UPDATE 2-Fresnillo Q3 silver, gold output rises to record

* Silver output 10.69 mln ozs, including Silverstream

* Gold production rises to 91,822 ounces

* Expects to slightly beat 2010 targets – spokesman

* Shares up 4.3 percent, outperforms mining index

(Adds comments from conference call, share price)

By Julie Crust

LONDON, Oct 13 (BestGrowthStock) – Mexican precious metals miner
Fresnillo (FRES.L: ) (FRES.MX: ) said its silver and gold production
rose to a record in the third quarter, exceeding expectations,
and that it will slightly beat its full-year targets.

Silver output rose to 10.69 million ounces, including metal
from the Silverstream agreement, and gold production jumped 44
percent on the year-earlier quarter to 91,822 ounces.

Numis Corp had expected 9.6 million ounces of silver, or
10.4 million including Silverstream, and 81,000 ounces of gold.

“This operational performance was enhanced by the
significant increase in metal prices over the period,” Chief
Executive Jaime Lomelin said in a statement.

“These factors contributed to a strong overall result in the
third quarter and give us confidence that the year as a whole
will be one of the most successful in Fresnillo’s history.”

Gold prices (XAU=: ) rose to a record $1,364.6 an ounce last
week, while silver (XAG=: ) hit a 30-year peak of $23.65 an ounce
on Monday on expectations that quantitative easing will be
needed to boost the frail U.S. economy. [GOL/]

The company will slightly beat its 2010 production target of
340,000 ounces of gold and 41.1 million ounces of silver,
including 3.0 million ounces from Silverstream, spokesman Arturo
Espinola said on a conference call.

It said cost control initiatives remain firmly on track.

The shares were up 4.3 percent at 0731 GMT, outperforming a
2.3 percent rise in a British mining index (.FTNMX1770: ).
(Editing by James Davey and David Cowell)

UPDATE 2-Fresnillo Q3 silver, gold output rises to record