Santacruz Silver Reports Second Quarter 2020 Production Results
TSX.V: SCZ
FSE: 1SZ
August 10, 2020
Santacruz Silver Reports Second Quarter 2020 Production Results
Vancouver, B.C. – Santacruz Silver Mining Ltd. (TSX.V:SCZ) (the “Company” or “Santacruz”) reports
production in the second quarter of 2020 was 709,765 silver equivalent ounces, representing a 1 05% increase
compared with Q2 2019 and a 27% decrease compared to Q 1 2020. Both Q2 2020 and Q1 2020 production
results include 100% of the Zimapan Mine’s quarterly pr oduction whereas the Q2 2019 results do not include
any production from the Zimapan Mine given Santacruz acquired its initial interest in PCG Mining, S.A. de C.V.
on July 1, 2019 and did not complete the acquisition of the final 50% of PCG Mining until Oct ober 4, 2019 (see
press releases dated July 2 and October 7, 2019).
The Company’s Q2 2020 production was negatively impacted by the precautionary Covid -19 related
suspension of operations at the Zimapan Mine (see press releases dated April 20 and May 13, 2020) where
mill production was suspended for 42 days during the second quarter. As for Rosario, a greater percentage of
personnel were believed to have a higher health risk resulting in a 40% decrease in the labor force - primarily
the underground mining team.
Carlos Silva, CEO of Santacruz, stated, "Heading into the second quarter our focus was on increasing
production at the Rosario and Zimapan mines to offset the suspension of production at Veta Grande .
However, with the onset of Covid -19 our focus shifted to the health and wellbeing of our employees and we
suspended mine and milling operations during the second quarter in accordance with Mexican gover nment
guidance.” Mr. Silva continued; “During this operational downtime, we made adjustments in all areas, including
milling and underground, which are helping improve our tonnage thr oughput at both mines as operations
resumed. Consolidated production is now on track to return to Q1 2020 levels . With improved metals prices,
most particularly silver, and production ramping up towards historic levels with improved eff iciencies we are
optimistic about our Q3 2020 results .” Finally Mr. Silva commented; “It is important to note that Rosario mine
production stopes have reached Level 6 where improved head grades are anticipated. As we continue moving
forward, our health protocols will remain vigilant as we strive to protect our employees, their families and the
wider communities throughout these times of COVID uncertainty.”
2020 Second Quarter Consolidated Production Results
Summary of Production Results 2020 Q2 2020 Q1 2019 Q2
Material Processed (tonnes milled) 116,799 168,495 57,944
Silver eqv. ounce production 709,765 967,635 346,023
Silver production (ounces) 216,034 296,767 107,582
Gold production (ounces) 57 130 258
Lead production (tonnes) 761 1,085 388
Zinc production (tonnes) 2,199 2,862 946
Copper production (tonnes) 308 438 -
Average Head Grade (g/t Ag Eqv.) 248 241 264
Development (metres) 1,094 2,434 1,761
2020 Second Quarter Zimapán Mine Production Results
Summary of Production Results 2020 Q2 2020 Q1 2019 Q2
Material Processed (tonnes milled) 106,725 139,903 -
Silver eqv. ounce production 639,021 829,514 -
Silver production (ounces) 181,836 245,344 -
Silver head grade (g/t) 75 77 -
Gold head grade (g/t) - - -
Lead head grade (%/t) 0.72 0.73 -
Zinc head grade (%/t) 2.55 2.41 -
Copper head grade (%/t) 0.42 0.43 -
Silver recovery (%) 70 71 -
Gold production (ounces) - - -
Lead production (tonnes) 692 913 -
Zinc production (tonnes) 2,021 2,303 -
Copper production (tonnes) 308 438 -
Average Head Grade (g/t Ag Eqv.)(1) 249 250 -
Development (metres) 659 1,418 -
2020 Second Quarter Rosario Project Production Results
Summary of Production Results 2020 Q2 2020 Q1 2019 Q2
Material Processed (tonnes milled) 10,074 17,497 20,789
Silver eqv. ounce production 70,744 73,251 141,410
Silver production (ounces) 34,198 29,324 47,717
Silver head grade (g/t) 113 63 74
Gold head grade (g/t) 0.25 0.22 0.28
Lead head grade (%/t) 0.77 0.36 0.44
Zinc head grade (%/t) 2.04 1.78 2.21
Copper head grade (%/t) - - -
Silver recovery (%) 93 82 97
Gold production (ounces) 57 84 137
Lead production (tonnes) 70 52 87
Zinc production (tonnes) 178 231 405
Copper production (tonnes) - - -
Average Head Grade (g/t Ag Eqv.)(1) 247 169 235
Development (metres) 435 772 932
2020 Second Quarter Veta Grande Project Production Results
Summary of Production Results 2020 Q2 2020 Q1 2019 Q2
Material Processed (tonnes milled) - 11,095 37,156
Silver eqv. ounce production - 64,870 204,613
Silver production (ounces) - 22,089 59,864
Silver head grade (g/t) - 86 101
Gold head grade (g/t) - 0.22 0.21
Lead head grade (%/t) - 1.15 1.11
Zinc head grade (%/t) - 2.07 2.12
Copper head grade (%/t) - - -
Silver recovery (%) - 72 50
Gold production (ounces) - 47 120
Lead production (tonnes) - 120 301
Zinc production (tonnes) - 188 541
Copper production (tonnes) - - -
Average Head Grade (g/t Ag Eqv.)(1) - 231 280
Development (metres) - 244 830
(1) Ag Eq has been calculated using the following metal prices:
Metal Prices 2020: Ag $17.85/oz, Au $1,480/oz, Pb $0.92/lb, Zn $1.09/lb and Cu $2.80/lb.
