Mining in Mexico: Key project acquisitions

A string of gold and silver projects have changed hands in Mexico in recent months following a surge in prices of the metals.

The country has seen at least seven deals announced, advanced or completed over four months. Only acquisitions worth US$500,000 or more are included.

Gold surpassed US$2,000/oz for the first time in August, and is currently trading around US$1,800/oz, up from US$1,480/oz in December 2019.

Silver is currently around US$24/oz, up from US$$17.11/oz.

DECEMBER

1. Santa Maria silver-gold project, Chihuahua state

Fabled Silver Gold closed a previously announced agreement to acquire an option on Golden Minerals’ Santa Maria primary silver project in December.

The option allows Fabled to acquire a 100% interest in the asset through staged payments totaling US$4.48mn over 24 months.

Fabled plans to immediately begin additional surface sampling and mapping at the asset prior to a drill program.

2. Lucita silver project, Zacatecas state

Defiance Silver signed an option agreement with Pan American Silver to acquire the latter’s Lucita property, which lies adjacent to Defiance’s San Acacio asset, in December.

The deal, in which Defiance will pay US$1.5mn over three years, will nearly triple Defiance’s land position in Zacatecas state to about 4,300ha.

“The Lucita option represents a key milestone for Defiance in establishing a district-scale land package at our Zacatecas projects and furthering out exploration thesis and strategy in the district,” CEO Chris Wright said.

NOVEMBER

3. La Sanguijuela, Cerro Gordo silver concessions, Jalisco state

Endeavour Silver acquired two adjacent groups of mineral concessions covering multiple mineralized vein structures close to its US$99mn Terronera primary silver project in November.

The company paid US$550,000 for an option to purchase the 2,759ha La Sanguijuela concessions which lie to the north of the Terronera concessions, covering possible extensions to the Terronera and Los Reyes veins.

Endeavour also acquired by staking the 2,200ha Cerro Gordo concessions covering possible vein extensions to the southeast of Terronera.

“We look forward to increasing our drill budget next year to advance our sizable resource base in this district-scale, high-grade, low sulfidation epithermal vein system,” CEO Brad Cooke said.

4. Margarita silver project, Chihuahua state

Magna Gold signed an option to acquire a 100% interest in the Margarita silver project from Sable Resources in the latest in a string of acquisitions.

Margarita comprises two concessions covering a total of 126ha in the Sierra Madre gold belt in Chihuahua state.

Under the deal, Magna will pay Cdn$2.3mn (US$1.80mn) in cash and issue shares worth Cdn$3.5mn to acquire Sable’s option, plus Cdn$868,000 in cash and Cdn$1.8mn in shares to the project titleholders to acquire the property.

Magna acquired the San Francisco gold mine in May and an option on the Los Muertos silver project in August, both in Mexico.

OCTOBER

5. Magistral del Oro gold tailings project, Durango state

Tarachi Gold signed an agreement under which it may acquire assets related to the Magistral del Oro tailing processing plant from Mexico’s Manto Resources.

Through the deal, Tarachi will seek to enter production and begin generating cash flows.

Under the non-binding letter of intent agreement, Tarachi will acquire the MDO plant, which is a 1,000t/d tailings processing operation and tailings resources estimated at about 1.3Mt grading 2.1g/t gold.

Tarachi will issue 4mn shares to Manto, grant Manto a 15% net profits royalty, reimburse the company up to US$500,000 for cash outlays and satisfy certain obligations owing by Manto of US$1.65mn plus any VAT.

SEPTEMBER

6. Juliana gold property, Sonora state

In a separate deal, Tarachi acquired the right to earn a 100% interest in the Juliana, Juliana No.1, Juliana No.2 and La Morita concessions in Sonora state, from local firm Exploradora Cobre de Bacanoras, for payments totaling US$2.0mn and 4.0mn shares.

7. MVZ silver-gold project, Chihuahua state

Global Li-Ion Graphite signed an agreement to acquire a 100% stake in the MVZ silver-gold project from local company Grupo Minero Diflor in September.

The property hosts three past-producing silver-gold deposits, El Moro, La Virginia and La Zorra, located within Diflor’s Pajarito project.

Global Li-Ion said it plans to use modern exploration technologies to seek undiscovered silver-gold mineralization near surface.

AUGUST

8. El Picacho silver-gold project, Sonora state

SilverCrest Metals acquired 11 concessions which make up the El Picacho project near its US$100mn Las Chispas project in Sonora state in August.

The company paid US$1.6mn plus outstanding taxes for the 7,060ha property, which it describes as a new district containing multiple precious metals veins.

Drilling is planned to start in 2020, SilverCrest said at the time.

Depending on exploration success, the company may look to develop El Picacho as a standalone mine or as a satellite project for Las Chispas, 40km away.