JOHANNESBURG (miningweekly.com) Mexico-focused precious metals miner Fresnillo is raising its gold production guidance for the full year to 870 000 oz, following a 19.6% quarter-on-quarter increase in gold production to 218 000 oz for the three months ended June.

The company on Wednesday reported a 23% year-on-year increase to 448 000 oz, owing to a higher speed of recovery and higher ore volumes processed at its Herradura operations, and a higher speed of recovery at its Noche Buena mine.

Fresnillo also saw a 14.5% increase in silver production, quarter-on-quarter, to 13-milion ounces, while its year-on-year production climbed 6.1%, owing to increased ore processed at Saucito and higher ore grades at Ciénega.

“We remain on track to meet our silver production guidance of between 49-million ounces and 51-million ounces,” says CEO Octavio Alvídrez.

“We continue to progress the turnaround at our Fresnillo mine, consolidating the improvements already made. I am confident that we remain on track to return Fresnillo to a more satisfactory operating level, and expect full year silver production at this mine to show an increase of around 6% compared with 2015,” he adds.

Meanwhile, first construction on Phase 1 at Fresnillo’s San Julián project has been completed on time and on budget. However, after a few days of testing, a minor technical failure occurred resulting in the lubrication system of the mill malfunctioning.

The company expects the milling facility to be up and running regularly towards the first week of August. The mine has been fully prepared and development continues, allowing Fresnillo to stockpile material while the milling facility issue is being addressed.

“Construction of the flotation plant (Phase 2) progressed as planned during the quarter and we continue to expect commissioning in the fourth quarter,” the company says.

The $51-million San Julián silver-gold project will have an expected average production of 10.3-million ounces a year of silver and 44 000 oz/y of gold once Phase 2 is commissioned by year-end and it reaches full capacity.