By Miguel A Heredia
During the twenty nine week of the year (July 13th to July 19th, 2020), at least 47 press releases were announced by companies working in Mexico, with ten communicating production and financial results, nine commenting on Mexican issues, eight announcing financial rounds, seven informing on exploration results, five disclosing deals and corporate issues, four reporting on resources and developments, and four discussing on social issues. ON MEXICO ISSUES, Claudia Pavlovich and Hector Astudillo, governors of Sonora and Guerrero respectively, asked the Ministry of Economy to reconsider returning to the support that was granted to the municipalities with the Mining Fund. Jose Ignacio Peralta Sanchez, governor of Colima state requested the reactivation of The Mining Fund. Karen Flores, Director of the Mexican Mining Chamber (CAMIMEX), stated that 16% of the workforce in the Mexican mining industry is occupied by women. The Secretary of Economic Development of Michoacan, Jesus Melgoza Velazquez, announced that the regional committee of the Mining Fund for the Development of Mining Areas was reactivated after approximately two years. Fernando Alanis, president of the Mexican Mining Chamber (CAMIMEX) declared that the mining sector in the country is at risk of contracting if new concessions are not granted. Torex Gold plans additional investment of USD $ 500M in Mexico but asked the government for certainty. The Ministry of Labor and Social Security (STPS) reported that it is in preparation for the next stage of the rescue of the miners who were trapped in the Pasta de Conchos mine in Coahuila 14 years ago. The Zacatecas Mining Cluster (Clusmin) and its members started the construction of the Compatible Mining Center in Zacatecas. Minera Esperanza Silver (Alamos Gold Inc.) reaffirmed its commitment with Mexico. ON EXPLORATION, In Sonora, Colibri concluded its current phase of field work at its Evelyn project and planed the next phase trenching program, Ridgestone reported drill results from the three first holes collared at its Rebeico project, Minaurum commenced phase II drilling at its Alamos Silver project, and Silver Viper reported results from four holes drilled at its La Virginia project. In Chihuahua, Kootenay released drill results from its Columba project, and Consolidated Zinc provided an exploration update on its Potrero and Don Lucas prospects. In Sinaloa, Vizsla expanded the exploration program at its Panuco project and added a third drill rig. ON MINING, Aura, Avino, Consolidated Zinc, First Majestic, Fortuna, GoGold, Gold Resource, McEwen, Santacruz and Sierra Metals reported Q2, 2020 production results from their Mexican operations. ON FINANCING, Aztec Minerals closed the first tranche of its private placement for gross proceeds of CAD $2.12M (Cervantes project, Sonora). Silver Tiger announced a plan to conduct a non-brokered private placement for gross proceeds of up to $11M (El Tigre project, Sonora). Tarachi Gold announced it intends to complete a non-brokered private placement for net proceed of up to CAD $5M (Tarachi project, Sonora). Xtierra closed its previously announced private placement for gross proceeds of $1M (Bilbao project, Zacatecas). Mammoth announced lifting of management cease trade order and issuance of shares for debt and incentive options (Tenoriba project, Chihuahua). Mexus announced that the company satisfied a $57K note payable by way of conversion (Santa Elena mine, Sonora). Telson announced that further to its application for a management cease trade order, which was granted by the British Columbia Securities Commission, it has been required to provide bi-weekly status reports (Tahuehueto project, Durango). One World Lithium announced that it will continue providing bi-weekly updates following a management cease trader order granted for the British Columbia Securities Commission (Salar del Diablo project, Baja California Norte). ON RESOURCES AND DEVELOPMENT, Endeavour announced a final PFS on its Terronera mine in Jalisco. GR Silver resumed the surface drilling at its Plomosas project in Sinaloa. Prime Mining provided an update regarding the initial phase of exploration planned on its Los Reyes project in Sinaloa. Minera Alamos provided mid-year construction update at its Santana project in Sonora. ON DEALS AND CORPORATE ISSUES, Carlyle entered in an option agreement with Riverside to purchase 100% interest in the Cecilia project in Sonora. Golden Minerals signed a letter of intent with Fabled Copper to sell its Santa Maria project in Chihuahua. Minera Alamos announced the appointment of a new member to its board of directors (Santana project, Sonora). Oroco announced the appointment of a director to join to its board of directors (Santo Tomas project, Sinaloa). ON SOCIAL RESPONSIBILITY, Fresnillo plc continues to implement sanitary measures in its work centers and support the communities surrounding the operations. Grupo Peñoles supported the donation of bed-chairs for Coahuila hospitals. MSX (New Gold Inc.) donated pantries to vulnerable population in the communities of Cerro de San Pedro, San Luis Potosi, as well as personal protection equipment to hospitals. Camino Rojo S.A. de C.V. (Orla Mining Ltd.) continued helping communities and government agencies where it operates to mitigate the risk of the COVID-19 pandemic.
