Mexico-focused miners' output spikes as metal prices surge

Mexico-focused miners' production increased significantly in Q2, driven largely by record prices of gold and silver. 

On April 12, gold prices surpassed the ceiling of US$2,400/oz and have been trading higher still, climbing beyond US$2,470/oz this week.

Silver has also seen a bullish streak this year, resulting in better figures in the Mexican mining sector.

BNamericas takes a look at the figures of some of Mexico's top metals producers in the quarter.

SilverCrest Metals

Gold recovered from SilverCrest Metals' Las Chispas operation in Sonora state dipped 7.8% year-on-year to 15,303oz and silver was down 4.6% to 1.46Moz, or 2.68Moz silver equivalent, but the company's sales were up in the quarter.

Las Chispas sold 14,500oz of gold and 1.45Moz of silver (2.60Moz silver equivalent) in 2Q24, the firm said in a statement. The Mexican operation generated record revenues of US$72.7 million with an average realized price of US$2,237/oz gold and US$27.80/oz silver, rising 8% and 19%, respectively, from 1Q24.

Ore mined at Las Chispas also reached 100,019t in the quarter, up 34% from the 74,400t reported in the same quarter of last year. 

"We are pleased to deliver another strong quarter in regards to production, grades and recoveries at the Las Chispas operation. Sales in the first half of 2024 of 5.19Moz silver equivalent position us well to deliver on our 2024 annual sales guidance of 9.8 to 10.2Moz silver equivalent," CEO N. Eric Fier said in a statement.

“This, combined with substantial increases in gold and silver prices in the quarter, drove record revenues and a return to growth of treasury assets in the quarter, despite planned higher sustaining capital expenditures,” he added. 

Torex

Toronto-based Torex Gold Resources reported gold production of 113,822oz in 2Q24, up 5.9% from 107,507oz in 2Q23 last year, while gold sold reached 113,513oz. 

“With strong production of 229,316oz through the first half of the year, the company is on track to achieve annual gold production guidance of 400,000 to 450,000oz,” Torex said. 

“ELG [El Limón-Guajes] continues to deliver safe, strong operational results. With second-quarter gold production of 113,822 oz and 229,316 oz through the first half of the year, we're well on pace to deliver on production guidance for the sixth year in a row,” president & CEO Jody Kuzenko said in a statement. 

“In this period of sustained higher gold prices, the solid cash flow generation from ELG will see us confidently through the final months of the Media Luna build, quickly repaying the modest level of net debt we expect to accumulate and returning to strong free cash flow around this time next year,” she added.

Gatos Silver

Vancouver-based Gatos Silver reported record mill throughput and zinc production in 2Q24 at its 70%-owned Cerro Los Gatos (CLG) mine in Chihuahua, Mexico. 

“In the second quarter of 2024, the CLG mine delivered strong operational results, with record zinc production and the sixth consecutive quarterly record for mill throughput. Silver equivalent production for the quarter was 3.88Moz, an increase of 18% from the second quarter of 2023, and we continue to track at the top end of 2024 guidance,” CEO Dale Andres said in a statement. 

“Our mine debottlenecking efforts delivered a mill throughput average of 3,240t/d, up 1% from the first quarter of 2024 and up 11% from the second quarter of 2023, as we advanced towards our medium-term target of sustained throughput rates of 3,500t/d,” Andres added. 

The miner expects to complete an updated life of mine plan in the third quarter of 2024, with the aim of extending the mine life further. Gatos Silver also increased exploration drilling efforts during the second quarter on near-mine targets and at the San Luis prospect, located 5km from the CLG mine.

Camino Rojo

Vancouver-based Orla Mining also delivered a strong quarter of gold production, reporting that its Camino Rojo oxide mine in Zacatecas produced 33,206oz of gold in 2Q24, up 14.3% year-on-year, and sold 34,875oz, up 14.6%.

“At June 30, 2024, Orla had cash of US$154mn and total debt of US$78.4mn, resulting in a net cash position of US$75.9mn. The company has an undrawn amount of US$71.6mn available on its revolving credit facility, which supports total liquidity of US$226mn at quarter-end,” the miner said in a statement. 

GoGold Resources

GoGold Resources, based in Halifax, Nova Scotia, reported production of 400,236oz silver equivalent in 2Q24, consisting of 138,708oz silver, 2,436oz gold, 148t copper and 125t of zinc. 

“This represents a 6% increase in production from the prior quarter,” the miner said in a statement. 

The company operates the Parral tailings mine in Chihuahua and the Los Ricos South and Los Ricos North exploration projects in Jalisco state.

“Parral’s production is climbing with the addition of the zinc circuit; this should continue over the next several quarters,” Brad Langille, president and CEO, said in a release.  

“We are advancing our definitive feasibility study at Los Ricos South, and anticipate a press release on the results of the study in early September. The definitive feasibility study has a focus towards a larger underground mine with a much smaller open pit. We have applied for an underground permit as in our view this will be more likely to be obtained on a timely basis,” Langille said.

“We see the project having more than 10 years of underground mine life, followed by a smaller open pit than originally planned in our preliminary economic assessment. The need for an open pit permit at Los Ricos South has been effectively pushed into the future more than a decade from now,” he added.