First Majestic Silver Revives Major Nevada Gold Project Amid Favorable Market Conditions

First Majestic Silver plans a $75M restart of its Jerritt Canyon gold mine in Nevada, driven by a 116% surge in resources and higher gold prices, targeting production by late 2027.

First Majestic Silver is moving forward with plans to restart a significant gold mining operation in Nevada that has been idle since early 2023. The decision is underpinned by a substantially improved gold price environment and encouraging new drilling data, positioning the project as a potential cornerstone for future growth. While market analysts have applauded the strategic move, the company's share price has recently faced headwinds.

Strategic Shift Bolstered by Exploration Success

Recent exploration efforts have yielded substantial results, providing strong technical justification for the mine's revival. Following an extensive drilling campaign, measured and indicated gold resources at the Jerritt Canyon site surged by 116% to reach 4.1 million ounces. This expanded resource base, coupled with current metal prices, allows the company to consider processing material with a lower gold grade while remaining economically viable.

The revised mining plan incorporates a hybrid approach, utilizing the existing underground infrastructure alongside potential new open-pit developments. To further define the project's scope, an additional 42,000 meters of drilling is scheduled for the current year.

Economic Rationale: A $75 Million Restart Plan

The Jerritt Canyon Mine was initially placed on care and maintenance in March 2023. At that time, elevated contractor costs and challenging weather conditions rendered operations uneconomical, especially with gold trading between $1,600 and $1,900 per ounce. The subsequent sustained rise in the gold price has fundamentally altered the project's economics.

First Majestic now intends to invest approximately $75 million to recommission the asset. This capital, slated for 2026, will fund technical preparatory work, underground development, and plant modernization. A pre-feasibility study evaluating the restart is expected to be finalized in the fourth quarter of this year.

Analyst Approval Contrasts with Recent Share Performance

Wall Street observers have responded favorably to the announcement. BMO Capital Markets identified the restart as a pivotal future growth driver for the company. Their projections suggest that, assuming production resumes in the second half of 2027, the mine could yield around 86,000 ounces of gold annually. In a similarly constructive note, HC Wainwright recently raised its price target for First Majestic Silver to $30.

Despite this strategic optimism, the stock has encountered recent selling pressure. After closing at €19.00 on Thursday, the shares show a decline of roughly 22.8% over the preceding 30-day period.

The final economic parameters for the Jerritt Canyon restart will be established upon completion of the pre-feasibility study in Q4 2026. This initiative marks a strategic expansion for First Majestic, traditionally a primary silver producer, by adding a significant gold component to its portfolio that is poised to reshape its production profile from 2027 onward.