ON MEXICO ISSUES
- Claudia Pavlovich and Hector Astudillo, governors of Sonora and Guerrero respectively, asked the Ministry of Economy to reconsider returning to the support that was granted to the municipalities with the Mining Fund. The governor of Guerrero said that the Mining Fund can be used to reactivate the economy in the most affected regions by the unemployment of the industry due to the COVID-19 pandemic, as well as to attend to the population affected by the virus, as well as for medical care and medicines. The governor of Sonora said that this support marked a before and after in the municipalities where the resources were applied, and stated that the Mining Fund should be reconsidered to promote the development of the municipalities. In addition, governors of Coahuila, Durango and Chihuahua highlighted the importance of mining activity in their states.
- José Ignacio Peralta Sanchez, governor of Colima state asked the Undersecretary of Mining, Francisco Jose Quiroga Fernandez, to resume Mining Funds pending from some years ago, since due to the current economic conditions is when this resource is most required. The governor stressed that mining is an engine for the entity’s economy, since it has important productive chains, which makes it a strategic sector.
- Karen Flores, Director of the Mexican Mining Chamber (CAMIMEX), stated that 16% of the workforce in the Mexican mining industry is occupied by women. She argued that although it seems a minority figure, its increase has been exponential. She also commented that Mexican mining adheres to the agreements of the 2030 agenda of the United Nations (UN) in two of its main objectives, such as the reduction of inequality and gender equity.
- The Secretary of Economic Development of Michoacan, Jesus Melgoza Velazquez, announced that the regional committee of the Mining Fund for the Development of Mining Areas was reactivated after approximately two years. The Mining Fund will allow physical infrastructure works to be carried out in municipalities with mining activity such as Tlalpujahua, Tzitzio, Tuzantla, Huetamo, Villa Madero, La Huacana, Arteaga, Coalcoman, Aquila and Lazaro Cardenas. Since the creation of the regional committee of the mining fund in 2014, MXP $171M have been earmarked for the realization of 61 projects such as paving works for streets and roads, construction of sanitary landfills, infrastructure for the drinking water service, sewerage and water treatment plants, placement of LED street lights, construction of classrooms, roofs and civic patios in schools.
- Fernando Alanis, president of the Mexican Mining Chamber (CAMIMEX), declared that the mining sector in the country is at risk of contracting if new concessions are not granted. Alanis recalled the importance of mining activity, in order to continue the 370,000 direct jobs and 2-3 millions of indirect jobs generated by this sector, in addition to the fact that for each hectare concessioned under active exploitation, it has a spill of MXP $22,829M. He also said that between 2016 and 2019 the sector paid MXP $174,500M for taxes.
- Jody Kuzenko, President & CEO of Torex Gold Resources Inc., declared that it plans additional investments of USD $ 500M in Mexico in the construction and commissioning of its Media Luna project in Guerrero but asked the government for certainty in key areas such as in the rule of law and in economic policies to keep its investment projects.
- The Ministry of Labor and Social Security (STPS), reported that it is in preparation for the next stage of the rescue of the remains of the 65 miners who were trapped in the Pasta de Conchos mine in Coahuila 14 years ago.
- The Zacatecas Mining Cluster (Clusmin) and its members, started the construction of the Compatible Mining Center in Zacatecas, which is expected to take a year. The Compatible Mining Center aims to promote the development of science, the use of the latest technology and promote innovation for the development of specific purpose applications in the mining environment in the areas of occupational health, physical and psychological safety of workers, and protection of the environment in mining operations in the state of Zacatecas.
