The boards of MAG Silver Corp. (MAG:TSX; MAG:NYSE.MKT) and joint venture (JV) partner Fresnillo, as well as the shareholders of the JV entity itself, Minera Juanicipio, all approved advancement of their Juanicipio project in Zacatecas, Mexico, MAG announced in a news release. MAG owns 44% of the project, and Fresnillo, which will be the operator, holds the remaining 56%.
"The joint approval of the project is a landmark milestone for the Juanicipio JV," MAG CEO George Paspalas said in the release.
"We are fortunate to have Fresnillo plc, with over 130 years of experience in the area, managing the construction and operations of Juanicipio. Their insightful experience has resulted in a very efficient upsizing development opportunity for the Joint Venture, which is greatly appreciated by the Board and Management of MAG Silver. We look forward to working together with our partner to realize further value from the joint venture," Paspalas added.
Fresnillo CEO Octavio Alvidrez also commented in the release: "The decision to approve Juanicipio reflects the extensive work the JV partners have done to derisk the project to meet stringent development criteria. This decision to invest demonstrates our confidence in the long-term outlook for mining in Mexico."
Construction at Juanicipio, which should create about 2,750 jobs, is to start immediately and is estimated to be completed in late 2020. Once in production, Juanicipio will create1,720 jobs.
The mine, in its initial 12-year life, is expected to produce an average of 11.7 million ounces of silver and 43,500 ounces of gold per year. Capex required before the mine is operating is about CA$395 million.
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