Argonaut Gold is lowering its 2022 production estimates due to lower grades and recoveries at its Mexican gold mines.

The company projects 2022 production to be between 200,000 and 230,000 gold equivalent ounces. 2021 production amounted to 244,156 GEOs, a 20% increase over the previous year's production.

Argonaut will provide full 2022 production guidance once it secures financing to complete its Magino gold project in Ontario.

"2021 was a strong year across our operating portfolio, as we achieved near the upper end of our GEO production guidance range and record annual GEO production for the company," Argonaut executive Dan Symons said.

Though production at La Colorada exceeded its guidance in 2021, Argonaut said it would have lower production levels due to a higher strip ratio and lower grade and recovery.

El Castillo would also produce less as it enters its final year of mining operations.

Production and costs are also affected by higher costs for consumables and reagents across all of Argonaut's operations.

 At Magino, Argonaut is considering expanding its processing plant. The company has received authorisation to build a processing facility that can handle up to 35,000 tonnes per day.

Argonaut is currently building a 10,000 tpd processing facility to lower initial capital costs. The company is weighing expanding the plant to process up to 20,000 tpd early in the project's life.

The company fired its CEO in December 2021 for significant cost overruns at Magino.

Argonaut now considers pre-commercial productive capital of US$367 million, with sustaining and closure capital costs at US$125 million.

The company spent US$273 million on the project from December 2020 until December 2021.

The search for a company executive continues, and two directors on the board are serving as company leaders.