- Minera Esperanza Silver (Alamos Gold Inc.), reaffirmed its commitment with Mexico and highlighted the enormous opportunity for Morelos to be part of the mining sector and the national extractive industry, which is equivalent to 8.3% of industrial GDP. The spokesperson for the Esperanza Silver mining company in Mexico, responsible for the Esperanza project, located in the municipality of Temixco stated that Temixco is shaping up to be one of the mining municipalities in Mexico, where well-being and possibilities for economic and social development are imminent and we must prepare for it.
- Colibri Resource Corporation, concluded the current phase of field work and released mapping and sampling results from its Evelyn project in Sonora. A total of 40 grab samples were collected, 9 of which returned grades greater than 0.1 g/t Au, including 4 running more than 1 g/t Au, with a peak value of 8.4 g/t Au at the Cerro Rojo target area. The high-grade samples all consist of quartz vein, veinlets, and quartz breccia with oxidized pyrite and goethite. Colibri plans the next phase on trenching at its Evelyn project.
- Ridgestone Mining Inc., reported drill results from the three first holes collared at its Rebeico project in Sonora. 1,674m were completed on the New Year Zone to investigate the subsurface extent of significant gold and copper mineralization previously sampled on surface. Significant drill intersections were encountered in hole 20REB013D with 2.13 g/t Au and 1.79% Cu over a width of 16.25m, including 5.25 g/t Au and 1.46% Cu over a width of 4.35m. Holes 20REB014D and 20REB015D intersected 0.25% Cu and 0.19%Cu over a width of 16.2m and 10.9m respectively.
- Minaurum Gold Inc., commenced phase II drilling program at its Alamos Silver project in Sonora with a minimum of 20,000m. This phase will involve systematically stepping out from discoveries made during Phase I drilling beginning with two drill rigs. “One drill will offset the Europa-Guadalupe discovery hole (AL17-007) which returned 8.25 m grading 1,760 g/t Ag. The other drill will test targets at Promontorio, both along the vein trend and beneath the Promontorio mine where recently acquired historical data revealed holes that returned up to 12.2 m grading 710 g/t Ag”.
- Silver Viper Minerals Corp., reported results from four new drill holes at La Virginia, two from the El Rubi discovery area and two from the exploration prospect, Macho Libre. Significant drill intersections were encountered in hole LV20-234 collared at El Rubi with 2.05 g/t Au and 11 g/t Ag over a true width (TW) of 4.26m, including 3.59 g/t Au and 16 g(/t Ag over a TW of 1.18m; hole LV20-231M drilled at Macho Libre with 0.63 g/t Au and 24 g/t Ag over a TW of 11.76m, including 1.07 g/t Au and 54 g/t Ag over a TW of 3.60m; and hole LV20-233M drilled at Macho Libre with 1.41 g/t Au and 26 g/t Ag over a TW of 0.90m. Drilling at the El Rubi Discovery Zone continues to expand the system and the rig is being mobilized to a second exploration target named Rubi East.
- Kootenay Silver Inc., released results from five drill holes collared at its Columba project in Chihuahua. These holes are step outs along strike and to depth from high-grade intercepts previously reported in the Phase-II drill campaign. Significant drill intersections were encountered in hole CDH-20-052 with 199 g/t Ag, 0.08% Pb, and 0.27% Zn over 7.53m, including 279 g/t Ag, 0.11% Pb, and 0.38% Zn over 4.08m, and including 601 g/t Ag, 0.03% Pb, and 0.12% Zn over 1.23m within the F Vein; hole CDH-20-053 with 116 g/t Ag, 0.11% Pb, and 0.24% Zn over 34m, including 175 g/t Ag, 0.17% Pb, 0.37% Zn over 11m, including 496 g/t Ag, 0.55% Pb, and 0.91% Zn over 3m, including 620 g/t Ag, 0.35% Pb, 0.9% Zn over 2m, including 753 g/t Ag, 0.38% Pb, and 1% Zn over 0.95m in F Vein and Hanging Wall structure; and hole CDH-20-054 with 158 g/t Ag, 0.4% Pb, and 0.35% Zn over 5m, including 319 g/t Ag, 0.18% Pb, and 0.5% Zn over 1.8m in F Vein.
