Updated Del Toro NI 43-101 Technical Report & Final Permit Received

FIRST MAJESTIC SILVER CORP. (AG: NYSE; FR: TSX) (the “Company” or “First Majestic”) is pleased to announce an updated and restated NI 43-101 Technical Report (“TR”) and Pre-Feasibility Study (“PFS”) for the Del Toro Silver Mine.


  • Silver Equivalent Measured & Indicated Resources increased to 76.5 million ounces
  • Silver Equivalent Inferred Resources increased to 81.8 million ounces
  • Average Measured and Indicated silver grade increased by 20% to 175 g/t
  • Total estimated production to reach 7.2 million silver equivalent ounces containing 5.4 million pure silver ounces in 2014
  • Subsequent to the Technical Report’s cut-off date, on August 13, 2012, the Company received the final permit from the Mexican government approving the cyanidation circuit and the enlarged 4,000 tpd plant
  • Estimated total direct operating costs are $35.00 per tonne and cash costs of $7.05 per ounce of silver on a by-product basis for LOM
  • Post Tax Net Present Value (“NPV”) at 5% discount increased by 30% to US$191.1 million using US$25 silver price
  • Internal Rate of Return (“IRR”) increased from 43% to 49% with a payback period of 3.5 years
  • Total capital requirement over three years remains $124.2 million, inclusive of a 5% contingency
  • The Del Toro Silver Mine is 100% owned by First Majestic Silver and there are no royalties payable

Due to improved metallurgical results and improved economics, the Company decided to re-state the previously released Pre-Feasibility Study dated March 31, 2012. This updated and restated NI 43-101 TR and PFS also considers further exploration and development work completed as at the cut-off date of June 30, 2012. These estimates include all work completed as at the cut-off date, including a total of 45,143 metres of diamond drilling over 141 holes and underground development totalling 9,850 metres. Six drill rigs remain active on site and a total of 5,725 metres drilled over 13 holes subsequent to the cut-off date were not included in this report.

The new Resource estimates as at the June 30, 2012 cut-off date consist of 76.5 million ounces of silver equivalent in Measured and Indicated Resources, plus an additional 81.8 million ounces contained in Inferred Resources. Total tonnage consists of 8.6 million tonnes of Measured and Indicated Resources, representing a 9% decreases from prior estimates plus an additional 7.5 million tonnes of Inferred Resources, representing a 19% decrease from prior estimates. The decrease in tonnage is a result of the reclassification of a large zinc ore body, called the San Juan Zinc deposit, into a new Inferred Mineral Resource pending additional resource definition. More details can be seen in the table below.

Construction of the new 4,000 tpd dual circuit processing mill commenced in April 2011. Production is presently scheduled to commence at the end of 2012. A delay in equipment delivery has resulted in some minor delays of the expected start-up date. Ramp up of production used in the PFS was as follows: Phase 1 — (starting in December 2012 through the first half of 2013) includes sulfide ore processing through the flotation circuit at a capacity of 1,000 tpd; Phase 2 — (beginning in the last half of 2013) includes oxide ore processing through cyanide leaching at a capacity of 1,000 tpd plus sulfide ore processing through flotation at a capacity of 1,000 tpd for total throughput of 2,000 tpd; Phase 3 – (Years 2014 through 2016) includes sulfide-ore processing (flotation) at a capacity of 2,000 tpd and oxide-ore processing (cyanide leaching) at a capacity of 2,000 tpd; Phase 4 (Years 2017 through 2019) includes sulfide-ore processing (flotation) at a capacity of 2,500 tpd in 2017, and 2,900 tpd in 2018 and 2019, plus oxide-ore processing (cyanide leaching) at a capacity of 1,500 tpd in 2017 and 1,000 tpd for 2018.

Total estimated throughput, described in more detail in the table below, is expected to reach a production level of approximately 7.2 million equivalent ounces of silver in 2014, represented by 5.4 million ounces of pure silver annually plus approximately 23.0 million pounds of lead and 25.2 million pounds of zinc.

Keith Neumeyer, CEO and President of First Majestic Silver, states: “The recent great news regarding the receipt of our final permit allowing for the full 4,000 tpd production at the Del Toro mill, including the allowance for doré production, is another major milestone for this project. The decision to construct a new state of the art laboratory as part of the La Parrilla expansion which is only 60 kms away has already proven to be a huge benefit to First Majestic. Based on the latest results from our metallurgical testing, we were able to improve the recoveries and economics of Del Toro. The La Parrilla lab will further assist the Company in responding to the needs of each of our mines as a specialized centralized facility. We have also been able to complete the construction of the sewage treatment facility for the town of Chalchihuites, which is on standby waiting for the mill production to commence.”

The following two summary tables were taken from the complete Del Toro Silver Mine updated and restated NI 43-101 TR and PFS prepared by Pincock Allan & Holt, Lakewood, Colorado (PAH). Shareholders and interested parties are encouraged to read this positive report in its entirety which can be viewed on SEDAR (www.sedar.com) and the Company’s web site atwww.firstmajestic.com.