First Majestic "could hit 20Moz/y silver by 2017"

First Majestic Silver (TSX: FR, NYSE: AG) could hit 20Moz/y silver production as early as 2017 if prices improve, CEO Keith Neumeyer told the Denver Gold European Gold Forum in Zurich.

The Vancouver-based company expects to produce

12.6-13.3Moz silver at its five mines, all in Mexico, in 2014, up from 10.6Moz last year.

But with added production from its La Luz silver and Plomosas silver-gold projects in San Luis Potosí and Sinaloa states respectively, First Majestic will hit the 20Moz/y mark at some point between 2017 and 2020, depending on silver prices, Neumeyer said.

Achieving 20Moz/y production from development of the projects, which still need permits, will cost about US$300mn, with that money coming from cash flow, he said.

If silver prices improve soon, boosting cash flow, this growth will happen "very quickly," Neumeyer said, with 20Moz/y production as soon as 2017 or 2018. He added that if prices do not improve much above US$20/oz achieving that level of output could take until 2019 or 2020.

Neumeyer told the event he expects silver prices to improve substantially in 2H14 and 2015.

First Majestic is a "one country, one metal" mining company and has no plans to invest outside Mexico or in production of other metals, he added.

The company's operating mines are Del Toro, La Parrilla, La Guitarra, San Martín and La Encantada.

Silver closed at US$19.64 in London on Wednesday (May 7), unchanged on the previous day, compared to an average of US$23.83/oz in 2013.