- Consolidated Zinc Limited, provided an exploration update on its Potrero and Don Lucas prospects in Chihuahua and has reserved $600K for exploration field work this year. The company has continued its Au exploration with desktop studies which has established targets and defined a scope of work for immediate commencement of field mapping, sampling and drilling in the current field season.
- Vizsla Resources Corp., expanded the exploration program at its Panuco project from 14,500m of drilling to 31,100m and added a third rig, which has already commenced to drill. In addition, a fourth drill rig is expected to arrive at the beginning of August. “Third and fourth drill rigs will test exploration targets including the strike extensions of the Napoleon vein corridor, the Tajitos vein, the San Carlos mine at Animas and additional targets along the Cordon del Oro vein corridor”. Drilling is continuing at the high-grade Napoleon discovery with drill hole NP-20-14 in progress. Drilling is testing to the south and down dip of the discovery hole NP-20-02 before moving back north to test vein extension near hole NP-20-07. The updated July-December exploration program is estimated to cost approximately $6.9 M.
- Aura Minerals Inc., presented Q2, 2020 production results from its Aranzazu mine in Zacatecas. It produced 5K Oz Au, 91.6K Oz Ag, and 6.2M Lb Cu (14,748 Oz AuEq).
- Avino Silver & Gold Mines Ltd., announced that it processed 40,190 tonnes of 0.40 g/t Au, 49 g/t Ag and 0.58% Cu at metallurgical recoveries of 79%, 90% and 90% respectively, to produce 404 Oz Au, 50.6K Oz Ag, and 459.8K Lb Cu (158.3K Oz Ag) during the period Q2,2020 from its Avino mine in Durango.
- Consolidated Zinc Limited, reported that Zn-Pb grades exceeding 25% and 8% respectively are being encountered at the newly opened up Las Espadas underground area while the semi-oxidized ore continues to be mined and delivered at rates of above 15o tonnes per day. At its Aldama plant, it has achieved record availability to July 10 2020 of 94.5% while the recoveries are improving above performance thanks to the effort of the technical team.
- First Majestic Silver Corp., presented production results for the period Q2, 2020 from their Mexican operations. The table below shows mine by mine production figures:
At the end of Q2, 14 exploration drill rigs were active across the company’s projects consisting of 11 rigs at San Dimas, two rigs at Santa Elena and one rig at La Encantada. The company anticipates adding seven additional rigs in Q3 with a primary focus on the regional potential around Santa Elena.
- Fortuna Silver Mines Inc., released Q2, 2020 production results from its San Jose mine in Oaxaca. The company milled 160,151 tonnes of 1.42 g/t Au and 220 g/t Ag at metallurgical recoveries of 90.91% and 90.84% respectively to produce 6,654 Oz Au and 1.03M Oz Ag, at cash cost of USD $66/ton.
- GoGold Resources Inc., presented production results from its Parral Tailings project in Chihuahua for the period Q2, 2020. The company produced 1,914 Oz Au, 270K Oz Ag, and 233K Lb Cu (504.4K Oz AgEq).
- Gold Resource Corporation, announced preliminary production results from its Oaxaca Mining Unit in Oaxaca. It produced 2,441 Oz Au, 185.3K Oz Ag, 551K Lb Cu, 2.56M Lb Pb, and 6.75M Lb Zn during the period Q2, 2020.
- McEwen Mining Inc, produced in Q2, 2020 from its El Gallo mine in Sinaloa over 1,900 Oz AuEq from residual leaching of the heap leach pad.
- Santacruz Silver Mining Ltd., released Q2, 2020 production and financial results from its Mexican operations. At Zimapan, Hidalgo the company milled 139,903 tonnes to produce 829,514 Oz AgEq from which 626,984 were sold, at cash cost per tonne and for Oz AgEq of $48.15 and $16.53 respectively, and AISC of $17.57 per Oz AgEq. At Veta Grande, Zacatecas, it milled 11,095 tonnes to produce 64,870 Oz AgEq from which 47,854 were sold, at cash cost per tonne and for Oz AgEq of $148.36 and $39.54 respectively, and AISC of $46.34 per Oz AgEq. At Rosario, San Luis Potosi, the company milled 17,497 tonnes to produce 73,251 Oz AgEq from which 61,111 were sold, at cash cost per tonne and for Oz AgEq of $62.12 and $23.47 respectively, and AISC of $29.01 per Oz AgEq.
