Exploration spending on the rise among Mexico's gold miners

Wednesday, April 12, 2017

Mid-tier gold miners in Mexico are planning increased exploration spending this year.

Three Toronto-based companies that produced 200,000-500,000oz at their Mexican operations in 2016 plan to invest US$55.1mn in exploration in the country this year, compared to US$41.0mn last year.

Start your 15 day free trial now!


Already a subscriber? Please, login

Two of the three companies are planning significant increases this year, with spending by the third remaining stable.

Minera Frisco is excluded as it did not report exploration guidance in its 2016 results.


Agnico Eagle's Mexico exploration budget for 2017 is US$26.8mn. More than a third (US$9.7mn) will be spent at the El Barqueño project.



The remainder will be shared between the Pinos Altos mine and Crestón Mascota satellite operation (US$6.1mn), the La India mine (US$6.9mn), the Soltoro project (US$1.4mn) and other properties.

The company plans to drill 119,000m in Mexico  this year.

Agnico's 2016 exploration spend was US$20.8mn in Latin America, down 18.3% from the previous year, mainly due to falls at El Barqueño and Morelos Sur in Mexico.

Agnico is Mexico's fourth biggest gold miner, with output of 355,230oz in the country last year.


Torex plans to spend US$10mn on exploration this year. The company spent about US$3.0mn last year, VP investor relations, Gabriela Sanchez, told BNamericas.

The company has the El Limón-Guajes (ELG) and adjacent Media Luna project in Mexico, and is forecast to be the country's fourth biggest gold producer in 2017, with guidance of 375,000oz.

One area of focus will be the Sub-Sill area close to the ELG plant, where Torex reported a resource estimate in March.


Alamos plans to invest US$17.0mn in exploration at its Mulatos mine in Mexico this year. This is broadly flat from US$17.2mn spent last year, Scott Parsons, VP investor relations, told BNamericas.

The company originally budgeted US$14.0mn for exploration at Mulatos (pictured) in 2016 but raised the amount to US$16.0mn in May.

Mulatos is a key exploration target for the company, with 2017 spending forming the bulk of its total exploration budget of US$24mn.

The focus will be on the La Yaqui and Cerro Pelón deposits and scout drilling at Los Bajíos and El Refugio deposits in the Mulatos district.

No exploration is planned at the El Chanate mine or Esperanza project in Mexico this year.


Increased exploration budgets by companies producing 200-500,000oz gold in Mexico reflect a broader trend.

The five biggest gold miners in Latin America plan to up spending, while the region's largest silver-focused miners also forecast an increase.

Fresnillo, Mexico's top gold miner, plans to spend US$160mn, up from US$138mn.

Goldcorp, the country's second biggest gold producer in 2016, plans to spend about US$100mn globally this year, roughly flat on 2016.

While no breakdown was given by mine or project, Mexico spending is likely to be lower due to the sale of the Los Filos mine earlier in April.

Increased exploration budgets reflect growing confidence among miners following improvements in gold and silver prices from lows in 2015-16, and successful efforts to reduce production costs in the sector.