Metal Prices 2019: Ag $15.25/oz, Au $1,281/oz, Pb $0.94/lb, Zn $1.20/lb and Cu $2.92/lb.
Qualified Persons
The scientific or technical information included in this news release has been reviewed and approved by Van
Phu Bui, P.Geo., consulting geologist, who is independent of the Company and is a qualified person, pursuant
to the meaning of such terms in National Instrument 43-101 ("NI 43-101").
About Santacruz Silver Mining Ltd.
Santacruz is a Mexican focused silver company that currently owns and operates the Rosario Project. The
Company also owns 100% of Carrizal Mining S.A. de C.V. Carrizal Mining is a private Mexican mining
company that holds a 20% working interest in the Company’s Veta Grande Project and has the right to
operate the Zi mapan Mine until December 31, 2020 under a mining lease agreement. On July 28, 2020 the
Company announced that it had reached agreement with Minera Cedros, S.A. de C.V. (“Minera Cedros”), a
wholly owned subsidiary of IndustriasPeñoles, S.A.B. de C.V., to acquire outright the Zimapan Mine for
US$20.0 million (plus applicable IVA of US$3.2 million), subject to a number of conditions, including receipt of
all necessary regulatory approvals including approval of the TSX Venture Exchange ("TSXV") to the
transaction which will constitute a "Fundamental Acquisition" pursuant to TSXV Policy 5.3.
The Company also ha s rights to two exploration properties, the Minillas property and Zacatecas properties as
well as the Veta Grande Project where mining operations are currently suspended.
The Company is managed by a technical team of professionals with proven track reco rds in developing,
operating and discovering silver mines in Mexico. Our corporate objective is to b ecome a mid -tier si lver
producer.
Zimapan Mine
Production at the Zimapan Mine is not supported b y a feasibility study on mineral reserves demonstrating
economic and technical viability or any other independent economic study under NI 43 -101. Accordingly, there
is increased uncertainty and economic and technical risks of failure associated with produc tion operations at
the Zimapan Mine. Production and econo mic variables may vary considerably due to the absence of a
complete and detailed site analysis in accordance with NI 43-101.
Rosario Project
The decisions to commence production at the Rosario Mine , Cinco Estrellas Property and Membrillo Prospect
were not based on a feasibility study of mineral reserves demonstrating economic and technical viability, but
rather on a more preliminary estimate of inferred mineral resources. Accordingly, there is incre ased
uncertainty and economic and technical risks of fail ure associated with this production decision. Production
and economic variables may vary considerably, due to the absence of a complete and detailed site analysis
according to and in accordance with NI 43-101.
Veta Grande Project
The decision to commence p roduction at Veta Grande Project was not based on a feasibility study on mineral
reserves demonstrating economic and technical viability. Accordingly, there is increased uncertainty and
economic and technical risks of failure associated with this productio n de cision. Production and economic
variables may vary considerably due to the absence of a complete and detailed site analysis in accordance
with NI 43-101.
‘signed’
Arturo Préstamo Elizondo,
Executive Chairman
For further information please contact:
Arturo Prestamo
Santacruz Silver Mining Ltd.
Email: [email protected]
Telephone: (604) 569-1609
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release .
Forward looking information
Certain statements contained i n this news release constitute "forward -looking information" as such term is
used in applicable Canadian securities laws , including statements relating to expected production increases,
the agreement with Minera Cedros and the acquisition of the Zimapan Mi ne by the Company. Forward-looking
information is based on plans, expectations and estimates of management at the date the information is
provided and is subject to certain factors and assumptions. In making the forward-looking statements included
in this news release, the Company has applied several material assumptions, including tha t the Company's
financial condition and development plans do not change as a result of unforeseen events, and tha t future
metal prices and the demand and market outlook for m etals will remain stable or improve. Forward -looking
information is subject to a variety of risks and uncertainties and other factors that could cause plans, estimates
and actual results to vary materially from those projected in such forward -looking info rmation. Factors that
could cause the forward-looking information in this news release to change or to be inaccurate include, but are
not limited to, the risk that any of the assumptions referre d to above prove not to be valid or reliable; there can
be no assurance that the Company will be successful in completing the acquisition of th e Zimapan Mine
(including obtaining the necessary funding); risk of delays or inability to obtain the approval of the TSXV to the
acquisition of the Zimapan Mine; market cond itions and volatility and global economic conditions , including
increased volatility and potentially negative capital raising conditions resulting from the continued COVID -19
pandemic and risks relating to the extent and duration of such pandemic and its i mpact on global markets; risk
of delay and/or cessation in planned work or changes in the Company's financial condition and development
plans; risks associated with the interpretation of data (in cluding in respect of the third party mineralized
material) regarding the geology, grade and continuity of mineral deposits; the uncertainty of the geology, grade
and continuity of mineral deposits and the risk of unexpected variations in mineral resources , grade and/or
recovery rates; risks related to gold, silver, base metal and other commodity price fluctuations; risks relating to
environmental regulation and liability; the possibility that results will not be consistent with the Company's
expectations, as well as the other risks and uncertainties applicable to mi neral exploration and development
activities and to the Company as set forth in th e Company's continuous disclosure filings filed under the
Company's profile at www.sedar.com. There can be no assurance that any forward -looking information will
prove to be accurate, as actual results and future event s could differ materially from those anticipated in such
statements. Accordingly, the reader should not place any undue reliance on forward -looking information or
statements. The Company undertakes no obligation to update forward -looking information or statements, other
than as required by applicable law.