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Market: TSX
Sector: Platinum & Precious Metals
EPIC: FVI
Latest Price: 3.75  (-2.60% Descending)
52-week High: 7.30
52-week Low: 3.55
Market Cap: 469.76M
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Fortuna Silver
www.fortunasilver.com

Fortuna Silver is a silver and base metal producer focused on mining opportunities in Latin America. The company's two primary assets are the Caylloma Silver Mine in southern Peru and the San Jose Silver-Gold Project in Mexico.

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Fortuna Silver starts commercial production at San Jose mine, Mexico

1st Sep 2011, 3:13 pm by Deborah Sterescu
Fortuna Silver starts commercial production at San Jose mine, Mexico

Fortuna Silver Mines (TSE:FVI) said Thursday that it has begun commecial production at its San Jose silver-gold mine in Oaxaca, Mexico, sending shares up around 3%.

Construction of the mine was initiated in March of last year, and was concluded on-time and on-budget, with total capital invested in the construction of roughly US$55 million, the company said.

San Jose is expected to produce 520,000 ounces of silver and 4,600 ounces of gold in 2011, and 1.7 million ounces of silver and 15,000 ounces of gold in 2012, at an estimated cash cost per silver ounce of US$5.04, net of by-products.

"This is a milestone for Fortuna. Our entire organization, with a special mention to our team at San Jose, has performed exceptionally well by delivering the construction and commissioning of our second mine on-time and on-budget," said president and CEO, Jorge A. Ganoza.

"We now look forward to continue delivering production growth through the expansion of San Jose to 1,500 tonnes per day by third quarter of 2013."

Commissioning of the processing plant began on July 15, treating low grade ore from development stock piles, and was completed on August 31, with the mill and mine operating  at the initial design rate of 1,000 tonnes per day (tpd), said Fortuna.

Metallurgical recoveries achieved for silver and gold are 75% and 80%, respectively. The company said it expects recovery rates to improve over the coming weeks, to the targeted 88% for silver and 90% for gold.

The San Jose mine has around 51,000 tonnes in the coarse ore stockpile, and 5,000 tonnes in fine ore stockpile.

As of 2:58pm EDT, shares of Fortuna rose 2.35% to $6.11.

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