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First Majestic Updates Mineral Reserve and Resource Estimates for YE2016 and Files Form 40-F Annual Report


March 31, 2017

VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 31, 2017) - FIRST MAJESTIC SILVER CORP. (the "Company" or "First Majestic") (TSX:FR)(NYSE:AG)(FRANKFURT:FMV)(BVM:AG) is pleased to announce its 2016 Mineral Reserve and Resource estimates for its existing mineral property assets in Mexico as of December 31, 2016. Metal prices used to estimate the 2016 Reserve estimates were increased slightly compared to previous estimates to: $18.00/oz for silver, $1,250/oz for gold, $1.00/lb for lead and $1.15/lb for zinc.

"We began 2016 with a small exploration budget of only $9.9 million designed to primarily assist with our mining activities," stated Keith Neumeyer, President and CEO. "In the second half of 2016, we increased the exploration budget by 71% and returned our focus on growing the ounces in the ground. For 2017, we are investing $27.0 million to complete over 183,000 metres of diamond drilling across our Mexican assets. This renewed investment is expected to add significant growth to our Reserves and Resources in the years ahead."

The following table shows the total tonnage mined from each of the Company's six producing properties during 2016, including total ounces of silver and silver equivalent ounces produced from each property and the tonnage mined from delineated Reserves and Resources at each property. A portion of the production from each mine came from material other than Reserves or Resources, as set out below under the heading "Material Not in Reserves".

2016 Production Table
 
  LA ENCANTADA LA PARRILLA DEL TORO SAN MARTIN LA GUITARRA SANTA ELENA TOTAL
TONNES OF ORE PROCESSED 881,075 610,509 337,020 297,802 155,696 988,060 3,270,162
               
OZ OF SILVER PRODUCED 2,706,516 2,220,874 1,500,951 1,902,963 923,597 2,598,537 11,853,438
               
OZ OF SILVER EQ. PRODUCED FROM OTHER METALS (1) 6,856 1,167,560 1,148,375 306,072 600,091 3,587,408 6,816,362
               
TOTAL OZ OF SILVER EQ. PRODUCED 2,713,372 3,388,434 2,649,326 2,209,035 1,523,688 6,185,945 18,669,800
               
TONNES MINED FROM MATERIAL IN RESERVES 47,722 588,624 315,937 213,362 117,414 932,033 2,215,092
               
TONNES MINED FROM MATERIAL NOT IN RESERVES 833,353 21,885 21,083 84,440 38,282 56,027 1,055,070
   
(1) Silver-equivalent ounces are estimated considering: metal price assumptions, metallurgical recovery for the corresponding mineral type/mineral process and the metal payable of the corresponding contract of each mine. Details as to the method of calculation can be found in the applicable tables within the remainder of this section.
(2) Totals may not add up due to rounding.

The Company completed a total of 97,576 metres of diamond drilling at its six operating mines in 2016, representing a 170% increase in metres drilled compared to the prior year.

For 2017, First Majestic is planning to invest $27.0 million towards exploration to drill approximately 183,000 metres at its core Mexican assets consisting of approximately 43,000 metres of diamond drilling intended to upgrade Resources to Reserves at La Parrilla, Del Toro, La Guitarra and Santa Elena; approximately 100,000 metres of diamond drilling intended to increase or add new Measured & Indicated or Inferred Resources at the six operating mines, with a focus at Nazareno in La Guitarra and the Ermitaño West project in Santa Elena; and drill approximately 40,000 metres at the Plomosas Silver Project. A combination of surface and underground drill rigs will focus on assisting mining activities, definition drilling and to support future updates to the Company's NI43-101 Technical Reports.

As of December 31, 2016, Proven and Probable Reserves totaled 116.7 million silver equivalent ounces, representing a 14% decrease or 18.6 million silver equivalent ounces in metal content compared to the prior estimate. This reduction is primarily due to the production depletion of 14.5 million silver equivalent ounces despite a modest increase of 3% in the assumed silver and gold prices and higher metal prices for lead and zinc. In addition, the reduction is the effect of an average increase of 10% in the cut-off grades for most of the mines. The escalation in the cut-off grade is a reflection of an increase of the mining and sustaining cost per tonne motivated by adopting more selective mining methods and the re-activation of sustaining development and near-mine exploration.

The Company's consolidated Measured and Indicated Resources totaled 139.6 million silver equivalent ounces, representing an 11% decrease from 2015 estimates primarily due to the production depletion and an increase of the production cost per tonne. In addition, Inferred Resources decreased 15% to 233.2 million silver equivalent ounces primarily due to the escalation in the cut-off grade as a reflection of an increase of the mining and sustaining cost per tonne.

