Mexico is a home away from home for Canadian mineral explorers and junior mine developers, with its highly prospective geology, low operating costs and pro-mining culture. Here are six Canadian juniors with active programs in Mexico.


Alamos Gold (TSX: AGI) is a Toronto-based, intermediate gold producer with three operating mines: Mulatos and El Chanate in Mexico’s Sonora state, and the Young-Davidson gold mine in northern Ontario. Together, they are slated to produce 400,000 to 430,000 oz. gold this year at all-in sustaining costs (AISCs) of US$940 per oz. gold.

The Mulatos mine started production in 2005 as Alamos’ founding operation, and has produced 1.7 million oz. gold to date from an open pit with a combination heap-leach and high-grade mill. Based on reserves at the end of 2016, Mulatos has at least another five years of mine life, and is on track to produce 150,000 to 160,000 oz. gold this year.

Alamos still considers the large land package around the mine as prospective for gold, and has budgeted $17 million for exploration there this year.

El Chanate is an open-pit, heap-leach mine that is at the end of its life and is only producing gold though residual leaching. During the second quarter, production was 17,600 oz. gold at an AISC of US$1,208 per ounce.

Much of Alamos’ mid-term gold production growth could come from its three development projects in Turkey, but it is also developing the Lynn Lake project in Manitoba, the Esperanza project in Mexico’s Morelos state and the Quartz Mountain project in Oregon.

Alamos has no debt, $150 million in cash and equivalents, and $150 million in undrawn credit.


A driller at Almaden Minerals’ Ixtaca gold-silver project in Mexico. Analyst Brent Cook commended the firm for its disclosures about the project. Credit: Almaden Minerals

A driller at Almaden Minerals’ Ixtaca gold-silver project in Mexico. Credit: Almaden Minerals

Vancouver-based Almaden Minerals (TSX: AMM; NYSE-MKT: AAU) is developing its wholly owned Tuligtic property in Mexico, which includes the Ixtaca gold-silver deposit. Led by Duane and Morgan Poliquin, Almaden staked and discovered Ixtaca in 2010 and describes it as “one of Mexico’s premier precious metal deposits.”

Almaden’s subsequent drilling at Ixtaca has outlined a reserve that stands at 65.1 million tonnes grading 0.62 gram gold per tonne and 37.7 grams silver per tonne, for 1.3 million contained oz. gold and 79 million contained oz. silver (or 2.4 million equivalent oz. gold).

Measured and indicated resources add 126 million tonnes at 0.49 gram gold and 26.99 grams silver for another contained 2 million oz. gold and 109 million oz. silver. Forty-seven million tonnes at lower grades lie in the inferred category.

Almaden describes the mineralization as occurring as cohesive, high-grade vein swarms hosted by barren limestone, and says conventional gravity and flotation would “readily separate barren limestone” from veins to create a high-grade concentrate, which leaches well to a doré bar.The company says preproduction engineering studies are underway, which should provide the necessary data for a production permit application.

According to a prefeasibility study, a mine at Ixtaca with a 14-year life producing 147,900 equivalent oz. gold per year at an US$862 per oz. AISC would cost US$117 million in initial capital expenses and have a 41% internal rate of return, plus a 2.2-year payback period. The net present value is US$310 million at a 5% discount rate.

At last count, Almaden had $20 million in cash and no debt.


Map of Americas Silver's claims in Mexico's Cosala district. Credit: Americas Silver.

Map of Americas Silver’s claims in Mexico’s Cosala district. Credit: Americas Silver.

Americas Silver (TSX: USA; NYSE-MKT: USAS) expects its Cosala district operations in Mexico’s Sinaloa state and its Galena complex in northern Idaho will deliver sustainable annual production of 5 million to 5.6 million equivalent oz. silver. It has a goal to be a “first quartile cost silver producer” by 2018.

The Toronto-based junior says Cosala offers “significant cash flow and exploration upside,” and notes that AISCs at Cosala have fallen 103% since 2014.

Cosala includes the fully funded, US$18-million San Rafael development project that is now under construction and should come on-stream by the end of September, providing what the company describes as “significant cash flow and reduction in cash costs.”

For all of 2017, Americas Silver is forecasting total production of 2 to 2.5 million oz. silver, or 5 to 5.5 million equivalent oz. silver at cash costs of US$4 to US$5 per oz. silver and AISCs of US$9 to US$10 per ounce.

In Mexico’s Sonora state, Americas Silver has its San Felipe silver-lead-zinc development project — a high-grade past producer acquired by Hochschild in 2006, which spent US$45 million on the asset. Americas Silver acquired an option on the property for US$7 million and has a second payment due in December.

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