REG - Fresnillo Plc - Report on Payments to Governments for 2021
23/06/2022 15:15
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RNS Number : 8745P Fresnillo PLC 23 June 2022
Fresnillo plc
21 Upper Brook Street
London W1K 7PY
United Kingdom
www.fresnilloplc.com (http://www.fresnilloplc.com)
23 June 2022
Fresnillo plc - Report on Payments to Governments for the year 2021
Background
This Report provides an overview of the payments to governments made by
Fresnillo plc and its subsidiaries for the year ended 31 December 2021 as
required under the UK Reports on Payments to Governments Regulation 2014 and
its amendment in December 2015 (the UK Regulations). This Report is also
intended to satisfy the requirements of the Disclosure and Transparency Rules
of the Financial Conduct Authority in the United Kingdom.
This Report is available for download from
http://www.fresnilloplc.com/investor-relations/regulatory-announcements/
(http://www.fresnilloplc.com/investor-relations/regulatory-announcements/)
The 'Basis of Preparation' section below contains information about the
content of the Report, the types of payments included and the principles that
have been applied in preparing the Report.
Basis for preparation - Report on Payments to Governments for the year 2021
Reporting entities
In accordance with the UK Regulations, this Report includes payments to
government made by Fresnillo plc and its subsidiary undertakings (Fresnillo).
Activities
Payments made by Fresnillo to governments arising from activities involving
the exploration, prospection, discovery, development and extraction of
minerals (extractive activities) are disclosed in this Report. When payments
cover both extractive and processing activities and cannot be split, the
payment has been disclosed in full.
Government
Government includes any national, regional or local authority of a country to
which Fresnillo has made a payment related to these regulations, and includes
any department, agency or entity that is controlled by such authority.
Project
Payments are reported at project level, except for payments that are not
attributable to a specific project which are reported at entity level. Within
the UK Regulations, a project is defined as being the operational activities
which are governed by a single contract, licence, lease, concession or a
similar legal agreement, and form the basis for payment liabilities with a
government. If agreements of this kind are substantially interconnected (i.e.
forming a set of operationally and geographically integrated contracts,
licenses, leases or concessions) these are treated for the purposes of these
Regulations as a single project. Indicators of integration include geographic
proximity and common operational management. For some payments that cannot be
attributable to a specific project, they were indicated at an entity level.
Materiality
In line with the UK Regulations, where a payment or a series or related
payments have not exceeded £86,000 (US$118,297 1 (#_ftn1) ) they have not
been disclosed.
Reporting currency
Payments disclosed in this report have been disclosed in US Dollars. Where
actual payments have been made in a currency other than US Dollars, i.e.
Mexican pesos (MXN), they have been translated using the annual average
exchange rate MXN / USD issued by The Central Bank of Mexico 2 (#_ftn2) .
Type of payments
a) Taxes. There are taxes paid by Fresnillo on its income, including
special mining rights. Payments are reported net of refunds. In accordance
with the UK Regulations payments made in relation to consumption, sales or
employee taxes were excluded.
b) Royalties.
c) License fees, rental fees, entry fees and other considerations for
licenses or concessions. These are fees paid as consideration for acquiring a
license for gaining access to an area where extractive activities are
performed.
Payments reported are on a cash flow basis and refunds are included in the
year received (i.e. 2021).
Other types of payments that are required to be disclosed in accordance with
the UK Regulations are the following; however, for the year ended 31 December
2021, there were no such reportable payments made by Fresnillo to a
government:
- Production entitlements
- Dividends
- Signature, discovery and production bonuses
- Infrastructure improvements
REPORT ON PAYMENTS TO GOVERNMENTS 2021
SUMMARY REPORT PER COUNTRY (IN USD)
Production entitlements Taxes ((1)) Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
MEXICO 0 407,147,515 1,727,376 0 0 32,953,195 0 441,828,086
PERU 0 0 0 0 0 2,009,755 0 2,009,755
CHILE 0 0 0 0 0 334,586 0 334,586
Total 0 407,147,515 1,727,376 0 0 35,297,537 0 444,172,428
MEXICO
GOVERNMENT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
Ministry of Economics 0 37,176,634 1,727,376 0 0 22,991,658 0 61,895,668
Ministry of Finance and Public Credit 0 369,970,881 0 0 0 0 0 369,970,881
Ministry of Environment and Natural Resources 0 0 0 0 0 130,911 0 130,911
National Water Commission 0 0 0 0 0 9,830,626 0 9,830,626
Total 0 407,147,515 1,727,376 0 0 32,953,195 0 441,828,086
PROJECT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
PROJECT
Ciénega 0 25,739,220 0 0 0 2,330,149 0 28,069,369
Fresnillo 0 39,594,682 0 0 0 3,500,821 0 43,095,503
Herradura / Nochebuena 0 169,606,532 0 0 0 14,103,366 0 183,709,898
Juanicipio ((2)) 0 3,249,607 0 0 0 133,226 0 3,382,833
San Julián 0 45,834,123 1,727,376 0 0 5,093,245 0 52,654,744
Saucito 0 100,590,080 0 0 0 7,792,388 0 108,382,469
ENTITY LEVEL
Comercializadora de Metales Fresnillo, S.A. de C.V. 0 10,384,011 0 0 0 0 0 10,384,011
Exploraciones Mineras Parreña S.A. De C.V. 0 3,096,161 0 0 0 0 0 3,096,161
Fresnillo plc 0 7,074,657 0 0 0 0 0 7,074,657
Operaciones Fresnillo, S.A. de C.V. 0 714,718 0 0 0 0 0 714,718
Servicios Administrativos Fresnillo, S.A. de C.V. 0 1,263,724 0 0 0 0 0 1,263,724
Total 0 407,147,515 1,727,376 0 0 32,953,195 0 441,828,086
PERU
GOVERNMENT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
Ministry of Energy and Mining 0 0 0 0 0 2,009,755 0 2,009,755
Total 0 0 0 0 0 2,009,755 0 2,009,755
PROJECT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
ENTITY LEVEL
Fresnillo Perú, 0 0 0 0 0 2,009,755 0 2,009,755
S.A.C.