The complete 2016 Mineral Reserve and Resource estimates for all metals, tonnage and grades are shown below in the following tables:

PROVEN AND PROBABLE MINERAL RESERVES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2016
 
Mine Category Mineral Type k tonnes Ag (g/t) Au (g/t)   Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz)
LA ENCANTADA Proven (UG) Oxides 289 239 -   - - 239 2,222 2,222
  Probable (UG) Oxides 1,516 213 -   - - 213 10,372 10,372
  Probable (UG) Oxides - Flotation 809 147 -   2.35 - 196 3,817 5,093
  Probable (Tailings) Oxides 4,138 110 -   - - 110 14,633 14,633
  Total Proven and Probable (UG) Oxides + Tailings 6,751 143 -   0.28 - 149 31,043 32,319
                       
LA PARRILLA Proven (UG) Oxides 181 200 0.12   - - 210 1,164 1,220
  Probable (UG) Oxides 671 161 -   - - 164 3,469 3,546
  Total Proven and Probable (UG) Oxides 852 169 0.06   - - 174 4,633 4,766
  Proven (UG) Sulphides 410 185 0.01   1.67 1.55 280 2,442 3,687
  Probable (UG) Sulphides 649 209 0.04   2.01 2.01 328 4,370 6,853
  Total Proven and Probable (UG) Sulphides 1,059 200 0.02   1.88 1.83 310 6,812 10,539
  Total Proven and Probable (UG) Oxides + Sulphides 1,910 186 0.04   1.04 1.02 249 11,445 15,305
                       
SAN MARTÍN Proven (UG) Oxides 880 246 0.28   - - 267 6,973 7,561
  Probable (UG) Oxides 1,311 243 0.16   - - 255 10,220 10,728
  Total Proven and Probable (UG) Oxides 2,191 244 0.21   - - 260 17,193 18,289
                       
DEL TORO Proven (UG) Transition + Sulphides 708 211 0.09   4.12 1.87 352 4,800 8,010
  Probable (UG) Transition + Sulphides 647 233 0.26   4.39 2.94 401 4,846 8,349
  Total Proven and Probable (UG) Transition + Sulphides 1,356 221 0.17   4.25 2.38 375 9,646 16,360
                       
LA GUITARRA Proven (UG) Sulphides 88 179 1.47   - - 273 509 775
  Probable (UG) Sulphides 1,041 256 1.34   - - 341 8,577 11,423
  Total Proven and Probable (UG) Sulphides 1,129 250 1.35   - - 336 9,086 12,198
                       
SANTA ELENA Probable (UG Main) Sulphides 2,597 110 1.63   - - 215 9,208 17,927
  Probable (PAD) Oxides Spent Ore 1,882 31 0.62   - - 71 1,857 4,275
  Total Probable Oxides + Sulphides 4,479 77 1.21   - - 154 11,065 22,202
  Total Proven and Probable All mineral types 17,977 155 0.42   0.54 0.29 201 89,551 116,384
(1) Mineral Reserves have been classified in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Definition Standards on Mineral Resources and Mineral Reserves, whose definitions are incorporated by reference into NI 43-101.
(2) Metal prices considered for Mineral Reserves estimates were $18.00 /oz Ag, $1,250 /oz Au, $1.00 /lb Pb, and $1.15 /lb Zn.
(3) The Mineral Reserves information provided above for La Encantada, La Parrilla, Del Toro, San Martín, La Guitarra and Santa Elena is based on internal estimates prepared as of December 31, 2016. The information provided was reviewed and validated by the Company's internal Qualified Person, Mr. Ramon Mendoza Reyes, P.Eng., who has the appropriate relevant qualifications, and experience in mining and reserves estimation practices.
(4) Silver-equivalent grade is estimated considering: metal price assumptions, metallurgical recovery for the corresponding mineral type/mineral process and the metal payable of the corresponding contract of each mine. Estimation details are listed in each mine section of the 2016 Annual Information Form.
(5) The cut-off grades and modifying factors used to convert Mineral Reserves from Mineral Resources are different for all mines. The cut-off grades and factors are listed in each mine section of the 2016 Annual Information Form.
 
MEASURED AND INDICATED MINERAL RESOURCES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2016
 
Mine / Project Category Mineral Type k tonnes Ag (g/t) Au (g/t)   Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz)
LA ENCANTADA Measured (UG) Oxides 305 269 -   - - 269 2,637 2,637
  Indicated (UG) Oxides 894 297 -   - - 297 8,518 8,518
  Indicated (UG) Oxides - Flotation 734 246 -   4.07 - 325 5,795 7,662
  Indicated (Tailings)

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