First Majestic securing La Parrilla purchase

Vancouver-based First Majestic Resource (TSX-V: FR) was due to officially acquire the La Parrilla silver mine in Mexico's Durango state Tuesday (May 11) with a US$1.0mn initial payment, investor relations chief Ryan Mulhern told BNamericas. "We'll have [La Parrilla] back in production in two months, and we should produce about 1Moz silver this year," he said, adding: "The mine is essentially going to pay for itself." First Majestic will pay US$3.0mn overall for the property and invest US$2.5mn in new equipment to ramp it up to full production, which should start next year at just under 2Moz. "As you can appreciate, a lot of the private vendors in Mexico are under-capitalized, so we'll certainly do some work to expand the resources at depth and laterally as well," Mulhern said. "That will be ongoing." Company president Keith Neumeyer is in Mexico to finalize the La Parrilla deal and secure another property acquisition there. Though details will not be made public until next week, Mulhern said the property is "a little" bigger than La Parrilla, will cost roughly US$4.0mn, and boasts average silver grades of more than 1,000g/t. Meanwhile, First Majestic aims to start exploration drilling this month on the Niko silver project in Chihuahua state, which it optioned from fellow Vancouverite Consolidated JABA Inc. (TSX-V: JBA) last year.