Gatos Silver (NYSE, TSX: GATO) produced a record 2.39 million oz. of silver during the first quarter of 2022 from its 70%-owned Cerro Los Gatos (CLG) mine, representing a 58% increase over Q1 2021. The increased production was primarily due to significantly higher silver grades, in addition to higher plant throughput and improved recoveries, Gatos said.
The company also produced 10.3 million lb. of lead and 13.8 million lb. of zinc, representing an increase of 36% and 58%, respectively, over Q1 2021, primarily due to higher mined ore grades.
During the quarter, the CLG mine achieved throughput of 234,985 tonnes and excellent recoveries for silver, lead, zinc and gold, the company said. CLG remains on target to achieve its annual guidance for 2022, including the plans to increase plant throughput levels to 2,700 tpd in the second half of 2022.
Meanwhile, company has signed a definitive agreement with its JV partner, Dowa Metals & Mining, to build and operate a new leaching plant to reduce fluorine levels in all zinc concentrates produced. The construction cost is estimated at $6 million.
CLG is one of three silver-lead-zinc deposits identified by Gatos within Mexico’s Los Gatos district, 120 km south of the city of Chihuahua, and is the company’s first commercially producing mine. Lead and zinc concentrate shipments commenced in September 2019, achieving commercial production levels by the end of that year.
Elsewhere in the silver and zinc-rich mineral district, Gatos is also seeking to advance the Esther and Amapola deposits, as well as 11 other mineralized zones.
The Esther deposit contains 460,000 tonnes of indicated resources at average grades of 133 g/t silver, 0.04 g/t gold, 0.02% copper, 0.7% lead and 2.1% zinc, while Amapola has 250,000 million tonnes of indicated resources at average grades of 135 g/t silver, 0.1 g/t gold, 0.02% copper, 0.1% lead and 0.3% zinc.
Shares in Gatos Silver rose 7.6% by 11:50 a.m. ET, giving the Mexico-focused silver producer a market capitalization of C$420.3 million ($334m).