- Sierra Metals Inc., announced production results from its Bolivar mine in Chihuahua for the period Q2, 2020. Cusi mine remained in care and maintenance throughout Q2, 2020. At Bolivar mine, the company processed 308,951 tonnes of 0.30 g/t Au, 26 g/t Ag, and 0.93% Cu at metallurgical recoveries of 63.79%, 82.80%, and 87.09% respectively, to produce 1,912 Oz Au, 214K Oz Ag, and 5.54M Lb Cu. “At Cusi mine, Chihuahua, development is currently on-going in a zone that will bypass the previously announced area of subsidence and provide access to higher-grade economic ore to provide feed for the mill. Production is expected to recommence after the mine development work is completed and once a process can be implemented at the mine to mitigate risk to employees at the site through a testing and quarantine methodology similar to the company’s other operations”.
- Aztec Minerals Corp., closed the first tranche of its private placement for gross proceeds of CAD $2.12M. Part of the gross proceeds will be used to conduct exploration work at its Cervantes project in Sonora, and for general working capital purposes.
- Silver Tiger Metals Inc., announced a plan to conduct a non-brokered private placement for gross proceeds of up to $11M. Net proceeds will be primarily used for further exploration at its El Tigre project in Sonora.
- Tarachi Gold Corp., announced it intends to complete a non-brokered private placement for net proceeds of up to CAD $5M. Gross proceeds will be used for exploration of its Tarachi project in Sonora, corporate development, and general working capital purposes.
- Xtierra Inc., closed its previously announced private placement for gross proceeds of $1M. Nett proceeds will be used to expand and diversify its royalty portfolio into Canada, USA and other mining friendly jurisdictions (Bilbao project, Zacatecas).
- Mammoth Resources Corp., announced lifting of management cease trade order and issuance of shares for debt and incentive options. The company has yet to file its Q1, 2020 financial statement and Management Discussion & Analysis which were due on June 30, 2020. It expects to file these statements shortly (Tenoriba project, Chihuahua). Mammoth also announced the issuance of 2,503,000 common shares to settle a total of $87,605 in related party and third party debts.
- Mexus Gold US, announced that the company satisfied a $57K note payable by way of conversion. In addition, Mexus’ audit obligation has been met with the audit expected to be completed in the next 7 days. The audit process was delayed due to the company moving from an exploration company to a production company (Santa Elena mine, Sonora).
- Telson Mining Corporation, announced that further to its application for a management cease trade order, which was granted by the British Columbia Securities Commission on June 16, 2020, it has been required to provide bi-weekly status reports in accordance with the alternative information guidelines in National Policy 12-203 management cease trade orders, until such time as the company has completed and filed its audited annual financial statements and management’s discussion and analysis in respect of the financial year ended December 31, 2019 (Tahuehueto project, Durango).
- One World Lithium Inc., announced that it will continue providing bi-weekly updates following a management cease trader order granted for the British Columbia Securities Commission. The company anticipated that the annual filings and the quarterly filings will be filed on or before July 30, 2020 (Salar del Diablo project, Baja California Norte).
ON RESOURCES AND DEVELOPMENT
- Endeavour Silver Corp., announced a final PFS on its Terronera mine in Jalisco. Base case highlights of the PFS include a NPV 5% of $137M, and IRR of 30%, annual production average of 3M Oz Ag and 32.8K Oz Au (5.9M OZ AgEq) over an initial 10 year mine life, a cash cost and AISC of $0.004 and $2.10 per Oz Ag net of the Au credit respectively, Initial and sustaining capital expenditures of $99M and $60M respectively, a payback period of 2.7 years, and a Pre-Tax and After-Tax undiscounted free cash flow of $315M and $217M respectively.
