will be realized throughout the second half of 2021 using up to 12 core
rigs. Fortuna also maintains a wide-ranging reconnaissance program in Mexico.
Qualified Persons
Amri Sinuhaji, Technical Services Director – Mine Planning for the company, is a Professional Engineer
registered with the Association of Professional Engineers and Geoscientists of the Province of British
Columbia (#48305) and a Qualified Person as defined by National Instrument 43 -101, Standards of
Disclosure for Mineral Projects (“NI 43-101”). Mr. Sinuhaji has reviewed and approved the scientific and
technical information pertaining to the San Jose, Caylloma and Lindero mines contained in this news
release and has verified the underlying data.
Paul Criddle, FAusIMM, Chief Operating Officer, West Africa for the company, is a Qualified Person as
defined by NI 43-101, and has reviewed and approved the scientific and technical information pertaining
to the Yaramoko Mine, Seguela Project and the West Africa exploration outlook contained in this news
release and has verified the underlying data.
David F. Volkert, Vice President of Exploration for the company, is a member of the American Institute of
Professional Geologists (CPG #10759) and the Association of Professional Engineers and Geoscientists of
British Columbia (P. Geo. #191936) and a Qualified Person as defined by NI 43 -101. Mr. Volkert has
reviewed and approved the Americas exploration outlook contained in this news release and has verified
the underlying data.
About Fortuna Silver Mines Inc.
Fortuna Silver Mines Inc. is a Canadian precious metals mining company with four operating mines in
Argentina, Burkina Faso, Mexico and Peru, and an advanced development project in Côte d’Ivoire .
Sustainability is integral to all our operations and relationships. We produce gold and silver and generate
shared value over the long -term for our shareholders and stakeholders through efficient production,
environmental protection, and social responsib ility. For more information, please visit our website at
www.fortunasilver.com.
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ON BEHALF OF THE BOARD
Jorge A. Ganoza
President, CEO, and Director
Fortuna Silver Mines Inc.
Investor Relations:
Carlos Baca | [email protected]
Forward-looking Statements
This news release contains forward -looking statements which constitute “forward -looking information”
within the meaning of applicable Canadian securities legislation and “forward-looking statements” within
the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995
(collectively, “Forward-looking Statements”). All statements i ncluded herein, other than statements of
historical fact, are Forward-looking Statements and are subject to a variety of known and unknown risks
and uncertainties which could cause actual events or results to differ materially from those reflected in the
Forward-looking Statements. The Forward-looking Statements in this news release may include, without
limitation, statements about the Company’s plans for its mines and mineral properties; the Company’s
anticipated performance in 2021; estimated production forecasts and sales for 2021; estimated production
costs and all -in sustaining cash costs for 2021; estimated capital expenditures in 2021; estimated
Brownfields and Greenfields expenditures in 2021; the success of the Company’s exploration activities at
its mines and development projects; the timing of the implementation and completion of sustaining capital
investment projects at the Company’s mines; the duration and impacts of COVID -19 on the Company’s
production, workforce, business, operations and fina ncial condition; metal price estimates, estimated
metal grades in 2021; the estimated amount of ore to be placed on the leach pad at the Lindero Mine in
2021, the grade of gold and the amount of gold estimated to be contained therein; the timing of the
commencement of steady state production at the Lindero Mine; the timing of the expansion of the ADR
plant at the Lindero Mine; the expansion of the heap leach pad at the Lindero Mine; the timing of the
signing key contracts for the Séguéla Project; the timing of a construction decision at the Séguéla Project;
the Company’s business strategy, plans and outlook; the merit of the Company’s mines and mineral
properties; mineral resource and reserve estimates; production costs; timelines; the future financial or
operating performance of the Company; expenditures; approvals and other matters. Often, but not
always, these Forward -looking Statements can be identified by the use of words such as “estimated”,
“potential”, “open”, “future”, “assumed”, “projected”, “used”, “detailed”, “has been”, “gain”, “planned”,
“reflecting”, “will”, “anticipated”, “estimated” “containing”, “remaining”, “to be”, or statements that
events, “could” or “should” occur or be achieved and similar expressions, including negative variations.
Forward-looking Statements involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be materially different from any
results, performance or achievements expressed o r implied by the Forward -looking Statements. Such
uncertainties and factors include, among others, changes in general economic conditions and financial
markets; the impact of the COVID -19 pandemic on the Company’s mining operations and construction
activities; the duration and impacts of COVID -19 on the Company’s production, workforce, business,
operations and financial condition, and the risks relating to a global pandemic, which unless contained