Total 0 0 0 0 0 2,009,755 0 2,009,755
CHILE
GOVERNMENT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
Ministry of Mining 0 0 0 0 0 334,586 0 334,586
Total 0 0 0 0 0 334,586 0 334,586
PROJECT REPORT (IN USD)
Production entitlements Taxes Royalties Dividends Bonuses Licenses & concessions fees Infrastructure improvements Total
ENTITY LEVEL
Fresnillo Chile SpA. 0 0 0 0 0 334,586 0 334,586
Total 0 0 0 0 0 334,586 0 334,586
Notes:
1: All tax payments made in 2021 to the Ministry of Finance and Public Credit
(the Mexican Tax authorities) are presented net of refunds received in 2021.
2: Represents 100% of the payments related to Juanicipio (56% Fresnillo plc,
44% MAG Silver)
For further information, please visit our website www.fresnilloplc.com
(http://www.fresnilloplc.com) or contact:
FRESNILLO PLC Tel: +44 (0)20 7399 2470
London Office
Gabriela Mayor, Head of Investor Relations
Patrick Chambers
Mexico City Office Tel: +52 55 52 79 3206
Ana Belem Zárate
POWERSCOURT Tel: +44 (0)7793 858 211
Peter Ogden
ABOUT FRESNILLO PLC
Fresnillo plc is the world's largest primary silver producer and Mexico's
largest gold producer, listed on the London and Mexican Stock Exchanges under
the symbol FRES.
Fresnillo plc has seven operating mines, all of them in Mexico - Fresnillo,
Saucito, Ciénega (including Las Casas Rosario & Cluster Cebollitas),
Herradura, Soledad-Dipolos(1), Noche Buena and San Julián (Veins and
Disseminated Ore Body), two development projects - the Pyrites Plant at
Fresnillo and Juanicipio, both of which have been completed but approvals to
operate are pending, and three advanced exploration projects - Orisyvo, Rodeo
and Guanajuato, as well as a number of other long term exploration prospects.
Fresnillo plc has mining concessions and exploration projects in Mexico, Peru
and Chile.
Fresnillo plc has a strong and long tradition of exploring, mining, a proven
track record of mine development, reserve replacement, and production costs in
the lowest quartile of the cost curve for silver.
Fresnillo plc's goal is to maintain the Group's position as the world's
largest primary silver company and Mexico's largest gold producer.
(1) Operations at Soledad-Dipolos are currently suspended.
FORWARD-LOOKING STATEMENTS
Information contained in this announcement may include 'forward-looking
statements'. All statements other than statements of historical facts included
herein, including, without limitation, those regarding the Fresnillo Group's
intentions, beliefs or current expectations concerning, amongst other things,
the Fresnillo Group's results of operations, financial position, liquidity,
prospects, growth, strategies and the silver and gold industries are
forward-looking statements. Such forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances.
Forward-looking statements are not guarantees of future performance and the
actual results of the Fresnillo Group's operations, financial position and
liquidity, and the development of the markets and the industry in which the
Fresnillo Group operates, may differ materially from those described in, or
suggested by, the forward-looking statements contained in this document. In
addition, even if the results of operations, financial position and liquidity,
and the development of the markets and the industry in which the Fresnillo
Group operates are consistent with the forward-looking statements contained in
this document, those results or developments may not be indicative of results
or developments in subsequent periods. A number of factors could cause results
and developments to differ materially from those expressed or implied by the
forward-looking statements including, without limitation, general economic and
business conditions, industry trends, competition, commodity prices, changes
in regulation, currency fluctuations (including the US dollar and Mexican Peso
exchanges rates), the Fresnillo Group's ability to recover its reserves or
develop new reserves, including its ability to convert its resources into
reserves and its mineral potential into resources or reserves, changes in its
business strategy and political and economic uncertainty.
LEI: 549300JXWH1UV5J0XV81
1 (#_ftnref1) Bloomberg 2021 average exchange rate 1.3755 USD/GBP
2 (#_ftnref2) Banco de Mexico 2021 average exchange rate 20.2800 MXN/USD
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