- GR Silver Mining Ltd., restarted the 4,500m surface drilling at its Plomosas project in Sinaloa with three drill rigs which is expected to continue through 2020. This drill program is focused on shallow drilling (up to 150m below surface) to expand the known mineralized zones along strike at Plomosas mine and San Juan-La Colorada areas, and follow-up drilling on several new high grade Au-Ag low sulphidation epithermal veins occurrences at the Yecora and El Saltito. Additionally, GR Silver will commence recon work on 11 priority targets identified to contain potential for new discoveries.
- Prime Mining Corp., provided an update regarding the initial phase of exploration planned on its Los Reyes project in Sinaloa. Focus of the phase 1 program is to upgrade and expand the current mineral resource, test identified zones of high-grade, and advance the understanding of the geology and structural controls of the known deposits of the property. The program is expected to cost approximately $6M and has a targeted completion date of late Q1, 2021.
- Minera Alamos Inc., provided mid-year construction update at its Santana project in Sonora. The company announced that the heap leach pad area has been cleared of all vegetation and is undergoing contouring ahead of clay placement and the pad liner installation, and that the bypass road construction at either end of the heap leach pad area is underway; reported that the explosive storage & detonator bunkers are awaiting final inspection from the Mexican authorities ahead of the explosive permit issuance; and that the fabrication of the plant carbon columns is complete with work underway for the remaining plant steel structure.
ON DEALS AND CORPORATE ISSUES
- Carlyle Commodities Corp., entered into an option agreement with Riverside to earn 100% interest in the Cecilia project in Sonora. In order to purchase 100% interest in the Cecilia property, Carlyle has to make aggregate cash payments of $200K over 3 years to Riverside, issue 1.5M common shares, issue 3M non-transferable special warrants, and incur an aggregate of $2.5M in exploration expenditures. Riverside will retain a 2.5% NSR.
- Golden Minerals Company, signed a letter of intent with Fabled Copper Corp., to sell its Santa Maria project in Chihuahua. The Agreement provides a 10-calendar day period during which Fabled will conduct its due diligence. If Fabled executes the option agreement to acquire 100% interest in Santa Maria property, it has to make a cash payment of USD $0.5M and issue 1M Fabled common shares, USD $1.5M in cash 12 months after closing of the transaction, USD $2M in cash 24 months after closing of the transaction, and upon Fabled exercises the option, it will grant to Golden a 1% NSR.
- Minera Alamos Inc., announced the appointment of a new member to its board of directors (Santana project, Sonora).
- Oroco Resource Corp., announced the appointment of a new member to join to its board of directors (Santo Tomas project, Sinaloa).
ON SOCIAL RESPONSIBILITY
- Fresnillo plc, continues to implement sanitary measures in its work centers and support the communities surrounding its operations in Fresnillo, Saucito, Juanicipio in Fresnillo, Zacatecas, Orisyvo in Uruachic, Chihuahua, Herradura, Noche Buena and Centauro in Caborca, Sonora, San Julian and Cienega in Durango, and in Torreon, Coahuila. . The company donated a last-generation respirator and medical protection equipment such as N-95 respirators, latex gloves, disinfectant gel, disposable gowns, disposable face masks, face masks, and disposable surgical face masks to the General Hospitals of the Mexican Institute of Social Security (IMSS), as well as thousand food pantries. With these actions, Fresnillo plc, belonging to the Mexican corporate Grupo BAL, joins the commitment to health care, with the purpose of guaranteeing the well-being of families and the population that lives in the areas surrounding its operations.
- Grupo Peñoles, through contributions made by employees to the service of Met-Mex Peñoles, supported the donation of bed-chairs to Coahuila hospital to support those who deserve decent living conditions.
- MSX (New Gold Inc.), donated pantries to vulnerable population in the communities of Cerro de San Pedro, San Luis Potosi, as well as personal protection equipment to hospitals designated as medical centers to care for patients with COVID-19.
- Camino Rojo S.A. de C.V. (Orla Mining Ltd.), continued helping communities and government agencies providing support in sanitary filters installed in the border of Zacatecas with the different states; donated pantries during the months of April, May and June containing products from the basic basket which are intended to contribute to the economy of families in the communities of influence, which are San Tiburcio, Berrendo and San Francisco de los Quijano.
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On the picture above, argillic alteration related to a porphyry copper system in a prospect in Michoacan, Mexico. Photo by Miguel A Heredia.